As Oracle doubles down on its artificial intelligence ambitions, the company has launched a fresh round of redundancies affecting thousands of employees, CNBC has learned from sources familiar with the matter.
This comes as the software giant contends with a 25% drop in its share price this year—the worst performance among tech megacaps—fuelled by investor concerns over ballooning debt and dwindling cash flows tied to vast AI infrastructure investments.
The firm’s core database offerings, long a staple for enterprise data handling, are under siege from the rise of generative AI competitors, prompting market jitters. Business Insider broke the story on Tuesday, and CNBC verified it with two insiders who spoke anonymously ahead of any official word. Oracle, which had 162,000 staff as of May 2025, declined to comment.
Mirroring moves by cloud leaders like Amazon, Oracle has poured billions into data centres built for demanding AI tasks, though it trails in scale. Capital spending jumped 40% year on year in the latest quarter, per Reuters, funded largely by debt, including a $50 billion bond and equity raise in January. Executives assured during March earnings, as reported by The Wall Street Journal, that no more debt would be sought in 2026.
Yet glimmers of promise shine through. A landmark September deal with OpenAI, worth over $300 billion, propelled remaining performance obligations—future contracted revenue—up 359% to $455 billion. This prompted a C-suite reshuffle, with co-CEOs Mike Sicilia and Clay Magouyrk stepping in for Safra Catz, according to TechCrunch.
Analysts at TD Cowen suggest cutting 20,000 to 30,000 roles could free up $8 billion to $10 billion in extra cash flow. “Demand for AI infrastructure, both GPU and CPU, continues to exceed supply,” Magouyrk said on a recent earnings call. “This is directly visible in our $553 billion remaining performance obligations.”
Rivals face similar strains, with Microsoft’s quarterly AI capex hitting $20 billion, while a McKinsey report flags a global shortage of one million AI specialists amid shifting talent pools. Oracle’s bet signals confidence in AI’s long-term payoff, even as short-term pain mounts.