Oracle has announced it is planning to cut thousands of jobs across divisions, reported Bloomberg News. Oracle, which has emerged as a major player in the business of renting computing power, is facing a cash crunch from a massive AI data center expansion effort, the report said. The report stated that Oracle is struggling to manage a worsening cash crunch from its much-touted and increasingly expensive AI data centre expansion. In September 2025, Oracle fired around 3,000 employees across India, US, Canada and Philippines.
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To fund the expansion, Oracle has rapidly increased borrowing. The company has reportedly taken on $58 billion in new debt in just two months, including $38 billion for data centre projects in Texas and Wisconsin and another $20 billion for a new campus in New Mexico. As a result, Oracle’s total debt has now crossed $100 billion.
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Wall Street analysts warn that Oracle’s aggressive spending could push free cash flow into negative territory over the next few years, with the massive AI investment unlikely to generate meaningful returns until around 2030. The company also announced last month that it plans to raise up to $50 billion this year through debt and equity sales to support its expansion.
The pressure is also visible in the stock market. After soaring 61% in 2024 and another 20% in 2025, Oracle shares have plunged 54% from their September 2025 peak, wiping out roughly $463 billion in market value. The decline continued on Thursday as the stock slipped as much as 1.5% following a report by Bloomberg.
Oracle will report third-quarter results on Tuesday. Its shares fell more than 15% last year, with its December results showing about $10 billion in cash burn for the first half of the fiscal year.
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At the same time, several US banks have reportedly pulled back from financing Oracle-linked data centre projects, as concerns grow over the company’s rising debt and massive AI spending plans. According to reports, interest rate premiums on Oracle’s debt have nearly doubled since September, reflecting increased risk perception among lenders.
To strengthen its finances, Oracle is also said to be tightening payment terms with new customers, requiring up to 40% of the contract value upfront in some cases. In another sign of shifting priorities, the company is reportedly exploring a possible sale of Cerner, the healthcare software firm it acquired for $28.3 billion in 2022.
Oracle layoffs 2026
The layoffs, expected to be in thousands, will impact divisions across Oracle and may be implemented as soon as this month, the Bloomberg report said, citing people familiar with the matter. Some cuts will be aimed at job categories that the company expects will shrink due to AI. The Oracle layoffs would maark the company's largest-ever restructuring. In a filing submitted in September, Oracle revealed that the restructuring plan could cost up to $1.6 billion in the current fiscal year, including severance payments—marking a significantly higher expense than any previous round of job cuts undertaken by the company.ALSO READ: When is International Women's Day in 2026, when will it be celebrated in India, what is this year's theme and more?
Which Oracle divisions to be impacted?
According to the Bloomberg report, the layoffs in Oracle will span multiple business units, with some targeting roles Oracle believes will be made redundant by AI, according to people familiar with the matter.The company has also frozen or slowed hiring across its cloud division after internally announcing a review of open job listings this week. Oracle, which had about 162,000 employees globally as of May 2025, declined to comment. Planning for the cuts is still active and the scope could change, Bloomberg noted.Larry Ellison's $300 billion OpenAI bet left Oracle bleeding?
The financial strain in Oracle traces back to Chairman Larry Ellison’s aggressive push to transform the tech giant from a traditional database software provider into a serious AI cloud competitor to Amazon and Microsoft. At the centre of this strategy is a massive $300 billion partnership with OpenAI. According to estimates by TD Cowen, the project could require $156 billion in capital spending and around 3 million GPUs to build out the necessary AI infrastructure.To fund the expansion, Oracle has rapidly increased borrowing. The company has reportedly taken on $58 billion in new debt in just two months, including $38 billion for data centre projects in Texas and Wisconsin and another $20 billion for a new campus in New Mexico. As a result, Oracle’s total debt has now crossed $100 billion.
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Wall Street analysts warn that Oracle’s aggressive spending could push free cash flow into negative territory over the next few years, with the massive AI investment unlikely to generate meaningful returns until around 2030. The company also announced last month that it plans to raise up to $50 billion this year through debt and equity sales to support its expansion.
The pressure is also visible in the stock market. After soaring 61% in 2024 and another 20% in 2025, Oracle shares have plunged 54% from their September 2025 peak, wiping out roughly $463 billion in market value. The decline continued on Thursday as the stock slipped as much as 1.5% following a report by Bloomberg.
Oracle will report third-quarter results on Tuesday. Its shares fell more than 15% last year, with its December results showing about $10 billion in cash burn for the first half of the fiscal year.
A warning for Oracle
TD Cowen had earlier warned that potential layoffs at Oracle could range between 20,000 and 30,000 employees, estimating that such cuts might generate $8–$10 billion in additional cash flow for the company.ALSO READ: Nepal Election results 2026: Who is Balen Shah? All about rapper-turned politician and Gen-Z's favourite, a frontrunner for PM post
At the same time, several US banks have reportedly pulled back from financing Oracle-linked data centre projects, as concerns grow over the company’s rising debt and massive AI spending plans. According to reports, interest rate premiums on Oracle’s debt have nearly doubled since September, reflecting increased risk perception among lenders.
To strengthen its finances, Oracle is also said to be tightening payment terms with new customers, requiring up to 40% of the contract value upfront in some cases. In another sign of shifting priorities, the company is reportedly exploring a possible sale of Cerner, the healthcare software firm it acquired for $28.3 billion in 2022.
