Oracle may cut up to 30,000 jobs to fund massive AI data centre expansion: Report

Oracle could be preparing for a major workforce reduction, with as many as 30,000 jobs potentially on the line, according to a new report. The move is reportedly aimed at freeing up capital to support the company’s aggressive expansion into Artificial Intelligence-focused data centres.

According to a CIO report citing analysis by investment bank TD Cowen, the US software giant is under growing financial pressure as it pursues large-scale infrastructure commitments. The report estimates that Oracle may cut between 20,000 and 30,000 roles, marking the largest round of layoffs in the company’s recent history.

“Both equity and debt investors have raised questions regarding Oracle’s ability to finance this buildout,” TD Cowen noted, highlighting concerns about how the company plans to fund its ambitious AI push.

The strain is largely driven by Oracle’s costly AI data centre commitments. The company has signed major agreements to build infrastructure for high-profile clients, including OpenAI, led by Sam Altman. TD Cowen estimates that Oracle’s data centre expansion could require capital expenditure of nearly $156 billion.

Compounding the challenge, several US banks have reportedly stepped back from financing Oracle’s data centre projects in recent weeks, significantly tightening access to fresh capital.

With fewer external funding options available, Oracle is now said to be looking inward to unlock cash. TD Cowen estimates that cutting tens of thousands of jobs could generate between $8 billion and $10 billion in free cash flow, funds that could be redirected toward building and operating AI-focused facilities.

Oracle has not yet issued an official statement responding to the report. However, the scale of the potential job cuts suggests the company may be facing difficult trade-offs to sustain its long-term growth strategy.

The report also points to broader challenges beyond layoffs. Several data centre lease deals that Oracle had been negotiating with private operators have reportedly stalled due to financing difficulties. Without these leases, Oracle may struggle to secure the additional capacity needed to scale its cloud and AI services.

If implemented, the layoffs would far exceed Oracle’s previous workforce reductions. By the end of 2025, the company had cut nearly 10,000 jobs as part of a $1.6 billion restructuring plan. The new figures would nearly quadruple that number.

Oracle is also exploring alternative ways to ease financial pressure. One option under consideration is the sale of Cerner, its Healthcare software unit acquired for $28.3 billion in 2022.

At the same time, Oracle has reportedly begun pushing customers to shoulder more responsibility for infrastructure development, reducing the company’s own capital commitments.

Another proposal being examined is a “bring your own chip” model, under which new cloud customers would supply their own hardware. This approach would allow Oracle to expand its services while keeping major capital costs off its balance sheet.