Oracle layoffs: More than 100 jobs cut as AI infrastructure costs rise

Oracle

Oracle is scaling back its cloud division workforce, cutting more than 150 roles in the Seattle area — the unit’s long-time hub — as it manages the steep costs of AI infrastructure build-outs, as per Bloomberg. According to people familiar with the matter, employees were informed this week that their positions had been eliminated, with some reductions tied to performance issues.

The company is still hiring for other cloud roles, particularly in Tennessee, where it has shifted focus since moving its headquarters to Nashville last year. An Oracle spokesperson did not respond to requests for comment, and the full extent of the layoffs remains unclear. Industry site Datacenter Dynamics first reported the cuts.

Like other tech giants, Oracle is attempting to balance massive AI-related capital expenditure with operational efficiencies. Microsoft has trimmed around 15,000 jobs this year, while Amazon and Meta have also enacted workforce reductions.

According to the report by Bloomberg, Oracle’s cloud business has been a key driver of investor optimism, with shares trading near record highs. In June, the company signed a landmark agreement with OpenAI for approximately 4.5 gigawatts of US data centre capacity. However, these projects come with multibillion-dollar commitments to expand server farms capable of handling surging AI demand.

The heavy outlay has weighed on cash flow, with Oracle reporting negative free cash flow for the fiscal year ending May, claims the report. In a June filing, the company noted that periodic workforce changes are part of its strategic adjustments, reorganisations, or performance management efforts, adding that such restructurings can temporarily affect productivity.

Even as AI fuels growth, the massive infrastructure investment it demands is prompting some of the biggest names in tech to cut back elsewhere.