Oracle Corp., led by co-founder Larry Ellison, is reportedly planning a large-scale workforce reduction in the coming months as the tech giant navigates a cash crunch caused by its rapid expansion into AI-focused data centers, Bloomberg reported. The layoffs are expected to affect multiple divisions across the company, potentially impacting thousands of employees worldwide.

Sources familiar with the matter told Bloomberg that job categories most likely to be affected are those where tasks can be supplemented or replaced by artificial intelligence. The company has also internally announced a review of open job listings in its cloud division, indicating a slowdown or freeze in hiring as it restructures to accommodate AI workloads.

Oracle’s aggressive push into AI and cloud computing aims to compete with major players such as Amazon and Microsoft. The company is building a large network of data centers to power AI operations for clients, including OpenAI, a move seen as historic in scale. However, the expansion is expected to place significant pressure on Oracle’s cash flow, with Wall Street analysts projecting negative impacts until around 2030 before the investments start generating returns.

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The planned layoffs are expected to be broader than Oracle’s typical rolling reductions, reflecting the scale of its ongoing transition. As of May 2025, the company employed approximately 162,000 people globally. While specific numbers and timelines for job cuts are yet to be confirmed officially, internal sources suggest the workforce reduction plans remain active and could evolve in scope.

Despite the looming layoffs, Oracle’s stock showed modest gains, closing 1.59% higher at $156.51 on Thursday, although the share price has fallen over 20% year-to-date. Investors appear closely monitoring the company’s financial trajectory as its AI and cloud investments begin to reshape its business model.

Analysts note that Oracle’s strategy represents a significant bet on AI as a growth engine but comes with short-term financial risks, including strained liquidity and operational adjustments. The company’s ability to balance aggressive expansion with workforce management will be critical to maintaining competitiveness in the fast-evolving cloud and AI market.

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