Key insights
- Oracle is conducting another round of layoffs, potentially numbering in the thousands, to support AI spending. This follows similar actions by Meta and Amazon. Oracle's stock has been pressured by debt concerns related to data center buildouts and reliance on key customers like OpenAI. While the stock is up today, it's down 25% YTD, suggesting broader concerns about Oracle's AI strategy and financial health, potentially signaling weakness in the cloud sector.
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Another tech giant is cutting jobs as AI spending grows.
This time it's Oracle (ORCL), which sent layoff emails to employees earlier today, according to Business Insider, with CNBC reporting the cuts could number "in the thousands."
Oracle, which said in its latest annual report that it had about 162,000 full-time employees as of the end of last May, declined to comment on the size or reason for the layoffs.
Shares of Oracle were up about 6% in recent trading, amid broader market gains after President Donald Trump suggested an end to the war in Iran could come soon.
Oracle's job cuts mark the latest in a string of layoffs in the industry as Big Tech giants look for ways to support their spending on AI. Some may also be anticipating they could need fewer workers thanks to developments in the technology.
Oracle's latest cuts come just months after an earlier round of layoffs. Meta Platforms (META) and Amazon (AMZN) have also trimmed roles this year, as large tech firms look to offset the impact of increasing spending on AI infrastructure.
Shares of the cloud computing company have been pressured for months by concerns over the company's debt load as it finances a massive buildout of data centers, its reliance on a few large customers including OpenAI, and broader uncertainty about the AI trade.
Even with Tuesday's gains, Oracle shares have lost about one-quarter of their value since the start of the year.
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