According to a report by CIO citing a research report by investment bank TD Cowen, Oracle will also be selling some of its activities as US banks pull back from investing in the company’s AI data centre expansion.
The Oracle layoffs will slash jobs of around 20,000 to 30,000 employees, the report said.
“Both equity and debt investors have raised questions regarding Oracle’s ability to finance this buildout,” TD Cowen said in its report, according to CIO.
The financing pressures are already taking a toll on Oracle’s customer relationships. The company had earlier taken up projects to build data centres for Sam Altman’s OpenAI — a commitment the TD Cowen pegs at around $156 billion. However,
Over the past few weeks, several US banks have pulled off from lending to Oracle for expanding its AI data centres.
Oracle layoffs: What it means for the tech giant
According to the CIO report citing TD Cowen, the Oracle layoffs would mean the company gaining $8 billion to $10 billion in free cash flow.
Oracle has not yet released a statement regarding the development.
The financing challenge comes amid Oracle’s ambitions to expand its data centres, with TD Cowen estimating that the company needed $156 billion in required capital expenditure for such expansion.
“Multiple Oracle data-centre leases that were under negotiation with private operators struggled to secure financing, in turn preventing Oracle from securing the data-centre capacity via a lease,” it said.
The potential Oracle layoffs, if they happen, will be the largest in the company’s recent history. In late 2025 the company had slashed around 10,000 jobs as part of a $1.6 billion restructuring plan.
The news comes days after reports of Amazon laying off 16,000 workers as part of its AI restructure plan.
What other steps has Oracle taken?
Apart from the layoffs, Oracle is also mulling the sale of its healthcare software unit Cerner, which it acquired for $28.3 billion in 2022.
Faced with the constraints, the company is further scrambling for other solutions to negate the effect on its finances.
As part of its strategy, Oracle has started to ask ompany has begun requiring as per the CIO report citing TD Cowen. This effectively translates to asking clients to help build the infrastructure, according to the investment bank.
Key Takeaways
- Oracle’s job cuts highlight the financial pressures facing tech companies in the AI sector.
- The ‘bring your own chip’ strategy indicates a shift in how companies may approach infrastructure costs.
- The layoffs signal a broader trend of restructuring in the tech industry as companies adapt to funding challenges.
It is also exploring an arrangement called “bring your own chip” (BYOC), where new customers will be required to supply their own hardware, shifting capital requirements off Oracle’s books.
Oracle expects to raise $45 billion to $50 billion in 2026 to build additional capacity for its cloud infrastructure, the software company said on Sunday.
