Austin/IBNS-CMEDIA: Tech giant Oracle is planning to slash between 20,000 and 30,000 jobs this week as part of a massive cost-cutting exercise, media reports said.
The layoffs are aimed at freeing up $8–$10 billion in cash flow, driven largely by Oracle’s reported $300 billion partnership with Sam Altman-led OpenAI, according to a report by The Times of India, citing investment bank TD Cowen.
Oracle is seeking funds to bankroll a vast network of AI-focused data centres, most of which are being built to serve OpenAI’s computing needs.
According to Mint, the job cuts come amid the United States banks pulling back from investments linked to Oracle’s AI data centre expansion plans.
Since September last year, lenders have also doubled interest rate premiums typically charged to Oracle, worsening its funding pressure.
The higher borrowing costs forced Oracle to pause negotiations on several data centre leases, resulting in delays and capacity shortfalls that fell below expectations of customers — particularly OpenAI.
To address the cash crunch, Oracle has reportedly begun charging new customers up to 40% of contract value upfront. The company is also exploring a “bring your own chip” model, under which customers would supply their own hardware.
TD Cowen further noted that Oracle has started shifting some near-term capacity requirements to Microsoft and Amazon, the Times of India report added.
