Oracle To Spend $700 Million To Expand Job Cuts As AI Data Centre Investments Pressure Cash Flow

Oracle has expanded its planned workforce reductions as the technology company faces mounting financial pressure from heavy investments in artificial intelligence infrastructure, particularly large-scale data centres built to support AI workloads.

According to a report by Bloomberg, the company disclosed that expenses linked to its "2026 Restructuring Plan" have increased to around $2.8 billion, mainly due to severance costs associated with employee layoffs.

Oracle has already recorded about $2.1 billion in restructuring expenses, while the additional $700 million reflects further cost-cutting measures expected to be implemented.

AI infrastructure spending drives cost pressures

Oracle’s increased restructuring efforts come as the company ramps up spending on AI-focused data centres for major customers, including OpenAI. The company began reducing its workforce earlier this year as part of efforts to control expenses, with reports indicating that additional job cuts were being planned.

During an analyst call, Oracle Chief Financial Officer Hilary Maxson highlighted "simplification and efficiency actions" as key measures helping the company reduce costs and protect profit margins.

Oracle had around 49,000 employees in the US and nearly 92,000 employees internationally as of the end of May. The company’s total workforce has declined by about 21,000 compared with a year earlier.

Larry Ellison share sale plan disclosed

Alongside the restructuring update, Oracle also revealed a new stock trading arrangement for Chairman Larry Ellison, who owns nearly 40% of the company’s shares.

The plan, adopted on June 22, allows Ellison to sell up to 50 million shares by October 24. Based on Oracle’s closing price on that day, the stake was valued at around $8.75 billion. However, Oracle shares have fallen about 16% since then.

Ellison has also been involved in major financial backing efforts, including his son David Ellison’s acquisition of Paramount Global and Paramount Skydance’s proposed $110 billion bid for Warner Bros. Discovery.

Oracle’s restructuring highlights the broader financial challenges technology companies face as they increase spending on AI infrastructure while attempting to maintain profitability and operational efficiency.