OpenAI plans Job Cuts up to 30,000 due to AI investments

Oracle is facing massive job cuts that could affect between 20,000 and 30,000 employees company-wide. Even measured against the global workforce of around 162,000 employees (as of May 2025), this would be a drastic cut in the personnel structure.

According to a report by Bloomberg (paywall), layoffs could begin as early as this month and cut across numerous business units. Initial internal measures have already been taken, with Oracle reviewing open positions in its cloud division and effectively freezing new hires in this area.

Financial bottleneck due to massive AI investments

The main reason for this step is a financial bottleneck caused by high investments in AI data centers. Oracle is trying to aggressively expand its cloud infrastructure to serve contracts with industry giants such as Meta, xAI, Nvidia, and especially OpenAI. The deal with OpenAI to provide computing capacity alone has a historic volume of 300 billion dollars.

To build the infrastructure needed for these customers, capital expenditures (Capex) have risen rapidly and are expected to grow by $15 billion in fiscal year 2026 to a total of $50 billion. This presents Oracle with massive challenges because US banks are reportedly increasingly reluctant to finance these construction projects. This drives up borrowing costs for Oracle.

The planned staff reduction is intended to help the company generate urgently needed 8 to 10 billion dollars in free cash flow. Automation also plays a central role in the layoffs: Oracle is specifically cutting positions that management expects can soon be taken over by artificial intelligence, rendering them obsolete for human workers.

Series of job cuts

The current layoff plans follow earlier job cuts but are far more drastic in scale. Back in September 2025, Oracle announced the start of its largest restructuring program to date, for which the company budgeted up to $1.6 billion for the current fiscal year to finance severance payments, among other things. As part of this restructuring, Oracle already parted ways with an estimated 10,000 employees worldwide at the end of 2025. Numerous departments were affected by these company-wide cuts, ironically including internal developer teams for machine learning and artificial intelligence.

In addition, there have been repeated job cuts in the past at healthcare software provider Cerner, which Oracle acquired in 2022 for $28.3 billion. To get a grip on the current liquidity problems, Oracle is now even considering divesting itself entirely of this division by selling Cerner, according to reports from investment bank TD Cowen.