Oracle layoffs hit cloud division as $500bn AI push gains pace

Oracle Corporation has begun cutting jobs in its high-profile cloud division as the company redirects spending towards a massive artificial intelligence infrastructure build-out, Bloomberg has reported.

More than 150 positions are being eliminated in the Seattle area, a longstanding hub for the cloud unit. Employees were informed this week that their roles had been removed. People familiar with the matter said the reductions are partly linked to performance issues.

Despite the cuts, the division continues to hire for select roles, suggesting a targeted restructuring rather than a full-scale downsizing.

In a June regulatory filing, Oracle stated it “periodically” restructures its workforce in response to strategy changes, reorganisations, or performance considerations. The company noted such moves can lead to “increased restructuring costs and temporarily reduced productivity while employees adjust to the restructuring.”

The move comes amid a wave of layoffs across the tech sector as companies balance AI investment with cost control. Microsoft has cut about 15,000 jobs in 2025, while Amazon and Meta Platforms have also scaled back staffing to redirect resources into AI-related initiatives.

AI development has significantly increased capital requirements for large technology firms, particularly for data centre capacity and advanced computing power.

Oracle’s shares remain near record highs, supported by strong performance in its cloud business. Last month, the company announced an agreement with OpenAI for about 4.5 gigawatts of US data centre capacity.

Under the deal, OpenAI will rent computing power from Oracle facilities for its “Stargate” project — a $500 billion AI infrastructure initiative involving Oracle, OpenAI and SoftBank Group.

While the OpenAI partnership positions Oracle as a major player in the AI race, the expansion carries significant costs. The company still faces tens of billions of dollars in spending to grow its data centre footprint to meet rising demand.

In the fiscal year ending May 2025, Oracle spent more than it earned, highlighting the financial strain of its aggressive investment strategy.

Oracle has not provided any further public comment on the job cuts beyond its June filing.