According to internal documents and people familiar with the matter, Oracle (ORCL) is planning to push forward with a new round of layoffs, with some teams facing reduction percentages that could reach double digits. The company has asked managers to submit lists of affected employees, with the goal of completing cost reductions before the start of the second fiscal quarter on September 1.
The core pressure behind these layoffs stems from Oracle’s massive bet on AI infrastructure. In fiscal year 2026, Oracle invested as much as $55.7 billion in infrastructure construction, primarily for data center buildouts and chip purchases, resulting in the company’s cash expenditures exceeding cash income by $23.7 billion. To fill the funding gap, Oracle raised $43 billion through bond issuances in fiscal 2026 and sold stocks to raise $5 billion. The company expects to raise approximately another $40 billion in financing this fiscal year.
As of early August, Oracle’s total debt had reached $129.5 billion, alongside $260 billion in data center lease commitments. Credit rating agencies have begun to closely monitor its financial condition.
This marks another large-scale round of layoffs for Oracle within fiscal 2026. According to official documents recently filed by the company, Oracle’s total headcount decreased by approximately 21,000 employees during the fiscal year ended May 31, 2026, a reduction of 13%, leaving the company with about 141,000 full-time employees globally.
In its annual report, Oracle formally acknowledged for the first time that the application of AI technology was one of the factors contributing to job reductions. The filing explicitly states: “The adoption and deployment of AI technologies in the company’s operations have resulted, and may continue to result, in a reduction of employee headcount.” This represents one of the clearest statements among major technology companies regarding automation replacing labor.
The restructuring came at a significant cost—Oracle paid $1.84 billion in severance and other separation costs in fiscal 2026, far exceeding the $374 million paid in the previous fiscal year. Notably, this round of layoffs nearly offset the headcount growth Oracle gained from its $28 billion acquisition of Cerner in 2022.
Although Oracle’s cloud infrastructure business grew 77% and total revenue rose 17% in the past fiscal year, massive capital expenditures are heightening market concerns. GuruFocus estimates Oracle’s intrinsic value at approximately $190.26 per share, implying about 23.5% upside from the current price of $145.48. So far this year, Oracle’s stock has fallen nearly 26%, reflecting both Wall Street’s general caution over soaring AI infrastructure costs and investor worries that AI may displace traditional software products. Barclays analysts noted that the layoffs could help improve cash flow to support AI infrastructure and maintained their “overweight” rating on Oracle.
