Oracle cuts jobs in Cloud division amid AI expansion drive
Oracle has initiated a new round of layoffs in its Cloud Infrastructure division, a move seen as part of a broader restructuring effort to allocate more resources to artificial intelligence (AI) infrastructure. Employees in the Oracle Cloud Infrastructure (OCI) unit were informed this week that their positions had been eliminated, according to Bloomberg and Data Center Dynamics.
The company has not disclosed the exact number of roles affected, nor issued an official statement on the matter. However, people familiar with the situation suggested that several hundred positions could be impacted, with most cuts reported in India and the United States. Workers in other regions are expected to meet with their managers later this week, prompting speculation of further reductions.
According to sources, the job losses span multiple groups within Oracle’s cloud operations — from the Enterprise Engineering division and Fusion ERP software team to staff maintaining data centres, project managers overseeing AI and machine learning work, and employees engaged directly in OCI’s AI initiatives. While some departures are linked to performance issues, the restructuring is primarily aimed at replacing certain roles with hires whose skills align more closely with Oracle’s growing AI ambitions.
In a June filing, the company had stated: “These types of restructurings have resulted, and may in the future result, in increased restructuring costs and temporarily reduced productivity while employees adjust to the restructuring.”
The cuts come as Oracle steps up competition with cloud leaders Amazon Web Services, Microsoft Azure, and Google Cloud. All major players are racing to expand data centre capacity to handle the training and deployment of large AI models. To keep pace, Oracle has been investing heavily in AI-ready infrastructure and securing high-profile partnerships.
Last month, Oracle signed an unprecedented deal with OpenAI to provide around 4.5 gigawatts of data centre capacity in the US as part of the AI firm’s Stargate project, an initiative backed by Oracle, SoftBank Group, and others to invest $500 billion in global AI infrastructure. Earlier this year, reports also pointed to a $30 billion-a-year agreement between OpenAI and Oracle for AI infrastructure supply.
The company’s fiscal performance has remained strong despite rising costs. In Q4 FY25, total revenue rose 11% year-on-year to $15.9 billion. Cloud revenue, combining IaaS and SaaS, climbed 27% to $6.7 billion, while OCI revenue surged 52% to $3 billion, cementing its role as a major growth driver. Even so, Bloomberg reported that Oracle spent more than it earned in the fiscal year ending May, underscoring the scale of its AI-related investments.
This is not the first time OCI has faced significant staff reductions. In November 2024, several hundred positions — many held by senior staff — were eliminated, with some replaced by lower-cost junior hires. That round was concentrated mainly in US operations.
Across the tech sector, similar patterns are emerging. Microsoft has cut around 15,000 jobs this year, while Amazon and Meta Platforms have also trimmed staff to redirect spending toward AI. Oracle’s latest restructuring signals the same strategic recalibration, reducing certain roles to make room for skills that match the next phase of AI-driven cloud growth.
