Oracle to spend an additional US$700 million on more job cuts
It is grappling with a cash crunch tied to the development of large-scale data centres for AI work
Oracle plans to allocate an additional US$700 million to expand its planned job cuts, as the company struggles with financial difficulties arising from the construction of large-scale data centers for artificial intelligence applications. The company disclosed a new share trading program for chairman Larry Ellison, who owns about 40% of Oracle's stock.
Under this plan, Ellison can sell 50 million shares between October 24, 2022, and April 24, 2023, which would yield US$8.8 billion. Despite this, Oracle's shares have declined by 16% since the trading program's adoption.
The cost of Oracle's job cuts, categorized under the "2026 Restructuring Plan," is now estimated at around US$2.8 billion, primarily consisting of severance payments to dismissed employees. The company has already incurred approximately US$2.1 billion in costs associated with this plan. Oracle's financial challenges stem from the expensive development of AI data centers for clients like OpenAI. The company had already initiated job cuts earlier in the year to conserve cash, as reported by Bloomberg.
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