Oracle began laying off employees this week in what analysts say could become the largest workforce reduction in the company's history. Investment bank TD Cowen estimates the cuts could affect between 20,000 and 30,000 workers, roughly 18% of Oracle's approximately 162,000 employees worldwide.

The layoffs started with early-morning termination emails from "Oracle Leadership," informing employees their roles had been eliminated "as part of a broader organizational change." Workers reported receiving no advance warning from HR or direct managers, with system access revoked almost immediately.

Paying for AI

The cuts are directly tied to Oracle's aggressive push into AI infrastructure. TD Cowen estimates the layoffs will free up $8 billion to $10 billion in annual cash flow to fund data center construction. Oracle has taken on $58 billion in new debt in just the past two months, including a $50 billion bond offering in February, and has committed to a $300 billion data center deal with OpenAI.

India appears to be among the hardest-hit regions, with approximately 10,000 positions eliminated, representing roughly 20% of Oracle's local workforce. Revenue and Health Sciences, SaaS and Virtual Operations Services, and NetSuite's India Development Centre all saw cuts of at least 30%.

Despite the mass layoffs, Oracle is not in financial distress. The company posted a 95% jump in net income last quarter, reaching $6.13 billion. Its stock, however, has dropped roughly 30% this year amid broader concerns about traditional software companies' ability to compete in the AI era.

Oracle declined to comment on the total scope of the reductions.