Citing a research note by investment bank TD Cowen, CIO announced that Oracle is also considering selling parts of its business as U.S. banks pull back from financing the company’s AI data center buildout, News.Az reports, citing foreign media.
It said the planned layoffs could affect between 20,000 and 30,000 employees.
“Both equity and debt investors have raised questions regarding Oracle’s ability to finance this buildout,” TD Cowen said in its report, as quoted by CIO.
The financing pressure is already affecting Oracle’s customer relationships. The company had previously committed to building data centers for OpenAI, led by Sam Altman, with TD Cowen estimating the value of that commitment at around $156 billion. However, over the past several weeks, multiple U.S. banks have reportedly withdrawn from lending to Oracle for the expansion of its AI data center operations.
According to the CIO report citing TD Cowen, the planned job cuts could generate between $8 billion and $10 billion in free cash flow for Oracle.
Oracle has not yet issued an official statement regarding the reported layoffs or financing plans.
The challenges come as Oracle pushes ahead with ambitious data center expansion plans, with TD Cowen estimating that the company would require roughly $156 billion in capital expenditure to complete the buildout.
