Oracle reduced its workforce by about 13%, or nearly 21,000 employees, during fiscal 2026 as the company continued a major restructuring of its business, a move that comes as artificial intelligence plays a bigger role across its operations.
According to Oracle’s annual report released on Monday, the company had 141,000 employees as of May 31, 2026. A year earlier, it employed around 162,000 people.
According to Layoffs.fyi, a website that tracks job cuts in the tech sector, 196 technology companies have laid off more than 119,800 employees so far this year.
The move comes at a time when Oracle is reporting record business numbers and sitting on a massive backlog of contracts, much of it linked to the AI boom.
Job cuts come as Oracle ramps up AI spending
Oracle spent $1.84 billion on severance payments and other restructuring-related costs during fiscal 2026. That was significantly higher than the $374 million it spent on similar activities in the previous fiscal year.
In its filing, Oracle said the workforce changes were driven by a range of factors, including management changes, product-related decisions, employee performance issues, strategic shifts and acquisitions.
Earlier this month, the company said it expects net capital expenditure of around $70 billion in its current fiscal year as it builds out the infrastructure needed to support growing demand for AI services.
To help pay for that spending, Oracle plans to raise another $40 billion through a mix of debt and equity financing. That figure includes a previously announced stock offering worth $20 billion. Oracle has signed several future AI contracts, and the value of work it still has to deliver is now greater than the company’s entire stock market value.
A large chunk of those contracts is linked to OpenAI, meaning Oracle is benefiting heavily from the boom in AI spending and demand for data centres.
Stock under pressure despite long-term gains
Oracle shares closed at $175.07, but investors have had a mixed experience recently. The stock has fallen 9.1% over the past week, is down 8.9% over the last month and has lost 10.5% since the start of the year.
However, the longer-term picture remains much stronger. Oracle shares have gained 55.3% over the past three years and surged 138.6% over the last five years. Oracle’s future now depends heavily on how successfully it can turn its huge AI order book into actual revenue.
Oracle’s restructuring supports the company’s bigger strategy of becoming a major provider of AI infrastructure and cloud services. The company has secured large multi-year contracts that could support revenue growth for years to come. It has also won significant business in sectors including healthcare, hospitality and the public sector.
However, there are risks.
The combination of layoffs, negative free cash flow and plans to raise billions of dollars increases pressure on management to deliver results. If demand for AI infrastructure slows or customer commitments change, Oracle could face challenges in justifying its spending.