Oracle may lay off 30,000 employees as US banks pull back from AI data-center financing

Oracle is reportedly heading towards another round of layoffs, following the company’s decision to cut around 10,000 jobs in late 2025. According to a report by CIO, citing investment bank TD Cowen, Oracle is considering eliminating between 20,000 and 30,000 positions and may also sell parts of its business as US banks pull back from financing its AI data-center expansion.

US banks pull back from Oracle AI data-center financing

Multiple US banks and equity investors have reportedly shown reluctance to finance Oracle-linked data-center projects, citing concerns over the company’s ability to repay the loans. As a result, Oracle is exploring alternative ways to manage its growing capital requirements.

TD Cowen noted that US lenders are unwilling to fund Oracle’s AI infrastructure plans, which has intensified pressure on the company’s financial strategy.

Planned job cuts could unlock $8–10 billion in cash flow

The proposed job cuts could free up $8 billion to $10 billion in cash flow, according to TD Cowen. Alongside layoffs, Oracle is also weighing the sale of certain business units to ease financial strain.

One such unit under consideration is Cerner, the healthcare software company Oracle acquired for $28.3 billion in 2022.

Cerner faces continued workforce reductions

Since acquiring Cerner, Oracle has repeatedly reduced headcount at the healthcare technology firm. This included layoffs in 2023 following issues related to a Veterans Affairs contract. Further divestment of Cerner is now being evaluated as part of Oracle’s broader cost-cutting strategy.

Oracle raises $58 billion but funding gap remains

Oracle has already borrowed heavily from the debt market, raising approximately $58 billion in just two months. This includes $38 billion for facilities in Texas and Wisconsin, and $20 billion for New Mexico. However, this amount represents only a fraction of the capital Oracle requires, and US banks remain increasingly reluctant to lend more.

Asian banks step in, but US capacity issues persist

Banks from Asia have stepped in to replace some US lenders, offering loans at premium rates. While this provides Oracle with an alternative path for international expansion, it does not resolve the company’s capacity challenges within the US market.

Oracle adopts new strategies to reduce capital needs

To offset these challenges, Oracle is considering multiple strategies to reduce its capital requirements. The company has begun requiring 40 per cent upfront deposits from new customers and is also exploring “bring your own chip” (BYOC) arrangements. Under BYOC, customers would supply their own hardware, shifting capital expenditure away from Oracle’s balance sheet.

Infrastructure commitments estimated at $156 billion

According to TD Cowen, Oracle requires nearly $156 billion in capital expenditure to meet its infrastructure commitments. These rising requirements have emerged as financing options narrow, particularly within the US market.

Borrowing costs rise as lenders step back

As US banks have pulled back, lenders financing Oracle’s data-center projects since September have reportedly charged double the earlier interest rates, pushing borrowing costs to levels typically associated with non-investment-grade companies, TD Cowen said.

The higher borrowing costs have affected several Oracle data-center leases that were under negotiation with private operators.

Financing bottlenecks delay data-center expansion

Without adequate financing, private data-center operators are unable to build the facilities Oracle needs, creating a bottleneck in the company’s infrastructure rollout across the US.