Oracle is considering laying off between 20,000 and 30,000 employees to fund its AI data center expansion as US banks pull back from financing the projects, according to investment bank TD Cowen reported on February 2, 2026.
The workforce reduction would free up $8-10 billion in cash flow, but represents Oracle’s largest layoffs in recent history following 10,000 cuts in late 2025. The company needs approximately $156 billion for infrastructure buildout but has raised only $58 billion through debt markets over two months.
Multiple US banks have refused to finance Oracle-linked data center projects, citing concerns about the company’s repayment ability. Interest rates have doubled since September, forcing Oracle to seek alternative funding from Asian banks at premium rates. Without adequate financing, private data center operators cannot build facilities Oracle needs, creating infrastructure bottlenecks across the US.
To manage capital requirements, Oracle now demands 40% upfront deposits from new customers and is exploring a “bring your own chip” model where customers supply hardware. The company is also considering divesting Cerner, the healthcare software unit acquired for $28.3 billion in 2022.
The financing crisis has already impacted Oracle’s customers. OpenAI reportedly moved portions of its computing needs to Microsoft and Amazon after delays in Oracle’s capacity delivery. Oracle told investors it expects to raise $45-50 billion in 2026 for additional cloud infrastructure, including $38 billion for Texas and Wisconsin facilities.
Employees in data center operations and non-core units face highest layoff risk. The cuts would follow Oracle’s pattern of repeated Cerner workforce reductions since acquisition, including 2023 layoffs following Veterans Affairs contract issues.
