The Oracle eliminated around 21,000 jobs last year, while accelerating its investments in artificial intelligence (AI) and expanding the capacity of its data centers.
The strategy follows a movement observed across the technology sector. Companies like Meta and Amazon have also cut thousands of employees in recent months, as they direct billions of dollars into AI infrastructure and seek to make their operations leaner to compete with startups specializing in the area.
Headquartered in Austin, Texas, Oracle reduced its headcount by approximately 13% in the last fiscal year. According to the company’s most recent annual report, the number of full-time employees fell from 162,000 to 141,000 by the end of May.
According to The Wall Street Journal, the layoff process began in March.
The company also recorded US$1.84 billion in expenses related to severance and other restructuring costs. In its report, Oracle reported that it maintains an ongoing reorganization plan, which has already resulted in staff cuts and could lead to further reductions in the future.
“The adoption and implementation of AI technologies in our operations has resulted and may continue to result in headcount reductions,” the company said.
Oracle highlighted that it has been expanding investments in artificial intelligence to incorporate the technology into its product portfolio, but recognized the risks involved in this strategy.
“If our competitors’ AI products achieve greater market acceptance than ours, or if we incur higher than expected costs to develop and maintain our AI solutions, we may not recover the investments we made,” he said.
At the same time, the company warned that failing to invest heavily in the area could also compromise its competitiveness.
In data centers focused on artificial intelligence, Oracle has been allocating billions of dollars. Net investments of US$70 billion are expected this fiscal year, up from the US$55.7 billion recorded in capital expenditures in the previous fiscal year, reflecting the high cost of the global race for AI.
The company gained prominence in the market by closing contracts linked to artificial intelligence valued at hundreds of billions of dollars. Among them is an agreement with OpenAI to provide computing capacity estimated at around US$300 billion over approximately five years, according to The Wall Street Journal.
In recent months, however, investors have begun to question whether the high investments announced by technology giants will be sustainable in the long term. Oracle itself has already warned that the accelerated expansion of its data center infrastructure could put pressure on its profit margins in the coming years.
Source: www.noticiasaominuto.com.br
Source link
