Big Tech

Oracle has issued a public statement addressing speculation around its partnership with OpenAI after analyst reports suggested that the company’s heavy push into artificial intelligence infrastructure could trigger significant job cuts. In a post on its official X handle, Oracle said that a widely cited Nvidia–OpenAI investment proposal had “no impact whatsoever” on its financial relationship with OpenAI. The company added that it remains “highly confident” in OpenAI’s ability to secure funding and honour its long-term commitments. The clarification came amid growing market chatter that Oracle may reduce its workforce by as many as 30,000 employees to help finance its expanding AI ambitions. The response followed a volatile period for firms linked to OpenAI. The Wall Street Journal reported that a proposed $100 billion investment by Nvidia into OpenAI never materialised and had stalled at an early stage. Nvidia CEO Jensen Huang later confirmed that discussions held last year were non-binding and did not progress into a formal deal. Despite Oracle’s reassurance, investor sentiment remained cautious. Shares of the software giant dropped nearly 3% to $160.06 shortly after the statement, reflecting concerns over the scale of Oracle’s exposure to the costly AI infrastructure build-out. Analysts have highlighted leverage as a growing pressure point. TD Cowen said Oracle is evaluating potential workforce reductions of between 20,000 and 30,000 roles, a move that could free up an estimated $8 billion to $10 billion in annual cash flow. The firm estimates Oracle’s long-term capital expenditure commitments linked to OpenAI — including massive data centre projects and advanced chip purchases — could reach roughly $156 billion. Oracle’s balance sheet has already expanded sharply. Analysts note the company has taken on around $58 billion in new debt in recent months to fund data centre campuses across the US, pushing total debt beyond the $100 billion mark. Since its peak in September 2025, Oracle’s market capitalisation has declined steeply, wiping out hundreds of billions of dollars in value. The strain is not limited to Oracle alone. According to Reuters, OpenAI has been exploring alternatives to Nvidia’s inference chips, holding discussions with AMD, Cerebras and Groq as it looks to lower costs and diversify its computing supply. While Oracle has not officially announced any job cuts, analysts say the situation highlights the enormous capital demands of the AI race and the growing challenge companies face in balancing long-term infrastructure investments with short-term financial discipline. With competition in AI infrastructure accelerating, investors are expected to closely watch how Oracle manages its spending, funding strategy and workforce decisions in the coming months.