Oracle’s Radical Restructuring: 21,000 Layoffs and $55.7 Billion in AI Spending Converge
Veröffentlicht: 26.06.2026 um 15:34 Uhr, Redaktion boerse-global.de
The market is punishing Oracle even as its AI-driven cloud business hits new heights. Shares have fallen 21.3% year-to-date, closing at €134.12 on Thursday after shedding 16.51% in the past seven days alone. The stock now sits nearly 18% below its 50-day moving average, with the relative strength index at 31.1 — a level that typically signals oversold conditions. Yet the company’s order backlog has never been larger.
Oracle’s committed but unbilled contracts surged to $638 billion last quarter, an $85 billion increase from the prior period. Almost all of the company’s current AI computing capacity is already leased. Revenue from cloud infrastructure jumped 93% in the fiscal fourth quarter, while total cloud sales rose by roughly half. The list of customers includes high-profile names such as OpenAI, which placed a massive order for Oracle’s specialized data centers — the so-called AI factories.
That explosive demand comes at an enormous upfront cost. Capital expenditures hit $55.7 billion in the latest fiscal year, well above the company’s own forecast. The result was a negative free cash flow of $23.7 billion, a dramatic swing from the roughly $300 million deficit reported a year earlier. Management plans to spend around $70 billion next year, with some internal projections even pointing to a potential peak of $95 billion. To fund the buildup, Oracle intends to raise $40 billion through a combination of debt and equity.
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At the same time, the company is aggressively cutting costs by slashing its payroll. Oracle has eliminated 21,000 positions, replacing many roles with automated processes driven by the very AI it is building for customers. The restructuring has triggered $1.84 billion in severance charges. It is a stark illustration of how the company is applying its own technology to streamline operations.
Beyond the cloud, Oracle is also expanding its defense business. At a summit in Brussels, the company announced ten new partners for its military-oriented ecosystem, focusing on autonomous systems and cybersecurity. One of the flagship projects, called Saga, has already been deployed by the Royal Navy in a live operation, collecting data in areas with no network connectivity.
Wall Street remains cautiously optimistic. Analysts have set an average price target of $237.91, implying more than 80% upside from the current share price. But that rosy outlook hinges on Oracle’s ability to convert its huge backlog into profitable revenue and to convince investors that the massive capital outlays will eventually generate strong returns. The stock’s 52-week high of $280.70 seems a distant memory, and the path back to those levels is littered with uncertainty over cash flow, dilution fears, and the execution risk of a company that is simultaneously firing thousands of workers while spending billions on new infrastructure.
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