Oracle is eliminating roughly 3,000 positions in India, while Microsoft has moved somewhere between 400 and 500 of its India-based employees onto performance improvement plans, according to a report by the Economic Times.
The moves come as both companies restructure their workforces around artificial intelligence priorities. Pareekh Jain, chief executive of market research firm EIIRTrend, said the Microsoft employees affected represent around 2% of the company's India headcount, and that the performance improvement plan is being rolled out as part of a worldwide initiative.
Oracle's India cuts are part of a pattern of workforce reductions that has been accelerating across the company. Over the fiscal year ending May 31, Oracle's total headcount shrank by 21,000 people, a 13% decline, bringing its global workforce to approximately 141,000. The company recorded $1.8 billion in restructuring charges for the year under what it designated its 2026 Restructuring Plan, with total anticipated charges of as much as $2.1 billion.
The primary driver behind the cuts is financial pressure from Oracle's AI data center buildout. The company's capital expenditure for fiscal 2026 totaled $55.7 billion, up from $21.2 billion the prior year, resulting in a cash outflow of $23.7 billion more than it generated. To cover those costs, Oracle raised $43 billion in debt and an additional $5 billion by selling stock during the fiscal year.
Some of the positions being eliminated fall into job categories the company expects to need less of because of AI, though the financial strain from infrastructure spending is described as the primary driver. Oracle declined to comment.
The company has continued to point to strong demand for its cloud services despite the cuts. Co-CEO Clay Magouyrk said on the company's most recent earnings call that customer demand for AI computing capacity has outpaced available supply, citing $553 billion in contracted but unrecognized revenue. Oracle posted 17% revenue growth in fiscal 2026, with its cloud infrastructure segment expanding by 77%.
Oracle stock rose about 5% on the news of the layoffs.
