- By Alex Gaw
- August 9, 2022
Technology and software giant Oracle cut jobs in marketing and in its beleaguered CX division on Monday amid fears of economic uncertainty, with reports from business and trade papers quoting sources in the know as saying that the total number of jobs lost in a chaotic start to the week reached as high as 5,000.
The layoffs in this round were concentrated at Oracle offices in San Francisco and the Bay Area, but retrenchment is also being expected at Oracle locations in Canada, India, and parts of Europe in the days or weeks to come, according to the people knowledgeable on the matter.
The cuts in the company’s CX division signal a pullback in customer analytics and advertising services, analysts say, so that Oracle could eliminate an underperforming arm of the business. The CX division, which sells systems for customers to build customer-facing websites, manage customer data, and personalize offerings, did not do as well as Oracle had initially hoped for but had, in fact, lagged behind in growth compared to the rest of the firm.
Even so, the ferocity of the layoffs shocked employees, not only because workers had been assured by management that their jobs were safe, but also because the cuts extended beyond marketing and CX to include senior employees in sales and engineering as well as high-performing personnel. Many were also reportedly let go just before their stock options vested, depriving them of what would have counted as expected compensation. Altogether, Austin, Texas-based Oracle is looking to save approximately $1 billion in costs by doing away with the jobs. The company had approximately 143,000 full-time employees as of May 31, according to its latest annual report. In its most recent financial quarter, Oracle saw revenue grow by 5% to $11.8 billion, buoyed by a 36% increase in cloud infrastructure revenue.
The job cuts are taking place as Oracle trains its sights on healthcare, with the company vying to become a more important player in the competitive cloud technology services market. Earlier this year, Oracle had completed the $28.3 billion acquisition of Cerner Corporation, the Kansas City, Missouri-based supplier of digital medical records and health information technology (HIT) services, devices, and hardware, in a bid to seek customers in one of the few remaining bastions of industry that have been slow to adopt cloud technology and where market leadership as a cloud services provider was still up for grabs.
Oracle is one of many companies resorting to layoffs in the face of discouraging earnings or forecast revenue and because of slowing sales due to inflation. And despite a stronger-than-expected report from the US Labor Department that said American employers added 528,000 jobs in July, Oracle joined Walmart and financial services company Robinhood in announcing the job cuts Monday. A news report also states that insurer Geico has closed all 38 of its offices in California, laying off hundreds of telephone agents that the company employed in the state.
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