Oracle Is Slashing Payroll While Borrowing Billions for AI. What It Means for ORCL Stock.

Oracle (ORCL) is in the limelight again, slashing jobs with one hand while it borrows billions of dollars with the other hand. The company has started another round of layoffs, with affected employees receiving termination notices beginning Sept. 14 as the company pushes ahead with a broader restructuring plan. Meanwhile, it faces an $89 billion debt problem that investors cannot overlook.

While this may appear counterintuitive, there is a clear bet behind it. Oracle is shrinking some costs so it can redirect more resources towards its AI cloud infrastructure business that is growing at extraordinary speed. Oracle stock is down 28% so far this year, underperforming the broader market. For Oracle investors, the question today is whether this gamble will pay off and whether Oracle is still worth investing in.