Oracle Corp. has reportedly axed hundreds of its engineering staff worldwide amid an organizational restructuring that’s meant to help the company refocus on its cloud infrastructure operations.
IEE Spectrum reported Friday that the total number of staff cut could exceed “thousands worldwide,” with up to 10 percent of Oracle’s staff affected, though lower estimates suggest a figure of 500 at a minimum. The cuts came despite no formal announcement of the restructuring plans from the company.
Oracle did at least confirm the layoffs in a statement to Business Insider, saying the idea was to shift resources to its cloud computing business.
“As our cloud business grows, we will continually balance our resources and restructure our development group to help ensure we have the right people delivering the best cloud products to our customers around the world,” Oracle spokeswoman Deborah Hellinger told Business Insider.
Dozens of axed Oracle employees took to the anonymous discussion website TheLayoff to discuss what had happened. Users reported cuts in various departments across Oracle’s worldwide offices, with several engineers who were working on older cloud projects said to have been let go. For example, one poster said 43 people were laid off from the Oracle Management Cloud team at the company’s Silicon Valley offices.
A second user reported that 32 engineers worldwide were cut from the Oracle Cloud Infrastructure team. Specifically, those cut were said to have been working on an older version of Oracle’s cloud called OCI Classic.
It was speculated that those layoffs may have something to do with Oracle’s recent announcement of a “Gen 2” version of the Oracle Cloud, which was billed as a “secure, unified architecture for all applications,” includinf the Oracle Autonomous Database and other SaaS applications.
That would make sense, since Oracle is undergoing a massive shift as it pushes its customers to move from buying old-fashioned software to using its cloud services, and its revenue is reflecting that shift.
In another post on TheLayoff, 50 more cuts were reported to have been made in areas such as marketing. And more staff were said to have been cut in Oracle’s New Hampshire offices. Those were said to have been employed by Dyn, which is a security and infrastructure business that Oracle acquired in late 2016.
Additional layoffs were reported in Oracle’s global offices as well. Almost 100 workers based in India are said to have been cut, for example.
It appears Oracle handled the cuts rather badly, with most of those given the boot only informed of their fate Friday morning. In some cases, affected employees were given just 30 minutes to clear their desks and leave the building, IEEE Spectrum reported.
Don Johnson, executive vice president of Oracle Cloud Infrastructure, reportedly sent out an “organization-wide email” to employees Friday morning that discussed how well the company was doing following its better-than-expected earnings report last week. The email apparently explained why the cuts were being made and told staff members that, going forward, everything in the company would revolve around the Oracle Cloud Infrastructure operation.
Tech industry analysts told SiliconANGLE that the way the layoffs were handled leaves much to be desired, and could have some unforseen consequences later on. They were also skeptical on the company’s apparent reason for the layoffs.
Rob Enderle of the Enderle Group said Oracle’s poor handling of the layoffs could have a negative impact on its ability to attract new talent in areas where it needs to beef up its workforce, later on down the line. The way some employees were treated could also cause others to consider leaving the company, he added.
“Right now companies like Oracle are having trouble filling positions and finding staff who’re willing to retrain,” Enderle said. “Candidates thinking of going to Oracle will also now likely feel they would be better served working someplace else. Doing layoffs is an art, and the Oracle folks apparently missed that.”
Enderle also said it seems a bit odd that Oracle would cut staff in order to address problems with its cloud offerings, which he said are inferior to those of its rivals. He suggested that the cloud message could be a misdirect, and that Oracle was in fact most likely just desperate to cut costs.
“We’ll understand this better when we see the next financial reports,” he said.
To understand what’s going on, it’s important to look and see where Oracle is letting go of talent and where it wants to bulk up, said Holger Mueller, principal analyst and vice president of Constellation Research Inc. And so Oracle’s apparent emphasis on its Gen 2 cloud doesn’t really equate with its decision to reduce its investments there, Mueller said.
Whatever the reasons, it’s true that lay offs are nothing new at Oracle. In September 2017, for example, the company made at least two rounds of staff cuts, letting go a number of staff working at its Solaris and Scalable Processor Architecture business units. Earlier that year, the company also cut 450 staff from its hardware business.
Photo: May Wong/Flickr
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