Over the last few months, Oracle laid off hundreds of employees from its Seattle office.
Reports circulated last week that about 300 employees were laid off as part of a larger layoff throughout the organization. These report pointed to infighting between the Seattle group and a similar group based in the Bay Area working on cloud infrastructure, which jibes with reports that suggested new Google Cloud CEO Thomas Kurian left Oracle last year.
The laid-off employees were part of the team responsible for building the company’s second generation (Gen2) cloud infrastructure, which was announced last October. The main reason behind the layoffs was reported that “it is filled with highly-paid engineers and is, so far, generating very little revenue to cover their costs.”
Oracle has been pretty straight forward about the fact that it wants to compete with the likes of Amazon Web Services, Microsoft Azure, and Google in infrastructure cloud computing, but it hasn’t made any recognizable progress toward that goal and decided last year to make it more difficult to assess the financial performance of its cloud efforts.
While Oracle has been able to justify throwing big salaries at Seattle-based cloud talent, it apparently can’t afford to make the massive investments in server hardware needed to match the computing power of the Big Three.
Earlier this month, Oracle also shut down its Research and Development Center in China. This shut down affected about 1600 employees. This was also one among many layoffs and restructures that have taken place in Oracle over the last few years. In March, the company laid off many employees from its offices in Silicon Valley, India and a few more – numbers in mid four figures.
Even though Oracle still makes sure to talk up the strong growth rates seen by various cloud app businesses during each earnings call, the company’s total revenue growth figures are staggering.
