Billionaire Larry Ellison has cut 21,000 jobs at Oracle as bosses claimed AI was increasingly replacing human workers.

The software giant had around 141,000 employees at the end of April, down from around 162,000 at the same time last year, according to its latest annual report.

Oracle said some of the job cuts were down to an ongoing restructuring programme. However, it also blamed the drop in its headcount on the rise of AI tools.

“The adoption and deployment of AI technologies across our operations have resulted, and may continue to result, in reductions to our workforce,” bosses said.

In April, thousands of Oracle workers were told they were being sacked immediately and were locked out of their company IT systems, according to an email seen by The Telegraph. However, the full extent of the lay-offs was not disclosed.

The job cuts, which represent just under 13pc of Oracle’s workforce, come amid a sweeping overhaul of tech companies as they shift their focus to AI and the infrastructure underpinning it.

Amazon and Meta are among other tech giants to have cut thousands of jobs this year in what analysts described as a “once-in-a-generation revolution” for Silicon Valley as so-called AI “agents” take on office work and coding.

Shares in Oracle, which was founded by Mr Ellison, fell 5pc overnight amid a wider sell-off in tech shares on Wall Street that also dragged down Google and Elon Musk’s SpaceX.

The restructuring reflects both increased use of AI within the company and an effort to shore up staff costs as Oracle refocuses its spending on technology infrastructure.

Oracle, which offers cloud computing and enterprise software services, has said it will invest $70bn (£52bn) over the coming year as it seeks to expand into AI data centres. It already has a $300bn deal to provide data services to the ChatGPT maker.

But these aggressive expansion plans have forced it to raise tens of billions of pounds in debt, piling pressure on its share price, which has dropped by almost a third in the last year.

Oracle racked up severance costs of $1.8bn related to the job cuts, it said on Monday night, and it expects this number to rise to $2.1bn. It marks a sharp increase in the $374m of restructuring costs recorded the previous year.

Mr Ellison, a close ally of Donald Trump and a major financial backer of Sir Tony Blair’s think tank, the Institute for Global Change, has enjoyed a renaissance of the company he founded in California almost half a century ago. The 81-year-old remains chief technology officer of the business and its biggest shareholder.

Alongside Oracle’s expansion plans, Mr Ellison has also been tightening his grip on Hollywood after taking control of Paramount last year.

Paramount, which is run by his son David Ellison, has since struck a $111bn debt-fuelled deal to buy major rival Warner Bros Discovery.

An Oracle spokesman said: “As our cloud and AI businesses grow, we will continually balance our resources and restructure our development group to help ensure we have the right people delivering the best cloud and AI products to our customers around the world.”

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