Austin-based Oracle cuts employees including in its Cerner healthcare unit, report says

Credit: Ricardo B. Brazziell/American-Statesman

Austin American-Statesman
Kara Carlson, Austin American-Statesman
June 16, 2023

Austin-based software giant Oracle is cutting employees and rescinding job offers, according to a report from Insider, as the tech industry continues to experience turbulence and job cuts.

The layoffs, which were first reported Thursday by Insider citing sources familiar with the matter, included open positions within its health unit. Oracle, the second largest software company in the world, did not respond to requests for comment on the reported layoffs.

Insider reported Oracle's healthcare unit includes electronic medical records firm Cerner, which Oracle acquired in December for $28.3 billion, the company’s largest ever acquisition. Cerner software is used by hospitals and doctors' offices to record and share health and medical data.

By Friday afternoon dozens of Oracle employees on LinkedIn had posted they were impacted by the layoffs, and had worked in positions related to Cerner, the healthcare unit and related to federal contracts.

In a call with investors on June 12, Oracle CEO Safra Catz said "significant changes" are still to come to the healthcare unit and said margins are still "nowhere close to the way we run a company," after an analyst asked where the company was in relation to synergy capture and cost takeout in the Cerner deal.

"I'd say we're at the beginning-ish, sort of at the beginning of the middle at most. We've got a long way to go on just operationally and we've got a lot of work going on the development side as we bring our technical capabilities into the product and move them into the Oracle Cloud," she said. "There are a lot of savings as we do that also."

The cuts also come just days after Oracle beat expectations on its fourth quarter earnings report, where the company said revenue grew 17% year-over-year in the quarter ending on May 31.

It’s unclear if any Austin-area employees are impacted by the recent layoffs. The layoffs follow cuts from last year, when Oracle slashed hundreds of jobs in August and as many as 200 employees in its cloud unit in December.

Oracle moved its headquarters from Redwood City to Austin in December 2020, where it already had significant office space with a five-story, 560,000-square-feet campus overlooking Lady Bird Lake.

The company currently employs about 2,500 people in Austin, according to the Austin Chamber of Commerce. At the Austin office's ribbon cutting ceremony in 2018, Oracle chairman and chief technology officer, Larry Elison said the Austin office could grow to fit 10,000 employees.

The cuts come as other tech giants nationwide cut thousands of employees. While impact has not been clear, industry experts said the Central Texas tech workforce has undoubtedly seen effects from the reductions, including those at companies with large Austin workforces including Google, Meta and Austin-based Tesla and Round Rock-based Dell.

In recent months that has included Accenture, an Irish-American contract firm focused on information technology services and consulting that is considered one of Austin's largest technology employers, which laid off 500 of its approximately 5,900 employees. Just a week before, Intel confirmed it would be laying off employees nationally in positions across the company.

Other cuts have come from Scribe Media, which laid off 90 employees in April, and Wipro, which cut 64 employees in May according to a Worker Adjustment and Retraining Notification Letter sent to the Texas Workforce Commission.