March 6 (Reuters) - Oracle and OpenAI have abandoned plans to expand a flagship artificial intelligence data center in Texas after negotiations dragged over financing and OpenAI's changing needs, Bloomberg News reported on Friday,

Oracle and OpenAI have abandoned plans to expand their flagship data centre site in Texas, walking away from a multibillion-dollar deal even as the AI developer races to secure more computing capacity.

Oracle (NYSE:ORCL) has had a brutal run since its moment in the AI spotlight. But Jefferies analyst Brent Thill isn’t running away from it. He just reiterated his Buy rating on the stock, and while he trimmed his price target,

Reports of layoffs at Oracle suggest that thousands will be let go this month to free up resources for its AI data center expansion plans.

Oracle plans to cut thousands of jobs across multiple divisions as it works to manage costs tied to its AI data center buildout. The company is reportedly reallocating spending toward large cloud infrastructure projects for clients such as OpenAI and Meta.

Oracle and OpenAI have canceled their plans to expand their Stargate data center in Abilene, Texas, according to a report. However, the companies will continue to work on their 4.5 gigawatt agreement.

The shifting plans underscore the complexity of building out AI data centers, which are expected to cost tens of billions.

While Oracle has traditionally been viewed as a legacy database provider, its aggressive pivot toward Oracle Cloud Infrastructure (OCI) has sparked a

Oracle Corporation plans mass layoffs affecting thousands of employees to address a cash crunch linked to its AI data center investments. Details here.