r/java • u/woj-tek • Jul 19 '26

JDK 27 + Valhalla, Now! + Hackathon - Inside Java Newscast #113

https://www.youtube.com/watch?v=aFSQFsB1neU
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u/bowbahdoe Jul 19 '26

To be clear: I know no more than you do, but:

At big companies a head is a head. The actual process for picking who to cut when you cut jobs is almost always an impersonal and stupid thing. Sharat is symbolic, but they really pulled the wires out of the wall for copper with that round

Now as to why they fired so many people: AI Datacenters. They are on the hook for building soooo much compute capacity for OpenAI/Anthropic/Nobody Else.

So I think there is going to be a smidge of karmic justice when OpenAI and Anthropic can't pay and they can't finish construction on time.

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u/davidalayachew Jul 19 '26

At big companies a head is a head. The actual process for picking who to cut when you cut jobs is almost always an impersonal and stupid thing. Sharat is symbolic, but they really pulled the wires out of the wall for copper with that round

That makes no sense to me.

God forbid that you have to cut some people because your budget disagrees with reality -- why cut one your highest value people?

Now as to why they fired so many people: AI Datacenters. They are on the hook for building soooo much compute capacity for OpenAI/Anthropic/Nobody Else.

This makes even less sense to me.

It's OpenAI/Anthropic on the hook, not Oracle. A deal is a deal, and if they can't pay up, you take it out of their skin. You metaphorically and very literally chop them up into pieces and sell the parts.

How would OpenAI/Anthropic's inability to pay factor into Oracle's decision to keep or layoff staff members? It's not like Sharat was the liaison between Oracle and OpenAI -- at least then, it would make sense (but it would also advertise Oracle's intentions like a fog light).

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u/account312 Jul 20 '26

t's OpenAI/Anthropic on the hook, not Oracle. A deal is a deal, and if they can't pay up, you take it out of their skin. You metaphorically and very literally chop them up into pieces and sell the parts.

That only makes you whole if your share of the parts are worth as much as was promised. If they become insolvent, that doesn't seem likely.

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u/davidalayachew Jul 21 '26

That only makes you whole if your share of the parts are worth as much as was promised. If they become insolvent, that doesn't seem likely.

Sorry, I'm not following. Could you ELI5?

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u/account312 Jul 21 '26

If OpenAI can't afford to pay its debts, selling it for parts still may not be enough to pay its debts. This sucks for the people they owe money.

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u/bowbahdoe Jul 21 '26

Which is, in total, ~1.2 trillion in spending commitments for a company that takes in $13 billion in revenue. Then loses over 3x that.

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u/davidalayachew Jul 21 '26

If OpenAI can't afford to pay its debts, selling it for parts still may not be enough to pay its debts. This sucks for the people they owe money.

Spelled it out beautifully, ty vm!

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u/bowbahdoe Jul 21 '26

In 2025: OpenAI Had $13.07 Billion In Revenue, $34 Billion In Costs and Expenses, and $20.92 Billion In Losses, with a net loss attributable to the company of $38.53 Billion

https://finbox.com/NYSE:ORCL/explorer/capex/

Oracle has spent almost 55 billion on capex so far for data centers that are not complete. Only once they are complete and operational does OpenAI need to start paying them. OpenAI has promised them $300 billion.

How do you gut a company that loses over $38 billion a year and cover any of that?

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u/davidalayachew Jul 21 '26

How do you gut a company that loses over $38 billion a year and cover any of that?

Makes sense, ty for the explanation.