Oracle confirmed that its capital raising strategy remains unchanged despite significant infrastructure investments for AI. In fiscal 2026, the company spent $55.7 billion on capital expenditures, exceeding its initial target of $50 billion by over 10%. The company reported a negative free cash flow of approximately $23.7 billion for the fiscal year ending May 31.
The company's contracted backlog reached $638 billion by the end of fiscal 2026, supported by agreements with OpenAI, Meta, and Nvidia. For calendar 2026, Oracle aims to raise between $45 billion and $50 billion through debt and equity, including a $25 billion bond offering.
Looking ahead to fiscal 2027, Oracle projects net cash capital expenditures of $70 billion, with gross spending potentially hitting $95 billion. This plan requires an additional $40 billion in funding. The company currently holds a BBB- credit rating, and its debt-to-EBITDA ratio has surpassed 4x.
Management has committed to maintaining its investment-grade credit rating to avoid higher borrowing costs associated with junk-bond status. Oracle's stock has shown volatility as investors weigh the company's long-term AI infrastructure expansion against its current balance sheet pressures.
