Oracle is raising $20 billion to fund its artificial intelligence infrastructure expansion. The company plans to secure $10 billion through a stock offering and another $10 billion via bond sales. The equity portion involves 86.2 million shares priced at $116 each, representing an 11.2% discount compared to the previous closing price.
The bond issuance consists of five fixed-rate offerings with maturities ranging from 2029 to 2046. These instruments carry interest rates between 7% and 8.65%. The deal is expected to close on November 4. Oracle intends to use the proceeds for capital expenditures, debt repayment, acquisitions, dividends, and share repurchases.
Following the announcement, Oracle shares fell 8.8% to $119.22, bringing the stock's year-to-date decline to approximately 39%. As of August 31, the company held $125.34 billion in debt. Oracle aims to increase its annual revenue from $67.36 billion in fiscal 2026 to over $225 billion by fiscal 2030.
Management projects that capital expenditures will peak in fiscal 2027 and 2028. The company expects free cash flow to turn positive in the second half of fiscal 2028, targeting over $30 billion in free cash flow by fiscal 2029. Oracle has committed to limiting further capital-market fundraising to $20 billion through fiscal 2030.
