Oracle filed to sell $10 billion in common stock and $10 billion in senior notes to finance its artificial intelligence infrastructure buildout. The company announced the offering on Monday through Securities and Exchange Commission filings. Oracle shares fell more than 5% on the news.
The company plans to use the proceeds for general corporate purposes, including capital expenditures, debt repayment, and future investments. Oracle previously disclosed this $20 billion fundraising plan at an investor day last week, when it also forecast revenue of at least $225 billion for fiscal 2030.
Oracle said it will limit additional capital market funding through fiscal 2030 to this $20 billion. The company plans to rely on vendor financing, customer-provided hardware, and customer prepayments to reach positive free cash flow by the second half of 2028.
Oracle's debt load has pressured both its stock and bonds. Shares are down 33% in 2026 and 50% over the past 12 months. The company's 4.95% bond due in 2031 currently yields 7.267%, up from lower levels. Oracle's five-year credit default swaps, which insure against default, stand at a spread of 296, up 270% in one year. S&P Global Market Intelligence's Gavan Nolan said this spread aligns more with a high-end junk bond rating. Oracle holds $125.34 billion in debt as of August 31, mostly in senior notes. S&P downgraded Oracle to BBB- in July, one level above high yield.
Pat Nerney, head of investment solutions at Dynasty Financial Partners, said execution matters most. "Can they do what they say they are going to do?" Nerney said. "If they have to come back to market in the back half of '27 after telling everyone this was the last of the capital needed ... look out."