Oracle Files $20B Stock-and-Bond Raise to Fund AI Buildout

Oracle filed with the SEC on Monday to sell $10 billion in common stock and $10 billion in senior notes to help pay for its AI and cloud data-center buildout, CNBC reported. Shares fell more than 6% on the day even though the raise had been previewed at the company's investor day a week earlier.

Oracle told the SEC the proceeds are earmarked for "general corporate purposes," a list that CNBC reports includes capital spending, debt paydown, acquisitions, dividends and share buybacks. The company reiterated that capex should peak this fiscal year and the next, and said it does not plan to raise more than $20 billion in additional financing for AI through fiscal 2030, pointing to a target of revenue above $225 billion and adjusted earnings above $21 per share by that year.

The pushback is on the balance sheet. Oracle, co-founded by former CEO Larry Ellison, carried $125.34 billion in debt as of August 31, with the bulk in senior notes. S&P cut the credit to BBB- in July, one rating level above high yield, and the stock had already shed roughly 33% this year through Friday before adding to that today.

It lands inside a broader hyperscaler funding squeeze that we've been tracking as debt-insurance costs reach multi-year highs; Alphabet priced a €6 billion seven-tranche euro bond the same day. Oracle is the first of the group to pair that debt leg with a sizable equity leg.