The cloud firm has faced scrutiny over its debt-fueled buildout of AI infrastructure, which has pressured its shares in recent months.
- Oracle is raising the funds to meet the contract cloud demand from its customers, including AMD, Meta, NVIDIA, OpenAI, TikTok, and xAI.
- The company would raise about $20 billion from equity and equity-linked instruments.
- Oracle faces a proposed class action lawsuit from certain bondholders who allege the company failed to timely disclose its debt plans in connection with a massive OpenAI deal last year.
Oracle, Inc. plans to raise up to $50 billion from a mix of debt and equity instruments this year to fund its buildout of data centers and artificial intelligence infrastructure, the company announced on Sunday – a move that puts its debt buildup back in focus.
The company, long considered a smaller cloud player in a market dominated by Amazon, Microsoft, and Google, has faced scrutiny over its high spending and debt-fueled AI build-out, and the perceived risk that its fortunes are now increasingly tied to one customer, OpenAI.
Last month, bondholders, led by the Ohio Carpenters' Pension Plan, sued the company, saying they suffered losses because it failed to disclose that it needed to issue significant additional debt to build out its artificial intelligence infrastructure.
The proposed class action was filed on behalf of investors who bought $18 billion in notes and bonds issued by Oracle in September, following a $300 billion contract with OpenAI. These investors said they were blindsided when Oracle returned to the capital markets seven weeks later to obtain $38 billion in loans to build data centers to support the OpenAI agreement.
Oracle’s shares declined 15.6% in January, ending in the red for a fourth straight month.
2026 Capital Raise Plan
“Oracle is raising money in order to build additional capacity to meet the contracted demand from our largest Oracle Cloud Infrastructure customers, including AMD, Meta, NVIDIA, OpenAI, TikTok, xAI and others,” the company said in a statement.
Oracle will raise around half of the funding through a combination of equity-linked and common equity issuances, including mandatory convertible preferred securities and a new at-the-market equity program of up to $20 billion.
The other part would come from senior unsecured bonds early in 2026. It confirmed that the company does not intend to issue additional bonds this year. The bond offering is managed by Goldman Sachs, and the bond offering by Citigroup; they are approved by the company’s board.
Retail’s Reaction
On Stocktwits, ORCL trended among the top 10 tickers as of late Sunday, with the retail sentiment continuing to be in the ‘extremely bullish’ zone. The recent news that Blackstone was reportedly considering investing in Oracle’s Michigan data center project also kept sentiment upbeat.
“$ORCL debt raise is good news because they already have commitments for the amount that was announced,” a user said, with several posts seemingly backing Oracle’s 2026 debt plan.
Analysts are optimistic, with 36 of 43 covering the stock recommending ‘Buy’ or higher, while 10 suggest ‘Hold,’ and two suggest ‘Sell,’ according to Koyfin.
Oracle's stock move is nearly flat for the past 12 months.
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