Oracle (ORCL.US) $20 billion financing: stock price collapse under AI gambling

According to Woofun AI, US software giant Oracle (ORCL.US) officially disclosed plans to raise a total of 20 billion US dollars by issuing bonds and stocks in order to accelerate the layout of artificial intelligence and cloud infrastructure. This move is aimed at supporting its ambitious goal of boosting sales to 225 billion US dollars by fiscal year 2030.

Although Oracle (ORCL.US) Chief Financial Officer Hillary Maxson predicts that the company's cash flow will be corrected in the second half of fiscal year 2028, and the stock price was previously expected to rise by about 11% in a single day on the 28th of last month as a result, the market reacted lukewarm to the financial pressure of its aggressive expansion.

According to data compiled by Woofun AI, Oracle (ORCL.US) currently has a total debt of 125.34 billion US dollars, far exceeding its sales of 67.36 billion US dollars in fiscal 2026. As a result, the stock price fell by about 6% after the announcement of the financing news, and the cumulative decline since this year has reached 38%. The financing involved 6 types of bonds with different maturities (2029 to 2046), of which 1 type is a floating interest rate and 5 are fixed interest rates, and the specific interest rate and issue price are yet to be determined; according to TradeWeb (TW.US) data, the face value of its 6.85% annual interest rate due in 2066 has dropped by more than 1.2 cents per dollar. The use of capital covers equipment investment, debt repayment, mergers and acquisitions, dividends, and share buybacks. Oracle (ORCL.US) promised to limit additional AI-related financing to less than $20 billion by FY2030, and equipment investment is expected to peak in this fiscal year and the next.

Meanwhile, the company set an adjusted earnings target of over $21 per share for fiscal year 2030.

The core of investors' anxiety is Oracle (ORCL.US)'s high dependence on the loss-making OpenAI business and its sales disadvantage compared to Microsoft (MSFT.US) and Amazon (AMZN.US). This structural risk makes the market cautious about its leverage ratio and profitability even with clear revenue growth guidelines. This is another key point in Oracle's (ORCL.US) game of financial transparency and market confidence, after several tech giants faced revaluation due to a surge in AI capital expenditure.