Oracle Corporation has announced a plan to raise $45 billion to $50 billion (approximately CZK 0.9 trillion to CZK 1.1 trillion) during calendar year 2026 through a combination of debt and equity financing. The company will use these funds to rapidly expand its Oracle Cloud Infrastructure business, which is experiencing unprecedented growth thanks to demand from major AI customers.
Massive financing for massive projects
Among the largest clients for which Oracle is building new data centers are OpenAI, Advanced Micro Devices, xAI, Meta Platforms, TikTok, and Nvidia. OpenAI has committed to spending several hundred billion dollars on Oracle Cloud services over the coming years. This contract represents a major business opportunity for Oracle, but it also requires massive upfront investment in infrastructure.
Oracle plans to raise approximately half of the funds through share sales and the other half through bond issuance. On the equity side, the company will launch an at-the-market share sale program worth up to $20 billion (about CZK 480 billion), as well as an issuance of mandatory convertible preferred securities. On the debt side, Oracle will conduct a one-time issuance of investment-grade bonds in early 2026. The company stated that it does not plan to issue any additional bonds during 2026 beyond this transaction.
Investor distrust = share price decline
Oracle shares have fallen 50% from last year's peak, representing a loss of approximately $450 billion in market value (about CZK 10.8 trillion). Investors are concerned about how much upfront investment Oracle will have to make before the contracts begin generating significant revenue growth. Another concern is whether OpenAI will be able to pay for its cloud service leases and whether Oracle can get the data centers ready on time. However, on Monday, February 2, 2026, Oracle shares rose 2% after Wall Street analysts said the financing plan eased concerns about the company's ability to fund its massive data center expansion.
In the three months ending in late November, Oracle burned through approximately $10 billion (about CZK 240 billion), driven by spending on data centers. In September, the company raised $18 billion (about CZK 432 billion) through a bond issuance. Oracle ended the quarter with approximately $20 billion (about CZK 480 billion) in cash, although its spending pushed free cash flow into negative territory and prompted the company to rely more heavily on debt.
Lenders have become cautious about all loans linked to Oracle's data centers and have privately said they want to limit their exposure. Developers building Oracle data centers for OpenAI have already borrowed more than $65 billion (about CZK 1.56 trillion) in construction debt.
Analysts' reactions
Analysts at Guggenheim said that Oracle is not only reaffirming its commitment to investment-grade debt but also sending a clear signal to bond investors and rating agencies. Analysts at Barclays noted that the combination of additional equity and mandatory convertible securities will reduce the need for debt and strengthen Oracle's balance sheet. However, analysts at Jefferies warned that although the financing plan "buys time" for Oracle's artificial intelligence ambitions, it may put pressure on margins in the short term, while free cash flow is unlikely to return to positive territory until fiscal year 2029.
Oracle is not the only technology company investing heavily in AI infrastructure. Companies such as Meta, Google, and CoreWeave are increasingly turning to debt markets to finance AI projects, raising concerns among investors. According to analysts at Morgan Stanley and JPMorgan, the technology sector could issue as much as $1.5 trillion in new debt over the coming years to finance AI and data center projects.
In its statement, Oracle emphasized that this financing plan reflects the company's commitment to maintaining an investment-grade rating, prudent capital allocation, balance sheet strength, and transparency with investors as it continues to expand its Oracle Cloud Infrastructure business.
Sources: axios.com and reuters.com
