Oracle Sells $20B of Stock and 7% to 8.65% Bonds to Fund AI Data Centers

Oracle closed $20 billion of new financing on 4 November 2026: 86.2 million shares sold at $116, about 11% below the 30 October close of $130.67, and $10 billion of notes carrying coupons from 7.000% to 8.650%, according to its 8-K. The raise closed a week after an investor day at which Oracle committed to limit additional capital raises for its fiscal 2027 to 2030 build-out to $20 billion. It used the whole allowance in one week. CNBC reported the shares fell 8.8% on 2 November, the day the offerings were filed.

What happened

The sequence started with Oracle's fiscal Q1 2027 results on 10 September. Revenue rose 30% to $19.3 billion and cloud infrastructure revenue grew 121% to $7.4 billion. Remaining performance obligations reached $664 billion after Oracle booked more than $30 billion of new AI cloud contracts. The company said it delivered 850 MW of additional data center capacity in the quarter and more than 300,000 GPUs to AI customers since the end of Q4.

Paying for that took $28.5 billion of capex in the quarter, against $8.5 billion a year earlier. Operating cash flow was $23 billion and free cash flow was about negative $5 billion. Oracle also disclosed that it had completed a $20 billion at-the-market stock sale during the quarter. Two days later, on 12 September, it announced that Larry Ellison had cancelled his plan to sell Oracle stock, without selling any shares under it.

At the 28 October investor day in Las Vegas, Oracle set out a target of at least $225 billion of revenue in fiscal 2030, positive free cash flow in the second half of fiscal 2028 and at least $30 billion of free cash flow in fiscal 2029. It said capex would peak in fiscal 2027 and 2028 and step down in 2029. And it committed to raise no more than $20 billion of new capital ($10 billion equity, $10 billion gross debt, excluding refinancing) for the rest of the cycle, leaning on vendor financing, customer-provided hardware and customer prepayments for the rest.

On 2 November Oracle filed for both offerings, and on 4 November both closed.

The numbers

The note tranches, from the 8-K: $2.0 billion at 7.000% due 2029, $1.75 billion at 7.450% due 2031, $2.25 billion at 7.850% due 2033, $2.5 billion at 8.000% due 2037 and $1.5 billion at 8.650% due 2046. For comparison, Meta's notes a day later priced at 6.250% for 2033 and 7.500% for 2056. Oracle pays about 1.6 points more on the 2033 maturity. My reading is that the gap is roughly what the market thinks separates an AA- AI builder from a BBB- one.

Why it matters

Oracle carries a BBB- rating, several notches below the Aa3/AA- that Meta cites for itself, and its numbers show the AI infrastructure model in its purest form: sign multi-year AI capacity contracts, borrow and issue stock to build the data centers, collect revenue later. The $664 billion RPO is the promise. The negative free cash flow, the BBB- rating and the 8.65% coupon are the cost.

The funding plan also depends on customers. Futurum reported that Oracle expects another $20 billion to $25 billion of customer prepayments related to components, which help offset gross capex and roughly match the gap between the $70 billion net cash cap and the $90 billion to $95 billion gross figure. Customer-provided hardware and vendor financing are now explicit parts of the plan. That means Oracle's capex depends partly on its biggest customers' balance sheets.

What sceptics say

CNBC's coverage set out both sides. The bear case: the stock is down 33% in 2026 and 50% over twelve months, five-year credit default swaps are at 292 basis points, and S&P Global Market Intelligence's Gavan Nolan said that level is more in line with a high-end junk rating. Pat Nerney of Dynasty Financial Partners asked: "Can they do what they say they are going to do?" He warned of trouble if Oracle has to come back to the market in late 2027.

The bull case: Oracle did exactly what it previewed. Baird's Rob Oliver said "This seems to be exactly what they previewed," and UBS's Karl Keirstead called the deal "a major relief given concerns about the state of debt markets and the cost of capital". Under the investor-day plan, anything beyond this $20 billion through fiscal 2030 (refinancing aside) has to come from operations, vendor financing, customer hardware and prepayments. If cloud infrastructure keeps growing at triple digits, the capex step-down in fiscal 2029 is believable.

What it means for engineering and DevOps teams

My take: if you run workloads on OCI, or are being offered aggressive OCI GPU pricing, read this as vendor-risk information, not a reason to panic. Oracle has funded its plan through fiscal 2030 on paper. But a provider paying over 8% on long debt has strong reasons to keep utilisation high and discounts tight, and a provider whose credit sits one notch above high yield deserves the same diligence you would give a neocloud. I made the same argument about GPU clouds and their debt.

Concretely: keep contracts shorter than the provider's refinancing horizon where you can, make sure your data and images can be moved (object storage in an open format, infrastructure in Terraform modules that are not tied to one cloud, container images in a registry you control), and test a restore on a second provider at least once a year. The outage postmortems are a good reminder that "the provider will be fine" is a hope, not an architecture.

FAQ

How much did Oracle raise in November 2026?

Oracle raised $20 billion on 4 November 2026: about $10 billion from 86.2 million shares at $116 each, and $10 billion of senior notes in five tranches with coupons from 7.000% to 8.650%.

Why is Oracle raising money?

Oracle is building data centers for AI cloud contracts behind its $664 billion RPO. Capex was $28.5 billion in fiscal Q1 2027 and free cash flow was negative. The company expects free cash flow to turn positive in the second half of fiscal 2028.

Will Oracle raise more capital?

At its 28 October investor day Oracle committed to limit additional capital raises through fiscal 2030 to $20 billion, excluding refinancing of existing debt. The November offerings used that allowance.

Related: GPU Clouds in 2026: H100s at $2.59 an Hour, $104B of CoreWeave Backlog on $35B of Debt, and a Six-Year Bet on Silicon, Cloud Outages 2025-2026: What 7 Official Postmortems Actually Teach and AI Power in 2026.