Oracle plans a $20B stock and bond sale, shares fall 6%

Oracle told investors that it will sell $20 billion of new stock and debt to pay for its AI buildout. Its large debt worries investors.

Oracle filed plans on Monday to sell $10 billion in stock and $10 billion in senior notes. Notes are a type of bond. The papers went to the US Securities and Exchange Commission. The money pays for its AI buildout. Investors knew the plan from an investor day. That was the week before. Shares of Oracle fell more than 6% on Monday.

How it works

Oracle says it will use the money for general corporate purposes. These can include capital spending, debt repayment and future investments. Oracle also plans vendor financing, hardware from customers and customer prepayments.

The numbers

• Oracle has $125.34 billion in debt, as of 31 August.
• Its shares are down 33% in 2026.
• Its 2031 bond yields 7.267%.
• It forecasts revenue of $225 billion or more for fiscal 2030.

What is not known

Rob Oliver, an analyst at Baird, says the plan is the same as the plan Oracle showed before. Oliver does not know the cause of the market reaction. Pat Nerney of Dynasty Financial Partners says execution matters. A new sale in late 2027 will be a bad sign.

Insight: Oracle moves part of the AI cost to suppliers and customers

Oracle limits new market funding to $20 billion and plans vendor financing, customer hardware and customer prepayments. It also says it will offer Google TPU chips from 2027, with no price or capacity. This reads as a plan to share the cost of AI capacity with the companies that supply and buy it. Customers can be told to pay first.