Oracle (ORCL) Raises $20 Billion in Stock and Bonds in One Day

Oracle (ORCL) went shopping for cash on Monday, and it came back with a lot of it. The company filed to sell $10 billion in common stock and $10 billion in senior notes, according to CNBC's market coverage of the SEC filings.

Shares slumped about 6% at midday on the news. For a stock that had just rallied on a promise of financial discipline, it was an ugly reversal.

The timing is what stings. At its investor day last Wednesday, Oracle told the market it would limit new capital raises to $20 billion across fiscal 2027 through 2030, split evenly between equity and debt. The stock jumped, touching an intraday high of $148.48.

Five days later, the whole allowance looks spent. As ZeroHedge summarized from Bloomberg's reporting, the bond deal is a six-part investment-grade sale with maturities running from two to 20 years. Bloomberg's own headline put the equity side at roughly $9.9 billion.

There is a fair counterargument. The cap reportedly excludes refinancing of existing debt, so Oracle can say some of the bond money simply replaces older borrowing. The stock sale can't be explained away that way.

The shares gave back the entire rally. They traded near $126.48 on Monday morning, more than 15% under that investor-day peak and below where they sat before the event.

The cash-flow picture explains the hunger. Oracle burned $23.7 billion in free cash flow in fiscal 2026 and another $5.4 billion from June through August, and it doesn't expect to turn free cash flow positive until the second half of fiscal 2028.

Oracle isn't alone. Microsoft sold $25 billion of bonds last Thursday, its first U.S. offering since 2017, and Meta is reportedly eyeing at least $20 billion of its own debt.

Amid all that, Stephens upgraded Oracle to overweight from equal weight on Monday with a $213 price target. That implies roughly 63% upside from Friday's close, and it landed the same morning as the offering.

"We believe the market needs to give Oracle more credit for the execution on delivering compute that continues to happen." — Brett Huff, Analyst, Stephens

Huff pointed to the operational evidence: Oracle delivered about 850 megawatts of capacity in the first quarter across 38 projects in 11 countries. He also thinks applications could grow at a double-digit pace for several years, ahead of the 10% Wall Street expects.

Stephens also argued that the lower capital-intensity guidance took much of the perceived risk out of Oracle's cloud business, per an Investing.com report on Yahoo Finance. In its view, free cash flow estimates jumped even as revenue and earnings forecasts barely moved.

Now the risks. New shares dilute existing holders, and Oracle hasn't laid out specific uses for the proceeds. The company also has a history here: in February it promised a single one-time bond issuance for 2026, then followed up with a second sale on Monday.

The cap is also now fully used on paper. If capex keeps climbing, the odds of a revised ceiling before 2030 aren't small.

For investors, the setup is a bet on execution against a financing overhang. A $213 target against a share price in the high $120s is a wide gap, but a stock that just sold $10 billion of its own paper may need a few sessions to absorb the supply.

Watch three things: how the offering prices, whether management reiterates the $20 billion ceiling, and how fast data-center capacity converts into free cash flow. A turn toward positive cash flow before fiscal 2028 would change the story quickly.

Bottom line: Oracle just spent four years of financing credibility in a single morning, and the stock has to earn it back with deliveries.