Oracle is trying to raise $20 billion to invest in AI. Its stock fell more than 6%.

On Monday, cloud giant Oracle began raising $20 billion to finance large-scale investments in data centers: the company plans to raise half of the amount through a bond offering and the other half through a stock sale. Just a few days ago, Oracle promised investors—who were concerned about the company’s high debt burden—that by the end of fiscal year 2030, it would raise no more than $20 billion in additional capital, excluding funds for refinancing existing debt. The hyperscaler’s stock, which has lost more than a third of its value this year, fell more than 6% on news of the new offering.

Oracle is issuing $10 billion in bonds in six tranches with maturities ranging from three to 20 years, a Bloomberg source said. According to the source, the initial spread guidance for the longest-maturity tranche is about 3.6 basis points over the yield on U.S. Treasury bonds. According to Bloomberg’s calculations, Oracle is offering a premium of about 0.5 percentage points over its existing debt to attract investors.

The company also plans to raise $10 billion through a stock offering. The hyperscaler intends to use the proceeds for general corporate purposes, including capital expenditures, debt repayment, acquisitions, dividend payments, and share buybacks. Bank of America will act as the lead underwriter for both offerings.

The market reacted to Oracle’s moves with a sell-off: the company’s stock plummeted more than 6% on November 2, hitting its lowest level since July. Since the beginning of the year, the hyperscaler’s stock has lost more than 36%, as investors are concerned about rising debt and the return on investment in AI.

Last week, at its investor day, Oracle announced that it expects to reduce capital expenditures starting in fiscal year 2029 and limit additional funding to $20 billion and gross debt growth to $10 billion through May 2030. The company said it plans to generate a positive cash flow of $30 billion in the fiscal year ending in May 2029, although analysts had forecast a negative figure. Oracle also reaffirmed its revenue forecast of $225 billion by fiscal year 2030. This slightly eased investors’ concerns about the return on AI investments, Bloomberg noted: Oracle’s stock rose 11% on October 28, and the company’s credit risk metric fell sharply.

As of the end of August, Oracle’s debt stood at approximately $125 billion. In the previous fiscal year, the company raised $43 billion. In September 2025, Oracle issued $18 billion in bonds, and in January 2026, the holders of those bonds filed a class-action lawsuit against the company, claiming they suffered losses after Oracle issued a new $38 billion bond offering just seven weeks after the previous issuance.

In the current fiscal year, Oracle has already raised $20 billion from the sale of shares. According to Morgan Stanley’s forecast, taking into account future payments for data center leases, Oracle’s total debt could approach $300 billion by 2028.

This article was AI-translated and verified by a human editor