Key points
- Oracle offers $10 billion of stock and $10 billion of notes
- Oracle's offerings match the $20 billion cap it set Oct. 28
- Oracle hasn't said whether any of the note money refinances debt
Oracle (ORCL) launched offerings of $10 billion in common stock and $10 billion in senior notes on November 2. Together, they match the amount and mix the company told investors it expected to raise through fiscal 2030, just five days earlier.
Oracle shares were down 4.2% at $125.22 in premarket trading as of 9:27 a.m. ET, below the $130.53 close on October 27, the day before the Investor Day.
Neither offering depends on the other one closing. The share price, the interest rates, and the size of each note tranche were still blank in the November 2 filings. The notes come in six series, maturing from 2029 to 2046, including one floating-rate series. BofA Securities is the global coordinator for both deals.
Oracle also filed a new shelf registration with the SEC the same day. Both offerings were made under it.
The offerings match Oracle's expected fundraising
At its Investor Day on October 28, Oracle committed to limiting new capital-market fundraising for its fiscal 2027 to 2030 investment cycle to $20 billion. It said it currently expects that to be $10 billion in stock and $10 billion in gross debt. The shares closed up 10.7% that day.
The stock sale matches the equity half of that plan. The cap excludes refinancing of existing debt, so the notes' effect on the cap depends on how much of the money, if any, goes to refinancing. If none of it does, the notes would match the $10 billion in gross debt Oracle currently expects to raise through fiscal 2030. Together with the stock sale, that would reach the full $20 billion cap.
The filings don't settle the question. Both say the money will go to general corporate purposes. Those may include capital expenditures, repayment of debt, future investments or acquisitions, and dividends or share buybacks.
The stock sale could add about 2.5% to Oracle's share count
The stock filing cites a last sale price of $130.67 on October 30. At that price, $10 billion would buy about 76.5 million shares, by our calculations. That is roughly 2.5% of the 3.02 billion shares Oracle had outstanding on August 31.
The new sale comes on top of the $20 billion of stock Oracle finished selling in the quarter that ended August 31.
Oracle already carries heavy obligations
Oracle's borrowings and lease liabilities totaled $169.1 billion on August 31, by our calculations from its latest quarterly filing.
Oracle says vendor financing, customer-provided hardware, and customer prepayments will reduce the cash it needs up front until its free cash flow turns positive in the second half of fiscal 2028. Some of the borrowing for its data centers sits with developers and lenders rather than with Oracle itself, including construction loans backed by Oracle's leases in Texas, Wisconsin, and New Mexico.
The company said its capital allocation priorities remain keeping its investment-grade credit ratings, paying a dividend, and funding growth.
