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(Sharecast News) - Oracle is looking to raise between $45bn and $50bn to fund the expansion of its Cloud Infrastructure business.
In a statement on Sunday, the company said it was raising the money to build additional capacity to meet the contracted demand from its largest cloud infrastructure customers, including AMD, Meta, Nvidia, OpenAI, TikTok, xAI and others.
Oracle said it will use a combination of debt and equity financing "to maintain a solid investment-grade balance sheet".
The company plans to raise about half of its 2026 funding through a combination of equity-linked and common equity issuances. This is expected to include an initial issuance of mandatory convertible preferred securities, representing a modest portion of the overall equity funding, as well as a newly authorised at-the-market equity program of up to $20bn.
In addition, Oracle plans to complete a single, one-time issuance of investment-grade senior unsecured bonds early in 2026 to cover the other half of the planned funding for the year.
"This funding plan reflects Oracle's commitment to maintaining an investment-grade rating, prudent capital allocation, balance sheet strength, and transparency with investors as the company continues to expand its Oracle Cloud Infrastructure business," it said.
Russ Mould, investment director at AJ Bell, said: "While most tech businesses are investing heavily in AI infrastructure, many of them are doing so from a position of balance sheet strength. Oracle is loading up with debt for its own splurge, with the cost of insuring against a default on these borrowings surging at the back end of last year.
"The perception is that Oracle's fortunes are now heavily tied to OpenAI and combined with the company's plans to raise up to $50 billion to invest in 2026, nervousness about the situation looks unlikely to go away any time soon."
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