Oracle Corp. intends to secure $45 billion to $50 billion this year via a mix of debt and equity offerings to expand its cloud infrastructure capabilities, indicating the substantial funding required to support AI’s expansion.

Oracle is securing funding to expand its capacity to fulfill the contracted needs of its biggest cloud clients, such as Advanced Micro Devices Inc., Meta Platforms Inc., Nvidia Corp., OpenAI, TikTok Inc., and xAI Corp., according to reports.

The announcement aligns with ongoing concerns regarding whether substantial AI-related investments by tech firms like Oracle will yield returns. The firm's stock has declined nearly 50 percent from its peak price on September 10, erasing approximately $460 billion in market capitalization.

The establishment of AI data centers has driven Oracle's free cash flow into the negative, and it is projected to remain so until 2030, as per reports. The firm is responsible for tens of billions of dollars in expenses in the upcoming years, primarily for semiconductors and leases.

Also Read: Semicon India 2025: Designing A Self-Reliant Semiconductor Hub

“Should Oracle successfully complete the raise, it can begin to pull itself out of the significant hole it has created,” stated Gil Luria, an analyst at DA Davidson & Co.

The firm intends to secure 50 percent of the capital through equity-linked and common equity offerings, which encompass mandatory convertible preferred securities, along with an at-the-market equity initiative totaling up to $20 billion.

Also Read: The Global Fintech Fest 2025: Enabling Finance for Better World

According to John DiFucci, an analyst at Guggenheim, issuing equity would signal to the market that Oracle is committed to preserving its investment-grade debt rating, as noted in a communication from January.

The remaining funding goal will be achieved through a sole bond issuance in early 2026. In 2025, the company raised $18 billion through one of the largest corporate bond issuances of the year.

Also Read: AI & Tech: Visionary Pre-Budget Insights from Industry Leaders

However, Luria noted that the debt market might not be willing to absorb this level of investment-grade debt from Oracle due to its current obligations and the activity in its credit default swaps. He mentioned that issuing equity could also negatively impact the company’s stock price.