Oracle Targets $50 Billion Capital Raise for 2026 Cloud Infrastructure Expansion

Oracle Corp announced it plans to raise between $45 billion and $50 billion in 2026 through a mix of debt and equity, as per Bloomberg reports.  

The funds will be used to build additional cloud infrastructure. The company said the amount reflects capital needed to meet existing contractual demand tied to artificial intelligence workloads. 

Customers Driving Demand 

Oracle said the capacity expansion is linked to signed agreements with large cloud customers, as per report.  

These include Advanced Micro Devices, Meta Platforms, Nvidia, OpenAI, TikTok and xAI. The company said additional data centres are required to deliver capacity already committed under these contracts. 

Cash Flow Position 

Investment in AI data centres has pushed Oracle’s free cash flow into negative territory. Data compiled by Bloomberg shows free cash flow is expected to remain negative until around 2030.  

The company faces tens of billions of dollars in future spending, mainly related to chips, hardware and long-term leasing arrangements. 

Equity Funding Plans 

About half of the proposed funding is expected to come from equity-linked and common equity issuance. This includes mandatory convertible preferred securities and an at-the-market equity programme of up to $20 billion. Oracle said these instruments would form a major part of the overall financing structure. 

Bond Issuance 

The remaining funding is expected to be raised through a single bond sale early in 2026. Oracle raised $18 billion from the bond market in 2025, one of the largest corporate debt offerings that year. Total borrowings have since increased alongside rising capital expenditure commitments. 

OpenAI Exposure 

A major part of Oracle’s cloud expansion is tied to its agreement with OpenAI. OpenAI has committed to spending about $300 billion over time to rent servers from Oracle.  

OpenAI is not currently profitable, adding uncertainty around the timing of cash inflows linked to the contract. 

Read More: Union Budget 2026: FM Announces Foreign Cloud Firms Using Local Data Centers to Get Tax Relief Until 2047! 

Conclusion 

Oracle’s planned capital raise highlights the scale of funding required to support signed cloud contracts. The company continues to operate with high spending commitments and extended pressure on cash flows. 

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