Five days after pledging to rein in fundraising, Oracle raised the full $20 billion in a single day through a $10 billion bond sale and a $10 billion stock filing, covering all the new debt and stock it had said it would raise through fiscal 2030. The stock fell as much as 6.5% to its lowest since July, erasing last week's 11% investor-day gain. Oracle owed about $125 billion as of August, nearly twice its shareholders' equity, after burning about $24 billion in cash last fiscal year. Its credit default swaps cost about five times as much as Microsoft's, and its bonds due 2066 yield about 8.4% versus about 6.1% for Apple's and Microsoft's bonds due 2062. Fitch kept its BBB rating, while Moody's affirmed its rating but kept a negative outlook, meaning a downgrade remains possible.
Summary written by Upside AI from the original article. Read the source for full details.
Read the original on Yahoo Finance ↗
Keywords
OraclebondsAI investmentdefault risk
Open a keyword to see other news on the same topic.
Related news
- Oracle stock pops 13% as long-term revenue forecast and clarity on financing ease debt concerns
Oracle shares rose about 12% on Wednesday after the company forecast $225 billion in revenue for fiscal 2030, implying average annual growth of 35%, and said it will limit additional fundraising over that period to $20 billion. Funding for fiscal 2027 through 2030 will be split equally between equity and debt, while vendor financing, customer-provided hardware and customer prepayments are expected to reduce upfront cash needs. Oracle had lost about one-third of its value this year on worries about rising interest rates and its heavy debt load tied to AI infrastructure spending; it has issued $117 billion in long-term debt and holds a BBB- rating from S&P. Capital expenditures are expected to rise 65% to $91.9 billion this fiscal year, according to FactSet, and Oracle expects positive free cash flow from the second half of fiscal 2028. The spread on its five-year credit default swaps stands at 277 basis points, down from about 320 basis points earlier this month.
- Why Oracle Stock Is Down Today
Oracle is raising $20 billion through a $10 billion sale of new common stock and $10 billion of senior notes to fund its AI build-out, and shares fell 6.9% as of 12:52 p.m. ET on Monday, Nov. 2. The raise falls within the cap of $20 billion through fiscal 2030 that Oracle announced last week, so the article says it is not a surprise. The company says the cash will go toward capital spending, paying down other debts and 'future investments or acquisitions.' The author is not convinced Oracle will stick to the cap, since capital spending could still grow while data center revenue is delayed by construction snags and political opposition.
- Oracle Stock Plunge Tops $60 Billion Amid $20 Billion Stock and Bond Sale. Why the Sell-Off Could Be an Opportunity
Oracle (ORCL) shares have fallen about 15% since Wednesday's close, when the company was valued at about 437 billion USD; it is now worth about 372 billion USD, a loss of over 60 billion USD in less than a week. The latest drop came on Monday, when Oracle launched a 10 billion USD stock offering and a separate 10 billion USD bond sale at the same time. The timing stood out because at its investor day, Oracle had said it was committed to limiting additional capital raises through FY30 to 20 billion USD, excluding refinancing of existing debt. The company is spending heavily on data centers for AI customers, with about 236.1 billion USD of consolidated debt outstanding as of Aug. 31. The article also cites Oracle's targets, including over 225 billion USD in fiscal 2030 revenue and 30 billion USD or more of free cash flow in fiscal 2029, while noting the plan depends on AI customers continuing to pay and that Oracle may need more money than it promised.
- Oracle files to sell $20 billion in new stock, bonds to finance AI buildout
Oracle filed plans to sell $10 billion in common stock and $10 billion in senior notes, totaling $20 billion, to fund its AI infrastructure buildout, according to an SEC filing. The fundraising was outlined at the company's investor day last week, but shares fell 3% in premarket trading. Oracle said the proceeds will go to general corporate purposes, including capital expenditures, debt repayment and future investments. The stock and bonds have been under pressure as investors worry about the heavy debt being taken on for AI infrastructure, with shares down 33% in 2026 and 50% over the past 12 months.
- Oracle Declines 4% as $10 Billion Bond Sale Revives AI Debt Worries; CoreWeave Advances 2%, Microsoft Holds Steady
Oracle is offering $10 billion of bonds to fund its AI data center buildout, and its stock fell 4% to $125.43 in morning trading. Its latest quarterly filing showed negative free cash flow of $5.4 billion for Q1 FY2027 and interest expense up 55% to $1.4 billion. Oracle had also launched a $25 billion bond offering in February alongside a $20 billion equity distribution agreement, which it completed in Q1. Stephens upgraded Oracle to Overweight and raised its price target to $213 from $185, though the stock is down 33% year to date. Meanwhile, CoreWeave rose 2% to $55.75 despite also relying on borrowing, and Microsoft held steady at $525.74, up 9% year to date.
- Oracle Bonds Are Sliding as AI Debt Worries Grow. At 62, She Discovers the “Safe” Side of Her 401(k) Can Lose Money Too
Oracle's 4.95% bonds due 2031 had a spread of 263 basis points over government debt on Oct. 23, wider than the 2.06 percentage point average for BB-rated bonds cited by the Wall Street Journal, as investors question the borrowing needed for AI expansion. Oracle planned to raise $45 billion to $50 billion in 2026, and its latest quarter showed capital spending of $28.5 billion, negative free cash flow of $5.4 billion and a 55% rise in interest expense, with shares down 34% this year. The article explains that bond funds can lose value without any default because of credit spreads and interest-rate risk. Using a six-year duration as an illustration, $100,000 in bonds would lose roughly $6,000 if yields rose one percentage point, and the 10-year Treasury yield rose from 4.18% at the end of 2025 to 5.00% on Oct. 26. The piece also outlines checks such as reviewing a fund's holdings, converting duration into dollars and comparing potential losses with spending needs.
Related markets
Latest news
- Marvell and Lumentum shareholders unite in panning merger deal: “It's a trash offer”
Marvell agreed to buy Lumentum in an all-stock deal, and shares of both companies fell Monday. Shareholders of both companies have criticized the offer, with one describing it as “a trash offer.”
- Nvidia Reports Nov. 17. History Says What Its Stock Usually Does Next.
Nvidia will report results for its fiscal third quarter of 2027 after the close on Nov. 17, with shares near $205, about 14% below their Oct. 6 closing high of $239.24. Revenue beat the top of management's forecast range in each of the past 10 reports, yet the stock fell the next trading day after six of them, with the largest drop about 8.5% in February 2025. Most of those declines were recovered by the next report roughly three months later, though the roughly 9% gain after the August report has since faded to about 10% below its post-report close. Nvidia guides for third-quarter revenue of $108.0 billion, plus or minus 2%. The author concludes history is not a strong reason to avoid the stock before the report, leaning toward buying before Nov. 17 rather than guessing the next day's move, with shares trading at about 14 times the consensus fiscal 2028 EPS estimate of $15.80.
- Profile of Sacombank Acting CEO Nguyen Thi Kieu Anh: From VPBank Credit Officer to Leading Private Bank Executive in Vietnam
Nguyen Thi Kieu Anh was appointed acting CEO of Sacombank effective Nov. 2, 2026, replacing Loic Faussier, who became senior adviser to the board. She has more than 20 years in banking, including 18 years at VPBank, where she rose from credit officer to regional director, followed by roles at LPBank from 2023 to 2025 such as branch director and deputy CEO. She joined Sacombank in late December 2025 and was appointed deputy CEO effective Dec. 23, 2025. In March 2026, she also took on the roles of corporate governance and information disclosure officer as the bank launched a new organizational model on March 16, 2026. Her appointment comes as Sacombank accelerates completion of its restructuring plan.
- Palantir's U.S. Revenue Soars 119% as Commercial Revenue Surpasses Government Revenue for the First Time. Here's Why Its Growth Is Still Surging, Even as Other AI Stocks Falter
Palantir reported Q3 revenue of $2.3 billion, up 96% year over year and its fastest growth on record, with EPS of $0.44, up 144%, beating consensus estimates of $2.2 billion and $0.41. U.S. commercial revenue rose 148% to $984 million, surpassing U.S. government revenue of $953 million for the first time. Management raised full-year revenue growth guidance to roughly 91% from 82%. The article notes the stock trades at 125 times earnings with a PEG ratio of 0.53, and the author views the outlook positively while cautioning that the premium valuation could lead to a swift and severe rerating if results fall short.
- Apple beats sales and profit expectations but AI costs weigh on holiday sales
Apple beat analysts' expectations with record revenue for the July–September quarter, driven by iPhone and services sales, but higher AI-related costs will weigh on margins. CEO John Ternus, who succeeded Tim Cook in September, said the company is closing the year with its most ambitious lineup and hinted at a strong holiday season, including the foldable Duo. CFO Kevan Parekh guided gross margin to 45% to 46%, down from 47.9% in the September quarter, citing higher memory costs and costs tied to ramping Siri AI, which uses Google's Gemini model. Analysts had expected Apple to spend about $11 billion over the 12 months to September, a fraction of the more than $700 billion that Microsoft, Alphabet, Amazon and Meta are on track to spend this year. Parekh said AI gives customers a compelling reason to upgrade.
- Alphabet Lost $500 Billion in Market Value. Should You Really Buy AI Stocks Now?
Alphabet shares fell 13% in one session, their worst trading day ever, after parts of its earnings report disappointed investors and wiped out about $500 billion in market value. The concern centers on AI infrastructure spending: Alphabet kept its capex forecast unchanged at $195 billion to $205 billion, and free cash flow came in at negative $9 billion versus analysts' estimate of $2.7 billion. Google ads still accounted for 64% of total revenue, while the cloud business posted a record 103% revenue gain to more than $30 billion. Alphabet, Amazon, Microsoft and Meta together aim to spend more than $700 billion this year on infrastructure. The author argues that for most investors, the recent decline is a chance to buy at an attractive price, though more volatility could follow.
Get the briefing on Telegram or Zalo
Join the Upside Telegram channel or Zalo group for the Vietnam stocks and gold briefing at 8:00 and 19:00 (Vietnam time) on trading days, plus a weekly wrap on Saturday morning.