Oracle stock rose sharply on Wednesday following announcements at its investor day that addressed persistent concerns about the company’s financing strategy for artificial intelligence infrastructure expansion. The software company projected revenues of $225 billion for fiscal 2030, representing an implied 35% average annual growth rate, and outlined a financing plan capping additional fundraising at $20 billion through that period.
The funding strategy will divide capital raises equally between equity and debt offerings across fiscal 2027 through 2030. Oracle noted that vendor financing arrangements, customer-provided hardware, and customer prepayments are anticipated to reduce immediate cash requirements as the company transitions toward positive free cash flow generation. Analysts surveyed by LSEG had anticipated fiscal 2027 revenue growth of 8%, with more substantial acceleration projected for the following two years, and their combined forecast for fiscal 2030 revenues reached $224.2 billion.
The company’s announcement came amid a challenging year for Oracle’s valuation. Prior to Wednesday, the company had declined approximately one-third of its value this year as investors worried that elevated interest rates combined with Oracle’s substantial debt burden would render the artificial intelligence expansion unaffordably expensive. The company currently carries $117 billion in long-term debt while maintaining an investment-grade credit rating of BBB-, the lowest tier above junk status.
Oracle pivoted aggressively into AI infrastructure last year to compete with major cloud providers and support OpenAI’s operations. Capital expenditures reached $55.7 billion in fiscal 2026 and are projected to increase 65% to $91.9 billion in the current fiscal year. To justify these outlays, Oracle projects operating margins exceeding 40% by fiscal 2030 and expects to achieve positive free cash flow in the second half of fiscal 2028, reaching more than $30 billion the following year. Analysts currently model negative free cash flow of approximately $35 billion for both the current and next fiscal years.
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