Oracle’s AI spending exceeds forecast, raising concerns over growing debt
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- Oracle spent $55.66 billion on capital expenditures in 2026, exceeding its $50 billion target.
- Oracle plans to raise nearly $40 billion in 2027 through debt and equity, including a $20 billion at‑the‑market equity issuance.
- Oracle expects fiscal 2027 capital spending of up to $95 billion, with $70 billion of its own projects and $20‑$25 billion anticipated repayments from customers.
- Stargate data center in Texas, built with OpenAI and other partners, will be more than three‑quarters complete within 90 days and will host OpenAI’s cutting‑edge coding models.
- Oracle’s CEO Clay Magouyrk said the company’s data‑center delivery is approaching one gigawatt, roughly the capacity delivered in the previous four quarters combined.
- Oracle’s CFO Hilary Maxson warned gross margins will step down in fiscal 2027 as the company ramps up data‑center projects.
- Oracle’s shares fell 8.9 % in extended trading after the spending and debt‑raising announcement.
Why it matters: Investors confront heightened risk as Oracle’s aggressive AI‑infrastructure rollout forces a $40 billion financing plan and squeezes margins, while the company’s $638 billion performance obligations and $76.56 billion near‑term revenue promise offer a counterbalance that the debt‑focused narrative often downplays for shareholders and creditors alike.
