Oracle Seeks Up to $50B for AI Data Centers

Oracle plans to raise between $45 billion and $50 billion this year to expand its data center capacity for artificial intelligence workloads.

The company says the fund is needed to meet growing demands from major customers such as OpenAI, Meta, Nvidia, AMD, xAI, and others that rely on large-scale computing power.

To raise the funds, Oracle plans to use a mix of debt and new share sales. About half of the amount will come from equity-related offerings, including common shares and mandatory convertible securities.

The remaining half will be raised through a large bond sale planned for early this year. This comes on top of the $18 billion Oracle already borrowed through bonds in 2025.

Investor confidence has been shaky as big technology companies continue to spend heavily on AI infrastructure. Oracle has drawn particular attention because it has taken on significant debt to build new data centers.

Since reaching a record high in September, Oracle’s stock has fallen by more than 50%, wiping out over $460 billion in market value.

A major concern for investors is Oracle’s reliance on OpenAI, one of its largest customers. OpenAI has committed to spending around $300 billion on cloud infrastructure but is still losing billions of dollars each year and depends heavily on private funding. This has raised doubts about Oracle’s long-term ability to comfortably repay its growing debt.

Investors have been buying more credit-default swaps, a form of insurance against the risk that Oracle could default on its loans. The cost of insuring Oracle’s debt has now reached its highest level in over five years.

Despite these concerns, some analysts remain calm. They argue that Oracle’s data center investments should remain valuable in the long run, even if OpenAI struggles. Analysts note that demand for AI infrastructure goes far beyond a single customer, and Oracle is likely to find other financial backers if needed.

In short, Oracle’s bold plan to raise billions highlights both the huge opportunity and the growing financial risks tied to the AI boom, leaving investors divided between fear today and faith in long-term payoff tomorrow.