US Stocks Movement | Oracle closed down nearly 3%, launches $50 billion fundraising plan, high debt draws attention

Gelonghui, February 3rd｜US software company Oracle has officially launched a fundraising plan of up to $50 billion, including an initial bond issuance of up to $25 billion, in a full-scale push for cloud infrastructure. Oracle's stock price rose and then fell on Monday, initially climbing 4% at the opening before weakening in the latter half and ultimately closing down 2.75% at $160.06. In order to seize the high ground in artificial intelligence (AI) computing power, Oracle announced the launch of a massive fundraising plan, aiming to raise up to $50 billion through a combination of bonds and equity to support its aggressive cloud infrastructure expansion strategy. The initial bond issuance will be divided into eight tranches, with an expected scale between $20 billion and $25 billion, to be issued in a single tranche in 2026. The remaining funding gap will be filled through equity-related instruments and common stock issuance. Oracle is attempting to transform itself from a traditional database software provider into a heavy-asset cloud infrastructure giant, competing with Amazon Web Services (AWS) and Microsoft Azure. Oracle's fundraising path has become clearer, temporarily alleviating market concerns about the company's sources of capital expenditure funding. However, Oracle's balance sheet has also come under scrutiny, with the group's current outstanding debt reaching approximately $95 billion. Against the backdrop of high interest rates, such large-scale debt expansion has raised concerns on Wall Street about the company's cash flow pressures and the vulnerability of its financial structure. Market skepticism about Oracle persists, as Michael Burry, the real-life inspiration for the protagonist in the movie "The Big Short" and legendary hedge fund manager, recently disclosed that he has shorted Oracle, criticizing its unnecessary heavy-asset expansion.