New York, February 4, 2026, 16:33 EST — After-hours update
- Oracle shares dropped roughly 5% in late trading after a new round of funding filings hit the tape
- A prospectus detailed an eight-tranche notes offering totaling $25 billion, plus a $5 billion mandatory convertible preferred deal
- Traders are eyeing the Feb. 5 settlement date for any indication Oracle will utilize its $20 billion “at-the-market” share program
Oracle shares dropped 5.2% to $146.65 in after-hours trading Wednesday, following a volatile session that saw the stock swing between $144.50 and $155.06.
Oracle is moving forward with a major funding effort linked to its data-center expansion. “Oracle is raising money in order to build additional capacity to meet the contracted demand” from key Oracle Cloud Infrastructure clients, the company said earlier this week. Reuters
Why it matters now: investors are wrestling with the costs tied to that capacity and the potential blow to equity holders, all while “AI trade” jitters weigh on tech. The Nasdaq dropped 1.51% Wednesday as growth stocks faltered. The S&P 500 edged down 0.51%, whereas the Dow managed a 0.51% gain. Reuters
This week, Oracle filed a prospectus supplement revealing a $25 billion offering of senior unsecured notes across eight maturities, from 2029 through 2066. The deal features $500 million in floating-rate notes due 2029, priced at compounded SOFR plus 1.11% — with SOFR referencing the overnight U.S. Treasury repo benchmark. Fixed-rate notes carry coupons between 4.55% for 2029 maturities and 6.85% for those maturing in 2066. Cloudfront
Oracle announced a 100 million depositary-share offering tied to 6.50% Series D mandatory convertible preferred stock, priced at $50 each. The company expects net proceeds around $4.95 billion. These securities pay dividends before converting into common stock later, which could dilute existing shareholders depending on the stock’s eventual price. StreetInsider.com
Oracle revised its paperwork for a $20 billion “at-the-market” program, allowing it to sell shares incrementally rather than all at once. The company also expanded the roster of banks acting as sales agents under its equity distribution agreement. Cloudfront
Analysts are scaling back targets amid concerns over the company’s cloud expansion and looming financing issues. On Tuesday, Scotiabank cut its price target to $220 from $260 but maintained a “Sector Outperform” rating. The bank flagged uncertainty about the speed and execution of Oracle Cloud Infrastructure’s growth and the implications for medium-term financing. Investing.com
The funding surge arrives as the market grows uneasy over the pace and impact of AI shifts. Nvidia CEO Jensen Huang dismissed worries that AI will supplant software tools as “illogical” on Wednesday, following a widespread selloff in software stocks. Reuters
The downside is clear: should demand for AI compute falter, big data-center projects delay, or capital markets grow less accommodating, Oracle might see borrowing costs rise and dilution pressures intensify beyond what investors can tolerate. Volatile markets can also push issuers to offer better terms or hold back on issuing, even when they genuinely need cash.
Traders are focused on the mechanics unfolding quickly: the mandatory convertible preferred deal is set to settle on Feb. 5. Alongside that, early price moves in the new financing instruments will be closely monitored, as will any indication Oracle begins tapping into its $20 billion at-the-market share program in the coming days.
