New York, Feb 5, 2026, 17:25 EST — After-hours
- Oracle shares fell sharply, ending the day down almost 7% at $136.48 on heavy volume.
- Recent SEC filings reveal a $20 billion at-the-market stock program, alongside a $25 billion bond offering and a deal tied to preferred stock.
- Ahead of Oracle’s upcoming earnings, investors are focused on potential dilution, the cost of funding, and demand for cloud services.
Oracle shares dropped 6.9% to $136.48 on Thursday, then held steady in after-hours trading. Investors digested new capital-raising details amid a broader tech sell-off.
The slide hits at a crucial moment as Oracle seeks to bankroll a major cloud infrastructure expansion while traders grow jittery over who will come out ahead — and who will foot the bill — in the next AI investment wave. The plan includes both debt and equity-linked instruments, a blend that could boost leverage and increase dilution risk.
Investors unloaded AI stocks following Alphabet’s announcement that it might spend up to $185 billion on capital expenditures in 2026. “We’re seeing this volatility about whether this investment will translate, ultimately, into results,” said Tom Hainlin, an investment strategist at U.S. Bank Wealth Management. Reuters
A recent filing revealed Oracle wrapped up an offering on Feb. 5, issuing 100 million depositary shares (ORCL-PRD). Each share stands for a 1/2,000th stake in its 6.50% Series D mandatory convertible preferred stock, which carries a $100,000 liquidation preference per preferred share. These mandatory convertibles blend characteristics: they dole out dividends before converting into common stock down the line, potentially upping the total share count.
Oracle also filed to launch an “at-the-market” program, aiming to sell as much as $20.0 billion of common stock via a syndicate of banks serving as sales agents. Instead of a single large sale, this drip-feed approach lets the company offload shares gradually at current market prices. SEC
The financing package also features a $25 billion notes offering divided into eight tranches. This includes $500 million in floating-rate notes maturing in 2029, alongside fixed-rate notes with coupons from 4.550% due 2029 up to 6.850% due 2066.
The backdrop hasn’t been kind. Software and services stocks have taken a sharp hit this week amid worries that rapidly advancing large language models—LLMs, the tech behind many chatbots—could encroach on the “application layer” that’s long fueled enterprise software profits. “I think the software selloff is getting overdone and the logic seems flawed,” said Talley Leger, chief market strategist at The Wealth Consulting Group. Reuters
Analyst actions piled on the pressure. Scotiabank dropped Oracle to “sector perform” from “sector outperform” and slashed its price target to $220 from $280, citing worries about the company’s cloud expansion and its funding requirements.
Oracle’s shares have tumbled roughly 25% in the past eight sessions, marking their worst losing streak in over 20 years, MarketWatch data shows.
The direction isn’t set in stone. Should Oracle quickly convert the financing into capacity and demand holds steady, the cash infusion might ease short-term bottlenecks in its cloud segment. But if demand wanes or investors remain wary about AI-driven spending returns, the pressure from share dilution and rising interest expenses could stick around.
The next steps are as mechanical as they are fundamental. Traders will look for signs of actual share sales through the at-the-market program, track the trading of the new ORCL-PRD depositary shares, and focus on Oracle’s upcoming quarterly cloud demand update. The company’s earnings report is due March 9, per Yahoo Finance’s calendar.
