Oracle plans to raise between $45B and $50B in 2026 to expand Oracle Cloud Infrastructure, splitting the funding roughly 50-50 between debt and equity. The company confirmed contracts with AMD, Meta, NVIDIA, OpenAI, TikTok, and xAI are driving the buildout.
This follows an $18B debt raise in 2025 for similar expansion. The scale matters: Oracle's new 1-gigawatt data center sites require over 1,000 permanent staff each, with tens of thousands more in construction. Each facility includes on-site power generation, battery storage, and closed-loop cooling to reduce grid and water dependency.
The funding structure addresses criticism from 2025, when some investors balked at balance sheet risk from pure debt raises. This time, Oracle is using a single investment-grade bond issuance for debt, plus mandatory convertible preferred securities and up to $20B in at-the-market equity offerings. Share dilution is likely but more controlled.
What this means in practice: Enterprise teams evaluating cloud migrations now face a capacity question alongside cost. If your AI workloads need GPUs at scale, AWS and Azure lead times are stretching. Oracle's positioning OCI as the alternative - particularly for Oracle Database customers already paying licensing fees.
The economics shift depending on workload. For pure compute, AWS and Azure still dominate on breadth. For Oracle Database deployments, OCI Autonomous Database can deliver 30-40% cost savings versus RDS Oracle licensing, especially at enterprise scale. The catch: migration complexity and fewer third-party integrations.
Oracle's Exadata Cloud@Customer lets enterprises run OCI infrastructure on-premises, competing with AWS Outposts. Pricing typically favors public OCI for variable workloads, but Cloud@Customer makes sense for licensing audit risk mitigation and data residency requirements.
Three things to watch:
- Whether Oracle can actually staff and power these sites on schedule
- How AWS and Azure respond to capacity pressure
- Enterprise adoption rates beyond existing Oracle shops
The hyperscaler buildout race is real. Oracle's betting $50B that demand will outstrip supply through 2027.