Oracle shares soars after projecting return to positive cash flow

Oracle Corporation's stock price surged following the organization's announcement of a long-term projection for free cash flow, which alleviated investor concerns regarding the anticipated returns on its artificial intelligence investments.

Free cash flow is projected to reach $30 billion in the fiscal year concluding in May 2029, according to Chief Financial Officer Hilary Maxson, who disclosed this information Wednesday at the company's annual conference in Las Vegas, a Bloomberg report said.

Oracle, traditionally recognized for its database software solutions, has undertaken a strategic transformation to establish itself as a provider of computational infrastructure for artificial intelligence applications. The organization is currently executing a substantial expansion of data center facilities to serve OpenAI and other clients.

As per the report, Wall Street participants are closely monitoring the magnitude of capital allocation directed toward these initiatives and the timeline for project completion.

The stock price increased by 11% to $144.34 in response to the company's extended forecast, representing the most significant single-day appreciation since May 29. The stock had experienced a 33% decline throughout the year through Tuesday's closing.

Additionally, Oracle announced that supplementary capital requirements would be constrained to $20 billion through May 2030, to be obtained through a combination of equity and debt financing.

Oracle also reaffirmed its previously stated guidance of $225 billion in aggregate revenue for the fiscal year ending in May 2030.

The organization intends to deploy an additional seven gigawatts of data center capacity. This expansion will bring Oracle's total data center infrastructure to exceed 10 gigawatts by the conclusion of fiscal 2028. One gigawatt of electrical capacity is sufficient to supply approximately 750,000 United States residences at any given moment.

Oracle indicated that following "a period of peak" capital expenditures during the current and subsequent fiscal years, such spending is "anticipated to decline in FY 29."

Oracle was the first prominent technology enterprise to experience negative free cash flow attributable to substantial investment in data center infrastructure—it recorded negative $23.7 billion in the fiscal year that concluded in May 2026.

 

Read Also: Stocks to Watch for October 29: Jio Platforms, JSW Energy, United Spirits, PNB Housing Fin and more