Oracle Co-CEO Caly Magouryk

Oracle's stock price closed up nearly 11% on Wednesday, following the software company's release of a revenue forecast for fiscal year 2030 of $225 billion, which implies an average annual growth of 35%, and it stated that it will limit additional financing during that period to $20 billion.

At the Investor Day, Oracle stated that as part of its financing plan for the fiscal years 2027 to 2030, the funds raised will be evenly allocated between equity and debt.

"Supplier financing, hardware provided by customers, and customer prepayments are expected to reduce the initial cash needs during the transition to positive free cash flow," Oracle stated in a document submitted to the U.S. Securities and Exchange Commission.

Analysts expect revenue to grow by 8% in fiscal year 2027, with a significant acceleration in the following two years. They predict that revenue will reach $224.2 billion in fiscal year 2030.

Before Wednesday, Oracle had already seen about a third of its market value evaporate this year, due to concerns that rising interest rates and the company's heavy debt burden would make the cost of building its artificial intelligence too high. According to Standard & Poor's, Oracle has issued $117 billion in long-term debt and has barely managed to maintain its BBB investment-grade credit rating, which is the lowest level above junk grade among investment grades.

Oracle has long been known as a giant in enterprise software. Last year, it made a major entry into the AI infrastructure sector, attempting to compete with large-scale cloud providers such as Google and Amazon, while also providing capacity for OpenAI. According to FactSet, its capital expenditures more than doubled to $55.7 billion in the fiscal year 2026, and it is expected to surge another 65% this fiscal year to reach $91.9 billion.

Oracle needs the revenue expansion brought about by its construction efforts to cover the soaring costs. The company stated that its operating margin for the fiscal year 2030 will exceed 40%.

Oracle also stated that it will achieve positive free cash flow in the second half of the fiscal year 2028 and reach over $30 billion in free cash flow in the following year. According to FactSet, analysts expect free cash flow to be negative $35 billion this fiscal year, with a similar situation next year.

The spread on Oracle's five-year credit default swap (CDS) insurance is currently 277 basis points, having reached around 320 basis points earlier this month. It has increased by nearly 100% this year.