Oracle Shares Drop Over 4% Pre-Market as Moody's Affirms Baa2 Rating with Negative Outlook

Stock News11-02 22:20

On Monday, Oracle (ORCL.US) shares fell more than 4% in pre-market trading, reaching $125.14.

On the news front, on November 2, Moody's affirmed Oracle's "Baa2" senior unsecured debt rating and "P-2" commercial paper rating, and assigned a "Baa2" rating to the company's proposed $10 billion senior unsecured notes offering, with the outlook remaining negative.

Oracle launched a $10 billion US dollar bond issuance on Monday, just days after the company announced a new capital expenditure plan to fund its artificial intelligence (AI) infrastructure investments. The company expects that the related debt and equity financing, combined with existing cash, will be sufficient to support construction through fiscal year 2029 when the project becomes self-funding.

Moody's estimates that Oracle's total AI infrastructure project scale, including chip costs and leased facilities, could exceed $500 billion. The company's free cash flow for the trailing twelve months ended August 31, 2026 was negative $35 billion, with adjusted debt/EBITDA exceeding 4 times.

Moody's stated that the negative outlook reflects the massive spending on AI infrastructure construction, financing uncertainties, and reliance on OpenAI as its largest AI infrastructure customer.

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