Oracle shares jump 12% after forecast of positive free cash flow

what happened

Oracle shares are rising about 12% on Wednesday after the company unveiled new financial targets at its investor day. According to Dow Jones Newswires, citing MarketWatch, Oracle expects positive free cash flow in the second half of its next fiscal year, the six months ending in May 2028. Analysts tracked by FactSet had expected more than $13 billion in negative free cash flow across the last two quarters of fiscal 2028.

The company also projects upwards of $30 billion in free cash flow for the fiscal year ending in May 2029 and said it is committed to limiting additional capital markets funding through fiscal 2030. The targeted financing totals $20 billion, split evenly between debt and stock offerings. On Tuesday, Oracle also said it will be the first major cloud provider to offer Google's TPU chips apart from Google itself.

why it matters

Investors have worried that Oracle's heavy AI infrastructure spending and borrowing would strain its cash flow. The new outlook eases those concerns and may shift sentiment across cloud AI providers.

market impact

Oracle stock and cloud AI names: easing debt concerns supports the shares

• ▲Oracle shares pressure up — a positive free cash flow forecast eases worries about AI spending

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