If some still doubted AI, which may be fueling an extraordinary speculative bubble lately, particularly amongst equipment manufacturers, the desire of major American names to raise capital, something they haven't done in decades, and to bet big on the technology should finally convert them.

Following Google and Meta, on this subject, refer to: Paradigm shift and a new era for Alphabet shareholders and At Meta, rumors of a capital increase weigh on the stock, it is now Oracle's turn to announce it is seeking $40bn in external financing through 2027, half via debt and the other half through a capital increase.

This follows a 2026 fiscal year during which Larry Ellison's group added $43bn in additional debt to its balance sheet, ahead of a $5bn capital increase.

It will take nothing less to face an extraordinary expansion of Oracle's investments in the infrastructure that will serve as the backbone of AI. Exactly one year ago, we noted in these same columns that these capital expenditures had increased tenfold in ten years, growing at a much faster pace than revenue and operating cash flow.

Once again, these expenditures have nearly tripled year-over-year. The natural effect is a compression of free cash flow, the profit returnable to shareholders, which is now deep in the red. The cash position is not improving either, with a dividend that nevertheless increased by $1bn between 2025 and 2026.

Oracle is now saddled with substantial debt, equivalent to more than five times its earnings before interest and taxes. This represents a complete paradigm shift for shareholders of the group, which remained entirely debt-free until the pandemic and was able to return the entirety of its juicy profits through share buybacks and dividends.

One can assume this bet is not being made blindly: Oracle's cloud segment, which accounts for half of consolidated revenue, saw its sales grow by 39% in the fiscal year just ended, driven by the meteoric growth of infrastructure services. This contrasts with the software segment, which represents just under a third of revenue and saw its sales decline by 1%.

Larry Ellison's group has decided to evolve and take a lead in a field where access to capital represents a major competitive advantage. Ultimately, this should make the position of groups that have installed the computing power infrastructure necessary for AI deployment virtually impregnable.

It remains to be seen to what extent these investments will pay off, and how long Oracle can degrade its balance sheet without drawing the ire of investors. Judging by the group's current valuation, the latter are currently betting on a win rather than a loss.