Oracle shares are down 4.9% in early trading after the company filed to sell $10bn of new common stock. Buyers are not waiting for the payoff the Investor Day promised, and are marking the stock down against the new supply. The shares had risen as much as 14% to $148.48 on Oct 28, after Oracle forecast $30bn of free cash flow, the cash left after running costs and investment, for fiscal 2029.

The sale is the equity half of a $20bn cap on new capital that Oracle set at its Investor Day for the period through fiscal 2030. The other half is $10bn of gross debt, and the company is described as planning to raise the $20bn through bond and stock sales together, though no terms or timing for the bonds are given. Refinancing of existing debt does not count toward the cap. Investors now have a number for dilution, the shrinking of each existing shareholder's stake when new shares are issued.

Oracle expects free cash flow to turn positive only in late fiscal 2028, after a negative $23.7bn in fiscal 2027, so the new money helps pay for a long gap. It kept its full-year capital spending forecast at $90bn to $95bn, with spending uneven through the year, and says spending steps down in fiscal 2029. Customer prepayments, customer-supplied hardware and vendor financing are meant to cut the cash it must find up front, but the rally rewarded a payoff that is still two years away while the shares are sold today.

The stock has already shown how fast sentiment can turn, falling 6% on Oct 14 on worries about execution after a run of operational and legal costs. A data breach liability linked to Cerner and limits on data-centre power in New Mexico were still unresolved as of Oct 8, and a share sale puts new supply on top of both. The price Oracle gets for the new shares, set against the $148.48 high of Oct 28, will show how much of that rally buyers were willing to pay for.

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