Oracle’s Debt Hits $125 Billion as AI Buildout Accelerates. Here’s What the Numbers Show

Oracle's total debt reached just over $125 billion in the first quarter of fiscal 2027, which ended August 31, 2026. Will Healy reported the numbers in a Motley Fool analysis. The debt is nearly twice Oracle's $67 billion book value.

The gap widened as the company borrowed to build artificial intelligence data centers.

Oracle stock has fallen 56% from its peak reached about a year ago, Healy reported. Shares jumped when Oracle signed a $300 billion cloud infrastructure agreement with OpenAI, then dropped as investors raised doubts about whether OpenAI could meet its side of the deal.

Spending Has Climbed Alongside The Borrowing

Oracle spent more than $28 billion on capital expenditures in the first quarter of fiscal 2027 alone, after spending nearly $56 billion on capital projects for all of fiscal 2026, according to Oracle's results as cited by Healy.

Oracle is rushing to build physical infrastructure. AI cloud customers require these new data centers and computing hardware.

A sharp slowdown in AI demand could strain the spending plan. Healy compared the risk to the dot-com crash. A bust in the sector did not eliminate the internet, and AI is unlikely to vanish, though development might slow temporarily.

Contracts Beyond OpenAI Have Grown Oracle's Backlog

Oracle's order backlog tracks the value of contracted work not yet delivered. It has risen by $209 billion since the OpenAI deal was announced a year ago. The backlog reached $664 billion, Healy reported.

The recent jump is worth more than two-thirds of the original OpenAI agreement. Demand is clearly coming from other customers.

What The Latest Quarter Showed

Oracle's fiscal first-quarter revenue came in just over $19 billion, up 30% from a year earlier. The company's cloud segment houses its AI infrastructure business. It grew 60%.

Operating expenses rose 18% for the quarter. Operating income climbed 57% to more than $6.7 billion.

Interest expense for the quarter totaled about $1.4 billion. Oracle still posted a quarterly profit of $4.7 billion after covering that cost.

Oracle also held roughly $37 billion in cash and marketable securities as of the same quarter, according to Healy's analysis.

This financial cushion, combined with the strong profit margin, led Healy to conclude that Oracle can keep funding its AI buildout while retaining room to adjust if demand cools.

Oracle shares closed at $147.61, down 1.98% on the day. The company now holds a market capitalization of $446 billion.