TLDR
- Oracle (ORCL) stock rose about 11% on Wednesday after the company set its FY30 targets at Investor Day.
- Oracle expects FY30 revenue above $225 billion, a compound annual growth rate of more than 35% from FY26.
- Targets for FY30 include a non-GAAP operating margin above 40% and non-GAAP EPS above $21.
- Free cash flow should turn positive in the second half of FY28, with at least $30 billion in FY29.
- New capital raises through FY30 are capped at $20 billion, split between equity and debt.
Oracle (ORCL) stock rose 10.73% on Wednesday after the company set financial targets for fiscal year 2030. The targets came at its Investor Day event in Las Vegas.
Oracle projects total revenue above $225 billion in FY30. That is a compound annual growth rate of more than 35% from FY26.
The company also set profit goals for FY30. It is aiming for a non-GAAP operating margin above 40% and non-GAAP earnings per share above $21.
Co-CEOs Clay Magouryk and Mike Sicilia presented the updated guidance. CFO Hilary Maxson joined them in laying out the plan.
Oracle also reaffirmed its fiscal 2027 outlook. It still expects total revenue of at least $90 billion and non-GAAP EPS of $8.10.
The FY30 revenue goal is more than twice the FY27 revenue outlook. That is the gap Oracle says it can close at a 35% annual pace.
Cash flow and spending plans
Free cash flow is a key part of the plan. Oracle expects it to turn positive in the second half of FY28.
For FY29, the company is targeting at least $30 billion in free cash flow. That comes one year after the expected turn to positive territory.
Capital spending is expected to peak in FY27 and FY28. Oracle said capital expenditures should decline in FY29.
Growth is set to be self-funded beginning in FY29. Net debt to adjusted EBITDA is expected to be below 3.5 times that year.
Oracle named three ways to reduce upfront cash needs. They are vendor financing, customer-provided hardware and customer prepayments.
Limits on new capital raises
Oracle committed to limiting additional capital raises through FY30 to $20 billion. That figure excludes refinancing of existing debt.
The amount would be split between $10 billion in equity and $10 billion in gross debt. For investors tracking Oracleās funding needs, that is a firm number to hold onto.
Oracle completed a $20 billion at-the-market equity raise in the first quarter of fiscal 2027. That came before Wednesdayās announcement.
Management said its capital allocation priorities remain the same. They are maintaining investment-grade credit ratings, paying dividends and funding growth opportunities.
Oracle stock was up 10.73% on the day, with its FY27 outlook of at least $90 billion in revenue and $8.10 in non-GAAP EPS unchanged.
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