Oracle's Ellison scraps $7.5 billion stock sale plan a day after it became public

Oracle Corporation's executive chairman, Larry Ellison, terminated a plan to sell as many as 50 million shares of the company's stock barely a day after Oracle disclosed the arrangement to investors, an about-face that underscored how sensitive markets have become to insider selling at a company pouring tens of billions of dollars into artificial intelligence data centers. Oracle said in a statement that no shares were sold under the plan and that Ellison "has no other plans to sell any of his Oracle stock."

The reversal came a day after Oracle disclosed, in a quarterly report filed with the Securities and Exchange Commission, that Ellison had adopted a Rule 10b5-1 trading plan on June 22 permitting him to sell up to 50 million Oracle shares before the arrangement's October 24 expiration. The filing was the first public confirmation of the plan's existence, and it landed the same week Oracle reported first-quarter results showing record cloud growth alongside widening cash outflows tied to its AI buildout.

The numbers behind the reversal

Ellison's now-canceled plan would have let him sell shares worth roughly $8.75 billion when it was adopted in June, based on Oracle's stock price at the time. By the time the plan became public, Oracle shares had slid enough that the same 50 million shares were worth closer to $7.5 billion. Oracle stock fell from about $162 the day before its earnings report to $150.28 by Friday's close, a two-day slide of roughly 7% that left the shares down about 14% from where they traded when Ellison's plan was adopted, according to a Yahoo Finance report on the cancellation. Ellison controls roughly 40% of Oracle's outstanding stock.

The stock move came despite an otherwise strong quarter. Oracle's own earnings announcement for its fiscal first quarter, which ended August 31, showed total revenue up 30% to $19.3 billion, cloud revenue up 62% to $11.6 billion, and cloud infrastructure revenue more than doubling, up 121%, to $7.4 billion. Remaining performance obligations, a measure of contracted future revenue, jumped by $209 billion year over year to $664 billion. Operating cash flow more than doubled to $23 billion, but free cash flow was still negative $5 billion for the quarter as spending on data centers continued to outrun incoming cash.

An AI-funded restructuring

Oracle's cash needs are the backdrop against which Ellison's trading plan, and its swift cancellation, played out. The same SEC filing that disclosed the trading plan also showed that Oracle has widened the projected cost of its 2026 Restructuring Plan, a set of job cuts and cost reductions tied to the company's shift toward AI infrastructure. Oracle now estimates the plan's total cost at up to $2.1 billion as of August 31, and said it added roughly $700 million more after quarter-end "to reflect additional actions that we expect to take," bringing the projected total to about $2.8 billion, mostly severance. Oracle recorded $167 million of restructuring expense in the first quarter alone, on top of prior charges. The Week's reporting on the restructuring tally and a separate account from Business Today both tied the added cost directly to Oracle's effort to redirect cash toward AI data center construction.

The company's capital demands have already drawn scrutiny from credit-rating agencies. Oracle now carries roughly $167 billion in total debt, and S&P Global Ratings downgraded the company's long-term credit rating to BBB-minus in July, one step above speculative, or "junk," grade, citing the scale of Oracle's data-center spending and its reliance on a small number of large AI customers for future revenue. Employees affected by the restructuring, Oracle's bondholders and shareholders, and the AI companies renting Oracle's cloud infrastructure are all exposed, in different ways, to the same underlying bet: that Oracle's AI infrastructure contracts convert into durable profit before its debt and severance costs catch up with it.

Wall Street's mixed reaction

Analysts were largely positive on the results themselves even as the stock fell. Oracle shares briefly rose as much as 8.5% in Friday trading before reversing to close down 1.7%, a swing that traders attributed to relief that Oracle held its capital-spending forecast steady rather than raising it further, followed by renewed unease once investors absorbed the restructuring increase and the disclosure of Ellison's trading plan in the same filing. Oracle's finance chief has told investors that gross margin, which stepped down roughly five percentage points over the prior fiscal year to about 66%, is expected to decline again in fiscal 2027 as new, less-profitable data-center capacity comes online. The juxtaposition of a large insider planning to sell stock and a company simultaneously asking investors to fund an even bigger buildout appears to have unsettled some shareholders, even though Oracle and Ellison moved quickly to defuse it by scrapping the plan entirely.

What happens next

Oracle has already locked in some of its near-term financing: the company said it completed a $20 billion at-the-market common stock sale during the first quarter as part of its previously disclosed capital program. For its fiscal second quarter, Oracle is guiding to revenue growth of 30% to 34% and cloud revenue growth of roughly 65% to 71%, with non-GAAP earnings per share expected between $1.85 and $1.93. For the full 2027 fiscal year, the company is projecting at least $90 billion in total revenue and non-GAAP earnings per share of $8.10. Oracle's board also declared a quarterly common-stock dividend of 50 cents per share, payable October 23 to shareholders of record as of October 9, according to the earnings press release Oracle furnished to securities regulators.

The 2026 Restructuring Plan is expected to keep generating severance and other charges through the rest of the program, meaning further job-cut disclosures are likely in coming quarters even as Oracle expands its AI infrastructure footprint. Investors will get the next official read on the balance between those two forces when Oracle reports second-quarter results in December, and any renewed insider selling by Ellison or other Oracle executives would, under the company's disclosure practice, surface in a future quarterly filing rather than in real time.