Oracle dividend: cash coverage and outlook
Oracle pays $2.00 per share in the base case through October 2027. In fiscal 2026, free cash flow was negative US$23,686 million while capital expenditure reached US$55,663 million, so the dividend was not covered by free cash flow.
How much does Oracle pay per share?
Dividends remain $2.00 per share in the base case through October 2027, then rise to $2.40 by October 2029. The bear freezes them at $2.00 because FY2026 free cash flow was negative $23,686M and FY2027 net CapEx outlay is guided at $70B. The bull reaches $3.00, requiring cash conversion to improve.
| May 2026 | May 2025 | May 2024 | May 2023 | May 2022 | |
|---|---|---|---|---|---|
| Revenue | 67,357 | 57,399 | 52,961 | 49,954 | 42,440 |
| EPS, diluted | 5.83 | 4.34 | 3.71 | 3.07 | 2.41 |
| Dividend per share | 2.00 | 1.70 | 1.60 | 1.36 | 1.28 |
Is Oracle's dividend covered by its cash?
In fiscal 2022, Oracle generated US$5,028 million of free cash flow but paid shareholders US$19,705 million, including US$16,248 million of buybacks. A buyback retires shares, increasing the remaining shareholders’ claim, but it cannot be funded indefinitely by current cash when payouts exceed it. Oracle also received US$26,151 million from investments sold or matured; that released previously invested money rather than creating new operating cash.
Fiscal 2023 then concentrated spending on acquisitions, with US$27,721 million of cash used, principally for Cerner. Oracle issued US$33,994 million of debt and repaid US$21,050 million. Fiscal 2024 briefly restored capacity: free cash flow reached US$11,807 million, shareholder payments were US$5,593 million, and net debt declined to US$76,208 million.
The reversal came with infrastructure spending. Free cash flow fell to negative US$394 million in fiscal 2025 and negative US$23,686 million in fiscal 2026, when capital expenditure reached US$55,663 million. A company can still be profitable in this situation. If a shop collects US$100, spends US$60 running the shop and buys a US$70 machine, it has operating cash flow of US$40 but free cash flow of negative US$30.
| May 2026 | May 2025 | May 2024 | May 2023 | May 2022 | |
|---|---|---|---|---|---|
| Free cash flow | -23,686 | -394 | 11,807 | 8,470 | 5,028 |
| − Dividends paid | 5,724 | 4,743 | 4,391 | 3,668 | 3,457 |
| − Share buybacks | 95 | 600 | 1,202 | 1,300 | 16,248 |
| − Acquisitions | 0 | 63 | 27,721 | 148 | |
| Paid to shareholders | 5,819 | 5,343 | 5,593 | 4,968 | 19,705 |
What could change Oracle's dividend?
| October 2027 | October 2028 | October 2029 | |
|---|---|---|---|
| EBITDA | 49,400 (41,360 / 55,000) | 68,600 (39,900 / 86,400) | 86,400 (47,300 / 118,800) |
| Shares (millions) | 3,049 (3,048 / 3,030) | 3,074 (3,159 / 3,034) | 3,124 (3,318 / 3,062) |
| Dividends per share | 2.00 (2.00 / 2.20) | 2.20 (2.00 / 2.60) | 2.40 (2.00 / 3.00) |
| Enterprise value to ebitda | 12.00 (8.00 / 15.00) | 13.00 (7.00 / 17.00) | 14.00 (7.00 / 19.00) |
| Net debt | 122,445 (141,845 / 115,945) | 151,645 (199,245 / 124,345) | 170,745 (259,845 / 109,545) |
What is Oracle's dividend yield against its price?
At $141.53, Oracle’s common shares are worth $432,585.28 million. Its trailing P/E is 22.2x, meaning investors pay $22.20 for each dollar of earnings generated over the last twelve months. That earnings measure matters, but OCI consumes cash before the full cost of its equipment reaches the income statement.