Key Highlights

  • Megaport has secured three new infrastructure contracts with combined total contract value of approximately A$506.2 million.
  • The contracts are expected to contribute approximately A$129.2 million in annualised Recurring Revenue once fully deployed and operational.
  • The agreements require approximately A$291.8 million of incremental capital expenditure, primarily for NVIDIA GPU, compute, network and storage hardware.
  • Megaport shares traded at A$21.80, up A$1.46 or 7.18%, at 10:43 am on 20 August 2026.

Megaport Expands AI Infrastructure Portfolio

Megaport (ASX:MP1) has expanded its AI infrastructure Business through three new contracts secured by its Wholly Owned Subsidiary Latitude.sh, covering GPU and CPU compute, networking and storage capacity for multiple US-based technology customers.

The agreements have a combined total contract value of approximately US$359.4 million, equivalent to A$506.2 million, based on the Exchange Rate cited by the company. The contracts provide committed revenue over fixed terms regardless of customer usage.

Megaport shares were trading at A$21.80, representing a gain of A$1.46, or 7.18%, at 10:43 am on 20 August 2026.

A$129.2m Annualised Recurring Revenue

The contracts represent approximately US$91.7 million, or A$129.2 million, in annualised recurring revenue. Revenue will be recognised progressively as the required hardware is deployed and becomes operational.

Megaport expects the full ARR contribution to be added on a run-rate basis by the end of Q3 FY27. The company has not disclosed the names of the customers, describing them as US-based technology providers supported by institutional shareholders.

The fixed contractual structure means the committed revenue is not dependent on the level of customer utilisation, although the timing of revenue recognition remains linked to hardware deployment.

Capital Expenditure Rises With Contract Expansion

The new agreements require approximately US$207.2 million, or A$291.8 million, in incremental capital expenditure. The Investment is primarily directed towards high-performance NVIDIA GPU hardware, together with compute, network and storage infrastructure.

The additional expenditure has been incorporated into Megaport's FY27 guidance. Hardware orders have already been placed, with delivery expected during Q2 FY27 and deployment planned in stages as equipment arrives.

At the end of each contract term, Megaport expects the infrastructure to move into its broader Latitude.sh compute pool, where it could generate revenue through customer renewals or the company's on-demand platform.

Funding Supported by Cash and New Debt Facility

Megaport said the Capital Expenditure will be funded from available liquidity. As of 30 June 2026, the company held A$435.4 million in cash at bank.

The company has also established a new A$825 million debt facility with a syndicate of domestic and international banks. Megaport said that, on a pro forma basis, it is fully funded for committed capital expenditure associated with strategic contracts announced since 27 April 2026, as well as the potential Acquisition disclosed alongside its results announcement.

The funding structure gives Megaport additional capacity to support infrastructure deployment while continuing to diversify its sources of capital.

Previously Announced Contracts Revised

Megaport has also provided an update on strategic contracts announced on 3 June 2026. Supply constraints prevented the company from securing certain components that met the required technical specifications.

The company subsequently agreed alternative arrangements with existing customers and entered into two new contracts involving higher-grade GPUs. These changes are expected to increase aggregate total contract value by approximately A$122.7 million, while leaving aggregate ARR and capital expenditure requirements materially unchanged.

Combined with the latest contracts, strategic agreements announced since 27 April 2026 now have total contract value of approximately A$1.3 billion.

AI Infrastructure Becomes Larger Growth Area

The latest contracts increase Megaport's exposure to infrastructure supporting AI applications and inference workloads. Latitude.sh provides compute, network and storage infrastructure through a software-defined platform, allowing customers to deploy infrastructure across a globally distributed environment.

The company's network currently spans more than 1,100 enabled locations worldwide, with its infrastructure offering increasingly incorporating dedicated compute and storage alongside connectivity services.

The new contracts therefore represent an expansion in both the scale and capital intensity of Megaport's infrastructure activities.

Conclusion

Megaport has added A$506.2 million of new contract value through three AI infrastructure agreements, with approximately A$129.2 million of annualised recurring revenue expected once the contracted infrastructure is fully deployed. The expansion comes with A$291.8 million of incremental capital expenditure, primarily for GPU and related infrastructure, while Megaport's cash position and newly established A$825 million debt Facility provide funding capacity for the committed investment. Including revisions to previously announced agreements, strategic contracts secured since 27 April 2026 now represent approximately A$1.3 billion of total contract value.