NEXTDC Limited (ASX:NXT), an ASX 100-listed data centre operator, has seen its share price decline over the past year despite a record year of customer contracting. NEXTDC Limited (ASX:NXT) shares were priced at $10.41, down 2.16% in today’s session, and are down 37.83% over the past year. The company reported FY26 results for the year ended 30 June 2026 on 27 August 2026, alongside FY27 guidance that points to a material step-up in Revenue and capital expenditure.

For context, the S&P/ASX 200 Info Tech [XIJ] (INDEXASX: XIJ) stood at 1,684.00, down 2.90% (−50.30 points) today as of 6 Oct, and is down 42.73% over the past year. Meanwhile, the S&P/ASX 200 stood at 8,735.70, up 0.57% (+49.30 points) today, and is down 2.74% over the past year.

Business Model and Operational Footprint

NEXTDC operates data centres under a Data Centre-as-a-Service model, providing power, security and connectivity to cloud providers, enterprises and governments. It operates Australia’s only network of Uptime Institute certified Tier IV facilities and runs a partner ecosystem of carriers, cloud providers and IT service providers.

Built capacity was 287.9 MW at 30 June 2026, up 80.0 MW in the year, with additions at S3 Sydney, M2 and M3 Melbourne and KL1 Kuala Lumpur. Sites under development include S4 Sydney (250 MW in progress, 115 MW in planning), M3 Melbourne, and edge facilities in Geelong, Sunshine Coast and Darwin. A site for M5 Melbourne has been acquired, with planning for up to 1.2 GW of IT capacity, and works have started at TK1 Tokyo.

Sector Dynamics

Data centre operators are exposed to Demand from cloud, hyperscale and AI workloads, which require large power allocations and long construction programmes. Within ASX technology, NEXTDC’s 37.83% one-year decline compares with a 42.73% fall in the S&P/ASX 200 Info Tech index, while Megaport Ltd (ASX:MP1) is up 38.02%.

Regulation is a live factor. New South Wales and the Commonwealth are proposing reforms to data centre grid connections and energy use. The NSW consultation closes on 14 September 2026 and national changes would phase in from 2027. NEXTDC states that its operating portfolio and Forward Order Book are unaffected, and that Transgrid confirmed in writing that its new capacity allocation policy does not apply to S4 Sydney.

FY26 Results and FY27 Guidance Release

Total revenue was A$496.5 million, up 16%, and net revenue was A$405.0 million, up 16%, above the A$390–400 million guidance range. Underlying EBITDA was A$248.8 million, up 15%. Statutory NPAT was A$82.1 million, compared with a loss of A$60.5 million, and included a A$128.8 million Fair Value gain on M3 Melbourne and S4 Sydney. On the previous accounting basis, the company states the result would have been a loss after tax of A$103.9 million.

Contracted utilisation rose 202% to 740.1 MW on a pro forma basis, billing utilisation rose 58% to 175.0 MW, and the Forward Order Book reached 565.1 MW, more than 3.2 times billing utilisation. Contracted EBITDA from existing contracts is expected to exceed A$1.0 billion. Capital Expenditure was A$3,397 million, above the A$2,700–3,000 million guidance, and pro forma Liquidity was A$8.7 billion after A$9.75 billion of capital raised since August 2025.

FY27 guidance is net revenue of A$615–640 million, underlying EBITDA of A$385–410 million and capital expenditure of A$5,250–5,750 million, with 197 MW expected to convert to billing.

The A$9.75 billion of capital raised since August 2025 comprises A$5,800 million of senior Debt facilities, A$750 million of subordinated notes, A$1,700 million of hybrid securities and A$1,500 million of equity, of which A$1,600 million of senior debt and A$1,750 million of subordinated capital were drawn at 30 June 2026. Capacity under development was 537 MW, with a further 240 MW or more in plan, and FY27 capital expenditure includes up to A$500 million of reimbursable customer fit-out. The company states that billing is contracted to more than quadruple to 740 MW by FY30, with 147 MW converting across FY29 and FY30.

Growth Catalysts and Critical Operating Risks

Growth catalysts include conversion of the 565.1 MW order book (197 MW in FY27 and 221 MW in FY28), new capacity at M2 and M3 Melbourne, S4 Sydney and KL1 Kuala Lumpur, and demand from AI, cloud and enterprise customers. Customer options, reservations and pipeline are described as at record levels.

Operating risks include execution on the largest capital programme in the company’s history, with FY26 capex exceeding guidance after three upward revisions. Pro forma liquidity relies on debt, hybrid securities and equity, with A$1,600 million of senior debt drawn at balance date. Other items include grid connection and power regulation, accounting policy changes affecting reported profit, construction timing and the dependence of contracted EBITDA on contracts completing as scheduled. The company notes that contracted EBITDA is a forward-looking estimate.

Where Things Stand

NEXTDC reports record contracting and a funded build programme, while its shares remain lower over twelve months. Upcoming reference points include the NSW consultation close on 14 September 2026, delivery milestones at its major sites and progress against FY27 guidance.