There are many AI stocks among ASX listed companies. Since AI stocks in US exchanges have been outperformers, some such shares of potential growth companies have shown intial traction.
NEXTDC Limited (ASX: NXT)
NEXTDC Limited (ASX: NXT) is strategically positioned to lead in the rapidly advancing AI and cloud computing sectors, benefiting from powerful megatrends driving innovation across industries. Generative AI has experienced explosive growth, with nearly 700% more usage, indicating a transformative shift. The company is one of the best growth stocks to buy now, as it is set to capitalize on the growing demand for digital infrastructure, driven by AI, which is now seen as an essential element of the Fourth Industrial Revolution. The global AI investment surge, highlighted by over US$100 billion spent by top U.S. hyperscalers in just six months, underscores the need for scalable, resilient infrastructure—an area where NEXTDC excels with its extensive ecosystem of clouds, carriers, and AI service providers.
AI's integration into business models is creating unprecedented demand for advanced data centres capable of handling vast volumes of data with low latency and secure connectivity. NEXTDC's hyperscale data centres are designed to meet these demands with high-density power, liquid cooling systems, and resilient infrastructure tailored for complex AI workloads. The company's AXON Network-as-a-Service platform further strengthens its position, facilitating seamless, real-time data exchanges essential for AI technologies like Retrieval-Augmented Generation (RAG) AI. NEXTDC is also at the forefront of AI innovation, achieving certification under NVIDIA's “AI Factory” standard, which positions the company as a key player in Australia's rapidly expanding AI landscape.
In Australia, NEXTDC is capitalizing on the growing AI market, which is projected to reach A$4.8 billion in 2024 and continue growing at a nearly 29% CAGR through 2030. The company's leadership in AI infrastructure was further demonstrated by its certification as the first Australian operator under NVIDIA’s DGX "AI Factory" standard. This milestone, along with NEXTDC's fourth consecutive win of the Frost & Sullivan Best Practice Award for Australian Data Centre Services Company of the Year, highlights its commitment to providing AI-ready infrastructure. With its strong position in a booming market and a clear focus on future-proofing its capabilities, NEXTDC is poised to lead the digital economy's evolution.
Dubber Corporation Limited (ASX: DUB)
Dubber Corporation reported Q1 FY25 revenue of $10.1 million, reflecting an 11% year-over-year increase compared to Q1 FY24 but a slight 2% decline from Q4 FY24. Notably, underlying constant currency recurring revenue rose 3% sequentially, underscoring the resilience of its core operations. The company demonstrated meaningful progress in cost management. Operating cash outflows were reduced by 12% quarter-over-quarter to $17.3 million, supported by a 5% reduction in total cash-based costs. Dubber’s annualized cash cost run-rate stands at $53 million, with further cost efficiencies anticipated in the coming six months, highlighting its commitment to operational discipline.
The recent completion of its 1-for-1 pro-rata entitlement offer raised $10.6 million at $0.015 per share, contributing to a total capital raise of $17.5 million, inclusive of institutional components. Sub-underwriters, including Thorney Investment Group, Regal Funds Management, and Peter Pawlowitsch, will receive allocations from the 290 million unclaimed shares. Additionally, a second tranche placement of $7.5 million from institutional investors strengthens Dubber’s financial position and signals robust market confidence in its growth strategy. Over the past three years, Dubber has achieved significant revenue growth, expanding from $16.3 million in FY22 to $38.7 million in FY24, alongside a notable recovery in gross profit. While operating profit and EBITDA remain negative, losses have narrowed, reflecting improved cost management. Total debt has been reduced by 34.6% over this period, bolstering financial stability. Operational cash flow, though negative, showed marked improvement in FY24, indicating progress toward better liquidity.
The 11% year-over-year revenue growth highlights strong performance, while a 2% sequential decline warrants monitoring. However, the 3% increase in recurring revenue suggests underlying stability. Cost reductions and disciplined expense management are positive signals for investors, who may find reassurance in Dubber’s efforts to enhance efficiency and drive toward profitability. With additional cost-saving measures and growth initiatives funded by recent capital raises, Dubber appears well-positioned to strengthen its financial health and unlock long-term shareholder value.
Source: Company’s Report
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