Megaport (ASX: MP1) Isn’t Just Expanding a Network – It is Rewiring How the Cloud Connects
Legacy telcos weren’t built for today’s multi-cloud, data-intensive world. Megaport Limited (ASX: MP1) is. With 936 enabled data centres across 26 countries and a strong H1 FY25 performance, Megaport isn’t just growing infrastructure it’s executing a bold strategy to lead the Network-as-a-Service (NaaS) space.
At its core, Megaport’s self-serve platform allows businesses to instantly provision private, high-speed cloud connections across providers and geographies without hardware, contracts, or friction. This is enterprise networking, redefined.
ARR Up, Cash Up, Strategy on Point
In H1 FY25, Megaport posted Annual Recurring Revenue (ARR) of $226.6M, up 18% year-on-year, and revenue of $106.8M, a 12% increase. Gross margin remained stable at 70%, reflecting strong operating discipline.
Net cash flow rose to $15.7M, and cash at bank hit $89.8M, giving the company a healthy net cash balance of $76.9M. Despite investments in growth, Megaport maintained profitability with EBITDA of $27.6M, and adjusted EBITDA of $29.1M, factoring out $1.5M in one-off GTM hiring costs.
New Markets, Bigger Backbone, More Use Cases
H1 wasn’t just about financials it was about scale and product momentum. Megaport:
- Rolled out a 400G backbone, unlocking 100G VXCs across 597 data centres
- Entered Brazil and Italy, expanding into 26 countries
- Launched AI Exchange (AIx) and Financial Services Exchange (FSx) to target AI and fintech demand
- Introduced BGP Internet and NAT Gateway, extending its reach into core network services
- Onboarded tech partners like Palo Alto Prisma, Aviatrix, and 6WIND
Importantly, MVE (Megaport Virtual Edge) customers now generate nearly 3x ARR compared to port-only users proof that solution selling is translating into higher-value growth.
Outlook Firm, Guidance Tightens
Revenue guidance for FY25 has been narrowed to $216M–$222M, reflecting improved confidence in stabilising customer retention, with NRR now at 107%. EBITDA guidance remains $57M–$65M, while capex is unchanged at $27M–$30M, including a $6M multi-year licence investment.
With growth in The Americas leading the charge, management says the company is well-positioned for a strong second half.
Why Now: The Network Layer Is the Next SaaS
Enterprises today need agile, scalable networks that match the speed of cloud. Megaport’s API-driven, real-time provisioning makes it a modern alternative to rigid, slow-moving telco solutions.
As AI, hybrid cloud, and digital transformation accelerate, Megaport’s platform solves a massive pain point: how to connect it all securely, instantly, and globally.
Final Word: Megaport Is Quietly Leading a Global Infrastructure Shift
This half wasn’t about hype it was about execution. With growing ARR, strong cash flow, expanding products, and new verticals, Megaport is positioning itself as the essential layer for global cloud connectivity. In a market that demands speed and scale, MP1 is doing both and doing it profitably.
NEXTDC (ASX: NXT) Isn’t Just Building Data Centres It’s Engineering the Digital Backbone for the AI Era
NEXTDC Limited (ASX: NXT) is an ASX100-listed data centre operator and Australia’s leading Data Centre-as-a-Service (DCaaS) provider. With a national footprint of Tier IV-certified facilities and a growing international presence, the company delivers mission-critical infrastructure to hyperscalers, enterprises, and government clients. Recognised for its sustainability, uptime, and operational excellence, NEXTDC also boasts one of Asia-Pacific’s most dynamic digital connectivity ecosystems.
Strong Financials, Deeper Commitment to Growth
NEXTDC delivered net revenue of $167.8M in H1 FY25, up 13% YoY, while underlying EBITDA rose to $105.4M, a 3% increase. Contracted utilisation hit 176MW, up 18%, and a forward order book of 83MW extends visibility across FY25 to FY29.
While total revenue declined slightly to $205.5M, this was offset by stronger operating leverage and increased high-value customer contracts. The company invested $1.0B in capex during the half, reinforcing its aggressive development push.
Despite a statutory net loss of $42.7M (impacted by debt refinancing), NEXTDC maintains liquidity of $2.5B, including $373M in cash and $2.1B in undrawn debt capacity as of 31 Dec 2024.
Capital Power: New Sites, Bigger Capacity, Faster Rollouts
In just six months, NEXTDC:
- Acquired land for S7 Sydney, targeting 550MW capacity
- Delivered 16MW at S3 Sydney and began construction on another 24MW
- Added 6MW at M2 Melbourne with 38MW more in progress
- Opened new data centres: A1 Adelaide, D1 Darwin, S6 Sydney
- Commenced expansion in B2 Brisbane and P1 Perth
- Launched construction at KL1 Kuala Lumpur with 10MW underway
KL1 is a strategic linchpin in NEXTDC’s Asia push and has already secured its first 10MW hyperscale customer - 15% of planned capacity before going live in 2026.
Forward Contracts and New Wins Reshape the Order Book
NEXTDC’s forward order book jumped to 135MW by May 2025, boosted by new AI-optimised infrastructure contracts. In both Victoria and Kuala Lumpur, major hyperscale wins are fuelling demand. Revenue from these deals will ramp in FY27-FY28, creating a multi-year growth pipeline.
CEO Craig Scroggie noted that NEXTDC is “delivering sovereign, AI-native digital infrastructure” with five foundational pillars: speed, scale, security, sustainability, and sovereignty.
Strengthening the Bench: Growth Incentive Plan Launched
To ensure retention and reward outperformance, the company introduced a one-off, fully at-risk Growth Incentive Plan (GIP) worth $150M for its executive leadership. This is tied to shareholder value creation, with full vesting requiring a 17.5%+ annual TSR through FY30.
It’s a bold, competitive move aimed at defending talent amid growing pressure from global and private-equity-backed rivals.
Final Word: NEXTDC Is Future-Proofing the Cloud Economy
From Sydney to Singapore, from megawatts to hyperscale AI, NEXTDC is positioning itself as the physical layer of tomorrow’s cloud-first world. It’s not just real estate it’s infrastructure for intelligence.
With $5.2B in assets, strong cash backing, and a focused Asia expansion strategy, NXT is not just building data centres it’s building the next decade of digital infrastructure.
(Source: Company Announcements)
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