NXT +2.14%: A beat to FY26 expectations and, more importantly, guiding to another sizeable step-up in earnings as its enormous development pipeline converts into billable capacity. Earnings came in of consensus, while FY27 guidance was comfortably above the market. The capex numbers remain eye-watering, but with contracted customers underpinning much of the expansion, NXT is moving from data centre capacity to actually monetising it.
Key results:
- Revenue of A$496.5m, up 16% and slightly ahead of A$490.6m expected.
- Underlying EBITDA of A$248.8m, up 15% and ~5% ahead of A$236.6m expected.
- Net profit of A$82.1m, turning around a A$60.5m loss last year.
- FY26 capex of A$3.40bn, double the A$1.70bn spent in FY25.
- No dividend declared as capital continues to be recycled into growth.
FY27 is where the earnings curve really starts to ramp up. NXT is guiding to underlying earnings of A$385-410m, with even the bottom end well above the A$368.4m consensus forecast. Billing conversion is expected to reach 197MW in FY27 and another 221MW in FY28 as new capacity comes online. One thing to note is the price tag is substantial, with FY27 capex jumping again to A$5.25-5.75bn, funding a pipeline that already has 537MW under development and another 240MW+ planned across Australia and Asia.
MM’s view: This is a better update from NXT because the debate is gradually shifting from how much money it needs to spend toward what that spending can earn. A ~5% EBITDA beat is nice, but the real attraction is FY27 guidance comfortably clearing consensus and the huge amount of contracted capacity moving toward billing over the next two years. We still can’t ignore A$5bn-plus of annual capex — NXT remains an extraordinarily capital-hungry way to play AI, cloud and hyperscale demand, and execution needs to be near flawless. But when you’re spending at this rate, investors need evidence that earnings are accelerating alongside it, and today NXT showed that in their result.
MM is bullish toward NXT
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