Shares of Australian data center operator NextDC plunged 39.5% on Wednesday after the company slashed its fiscal 2027 revenue and earnings forecasts. The downward revision follows severe power supply delays at its Melbourne facility, driven by ongoing local community opposition and stalled infrastructure upgrades.
Shares of Australia’s NextDC tumbled nearly 39.5% mid-week as the data center operator adjusted its financial projections downward for fiscal 2027, according to CNBC reporting. The company reduced its expected revenue to a range between $475 million Australian dollars and A$500 million, dropping from an earlier forecast of A$615 million to A$640 million. Underlying earnings before interest, taxes, depreciation, and amortization were similarly cut to a range of A$245 million to A$265 million, down from an initial estimate of A$385 million to A$410 million.
Australian data center operator NextDC's shares plunge 40% after it slashes earnings forecast https://t.co/7FGpXUpwRs
Melbourne M3 Project Stalls on Power Delays
Infrastructure upgrades at the M3 Melbourne data center remain suspended due to pushback from local residents and stakeholders. The financial retraction stems directly from power supply disruptions at the company’s M3 Melbourne data center. Electricity distributor Jemena indicated it does not expect to resume construction work before February 2027, citing safety concerns, restricted access to work sites caused by community opposition, and a lack of required consent from the local council while community consultation continues.
Financial firm Citi warned clients that the power interruptions could impact NextDC’s earnings well beyond fiscal 2027. The brokerage pointed to approval delays regarding the M3 expansion and an extended timeline for necessary transformer upgrades.
Canberra Weighs New National Investment Standards
Treasurer Jim Chalmers stated that the government is working to establish national investment standards as Australia grapples with public unease regarding the environmental and community impacts of data centers.
Speaking on CNBC’s Squawk Box Asia,
Chalmers noted that the government welcomes investments in data centers and artificial intelligence infrastructure provided they align with national interests. He added that officials are finalizing national standards to address deployment concerns.
Data center projects worldwide face increasing pushback from local communities concerned about environmental and neighborhood disruptions. Market pressure on NextDC has intensified. Shares have declined for seven straight weeks and are tracking toward a loss for the eighth week.
