Shares in Australian data center operator NextDC plunged as much as 44% on Wednesday after the company slashed its revenue and earnings guidance, wiping roughly A$3.1 billion off its market value in early trading.
The company cut its fiscal 2027 revenue forecast to between A$475 million and A$500 million, down sharply from its earlier guidance of A$615 million to A$640 million, while lowering its underlying EBITDA forecast to A$245 million to A$265 million from a prior range of A$385 million to A$410 million.
At the heart of the downgrade is a stalled power upgrade at NextDC’s flagship M3 data center in Melbourne, where infrastructure work has been suspended amid community opposition. Electricity distributor Jemena does not expect to resume the upgrade before February 2027.
NextDC said the resulting delay would push back roughly A$140 million, about $98 million, in contracted customer revenue that had been expected this financial year, as the company is unable to bring the additional power capacity online on its original timeline.
The scale of the selloff underscores how directly data center operators' growth prospects are now tied to local power infrastructure, with community pushback over electricity capacity emerging as a significant operational risk even for a company otherwise benefiting from surging AI-driven demand.
The episode is likely to draw close attention from investors across the broader data center sector, as it highlights how power-grid bottlenecks and local opposition to infrastructure upgrades can materially disrupt growth timelines regardless of underlying customer demand.
