NEXTDC cuts FY27 outlook as Melbourne power network delays hit M3 data centre

what happened

Australia's NEXTDC on Wednesday lowered its revenue and earnings forecasts for fiscal 2027. The reason is delays to electricity network works in Melbourne, which pushed back the delivery and billing of contracted capacity at its M3 data centre, according to Reuters.

The company now expects FY27 net revenue of A$475 million to A$500 million ($332.41 million), down from A$615 million to A$640 million previously. Underlying EBITDA is now seen at A$245 million to A$265 million, versus A$385 million to A$410 million before. Both ranges exclude the affected M3 contracts.

NEXTDC said Jemena had suspended parts of the grid works needed to raise supply to M3, citing opposition from the community and stakeholders, and does not expect to restart them before February 2027. The next supply increase at M3 is now expected in 2028. The company also put all new development projects and land acquisitions on hold and will look at selling some development sites. Exchange rate: $1 = 1.4290 Australian dollars.

why it matters

The signal reaches beyond one company. Capacity expansion timelines for data centre operators depend on grid upgrades, so delays of this kind feed directly into revenue timing. The freeze on new projects and possible site sales suggest a shift toward preserving capital.

market impact

NEXTDC and Australian data centre stocks: grid delays push back revenue growth and weigh on earnings forecasts.

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