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Highlights
- NextDC lifts data centre commitments by 7% in May
- KL1 in Kuala Lumpur secures major contract ahead of launch
- Full revenue potential seen from fiscal 2028
NextDC (ASX:NXT) has made a strategic leap forward in its data centre operations, reporting a notable 7% increase in contracted utilisation in less than a month. This comes as the company secures new customer contracts across its network, with significant contributions from its expansion into Southeast Asia.
Surge in Contracted Utilisation
As of 31 May, NextDC announced an additional 16 megawatts (MW) of contracted capacity, pushing its total up to 244MW, up from 228MW recorded on 6 May. This rapid growth signals accelerating demand for high-performance digital infrastructure, particularly from clients focused on AI and cloud scalability.
The standout performer among the company’s sites is KL1, the upcoming data centre in Kuala Lumpur. With a new 10MW hyperscale contract secured, KL1 now accounts for 15% of its total planned capacity. This facility is scheduled to become operational in early calendar 2026 and marks NextDC’s first step into Malaysia.
Strategic Impact of KL1
KL1 is viewed as a pivotal component of NextDC’s Asia-Pacific expansion strategy. The company’s leadership views this early customer commitment as a vote of confidence in its capability to deliver purpose-built, AI-native infrastructure. This aligns with growing regional demand for scalable, sovereign digital ecosystems, particularly in emerging tech hubs.
Commentary from the management emphasised KL1’s strategic importance, highlighting it as an integral element in the firm’s ambition to support AI-driven digital transformation. The early uptake from a hyperscale client also validates KL1’s role as a forward-looking investment within the broader S&P/ASX200 index.
Revenue Outlook and Timeline
While the contracts have been signed, most of the related revenue is anticipated to begin flowing in fiscal 2027. Full financial realisation is expected by fiscal 2028, once the ongoing development and commissioning of new data halls are complete. This long-term ramp-up showcases NextDC’s patient capital model and forward visibility in revenue streams.
Investors focusing on long-term infrastructure plays and digital transformation themes might find the outlook aligned with growth-oriented segments of the ASX200. Although not traditionally classified under ASX dividend stocks, NextDC’s predictable contracted revenue base and expansion potential may offer a different kind of value proposition.
Final Thoughts
NextDC’s momentum in expanding both its geographical footprint and client base underscores a broader trend in the digital infrastructure space. The KL1 development is not only a technological upgrade but also a strategic gateway to Southeast Asia. As data needs continue to surge globally, initiatives like KL1 position NextDC as a serious contender in delivering regional cloud and AI solutions.
