The logo of Australian data center operator NextDC is seen at its Artarmon facility in Sydney on September 15, 2026. (Photo by Saeed KHAN/AFP via Getty Images)
Saeed Khan | Afp | Getty Images
Australia’s actions NextDC plunged 39.5% on Wednesday after the data center operator cut its annual profit forecast, citing power supply delays at its Melbourne facilities amid opposition from the local community and stakeholders.
The company lowered its revenue forecast for fiscal 2027 to between A$475 million and A$500 million, from A$615 million to A$640 million forecast earlier, while reducing its underlying earnings before interest, tax, depreciation and amortization, or EBITDA, forecast from A$245 million to A$265 million, from A$385 million. million Australian dollars to 410 million Australian dollars.
NEXTDC actions on October 22.
The power supply delays stem from the suspension of infrastructure upgrades at the company’s Melbourne M3 data center due to community opposition, with electricity distributor Jemena not expecting to return to work until February 2027, according to NextDC.
Jemena cited security concerns and restricted access to construction sites due to community opposition, as well as a lack of consent from the local council pending further community consultation.
Citi said in a note that delays in NextDC’s power supply could affect earnings beyond fiscal 2027, citing delays in M3 expansion approvals and a longer-than-expected timeline for transformer upgrades.
As Australia grapples with growing concerns about the impact of data center development on local communities, Treasurer Jim Chalmers said the government was working to set national standards for investment.
Chalmers told CNBC’s “Squawk Box Asia” on Wednesday that the government welcomes investments in data centers and AI infrastructure, as long as they are in line with the country’s national interest, adding that the government is finalizing national investment standards to address concerns over AI deployment.
Australia is not alone in facing opposition to data center projects: there is growing pushback against data center projects around the world, due to concerns about their impact on local communities and the environment.
NextDC shares have fallen for seven straight weeks and are on track to finish lower for the eighth week.
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