Megaport has secured a major portfolio expansion in artificial intelligence infrastructure, with three new contracts valued at AUD$506.2 million announced through its Latitude.sh subsidiary. The deals underscore rising demand for compute capacity to support AI applications and inference workloads, demonstrating the company’s ability to land large, multi-year commitments from established technology providers backed by institutional shareholders.
The contracts are structured around committed revenue independent of customer usage, generating approximately AUD$129.2 million in annualized recurring revenue once fully deployed. This committed revenue model reduces execution risk compared to usage-based alternatives, as customers have locked in their capacity requirements for the contract duration. All contracts meet Megaport’s internal return hurdles, encompassing factors such as counterparty credit quality, contract tenure, payback periods, and investment returns consistent with previously announced strategic deals.
Deploying these contracts requires AUD$291.8 million in capital expenditure, primarily for high-performance NVIDIA GPU hardware, compute resources, network infrastructure, and storage capacity. Megaport expects hardware delivery in the second quarter of fiscal 2027, with phased deployment as equipment arrives. The company projects full revenue run-rate contribution by the end of the third quarter of fiscal 2027, providing clear visibility into revenue growth during the second half of the financial year.
Funding for this capex expansion is well positioned. Megaport reported AUD$435.4 million in cash reserves as of 30 June 2026 and announced a new AUD$825 million debt facility arranged by a syndicate of domestic and international banks. On a pro forma basis, the company is fully funded for all committed capital expenditure from strategic contracts announced since late April 2026, plus a potential acquisition disclosed in today’s financial results.
The announcement reflects Megaport’s strategic positioning within the AI infrastructure market, where customers require reliable, scalable, and dedicated compute capacity. By securing long-term contracts with institutional-backed technology providers, Megaport has converted near-term demand uncertainty into multi-year revenue visibility. Investors should monitor hardware delivery and deployment progress in the coming quarters, particularly whether equipment arrives as anticipated in fiscal 2027’s second and third quarters. Additionally, watch for announcements regarding the potential acquisition mentioned in today’s results, which could signal further capital deployment into AI infrastructure. This announcement has been designated as price sensitive and material by the ASX.
View the full ASX announcement (PDF)
About Megaport Limited (ASX: MP1)
Megaport Limited is a software-defined network service provider that offers Network as a Service (NaaS) solutions enabling enterprises to connect to cloud providers, data centers, and internet exchanges on a flexible, pay-as-you-go basis. The company operates a global interconnection platform connecting approximately 3,000 enterprise customers across over 1,000 data centers worldwide. Megaport’s Marketplace enables businesses to access multiple cloud and IT service providers without relying on the public internet.
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