NextDC (ASX:NXT) shares crashed 41.7% to A$5.35 on Wednesday 21 October 2026, their biggest one-day fall since listing in 2010, according to IBTimes. A delay to power works at its M3 data centre in Melbourne forced a sharp cut to FY27 guidance. The shares bounced 7.5% to A$5.75 on Thursday, but remain near eight-year lows.
What went wrong at M3 Melbourne
According to NextDC’s ASX announcement:
- Jemena, the local electricity distributor, suspended parts of a 66kV power line upgrade needed for M3 in West Footscray
- The reason: safety concerns and lack of site access due to community and stakeholder opposition, with the local council withholding consent pending further consultation
- The delay: Jemena does not expect to restart before February 2027, and NextDC now expects the next increase in grid supply during FY28
CEO Craig Scroggie said the company had “taken the affected M3 contracts out of FY27 guidance until we can reliably estimate their contribution.”
The guidance cut
| FY27 | New | Previous |
|---|---|---|
| Net revenue | A$475M to A$500M | A$615M to A$640M |
| Underlying EBITDA | A$245M to A$265M | A$385M to A$410M |
| Capex | A$4.5B to A$5.0B | A$5.25B to A$5.75B |
The affected M3 contracts made up about A$140 million of both revenue and EBITDA in the old guidance. NextDC also warned that service level credits could push EBITDA below the new range, and that some contracts allow the customer to terminate in certain circumstances.
All new development projects and land acquisitions are on hold.
Is NextDC’s balance sheet at risk?
NextDC had about A$8.7 billion of liquidity at 30 September, including A$1.3 billion in cash, and expects to remain compliant with its debt covenants at 31 December. However, it warned the delays could affect its ability to draw its undrawn senior debt.
The insider angle: April’s A$12.70 capital raising
In April 2026, NextDC raised about A$1.5 billion in an entitlement offer at A$12.70 a share, according to ShareCafe. Market Index records show several directors took up new shares at that price.
At A$5.75, those shares are about 55% below what investors paid six months ago. No director has reported an on-market purchase since the crash, and any purchase must be disclosed within five business days. Our Applied Digital report shows how executives buying after a data centre sell-off can signal confidence.
What brokers say
Morgan Stanley called the sell-off “overdone and provides an attractive opportunity,” while Citi kept its buy rating and A$21.15 target, according to IBTimes.
What NextDC investors should watch
- The 20 November AGM, where the board will report on its capex review
- Any customer terminations or service level credits at M3
- Director trades in Appendix 3Y notices
- Victoria’s 28 November election, which has pushed planning decisions for later M3 stages into 2027
Bottom line
NextDC still has strong liquidity, but losing about A$140 million of expected FY27 revenue to a local power dispute has hurt confidence. April’s A$12.70 buyers are down about 55%.
