Signed, Not Built: Who Gets Paid as Australia's AI Data Centre Money Gets Dearer

Australia's AI data centres have the customers. What changed in two weeks is the price of the money to build the halls. The Reserve Bank lifted rates to 4.60%, then warned about debt-funded AI building. Firmus pulled a US$5 billion float. NEXTDC has 565 MW signed but not yet billing, and borrows to close the gap. Builders are paid first. Funding the build is the step that sets the pace.

AUSTRALIA PULSE · AI DATA CENTERS · Data as at 13 Oct 2026 · Next update: the RBA rate decision on 3 Nov 2026
Affects: AI Data Centers · Neoclouds · Hyperscalers — Markets: Australia · Singapore · Malaysia · US

Education only, not advice to buy or sell any security. Company and central bank figures are as reported. A signed contract is not a billing hall. Our own sums are labelled.

The numbers that matter this week

Figures from NEXTDC's ASX releases of 27 August and 10 September, the RBA's 29 September decision, and Reuters on 9 October 2026. Status chips are Second Order’s read.

On this page: Why it matters · What changed · NEXTDC’s gap · The notes · Firmus · Our math · Who gets paid · What is stuck? · Dates next · What would change this · FAQ

Why does the price of money matter for Australia's data centres now?

Because a data centre is paid for long before it pays. A customer signs for a hall. The operator then has to buy land, secure power, put up the building and fit it out. The rent starts only when the customer's equipment is installed and running. That often takes years. Everything in between is funded with borrowed money or new shares.

When money is cheap and investors are keen, that gap is easy to bridge. When rates rise and investors get picky, the same signed contract costs more to deliver. The demand has not gone away. The cost of carrying the build has gone up. For why spending runs years ahead of revenue, see cash capex, explained, and for the build itself, how long it takes to build an AI data center.

Australia has been one of the busiest places in Asia for AI data centres. On 10 October our Sydney approvals Pulse found that power, not planning, now decides when new halls can run. This Pulse looks at the other input every hall needs: the money to build it.

What changed between 29 September and 9 October?

Four things, in quick order.

• 29 September — rates went up. The Reserve Bank of Australia raised its cash rate by a quarter of a point to 4.60%, after three earlier rises this year. It said inflation was still too high and that growth in business investment and debt was strong. The decision was unanimous.
• 1 October — a warning. The RBA's Financial Stability Review said the AI boom is increasingly fuelled by expectations of fast earnings growth and by a debt-financing cycle that is becoming more opaque and circular. ABC News reported that the review singled out pockets of higher-risk firms in the AI value chain, including data centre construction, utility and neocloud providers.
• 7 October — the market moved. NEXTDC shares fell to their lowest level in three years, The Bull reported, on a day Australia's 30-year government bond yield hit a record 5.88%.
• 9 October — a float pulled. Firmus, an Nvidia-backed builder of AI data centres, withdrew its planned US$5 billion listing on the ASX. The same morning Maas Group, which makes power equipment for Firmus, told the ASX it had already received A$373 million against about A$1.1 billion of work orders.

None of these events cancels a customer contract. Together they change what it costs to turn a contract into a running hall. That is the change that matters for who gets paid.

How does NEXTDC pay for 565 MW it has already signed?

NEXTDC is the clearest public example of the gap. Its results on 27 August showed a record year for signing customers. Contracted capacity tripled to 740.1 MW on a pro forma basis. But only 175.0 MW was billing at 30 June, and only 287.9 MW was built. The rest, a forward order book of 565.1 MW, is signed and waiting to be built and switched on. For how the business works, see what NEXTDC does.

The company expects that waiting capacity to start paying at a faster rate: 197 MW should begin billing in the year to June 2027, and another 221 MW in the year after. Together that is 74% of the order book within two years. NEXTDC says the contracts it already holds should bring in more than A$1.0 billion of EBITDA a year once they are all running.

To get there it has to build. NEXTDC spent A$3,397 million in the year to June 2026, A$397 million above the top of its own guidance, because it sped up construction to meet customers' dates. For the current year it guides A$5,250 to 5,750 million of spending, against net revenue of A$615 to 640 million and EBITDA of A$385 to 410 million. It says that spending will be funded from operating cash flow and from A$8.7 billion of pro forma liquidity at 30 June.

The liquidity did not appear by itself. NEXTDC says it raised A$9.75 billion of new capital between August 2025 and its results: A$5.8 billion of senior bank debt, A$750 million of subordinated notes, A$1.7 billion of hybrid securities and A$1.5 billion of new shares. Two weeks after the results came one more layer.

What are NEXTDC's A$1.1 billion notes, and why do they matter?

On 10 September NEXTDC priced A$1.1 billion of subordinated convertible notes due in September 2031. They pay 1.75% a year. Holders can swap them for shares at A$16.695 each, 32.5% above the A$12.60 reference price on the day. NEXTDC expects about A$1,006 million of the money after paying for a hedge.

• Low interest, paid in upside. A 1.75% coupon is far below the 4.60% cash rate. Lenders accept it because they get the right to own shares if the price rises above A$16.695. That right is the real cost.
• A hedge with a ceiling. NEXTDC bought cash-settled options, called a capped call, that pay it back if the share price rises between A$16.695 and A$21.42. Above A$21.42 it is not hedged.
• Behind the banks. The notes rank below NEXTDC's senior debt, level with the A$750 million of subordinated notes it sold in April 2026, and ahead of its hybrids and its shares.
• Dates to watch. Holders can start converting from 28 October 2026. They can ask for their money back on 17 September 2029.

None of this is unusual for a fast-growing landlord. It is how data centre builders around the world fund projects without selling shares at today's price. But it adds a layer between the banks and the shareholders, and every layer has a claim on the halls' future rent. The more layers, the longer shareholders wait to be paid.

Why did Firmus pull its float, and why does it matter beyond Firmus?

Firmus builds and runs AI data centres, which it calls AI factories. It is backed by Nvidia, Coatue, Blackstone and Jane Street. It planned to sell shares at A$11 each, which Reuters put at an equity value of US$30.6 billion, nearly three times the US$10.5 billion it was valued at in a private round in early August. We covered the pull itself in the Firmus float Wire.

Reuters reported three reasons investors walked away. Orders started to be pulled after the chief executive of CDC Data Centres said on a podcast that a plan to build 1.6 GW of AI factories with Firmus was no longer going ahead. Investors were told the deal's escrow terms would let existing holders sell more than half the stock from day one. And analysts working for the banks put Firmus' debt at about US$30 billion. Firmus has two leased data centres running, in Melbourne and Singapore, and plans five more.

The founders said Firmus will now raise money from private markets and consider listing elsewhere. A person involved in the deal told Reuters a Nasdaq listing would follow. Its customers' contracts still stand.

Why it matters beyond one company: it is a test of what public investors will pay for signed megawatts that are not yet built. The answer, for now, is less than the sellers hoped. That is the same question NEXTDC's shareholders face, at a smaller scale. It is also the question behind our CoreWeave analysis, where 4.2 GW is signed and 1.5 GW is live. For what a neocloud is, see neoclouds, explained.

Our math: what do the numbers say?

• Signed against billing: 740.1 MW contracted is about 4.2 times the 175.0 MW billing at 30 June (our arithmetic). The order book alone is 3.2 times billing, NEXTDC says.
• Spending against earning: at the middle of its guidance, NEXTDC plans to spend about A$5.5 billion this year against about A$397.5 million of EBITDA, so EBITDA covers about 7% of the spend, roughly 14 times over (our arithmetic).
• What the notes save: 1.75% on A$1.1 billion is about A$19.25 million of interest a year. The same sum at the 4.60% cash rate alone would be about A$50.6 million, a gap of about A$31 million a year that holders take in conversion rights instead (our arithmetic; real borrowing costs sit above the cash rate).
• What conversion means: if every note converted at A$16.695, NEXTDC would issue about 65.9 million new shares (our arithmetic), before any offset from the capped call.
• Total raised: A$9.75 billion before the results plus A$1.1 billion of notes after is about A$10.85 billion committed since August 2025 (our arithmetic).
• Cash already in builders' hands: Maas Group's A$373 million is about 34% of its roughly A$1.1 billion of Firmus work orders, leaving about A$727 million to collect by the end of 2027 (our arithmetic).
• The Firmus price jump: US$30.6 billion against US$10.5 billion is about 2.9 times in about two months (our arithmetic).

What this tells you: the customers are there, and the builders are being paid. The open question is the cost of carrying the gap until halls bill. A higher rate makes every month of that gap dearer. For a US read on the same question, see the Meta Hyperion bond Wire.

Who gets paid first?

First, the builders and power-gear makers — on progress, now. They are paid as each stage is done, out of money the owner has already raised. Maas Group has A$373 million in hand from Firmus and expects to finish its work orders by the end of 2027. SKS Technologies won another A$38 million on 6 October for the MEL2 data centre in Melbourne's northwest, taking that job to A$66 million and its work on hand to A$270 million. NRW's Fredon won a first-stage mechanical package of about A$115 million on 24 September for Stack's 864 MW MEL03 campus, part of about A$300 million of work through 2028.

One caution: builders are paid only while owners can fund. Maas Group's filing answered the obvious question after the Firmus float — the work continues, under the master service agreement. But the larger their share of one client, the more they depend on that client's next raise.

Second, landlords with funding in place — as halls bill. NEXTDC has A$8.7 billion of pro forma liquidity and the notes on top. Its income rises as megawatts move from signed to billing: 197 MW this year, 221 MW next. Each megawatt that starts billing turns spending into rent. Smaller operators face the same maths with less cash; see what Macquarie Technology does.

Third, the shareholders — who pay for the wait. They own what is left after banks, note holders and hybrid holders are paid. Each new layer of funding sits ahead of them. Firmus' early backers lost a public price for their stake; Maas Group alone holds about 2.2 million Firmus shares bought this year at about A$188 each. NEXTDC's holders have watched the shares slide to a three-year low while the order book grew.

Fourth, the customers — who wait for halls. Clouds, AI labs and neoclouds have signed, but cannot use a hall until it is powered and fitted out. If owners slow building to save cash, customers wait longer. For the Malaysian side of the same build, see the Malaysia power-use Pulse; for Singapore's tight supply, the Singapore licence Pulse.

One-line rule: while money is dearer, builders are paid first on progress, funded landlords are paid as halls bill, shareholders pay for the wait, and customers wait for halls. The stuck step is funding the build.

So what is the stuck step?

Funding the build — the stretch between a signed contract and a billing hall. Not demand, which NEXTDC's order book shows is strong. Not power, for NEXTDC's existing book: it says its order book is unaffected by the proposed grid reforms in New South Wales and nationally, and Transgrid has confirmed in writing that its new capacity allocation policy does not apply to the S4 Sydney campus. Three things make funding stick right now:

• Price: a 4.60% cash rate and record long-bond yields raise the cost of every dollar borrowed to build, and the discount on rent that arrives years later.
• Appetite: the Firmus float showed public investors will not pay any price for megawatts that are not yet running.
• Scrutiny: the central bank has named data centre builders and neoclouds as higher-risk firms. Lenders read the same review.

So-what: the halls with money already raised keep going and get paid as they bill. Projects that still need new money take longer, or raise it on worse terms. In a market where power and planning were already the bottleneck, money is now a second gate. The same order of payment shows up in the US, where data-hall building hit a record. For the general rule, see where cash sticks before a billed hour.

Which dates test this read next?

• 13 Oct 2026 — the RBA publishes minutes of its 29 September meeting, two weeks after the decision. The test: how open the board is to another rise.
• 28 Oct 2026 — NEXTDC's notes can start converting into shares at A$16.695. The test: whether the share price is anywhere near it.
• 3 Nov 2026 — the RBA's next rate decision. The test: whether the cost of money rises again.
• Date not set — Firmus' private round. The test: its size, its price against US$30.6 billion, and who leads it.
• 30 Jun 2027 — end of NEXTDC's financial year. The test: did 197 MW start billing, and did spending stay inside A$5.25 to 5.75 billion?
• End of 2027 — Maas Group expects to finish its Firmus work orders. The test: whether the rest of the roughly A$1.1 billion is paid on time.

The rate dates matter, but the billing date matters more. When signed megawatts start paying rent, the funding gap closes from the other side.

What would change this view?

• The RBA signals it is done raising rates and long-bond yields fall — funding gets cheaper and the stuck step eases.
• Firmus closes a large private round at a price close to its float — private money fills the gap the public market left.
• NEXTDC moves megawatts to billing faster than guided — rent arrives sooner and less outside money is needed.
• A big customer delays or cuts a contracted hall — the problem moves from funding to demand, which would be worse.

Practical takeaways

• The RBA lifted the cash rate to 4.60% on 29 September and flagged debt-funded AI building on 1 October
• Firmus pulled its US$5 billion ASX float on 9 October; it will raise privately
• NEXTDC has 565.1 MW signed but not yet billing and plans A$5.25 to 5.75 billion of spending this year
• It added A$1.1 billion of 1.75% convertible notes on top of A$9.75 billion raised since August 2025
• Builders such as Maas Group, SKS and Fredon are paid first, on progress
• Stuck step: funding the build, between a signed contract and a billing hall

FAQ

What is NEXTDC?
NEXTDC is an ASX-listed data centre operator based in Brisbane. It builds and runs large halls in Sydney, Melbourne and other cities, and rents space and power to cloud companies, AI firms and businesses. It earns money once a customer's equipment is running and billing, not when the contract is signed.

What is a convertible note?
It is a loan that the lender can swap for shares later, at a price set on day one. Because lenders get that option, they accept a low interest rate. NEXTDC's A$1.1 billion of notes pay 1.75% a year and convert at A$16.695 a share, 32.5% above the share price used when they were priced.

Why did Firmus pull its float?
Firmus, an Nvidia-backed builder of AI data centres, withdrew its planned US$5 billion ASX listing on 9 October 2026. Reuters reported that investors pulled orders after a data centre partner said a joint 1.6 GW plan was no longer going ahead, and over concerns about price, debt and early share sales. Firmus says it will raise money privately.

Is this investment advice?
No. Education only. It maps who gets paid and which step is stuck. It is not a recommendation to buy or sell any security.

Keep reading on the map

• Australia Markets hub — country page
• Sydney approvals Pulse — why power decides when halls run
• Firmus float Wire — the pull, day one
• What is an AI data center? · AI Data Centers on the stack
• All Markets doors — Taiwan, Korea, US, China, Singapore, Australia, Malaysia

Not investment advice. Do your own research.

References

1. NEXTDC, FY26 Record Results and Record FY27 Growth Guidance (ASX release), 27 Aug 2026. announcements.asx.com.au — megawatts signed, built and billing; FY27 guidance; capital raised since August 2025.
2. NEXTDC, Successful pricing of A$1.1 billion Convertible Notes Offering (ASX release), 10 Sep 2026. announcements.asx.com.au — coupon, conversion price, capped call, conversion and put dates.
3. Reserve Bank of Australia, Statement by the Monetary Policy Board: Monetary Policy Decision, 29 Sep 2026. rba.gov.au — the rise in the cash rate to 4.60%.
4. Reserve Bank of Australia, Financial Stability Review: Financial Stability Assessment, 1 Oct 2026. rba.gov.au — the warning on debt-funded AI investment.
5. ABC News, RBA relaxed about housing downturn but deeply worried by AI and bonds, 1 Oct 2026. abc.net.au — higher-risk firms in the AI value chain; next rate decision date.
6. Reuters (via Euronext), Nvidia-backed Firmus scraps $5 billion Australia IPO amid growing AI scrutiny, 9 Oct 2026. live.euronext.com — why the float was pulled, valuation, debt and the CDC comment.
7. Maas Group Holdings, Update on Firmus (ASX announcement), 9 Oct 2026. announcements.asx.com.au — A$1.1 billion of work orders and A$373 million received.
8. SKS Technologies, MEL2 contracted works rises to $66 million (ASX release), 6 Oct 2026. investorpa.com — the MEL2 award and work on hand.
9. NRW Holdings, Fredon Contract Award – Stack Data Centre MEL03 (ASX announcement), 24 Sep 2026. announcements.asx.com.au — the MEL03 mechanical package.
10. The Bull, NextDC Shares Fall To New Low, As Pressure Builds, 7 Oct 2026. thebull.com.au — three-year share low and the record 30-year bond yield.