DXN sees revenue, gross profit fall in FY26

Prefabricated modular data centre specialist DXN has released its results for FY26, with the company suffering a 33% drop in revenue from $15.1 million in FY25 to $10.1 million.

The decrease was attributed to what the company said was "a slower start to the year" due to customer-side project deferrals, with modular project activity increasing materially in the second half of FY26 as previously deferred projects progressed through manufacturing and execution, supporting increased revenue recognition toward year-end.

Gross profit for the year was $1.8 million, 63% down on FY25, while EBITDA was $4.4 million, and underlying EBITDA, adjusting for non-operating and non-cash items, was $3.7 million.

The company strengthened its capital position during the FY26 with a $7 million capital raise to fund additional factory capacity, positioning the group to scale production ahead of anticipated demand from its AI HPC opportunity and broader pipeline, ending the year with a cash position of $11 million as at 30 June 2026.

On the same date, DXN completed the strategic divestment of non-core subsidiary TAS01, owner of the company's Hobart colocation data centre. The transaction is expected to generate a total consideration of up to $520,000.

The compamy stated that its "standout achievement" of FY26 was its maiden AI HPC contract, an approximately $8.8 million agreement signed in June with a US-listed neocloud operator for a 1.36MW AI HPC modular data centre.

The contract validated DXN's AI-ready modular platform, the company claims, developed over three years, and established a pathway to a campus-scale follow-on opportunity indicatively valued in excess of US$200 million, contingent on successful delivery of the POC module.

Within two months (subsequent to financial year end), DXN secured a second AI HPC contract valued at approximately $12.2 million, demonstrating the platform's ability to win repeat work across both offshore and domestic markets.

DXN also continued to diversify across sectors during the year and continued to observe "substantial manufacturing progress" on orders for Speedcast, as well as a global internet company customer in South America during the year.

DXN also progressed its international expansion strategy, establishing a non-binding joint venture with Super Sistem Indonesia to capitalise on the rapidly rising need for digital infrastructure across South-East Asia.

The company established a manufacturing facility in Johor, Malaysia, its first manufacturing footprint outside Australia, and a platform for future growth across Southeast Asia.

To support the board and management team through this next phase of growth, DXN has also appointed a new COO with significant data centre industry experience, expected to commence in September 2026

Shalini Lagrutta, DXN’s MD, said FY26 will be remembered as the year DXN's long-term investment thesis came into focus.

"While revenue for the year was impacted by customer-side project deferrals, our maiden AI HPC contract validated years of investment behind our AI-ready modular platform and drove a five-fold increase in the company's market capitalisation," she said.

"We enter FY27 with our strongest-ever backlog currently sitting at $40.9 million as of 30 August 2026 and a rapidly maturing pipeline of identified projects, of which approximately 21% are AI infrastructure related."

Lagrutta said that the company's near-term priority is the successful delivery and commissioning of the AI HPC pilot, the key catalyst for converting its indicative US$200 million-plus follow-on opportunity into contracted work.

"Alongside this, we are scaling our manufacturing network through the establishment of a Malaysian manufacturing facility and a proposed east coast Australian facility, targeting an increase in monthly production capacity," she stated.

"With a reinforced balance sheet and record backlog, we believe DXN is well positioned to deliver sustainable top-line growth over the medium term."

DXN entered FY27 with $23.5 million in backlog work as at 30 June 2026, and with further contract wins over July and August this has grown to $40.9 million (as at 30 August 2026), a position it describes as "its strongest-ever".

The company expects 45% of this backlog work to be converted in the first half of FY27; DXN currently has 99 projects in the pipeline as at 17 July 2026, of which approximately 21% are AI infrastructure related.