Megaport subsidiary secures $35 million three-year contract with high-growth tech customer
The numbers: Excluding this deal, Latitutde.sh's compute annualised recurring revenue (ARR) has risen 31% to USD58.7 million, up from USD45 million on 31 December 2025.
Megaport Network's ARR, including India, has risen 23% on a constant currency basis to $272 million compared to 31 March 2025. Excluding India, the increase is 20% on a constant currency basis.
Group capex for 2026 guidance of $90 million to $100 million remains unchanged excluding this deal, but new equipment delivered ahead of 30 June 2026 could see group capex lift by up to $17.2 million.
The context: The new contract is with a US-based, unlisted high-growth technology customer. Megaport's ASX filing indicates they operate in the developer tooling sector and serve "enterprise customers' accelerating demand for agentic AI". The customer is supported by institutional capital.
Approximately USD12.2 million in incremental capital expenditure on CPU services will support the contract, which will form part of a committed USD86 million in capex undertaking agreed for the 2026 and 2027 calendar years as part of the Latitude acquisition.
What they said: "Securing a contract of this size reflects both the scale of the opportunities we see in the compute market, and our disciplined approach to deploying capital," Megaport CEO Michael Reid said in a statement.
"We will continue to evaluate similar opportunities, investing alongside committed customer demand at compelling paybacks, ensuring capital is deployed after rigorous analysis while supporting the long-term growth of these markets," he said.
"The explosion in AI use cases is driving incredible demand for compute and storage, with CPUs remaining a critical component of the infrastructure that powers AI."
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