Megaport (ASX:MP1) share price higher on FY21 results and acquisition

The Megaport Ltd (ASX: MP1) share price is on the move on Tuesday morning following the release of its full …

| More on:
nextdc share price

Image source: Getty Images

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

The Megaport Ltd (ASX: MP1) share price is on the move on Tuesday morning following the release of its full year results.

In early trade, the network as a service (NaaS) solutions provider's shares are up 1% to $17.60.

Megaport share price higher after FY 2021 results and acquisition announcement

  • Revenue increased 35% year on year to $78.28 million.
  • Monthly recurring revenue (MRR) jumped 32% to $7.5 million (annualises to $90 million)
  • Customers increased 443 or 24% to 2,285
  • Ports grew 1,922 or 33% to 7,689
  • Average revenue per port down $2 to $978
  • Net loss of $55 million but cash position of $136.3 million
  • US$15 million acquisition of InnovoEdge

What happened in FY 2021 for Megaport?

Another year of strong growth was reported today, which is helping drive the Megaport share price higher.

For the 12 months ended 30 June, the company reported a 35% increase in revenue to $78.3 million and a 32% jump in MRR to $7.5 million. This was driven by the expansion of its data centre footprint, customer and ports growth, strong demand for Megaport Cloud Router, and the launch of Megaport Virtual Edge.

Positively, the company achieved the milestone of becoming EBITDA break-even in June. Though, on the bottom line, Megaport still recorded a $55 million loss for the period. Nevertheless, the company remains in a very strong financial position, with a cash balance of $136.3 million at the end of the year.

What did management say?

Megaport's Chief Executive Officer, Vincent English, said, "Our investment in innovation and products supported big growth in Fiscal Year 2021. Megaport Cloud Router, our virtual routing service that creates cloud-to-cloud connections on demand, grew 64% in the period."

"MCR drives greater service adoption across our platform and provides our customers the agility they need to power their digital transformation. Our revenue numbers were also bolstered by strong new customer growth as a result of investments made in our commercial team and focus in growing our channel," he added.

What's next for Megaport?

Mr English is positive on the year ahead but provided no real guidance for FY 2022.

He commented: "The Megaport mission for the coming year is to 'Scale Up, Scale Out'. This is a commitment by everyone at Megaport to accelerate our growth and our innovation cycle to increase our lead in the NaaS space. With a proven business model, the trust of partners and customers, and a leading platform built for innovation, we are well positioned to achieve this. We will invest in revenue growth by making investments in further market expansion, product and service innovation, and most critically, the people responsible for making Megaport the transformational technology company that is changing the way IT services are built today and tomorrow. "

InnovoEdge Acquisition

Also giving the Megaport share price a boost today was a separate announcement. That announcement reveals that Megaport has signed an agreement to acquire InnovoEdge for US$15 million in cash and scrip. It is an AI-powered multicloud and edge application orchestration company.

Vincent English said: "Empowering our customers and partners with greater agility is a priority for Megaport. The acquisition of InnovoEdge aligns well with that priority and will help us drive greater functionality across our leading Network as a Service platform. By integrating the InnovoStudio service with our portal and software defined network, we will provide customers and partners with greater visibility and control of networking, cloud, and service resources."

Megaport share price continues to outperform

Following today's gain, the Megaport share price is now up a sizeable 24% in 2021. This means it is outperforming the ASX 200 by approximately 11%.

Wondering where you should invest $1,000 right now?

When investing expert Scott Phillips has a stock tip, it can pay to listen. After all, the flagship Motley Fool Share Advisor newsletter he has run for over ten years has provided thousands of paying members with stock picks that have doubled, tripled or even more.*

Scott just revealed what he believes could be the 'five best ASX stocks' for investors to buy right now. We believe these stocks are trading at attractive prices and Scott thinks they could be great buys right now...

See The 5 Stocks *Returns as of 30 April 2025

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. owns shares of and has recommended MEGAPORT FPO. The Motley Fool Australia has recommended MEGAPORT FPO. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

More on Earnings Results

A woman looks up at a plane flying in the sky with arms outstretched as the Flight Centre share price surges
Earnings Results

Up 78% since April, why is the Webjet share price taking off again today?

Webjet shares have soared 78% since 4 April and are lifting off again today. But why?

Read more »

a woman holds her hands to her temples as she sits in front of a computer screen with a concerned look on her face.
Industrials Shares

Guess which ASX 200 stock is crashing 24% on results day

Investors were not impressed with this result. But why?

Read more »

A man in full American NFL playing kit crouches over with his arms across his chest in a defensive stance against a dark background.
Technology Shares

ASX 300 tech stock charges 7% higher to record high on stellar results

This tech stock delivered another impressive result this morning.

Read more »

a group of people sit around a computer in an office environment.
Earnings Results

Guess which ASX 200 tech stock is rocketing 12% on record results

Another half, another record result from this high-quality company.

Read more »

A young man sitting at an outside table uses a card to pay for his online shopping.
Consumer Staples & Discretionary Shares

Why is the Kogan share price crashing 12%?

Profits are down at this ecommerce company during the second half.

Read more »

Frustrated stock trader screaming while looking at mobile phone, symbolising a falling share price.
Resources Shares

Guess which ASX 200 mining stock is sinking 7% following its quarterly update

Let's see how this miner performed during the third quarter.

Read more »

A man sits thoughtfully on the couch with a laptop on his lap.
Earnings Results

Up 50% in a year, are Xero shares a buy after Thursday's earnings results?

ASX investors reacted positively to Xero’s full-year earnings results on Thursday. Now what?

Read more »

Overjoyed man celebrating success with yes gesture after getting some good news on mobile.
Earnings Results

Xero share price higher despite FY25 earnings miss

The cloud accounting platform provider reported strong top line growth but its earnings fell short of expectations.

Read more »