S&P/ASX 200 Index (ASX: XJO) tech share Nextdc Ltd (ASX: NXT) is off to the races today.
Shares in the Australian data centre developer and operator closed yesterday trading for $11.12. Shares are currently changing hands for $12.17 apiece, up 9.4% in midday trading.
The ASX 200 is also in the green today, up a more modest 0.58%.
Here's what's driving investor in the blue-chip tech company on Wednesday.
Image source: Getty Images
Why is the ASX 200 tech share leaping higher?
The NextDC share price is surging after the company updated the market on its data centre utilisation capacity.
NextDC reported that in the wake of recent customer wins, its contracted utilisation has increased by 43%, or 35.9 megawatts (MW), to 120MW since 31 December.
The company's new S3 data centre has been the biggest beneficiary of the new customer contracts, having now reached 46% of its total planned capacity.
Commenting to the customer wins driving the ASX 200 tech share higher today, NextDC CEO Craig Scroggie said, "It is very pleasing for the company to have secured this record level of incremental customer contract wins."
Looking ahead, Scroggie added:
Having done significant work over recent years to deliver UI certified Tier IV metropolitan hyperscale data centres in S3, M2 and M3, the company is very well positioned to continue to take advantage of further customer growth across these critical digital infrastructure assets.
NextDC noted that it expects to progressively recognise revenue from most of the new customer contract wins from late FY24 through FY29. This will follow on the completion and commissioning of additional data halls over the coming years.
The ASX 200 tech share has already secured expansion land in the Macquarie Park availability zone for S5 Sydney. Subject to development approval, NextDC expects S5 will accommodate target IT capacity of 60MW+ once it's constructed.
NextDC share price snapshot
As you can see in the chart below, the NextDC share price has been a stellar performer in 2023, up 32%. The ASX 200 tech share is up 9% over the past 12 months.
