This week in digital infrastructure, chip giant Nvidia’s (NASDAQ: NVDA) impressive earnings failed to satisfy market expectations, leading to a notable stock decline. The M&A landscape remains active, highlighted by significant transactions in the data centre sector, including potential sales and strategic partnerships. In Asia-Pacific, major developments include investment surges and new alliances, while Europe’s data centre expansion faces regulatory hurdles. The Americas see continued growth with substantial projects and partnerships, reflecting the sector’s robust momentum. Overall, the global digital infrastructure market continues to evolve rapidly, driven by innovation and strategic investments.

See below for more detailed updates and stay tuned for further reporting by The Tech Capital on digital infrastructure financing in the coming weeks!

The big story: Nvidia’s results are impressive, but fail to impress

The anticipation around Nvidia’s earnings results this week could be felt all around the industry and despite record profits of US$30 billion for Q2, fell by 6.8% in after-hours trading on Wednesday.

Stacy Rogan, a managing director & senior analyst at Bernstein told The Tech Capital this was likely due to some concern over the implied gross margin guidance for Q4, which was down as Blackwell began its ramp and H200 mix increases. Still, Bernstein believes the overall gross margin into FQ4 should still be very respectable, predicting 73-74%.

The firm’s research note following the earnings reports said it “believes next year’s margins should overall hold in fine as the platform matures, they settle pricing, optimize their supply chain and gain scale, and add more software to the mix.

“It’s not enough to beat sell-side expectations, they have to beat the buy-side whisper numbers, which are usually higher and are not written down anywhere,” he says.

Q2 revenue did outperform the street’s expectations of US$28 billion. Bernstein’s research note also says that Q3 guidance was also very good (US$32.5 billion/~US$0.73 per share vs Street US$31.9 billion/US$0.71) with QoQ growth largely driven by continued data centre strength (likely implied at $28 billion+).

“I think the US$32.5 billion guidance was in the range of the whispers (US$32-US$33 billion vs sell-side consensus at ~US$31.8 billion) but maybe would have been nice to see them at the higher end,” Rogan added.

Concern had been raised heading into the earnings report that the delay to the Blackwell GPU due to a design flaw could affect sales heading into the end of the year, but CEO Jason Heung assured that Nvidia has already shipped pilot versions to customers and partners.

It was also noted that one of Nvidia’s biggest customers, Super Micro, saw its stock tank on the day of Nvidia’s earnings release. This was due to a short report from hedge fund Hindenburg Research accusing the AI-server maker of accounting malpractice, “sibling trading” and sanctions evasion. Then just 24 hours later, it said it would delay the filing of its annual report, sending shares tumbling 25%.

Asia-Pacific

This week wasn’t all about Nvidia though. Equally as anticipated by the industry (we hope) was the release of The Tech Capital’s agenda for its annual finance forum in Jakarta (Nov 20-21).

There was also a development in the ongoing sale of Australian data centre operator AirTrunk, with two consortiums submitting final offers valuing the portfolio at A$20 billion (US$13.55 billion).

On one side of the auction battle is the Blackstone Group (NYSE: BX) in partnership with the Canada Pension Plan Investment Board (CPPIB).

Also vying the real estate is a consortium spearheaded by IFM Investors which has assembled a lineup of well-known industry players, including DigitalBridge (NYSE: DBRG), Global Infrastructure Partners (GIP), Mubadala’s MGX, and Silver Lake.

Bank of America’s (NYSE: BAC) Singapore country head said the digital infrastructure and renewable energy sectors are driving Japanese and Middle Eastern investors to South East Asia, and BDx Indonesia and NeutraDC unveiled an Internet exchange ecosystem targeted at Indonesia’s US$146bn Internet economy.

We reported that Aurum Equity Partners have announced a US$400 million investment in a 100MW Indian data centre. And also covered the news that Singtel (SGX: Z74) and Hitachi (TYO: 6501) have forged an alliance to tap into Japan’s booming US$5 billion data centre market.

In the hyperscale place, reports have emerged that Google (NASDAQ: GOOG) is looking to set up shop with a data centre in Vietnam. While the public cloud megahouse’s interest in establishing a hyperscale data centre in the country is significant, the company may face competition from other tech giants.

Europe

In a much-needed win for Europe’s AI industry, which Meta’s (NASDAQ: META) Mark Zuckerberg and Spotify’s (NYSE: SPOT) Daniel Ek warned could risk falling behind due to its “fragmented regulatory structure” and its detrimental impact on innovation, CoreWeave are teaming up with EcoDataCenter to bring the first Nvidia Blackwell GPU cluster to the continent.

Ek will no doubt be ecstatic that the computing power will be deployed in his home country of Sweden, at EcoDataCenters campus in Falun.

We caught up with the Swedish data centre company’s CEO after the news broke, and found out that the firm has plans to extend the campus by up to 80MW.

But as the team at EcoDataCenter will no doubt be celebrating a massive win, the same cannot be said for Google.

Its plans to expand its data centre campus at Grange Castle Business Park were rejected by South Dublin County Council due to insufficient grid capacity to greenlight the proposal.

In addition, it noted there was a lack of onsite renewable energy that could be used to power the data centre, and a lack of clarity provided around Power Purchase Agreements with regard to the specific site.

While Google wish they could be more Green, one company that very much is so (in name at least), broke ground on its fourth facility in its campus in Zurich.

Green said the expansion will introduce 5,526 square metres of data centre space, designed to deliver high-performance computing capabilities, with 12MW of capacity.

While the group continues its expansion efforts, recent reports suggest that Paris-based private equity firm InfraVia Capital Partners is contemplating the sale of the Swiss data centre operator portfolio.

Sources have indicated that this potential divestiture could position Green’s valuation at approximately €1 billion (US$1.1 billion), and in another US$1 billion-plus deal, Telefonica (BME: TEF) and Asterion are seeking an exit from data centre operator Nabiax, with Goldman Sachs (NYSE: GS) among frontrunners for data centre portfolio.

In the fibre industry, euNetworks (EUNG.SGX) closed a US$2.3 billion equity refinancing and announced two new partners in global financial services and pensions firm Mercer and Australian pension fund Aware Super.

Americas

In the Caribbean, Blue NAP Americas announced a strategic partnership with Australia’s Zella DC to bring its micro data centre solutions to the region.

Further down in South America, Google made extra headlines as it announced a US$850 million investment into Uruguay. The project is the second infrastructure investment in LATAM by the public cloud giant and joins a global data centre fleet of 28 sites.

Far from a micro-project, Tract also announced it had closed a land acquisition deal in Buckeye, Arizona to develop a 1.8GW US$20 billion data centre campus.

In more eyewatering numbers, Blackstone’s mega-trust said its QTS data centre business has the potential to ascend to US$92 billion in new development.

In other news, AREP’s PowerHouse Data Centers bolstered its leadership team with three executive appointments, OCP, AWS (NASDAQ: AMZN), Google, Meta, and Microsoft (NASDAQ: MSFT) revealed plans to spearhead a ‘Green Concrete’ test drive for data centres and Meta entered a geothermal data centre partnership with Sage Geosystems.

Talen Energy (NASDAQ: TLN) unlocked funds for 960 MW AWS campus development and in a testament to the boom in data centre investment and M&A, US law firm DLA Piper revealed data centre deals made up 14% of the transactions it has worked on in 2024, up from just 4% in 2023.

We also found out that five institutional investors alone have amassed an US$11 billion stake in Digital Realty Trust (NYSE: DLR).

That’s all for this week, stay tuned as we bring you more updates from across the world of digital infrastructure financing next week and for the year ahead! In the meantime, do check our APAC Finance Forum’s website as we gear up for another exec-packed edition. Submissions for the APAC Awards are also open until September 20.