Artificial intelligence has produced some of the biggest winners in global markets, with chip giant Nvidia Corp (NASDAQ: NVDA) leading the charge.
While the S&P/ASX 200 Index (ASX: XJO) doesn't have a semiconductor powerhouse of that scale, one ASX share is emerging as Australia's closest equivalent: NextDC Ltd (ASX: NXT).
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Hyperscale data housing
Rather than designing the chips that power AI, NextDC builds the digital infrastructure where those chips live. Its hyperscale data centres provide high-density power, cooling, and connectivity. They are needed to run the massive GPU clusters used in AI training and cloud computing.
In other words, if Nvidia sells the engines of the AI boom, this $9 billion ASX share is helping build the highways.
Surging results
That positioning has been translating into steady growth. In its first half-year results for 2026, NextDC reported total revenue of $232 million, up 13% year over year.
Underlying EBITDA also increased by 9% to $115.3 million, reflecting expanding utilisation across its facilities. Customer demand for data centre capacity also continued to rise, 137% to almost 417 megawatts.
Global data centre race
A key driver behind that growth is the surge in demand for AI infrastructure. Every generative AI model, cloud platform, and large-scale data application requires enormous computing power.
That has triggered a global race to build more data centres, and the ASX share is positioning itself as a major player in the Asia-Pacific region.
The company is investing aggressively to capture that opportunity. Management has unveiled a multibillion-dollar expansion pipeline, including billions in development spending to add new capacity across Australia and Asia.
There are also signs that the ASX share is becoming increasingly embedded in the global AI ecosystem. In late 2025, NextDC signed a memorandum of understanding with OpenAI to develop a hyperscale AI campus and GPU supercluster in Sydney. This project highlights the scale of computing demand expected in the coming years.
What next for the ASX share?
Wall Street and local brokers appear to be taking notice. According to consensus estimates, the ASX share carries a strong buy rating from most analysts. The average 12-month price targets sit around $20.
The most bullish forecast is $31.02, representing a potential 127% upside from the current share price of $13.69. Morgans retained its buy rating on the ASX share and a price target of $20.50, a potential plus of roughly 50% over 12 months.
The broker believes the valuation still looks attractive. Morgans notes that the company now has about 416 megawatts of contracted capacity, which "underpins FY29 underlying EBITDA of greater than $700 million without new contract wins."
Foolish Takeaway
Of course, the investment case in this ASX share isn't risk-free. Data centres are capital-intensive assets, and NextDC is spending billions to expand its footprint. Rising energy costs and the massive power requirements of AI facilities could also become constraints for future growth.
Even so, the bigger picture remains compelling. AI is driving one of the largest technology infrastructure buildouts in history, and NextDC sits squarely in the middle of it.
Australia may not have its own US$4.3 trillion Nvidia yet. But when it comes to powering the AI revolution locally, NextDC is arguably the closest thing the ASX has.
