That scarcity could create opportunities for investors willing to look beyond the obvious names. A handful of smaller ASX AI companies offer exposure to the long-term AI theme, with potential catalysts that could drive significant growth if execution improves.

Two names attracting increasing attention are Appen Ltd (ASX: APX) and Macquarie Technology Group Ltd (ASX: MAQ).

Appen: A risky AI turnaround play

Appen sits directly inside the AI ecosystem. The company provides training data used by many artificial intelligence models, helping businesses build and improve machine learning systems.

However, the journey has been far from smooth. The ASX AI share surged 71% to an annual high of $1.90 in January after a strong quarterly update boosted investor confidence. That optimism faded quickly after the company's next update in April.

While revenue increased 9% to $54.8 million, investors were disappointed by the company's weak profitability. Appen Global's performance was a particular concern, with revenue falling 37% to $19.9 million.

The result triggered a sharp sell-off, sending shares down around 30%. Since then, the recovery has failed to materialise, with Appen shares trading near $0.86 and down around 30% over the past year.

Management has since reaffirmed FY26 revenue guidance of between $270 million and $300 million, ahead of FY25 revenue of $231 million. The key question now is whether demand for AI training data can translate into stronger earnings.

If Appen can prove its turnaround is working, secure new partnerships, and return to sustainable growth, the market could quickly reassess the company's value.

The next major test arrives with its first-half FY26 results in late August.

Macquarie Technology: The infrastructure behind AI

While many investors focus on AI software companies, Macquarie Technology is targeting the infrastructure powering the revolution.

The company operates data centres, cloud services, cybersecurity solutions, and sovereign hosting platforms — all areas expected to benefit from rising AI adoption.

In March, Macquarie Technology secured a $200 million hybrid investment from the government-backed National Reconstruction Fund Corporation.

The funding will support the expansion of sovereign cloud, cybersecurity, and AI infrastructure for government agencies, defence organisations, and critical industries.

Unlike many speculative AI plays, Macquarie Technology already has a profitable business. The ASX AI share has delivered 20 consecutive half-years of operating income growth, demonstrating consistent execution.

As demand for data centre capacity continues rising, additional infrastructure coming online could provide a significant earnings boost.

If investors begin valuing Macquarie Technology closer to established data centre operators such as NextDC Ltd (ASX: NXT), the shares could have further upside.

Foolish takeaway

AI investing is still dominated by global giants, but opportunities exist across the ASX.

Appen offers a higher-risk turnaround opportunity tied directly to AI model development, while Macquarie Technology provides exposure to the essential infrastructure supporting the AI boom.

Neither ASX AI share is guaranteed to succeed, but both show why investors shouldn't overlook the smaller companies helping build the next generation of artificial intelligence.

The post These overlooked ASX AI shares could be tomorrow's winners appeared first on The Motley Fool Australia.

The software giant reported revenue of US$90 billion for the June quarter, up 18% year over year.

Net income climbed 31% to US$35.8 billion.

Microsoft Cloud revenue reached US$59.3 billion, a 27% increase, while Azure growth accelerated to 43% from 40% in the prior quarter.

So what does any of this have to do with the Australian share market?

The answer runs through the physical infrastructure that every hyperscaler has to use.

What Microsoft actually reported

In the case of Microsoft, the headline number that matters most for ASX investors is not revenue at all. It is capital expenditure.

Microsoft spent US$41 billion on capex and finance leases in the June quarter alone, a jump of roughly 69% year over year.

The company expects to spend more than US$50 billion in the September quarter.

Chief financial officer Amy Hood told analysts:

We expect FY27 capital expenditures will grow year-over-year given demand signals across our portfolio.

Commercial remaining performance obligations, effectively contracted revenue not yet recognised, jumped 84% to US$678 billion.

Azure passed US$100 billion in annual revenue for the first time, and Microsoft 365 Copilot surpassed 30 million paid seats.

What Microsoft's capex bill means for ASX shares

Hyperscaler capital expenditure has to land somewhere physical.

It funds buildings, power connections, cooling systems, and fibre.

That is the demand curve two ASX 200 shares sit directly on, and both have re-rated hard on the thesis over the past year.

NextDC Ltd (ASX: NXT) is the local pure-play data centre operator.

The company is carrying roughly $5 billion of forecast FY27 capital expenditure to build out capacity for AI workloads.

A recent agreement with a frontier AI lab underlined its ability to win the largest contracts on offer.

Goodman Group (ASX: GMG) plays a different role in the same story.

Data centres now account for 73% of its development pipeline, which was on track to reach $18 billion by June 2026.

Its edge is a secured power bank of 6.4 gigawatts across 16 cities, assembled over years, and difficult for a newcomer to replicate.

Securing grid connections has become the real bottleneck in this industry, and Goodman has positioned itself very nicely to benefit from this need.

Megaport Ltd (ASX: MP1) sits in the middle, providing the connectivity layer between enterprise customers and platforms like Azure.

Data#3 and the direct Microsoft earnings link

Data#3 Ltd (ASX: DTL) has the most literal exposure of the group.

The company resells Microsoft licences, Azure capacity, and Microsoft 365 Copilot to Australian enterprise and government customers.

That is a double-edged relationship.

Data#3 grew first-half FY26 gross sales 9.2% to $1.5 billion, with net profit before tax up 4.5% to $33.5 million.

But margins in its Software Solutions division were squeezed by changes to Microsoft's partner incentive program.

Management does not expect those vendor changes to materially dent the group's FY26 numbers.

Rising Azure consumption is a tailwind for volumes, while vendor concentration remains the standing risk.

Data#3 reports its FY26 result in August, and investors will want to see whether the incentive headwind has washed through.

Foolish Takeaway for Microsoft earnings

Microsoft's earnings were a reminder that AI infrastructure spending is still accelerating rather than plateauing.

For NextDC and Goodman Group, that spending is effectively the whole thesis.

For Data#3, the benefits are more nuanced, since the same vendor that drives its growth also sets its margins.

The obvious risk is that hyperscalers eventually decide the returns do not justify the capital outlay.

Alphabet recent capex guidance was met with a sharp share price fall, which shows the market's patience is not infinite.

For now, though, the money is still being committed, and Australian infrastructure is on the receiving end.

The post What do Microsoft's strong earnings mean for these ASX shares? appeared first on The Motley Fool Australia.

This has arguably created value among some oversold ASX tech stocks, with RBC listing several that it believes represent good value at current levels.

AI spectre still hovers over the ASX tech sector

Broadly, RBC said in a note to clients this week that artificial intelligence (AI) and its ramifications for the sector remain the dominant driver of their views coming into the August reporting season.

RBC said:

Repeated releases of frontier models showcasing agentic capabilities across enterprise workflows should continue to weigh on multiples near-term, with the debate remaining on terminal values rather than near-term earnings. However, we believe software continues to have a role to play, and a SaaSurrection scenario is not out of reach – the sector will likely need another 1-2 reporting seasons for earnings to disprove the (disruption) narrative before the market ascribes any meaningful re rate.

RBC said within software, "we view our coverage through the lens of whether an AI/agent must transact through, or can route around, an application''.

They have a preference for companies whose products serve mission-critical enterprise workloads, as opposed to narrower verticals.

They added:

We remain positive on Data Centres and Networking players on their exposure to the AI capex cycle with demand indicators remaining strong.

Let's see who they like specifically:

Technology One Ltd (ASX: TNE)

RBC said this company is "emerging as one of the most AI defensive software names across our coverage owing to its mission-critical status amongst its public sector client base''.

The broker said Technology One had strong return on investment and was growing well in the UK, "with ANZ seeing opportunities in Federal gov, on top of differentiated SaaS+ offering''.

RBC has a price target of $33 on Technology One shares.

Megaport Ltd (ASX: MP1)

RBC said this company is one of the cleanest ways to get exposure to the AI thematic on the ASX, "with both networking and compute segments direct beneficiaries of AI demand''.

They added:

Demand outlook for compute remains robust with record hyperscaler capex, AI lab leasing, and GPU pricing strength.

RBC has a price target of $25 on Megaport shares.

Wisetech Ltd (ASX: WTC)

RBC said the FY27 guidance from this company will be highly anticipated.

Overall, the market consensus is bearish on the stock, RBC said, and debate around the impact of AI and governance concerns "won't dissipate anytime soon''.

Despite those negative sentiments, RBC has a price target of $64 on the shares.

NextDC Ltd (ASX: NXT)

RBC said AI and cloud business continues to drive a record order book for NextDC, "however, largely overshadowed by focus on execution as NXT enters into a heavy capex phase with several concurrent projects contributing to about $4.5bn of capex spend across FY27''.

RBC has a price target of $22 on NextDC.

The post Check out these 4 ASX tech firms RBC Capital Markets expects to outperform appeared first on The Motley Fool Australia.

The real difference appears when those purchases continue for years, and the returns start earning returns of their own.

So, what could that monthly habit eventually become?

Building towards a 9% return

For this example, I will assume the portfolio earns an average return of 9% per annum, with dividends reinvested.

That figure is not guaranteed. Share market returns can vary significantly from year to year, and investors will experience falls along the way.

Still, I think 9% is a reasonable long-term target for a portfolio built around diversified exchange-traded funds (ETFs) and quality ASX shares.

I would consider making a broad fund such as the iShares S&P 500 ETF (ASX: IVV) a core holding. It gives investors access to hundreds of major US companies across technology, healthcare, financial services, consumer goods, and industrials.

The Vanguard Diversified High Growth Index ETF (ASX: VDHG) could provide an even broader foundation by spreading money across Australian shares, international markets, emerging economies, and a smaller allocation to defensive assets.

Investors comfortable with greater volatility could add the Betashares Nasdaq 100 ETF (ASX: NDQ), which places more weight on companies benefiting from artificial intelligence, cloud computing, semiconductors, software, and digital commerce.

Which ASX shares could help?

I would also consider selected ASX shares capable of growing earnings over many years.

Breville Group Ltd (ASX: BRG) has room to expand its premium appliance brands across international markets, while Goodman Group (ASX: GMG) is building data centre infrastructure in locations where land and power are difficult to secure.

Nextdc Ltd (ASX: NXT) offers another route into rising demand for computing capacity. Its facilities support cloud services, artificial intelligence, cybersecurity, and the increasing volume of data moving through the economy.

Cochlear Ltd (ASX: COH) could add healthcare exposure through a business serving people with hearing loss, while BHP Group Ltd (ASX: BHP) provides access to iron ore, copper, potash, dividends, and the resources required for global development.

I would not expect every holding to return exactly 9%. The aim would be for the portfolio as a whole to reach that average over time.

What could the portfolio become?

With $500 invested at the end of every month and an average annual return of 9%, the portfolio could grow to approximately $95,000 after 10 years.

After 20 years, it could reach around $320,000.

The effect of compounding becomes much clearer from there. After 30 years, the balance could rise to approximately $860,000.

Continuing for 40 years could produce around $2.1 million, while 50 years could take the portfolio to roughly $5.1 million!

These estimates assume monthly compounding and exclude brokerage, fees, and tax.

The later figures look so much larger because the portfolio eventually contributes far more growth than the monthly deposits. Time allows each earlier investment to keep compounding while new money continues entering the market.

Foolish takeaway

Investing $500 a month in ASX shares could create a substantial portfolio, but the biggest results require patience.

I would build around diversified ETFs, add quality companies with clear growth opportunities, reinvest the income, and continue buying through both strong and weak markets.

The first decade may feel gradual. But over longer periods, compounding can completely change the outcome.

At an average return of 9%, a regular $500 investment could eventually grow into several million dollars.

The post What could $500 a month in ASX shares actually turn into? appeared first on The Motley Fool Australia.

Let's see which ones they like.

NextDC Ltd (ASX: NXT)

NextDC shares are flat over the past 12 months, having traded as low as $10.74 and as high as $17.93.

UBS has a price target of $22.55 on NextDC shares compared to $14.03 currently.

The broker referred to a recent announcement NextDC made to the ASX, which said that following further contract wins, NextDC's contracted utilisation had increased by 11% to 740 megawatts.

NextDC said at the time, "the pro-forma forward order book is expected to progressively convert to billings, revenue and EBITDA over the period FY26 to FY30''.

UBS said there was "very little" detail in the update, but said it was "another substantial win''.

The broker added that it was not possible to put a number on the earnings impact, as it was unclear whether it was a neocloud or AI contract.

Alkane Resources Ltd (ASX: ALK)

UBS has actually downgraded its price target for Alkane by 40 cents to $1.75, but still has a buy rating on the gold stock, which was last changing hands for $1.35.

The broker said the company's recently-released quarterly costs came in above their estimates, and FY27 guidance was soft.

Alkane also proposed a maiden 2-cent dividend in the recent update, having built its cash holdings to $432 million.

Managing Director Nic Earner said it was a good end to the year for the company.

He said:

It has been another great quarter for Alkane, producing 40,949 ounces of gold and 456 tonnes of antimony (42,491 ounces of gold equivalent) over the full quarter, which places full year FY26 production at 168,337 ounces of gold equivalent, in the top half of guidance.

UBS said M&A activity would remain in focus as the most viable way for the company to grow production.

The broker added:

Near term production in Tier 1 jurisdictions remains the preference, and we continue to view ALK's holding of Medallion Metals (ASX: MM8), with its Ravensthorpe Gold Project as an interesting option.

BCI Minerals Ltd (ASX: BCI)

Shaw and Partners has a buy rating on this salt project developer, saying in a research note this week that the company was progressing well.

The broker said:

Mardie has advanced significantly since our recent initiation, achieving construction completion of 85% (82% including the crystalliser lining program), up from 81% in March. Crucially, the operation has commenced salt precipitation on schedule, exiting the initial filling phase to become an active producer with 49kt of crystallised salt on pavement at quarter end. The critical path to First Salt on Ship remains governed by natural solar evaporation and weather conditions during this early phase. Management continues to target operational readiness for FSOS by MarQCY27.

Shaw and Partners said as the project closes the gap to its first commercial harvest, "the current market valuation continues to significantly discount the tier-1 replacement value of this 60-plus year infrastructure asset. We expect a major equity re-rating as execution risks give way to structural cash flow''.

The broker has a price target of 75 cents on BCI compared to 42.75 cents currently.

The post Brokers name 3 ASX shares to buy with gains of up to 75% appeared first on The Motley Fool Australia.

After opening sharply lower and spending most of the session in red territory, the ASX 200 ended up staging a late afternoon recovery, closing with a minuscule 0.023% rise. That leaves the index at 8,793.3 points.

This bumpy day for ASX investors followed a rough start to the American trading week on Wall Street's boards last night.

The Dow Jones Industrial Average Index (DJX: .DJI) started the week on a sour note, falling 0.59%.

The tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC) fared slightly better, though, dropping by 0.048%.

But let's return to the local markets now and take stock of what the various ASX sectors were up to this Tuesday.

Winners and losers

Despite the broader market's nominal lift, green sectors outnumbered red sectors this session.

Leading those red sectors were healthcare stocks. The S&P/ASX 200 Healthcare Index (ASX: XHJ) crashed 1.05% lower today.

Communications shares were on the nose as well, with the S&P/ASX 200 Communication Services Index (ASX: XTJ) tumbling 0.88%.

Consumer discretionary stocks weren't popular either. The S&P/ASX 200 Consumer Discretionary Index (ASX: XDJ) saw its value tank 0.83%.

We could say the same for financial shares, as you can verify by the S&P/ASX 200 Financials Index (ASX: XFJ)'s 0.71% dive.

Next up were industrial stocks. The S&P/ASX 200 Industrials Index (ASX: XNJ) had dipped 0.34% by the closing bell.

Our last losers were consumer staples shares, with the S&P/ASX 200 Consumer Staples Index (ASX: XSJ) slipping 0.08%.

Turning to the green sectors now, these were led by gold stocks. The All Ordinaries Gold Index (ASX: XGD) soared 3.64% higher this Tuesday.

Tech shares ran hot as well, evident from the S&P/ASX 200 Information Technology Index (ASX: XIJ)'s 3.26% surge.

Mining stocks were also in demand. The S&P/ASX 200 Materials Index (ASX: XMJ) jumped 1.33% today.

Real estate investment trusts (REITs) were next, with the S&P/ASX 200 A-REIT Index (ASX: XPJ) leaping 0.61%.

Then we had energy shares. The S&P/ASX 200 Energy Index (ASX: XEJ) saw a 0.4% increase this session.

Finally, utilities stocks got over the winner's line, illustrated by the S&P/ASX 200 Utilities Index (ASX: XUJ)'s 0.22% lift.

Top 10 ASX 200 shares countdown

Gold miner Minerals 260 Ltd (ASX: MI6) took out today's top spot. Minerals 260 shares spiked 7.69% higher this Tuesday to close at 64 cents apiece.

There wasn't any news out from the company, but most gold shares had a strong session.

Here's how the other winners landed their planes: 

Our top 10 shares countdown is a recurring end-of-day summary that shows which companies made big moves on the day. Check in at Fool.com.au after the weekday market closes to see which stocks make the countdown.

The post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

What did NEXTDC report?

• Contracted utilisation as at 30 June 2026 grew by 73MW (up 11%) to 740MW.
• Pro-forma forward order book increased to 565MW.
• Order book expected to convert to billings, revenue and EBITDA from FY26 to FY30.
• FY26 net revenue, underlying EBITDA and capex guidance remain unchanged.

What else do investors need to know?

NEXTDC attributes its contracted utilisation lift to recent customer contract wins, strengthening its position as a leading data centre platform for the digital economy. The company says its pro-forma forward order book, now at 565MW, will progressively convert to revenue streams over the coming years.

Importantly, NEXTDC confirmed that guidance for FY26 net revenue, underlying EBITDA and capital expenditure is unchanged from previous updates. This gives investors some predictability for near-term financial performance.

What's next for NEXTDC?

NEXTDC intends to deliver on its strong contract pipeline, moving forward orders to revenue and earnings between FY26 and FY30. The stability in earnings guidance suggests management is confident in executing its growth plans.

With its expanding customer base and certified Tier IV operations, NEXTDC is well-placed to respond to continued demand for cloud and data centre services across Australia and Asia.

NextDC share price snapshot

The NextDC share price has underperformed the market over the past 12 months with a decline of almost 7%. This compares to a gain of almost 1.5% from the S&P/ASX 200 Index (ASX: XJO).

View Original Announcement

The post NEXTDC share price on watch as contracted utilisation rises and forward order book grows appeared first on The Motley Fool Australia.

For money that may stay invested for decades, I would want a combination of dependable earnings, growing dividends, and exposure to businesses that could look much larger in the future.

These are three ASX 200 shares I would consider.

Commonwealth Bank of Australia (ASX: CBA)

CBA is rarely the cheapest major bank, yet it remains the one I would feel most comfortable owning for the long term.

The bank is woven into the financial lives of millions of Australians. Customers use it to receive wages, pay bills, save money, buy homes, operate businesses, and invest. Those relationships create a strong franchise.

CBA also keeps investing in its digital platform, payments, fraud prevention, and customer experience. I think that spending can help the bank protect its market position as financial services become increasingly digital.

Its fully franked dividends could provide income inside an SMSF, while its exposure to lending, deposits, and household finances gives shareholders a direct connection to the Australian economy.

The premium valuation deserves attention, and banking conditions will shift over time. Even so, I think CBA has the financial strength and customer loyalty to remain a leading ASX business for many years.

Coles Group Ltd (ASX: COL)

Coles would bring a more defensive source of earnings to the SMSF.

Households can delay buying furniture, electronics, or a new car when money becomes tight. Grocery spending is much harder to avoid.

That regular demand gives Coles a strong starting point, although the company still needs to compete hard on price, availability, convenience, and customer trust.

I like the work Coles has been doing across online shopping, loyalty, distribution, and automated fulfilment. These investments can help the supermarket serve customers more efficiently while supporting growth beyond simply opening more stores.

The Flybuys ecosystem also gives Coles greater insight into shopping habits and another way to strengthen customer relationships.

Margins in supermarkets are relatively thin, and competition from Woolworths Group Ltd (ASX: WOW), Aldi, and other retailers will remain intense. Cost inflation and political scrutiny can also create pressure.

Nevertheless, for an SMSF, I think Coles offers a compelling blend of defensive demand, dividends, and measured long-term growth.

NextDC Ltd (ASX: NXT)

The final ASX 200 share would give the portfolio a stronger growth engine.

NextDC develops and operates data centres, which provide the physical infrastructure behind cloud computing, artificial intelligence, cybersecurity, streaming, and digital payments.

The digital economy may feel invisible, but it still needs buildings, electricity, cooling systems, secure connections, and enormous computing capacity.

NextDC is investing heavily to meet that demand across Australia and overseas. Its expansion requires substantial capital, and returns can take time to appear as new capacity is developed and contracted.

That creates risks around funding, project execution, customer concentration, and the timing of revenue. It also means the shares may be much more volatile than CBA or Coles.

I would keep the position measured, but I think an SMSF with a long horizon can afford to own some businesses whose strongest earnings may still lie well ahead.

Foolish takeaway

I would want an SMSF portfolio to keep working through several stages of retirement planning.

Income becomes increasingly attractive as retirement approaches, while growth can help the portfolio keep pace with rising living costs and support larger dividends later.

CBA and Coles could provide a steadier earnings base, while NextDC offers exposure to infrastructure supporting a rapidly expanding digital economy.

I think that combination could give an SMSF enough resilience for uncertain periods and enough ambition to keep growing over the long term.

The post 3 top ASX 200 shares I'd buy for a self-managed superannuation fund appeared first on The Motley Fool Australia.

After yesterday's lethargic showing, investors came back to the ASX boards with a little more pep in their steps, sending the ASX 200 0.37% higher. After staying in green territory all day, the index ended up closing at 8,841.1 points.

This confident mid-week session for the Australian markets follows a sunny session on Wall Street.

The Dow Jones Industrial Average Index (DJX: .DJI) had a lukewarm day, rising by just 0.018%.

However, the tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC) was far more bullish, gaining 0.9%.

Let's get back to the local markets now and dive a little deeper into what the various ASX sectors were up to today.

Winners and losers

We had more green sectors than red ones this session.

Leading the red sectors were communications shares. The S&P/ASX 200 Communication Services Index (ASX: XTJ) was shunned, tumbling 1.2%.

Gold stocks had a similar experience, with the All Ordinaries Gold Index (ASX: XGD) diving 0.95%.

Energy shares found themselves on the nose, too. The S&P/ASX 200 Energy Index (ASX: XEJ) retreated 0.57% this hump day.

We could say the same for consumer staples stocks, with the S&P/ASX 200 Consumer Staples Index (ASX: XSJ) dipping 0.56%.

Healthcare stocks couldn't hold their own either, evident by the S&P/ASX 200 Healthcare Index (ASX: XHJ)'s 0.38% slide.

Our last losers were consumer discretionary shares. The S&P/ASX 200 Consumer Discretionary Index (ASX: XDJ) slipped 0.22% lower by the close of trading.

Let's turn to the winners now. Leading the push higher were mining stocks, with the S&P/ASX 200 Materials Index (ASX: XMJ) surging 1.7%.

Utilities shares were far tamer, though. The S&P/ASX 200 Utilities Index (ASX: XUJ) lifted 0.17% today.

Financial stocks were also in that ballpark, illustrated by the S&P/ASX 200 Financials Index (ASX: XFJ)'s 0.15% advance.

Tech shares followed financials. The S&P/ASX 200 Information Technology Index (ASX: XIJ) jumped 0.13%.

Then we had real estate investment trusts (REITs), with the S&P/ASX 200 A-REIT Index (ASX: XPJ) also bouncing 0.13% higher.

Finally, industrial stocks rounded out the winners this Wednesday, as you can see by the S&P/ASX 200 Industrials Index (ASX: XNJ)'s 0.07% bump.

Top 10 ASX 200 shares countdown

Our best performer this hump day was miner Kingsgate Consolidated Ltd (ASX: KCN). Kingsgate shares shot up 15.89% this session to finish at $4.23 each.

This came after the company reported some guidance and production updates, which clearly went down well with the market.

Here's how the other top stocks tied up at the dock: 

Our top 10 shares countdown is a recurring end-of-day summary that shows which companies made big moves on the day. Check in at Fool.com.au after the weekday market closes to see which stocks make the countdown.

The post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

Companies such as Nvidia, Micron, and SpaceX have attracted huge investor interest as the infrastructure demands of the AI industry continue to grow.

Not all providers created equal

Macquarie has this week issued a research note to clients, which argues that simple ownership of GPUs (graphics processing units) is not enough, but that it has to be paired with the ability to "convert capital, power and installed capacity into useful compute''.

They add:

In our view, useful compute per MW per dollar is the most important metric for assessing Neocloud quality. Neocloud customers buy useful compute output, not machine access. Two operators using the same GPU hardware can deliver materially different performance, utilisation, latency and cost outcomes depending on network architecture, software stack, reliability, batching, caching and customer mix. As the industry matures, durable premiums will accrue to operators that can prove better delivered compute.

To clarify, a neocloud is a specialised cloud provider built to specifically support AI and machine learning workloads.

Which ASX tech companies look set to benefit?

When it comes to the Australian market, Macquarie's top sector picks for companies that can support neoclouds are Megaport Ltd (ASX: MP1) and Nextdc Ltd (ASX: NXT).

Macquarie said in its note to clients that in Australia, neocloud entrants like Firmus and Sharon AI "are competing for the same scarce pool of data centre capacity, adding another source of demand to a market that was already supply constrained''.

They added:

The relevance for NXT is straightforward: neoclouds are being forced to secure data centre capacity ahead of GPU deployment, with NVIDIA supply of GPUs contingent on signing upfront data centre contracts. This pulls demand forward into an already constrained market. NXT's agreement with Sharon AI for 50MW of capacity at its M3 site is an example of this.

Macquarie has a price target of $18.30 on Nextdc shares compared to $13.07 currently.

With regard to Megaport, Macquarie said the company "already has the diversified Enterprise customer base and characteristics that drive quality for Neocloud operators''.

They added:

These characteristics drive lower operating risk (MP1 signs contracts before capex), a net cash position, and higher quality business and customer mix.

Macquarie said Megaport's Latitude business division was also diversified well-beyond just AI, supporting a "highly diverse mix of non-AI workloads, including web hosting, game servers, large relational databases, streaming applications, and traditional enterprise IT migrations that require high performance without virtualisation overhead''.

Macquarie has a price target of $27.80 on Megaport shares compared to $19.90 currently.

The post Which ASX tech companies does Macquarie like in the surging cloud computing sector? appeared first on The Motley Fool Australia.

SK Hynix Inc (NASDAQ: SKHY), the South Korean chipmaker that supplies the high-bandwidth memory sitting inside almost every Nvidia processor, sold 177.9 million American depositary shares at US$149 each on 9 July. The company raised approximately US$26.5 billion.

The securities began trading on the Nasdaq on 10 July under the ticker SKHY, closing their first session up approximately 13% at US$168.

That makes it the largest US listing ever by a foreign company, surpassing Alibaba's US$25 billion debut in 2014.

It is also the second-largest globally after SpaceX's US$85.7 billion Nasdaq listing in June.

Is this technically speaking a SK Hynix IPO?

Despite the headlines, this was not technically an IPO.

SK Hynix's common shares have traded on the Korea Exchange for decades, and the company was already valued above US$1 trillion before the US listing.

What happened last Friday was an American depositary share offering, creating a new US-traded security tied to an already-public business rather than floating a previously private company.

SK Hynix did not become a public company through this offering. However, it made itself far easier for American and international investors to own.

Why the AI memory story is important for ASX investors

SK Hynix reported revenue of 97.1 trillion won, approximately US$64.1 billion, in 2025, a company record.

Net income reached 42.9 trillion won, or approximately US$28.3 billion, implying a net profit margin of 44%.

Its Korea-listed shares have risen by more than 515% over the past 12 months as high-bandwidth memory has become a critical bottleneck in AI infrastructure.

The company captures approximately 56% of the global HBM market, according to its SEC filing.

For ASX investors, that AI memory demand story connects directly to two ASX-listed funds and one Australian company.

Global X Semiconductor ETF (ASX: SEMI)

The most direct ASX exposure to SK Hynix is through the Global X Semiconductor ETF.

SK Hynix is already one of SEMI's largest holdings, sitting alongside Micron, AMD, TSMC, and Nvidia.

SEMI holds just 30 companies tracking the Solactive Global Semiconductor 30 Index, making it a concentrated, high-conviction way to own the semiconductor supply chain from the ASX.

That concentration cuts both ways.

The fund is heavily exposed to the memory cycle, which has historically been one of the most volatile in technology. The sector has periods of shortage-driven price surges followed by oversupply and collapsing margins.

SK Hynix's own capital expenditure plans, including two new fabrication complexes in South Korea, are examples of capacity expansion that have triggered previous downturns.

Betashares Nasdaq 100 ETF (ASX: NDQ)

The Betashares Nasdaq 100 ETF is the other route, though the connection is less immediate.

SK Hynix's Nasdaq listing raises the prospect of eventual NASDAQ-100 Index (NASDAQ: NDX) inclusion. This would force every fund tracking that index, including NDQ, to buy SKHY.

That is the same dynamic that played out with SpaceX's fast-track inclusion earlier this month.

NDQ holders should understand that index inclusion is not automatic and would depend on SK Hynix meeting the exchange's eligibility criteria for foreign-domiciled ADRs.

NextDC Ltd (ASX: NXT)

NextDC is the Australian company most directly connected to the same underlying trend.

The AI memory shortage driving SK Hynix's extraordinary revenue growth stems from AI data centres consuming HBM faster than manufacturers can produce it.

NextDC builds and operates those data centres in Australia.

Contracted utilisation surged 60% to 667MW in the March 2026 quarter alone, and the company's forward order book is expected to generate contracted EBITDA in excess of A$1 billion.

Every dollar of SK Hynix's memory revenue reflects AI compute demand that must be housed somewhere, and in Australia, that increasingly means NextDC.

Foolish Takeaway for the SK Hynix IPO

SK Hynix's IPO is a landmark moment for the AI memory trade.

For ASX investors, SEMI provides the most direct exposure, NDQ offers a potential future index-inclusion angle, and NextDC captures the same underlying AI infrastructure demand from the Australian side.

But investors should remember that memory is a famously cyclical industry.

A wave of AI companies rushing to IPO at peak valuations has historically been a signal worth treating with caution rather than enthusiasm.

The post SK Hynix IPOs in the US. Here's what that means for ASX investors appeared first on The Motley Fool Australia.

Company updates can change investor confidence , while sell-offs can unlock ideas for opportunistic Aussies.

Analysts regularly tells investors about price targets, which explains to us where the share price could be in 12 months from the time of that investment call.

Let's look at two ASX shares with a potentially exciting future.

Judo Capital Holdings Ltd (ASX: JDO)

Judo is a financial institution that provides loans to small and medium enterprises (SMEs), with term deposits being a key source of funding. Term deposit customers include SMSFs, individuals and businesses.

The company recently said its FY26 cost-to-risk is expected to be in the range of between $116 million to $122 million because of three exposures across different sectors as a result of customer-specific developments.

Even so, Judo still expects its FY26 profit before tax (PBT) to be between $163 million to $169 million, or approximately 30% growth compared to FY25.

The company also expects FY27 PBT to be between $210 million to $220 million, which would be a 30% rise as a result of growth and operating leverage despite this period of uncertainty.

According to CMC Invest, there have been 10 ratings on the business within the last three months, with eight of those being a buy and two being a hold. Of those 10 ratings, the average price target is $1.63, which implies a possible rise of 77% from where it is at the time of writing.                                                                         

Nextdc Ltd (ASX: NXT)

Another ASX share that has attracted a lot of positive attention is Nextdc, a business that builds, owns and operates data centres in a number of Australian cities. It also has a growing number of locations overseas, including Japan, Malaysia and New Zealand.

The business is investing heavily in data centres to provide the computing infrastructure feeding global demand for AI.

Nextdc is seeing this period as a great time to heavily invest, and it's also seeing a rapid increase in the contracted utilisation. In mid-April, the company upgraded its contracted utilisation by 60% to 667MW and it also upgraded its FY26 capital expenditure guidance range to between $2.7 billion to $3 billion.

According to CMC Invest, there have been eight broker ratings on the business in the last three months, with all of those being a buy. The average price target of those eight analysts is $20.41, which implies a possible rise of 46%.

These are both businesses growing profit rapidly, though there are other ASX shares that could be even better buys.

The post 2 ASX shares tipped to grow 45% or more in the next 12 months appeared first on The Motley Fool Australia.

What did NEXTDC report?

• New senior debt facilities of $2.3 billion secured, upsized from the $1.8 billion announced in May 2026
• Total available senior debt facilities increase from $6.4 billion to $8.7 billion
• Margins on new facilities broadly consistent with existing debt of similar tenor
• Proceeds to support data centre development, recent customer contract wins, and general corporate purposes

What else do investors need to know?

NEXTDC's upsized debt reflects ongoing strong demand for its services and continued support from a broad syndicate of local and international banks. The funding builds upon recent capital raising initiatives, including a $1.5 billion Entitlement Offer, $1.7 billion Hybrid Securities Offer, and a $750 million Wholesale Notes Offer, further diversifying NEXTDC's funding sources.

Financial close of the new facilities is expected in mid-July 2026, pending satisfaction of standard conditions. The company's growing capital base positions it to accelerate growth following a record increase in contracted utilisation earlier this year.

What's next for NEXTDC?

With expanded funding in place, NEXTDC is well positioned to support capital expenditure linked to recent contract wins and continued rollout of state-of-the-art data centres. The company maintains a strong focus on operational sustainability, leveraging renewable energy and efficiency, supporting further growth in Australia's digital infrastructure market.

Investors can expect NEXTDC to continue innovating and scaling its platform to meet rising demand for secure, sustainable, and connected cloud and IT infrastructure solutions.

NEXTDC share price snapshot

Over the past 12 months, NEXTDC shares have risen 21%, outperforming the S&P/ASX 200 Index (ASX: XJO), which has risen 2% over the same period.

View Original Announcement

The post NEXTDC boosts funding with $2.3 billion senior debt facility upsize appeared first on The Motley Fool Australia.

That leaves the index at 8,803.9 points.

This tough Tuesday for ASX investors comes despite a much bubblier night of trading over on Wall Street.

The Dow Jones Industrial Average Index (DJX: .DJI) remained in fine form, gaining 0.29%.

The tech-heavy Nasdaq Composite Index (NASDAQ: .IXIC) did even better, rising 1.12%.

Let's return to tour local markets now and take stock of how the various ASX sectors fared amid today's trading conditions.

Winners and losers

Despite the market's falls, there were a few sectors that put on weight this Tuesday.

But first, it was gold stocks that were first in the firing line. The All Ordinaries Gold Index (ASX: XGD) was smashed this session, crashing down 4.28%.

Broader mining shares were hit hard as well, with the S&P/ASX 200 Materials Index (ASX: XMJ) plunging 2.64%.

Real estate investment trusts (REITs) also had a day to forget. The S&P/ASX 200 A-REIT Index (ASX: XPJ) tanked 1.34% today.

Energy stocks were on the nose too, evidenced by the S&P/ASX 200 Energy Index (ASX: XEJ)'s 1.28% dive.

Utilities shares didn't escape the storm either. The S&P/ASX 200 Utilities Index (ASX: XUJ) cratered 0.55% this Tuesday.

Industrial stocks suffered a similar fate, with the S&P/ASX 200 Industrials Index (ASX: XNJ) dipping 0.45%.

Healthcare shares were unlucky too. The S&P/ASX 200 Healthcare Index (ASX: XHJ) sank 0.11% today.

Our last losers were consumer staples stocks, illustrated by the S&P/ASX 200 Consumer Staples Index (ASX: XSJ)'s 0.03% slip.

Turning to the winners now, it was tech shares that were the stars of today's show. The S&P/ASX 200 Information Technology Index (ASX: XIJ) soared up 2.01% this session.

Communications stocks also ran hot, with the S&P/ASX 200 Communication Services Index (ASX: XTJ) surging 1.58%.

Financial shares got a reprieve as well. The S&P/ASX 200 Financials Index (ASX: XFJ) jumped 1.25%.

Finally, consumer discretionary stocks had a nice Tuesday, as you can see from the S&P/ASX 200 Consumer Discretionary Index (ASX: XDJ)'s 0.69% rise.

Top 10 ASX 200 shares countdown

Today's top index stock was financial share Netwealth Group Ltd (ASX: NWL). Netwealth stock flew 6.73% higher this session to close at $24.43 a share. 

This came after the company revealed its outlook for FY26, as well as some other developments.

Here's how the other winning stocks landed their planes: 

Our top 10 shares countdown is a recurring end-of-day summary that shows which companies made big moves on the day. Check in at Fool.com.au after the weekday market closes to see which stocks make the countdown.

The post Here are the top 10 ASX 200 shares today appeared first on The Motley Fool Australia.

But the infrastructure AI actually runs on, the data centres, the power grids, the networks, is being built right here in Australia.

Three ASX AI stocks are capturing that opportunity in very different but equally compelling ways.

NextDC: where AI workloads live

NextDC Ltd (ASX: NXT) is Australia's largest independent data centre operator, and the closest thing on the ASX to a direct, pure-play bet on AI infrastructure demand.

The numbers confirm the demand is real and accelerating.

Contracted utilisation surged 60% to 667MW in the March 2026 quarter alone. This was driven by massive contract wins as AI workloads requiring intensive computing power, storage, and connectivity flooded into NextDC's facilities.

The company's forward order book, combined with existing billing, is expected to generate contracted EBITDA in excess of A$1 billion. This is more than four times the midpoint of FY26 guidance, as that contracted capacity converts to revenue progressively from FY26 through FY30.

OpenAI, one of the world's largest and best-funded AI companies, is the foundational customer for NextDC's $7 billion AI data centre campus in Western Sydney. This relationship relationship validates both the strategic importance of Australian AI infrastructure and NextDC's position within it.

The risks are equally visible.

$5 billion in FY27 capital expenditure means execution matters enormously given the large sums of capital invested.

Goodman Group: a surprise ASX AI infrastructure play

Goodman Group (ASX: GMG) is the landlord of the AI revolution.

Before a data centre can be built, someone needs to secure the land, obtain planning approvals, connect the power, and deliver the shell.

That is Goodman's role, and it is an increasingly scarce and valuable one.

Data centres now make up 73% of Goodman's development pipeline, which is on track to reach $18 billion by June 2026. The company possesses a global power bank of 6.4 gigawatts across 16 cities that took years to assemble and that no newcomer can replicate quickly.

This is Goodman's competitive advantage.

Morgans has noted that industry data centre capital expenditure requirements likely exceed global capital market funding capacity. This statement describes a market where the constraint is not demand but the ability to build fast enough.

Consequently, Goodman is positioned on the supply side of that constraint, with secured power, sites, and locked-in capital partners already in place.

On the broker side, Morgans retains a buy rating on Goodman with a $36 price target, and UBS endorses Goodman's outlook with a $36.41 price target.

Megaport: how AI workloads move

Megaport Ltd (ASX: MP1) has changed the most of the three over the past twelve months.

The company was already known as a network-as-a-service provider connecting businesses to cloud platforms.

But its acquisition of Latitude.sh pushed it deeper into the AI infrastructure stack by adding high-performance GPU, CPU, and storage capabilities alongside its core connectivity offering.

Subsequently, Megaport rose almost 50% in FY26, smashing the ASX 200's 3% gain, as the market began to recognise it as an AI infrastructure contender rather than simply a cloud connectivity story.

$254 million in new AI contracts through Latitude.sh, generating $90.6 million in annualised recurring revenue, confirmed that AI demand is already flowing into the business.

CEO Michael Reid described the contract wins as evidence that

Megaport is becoming an essential platform for powering the applications of tomorrow.

The risks across all three ASX AI stocks

However, none of these three ASX AI stocks is without risk.

NextDC's $5 billion FY27 capex plan means any slip in execution or AI demand would hit the stock hard.

Goodman's premium valuation reflects how much the market has already priced into its data centre transition. This leaves little room for disappointment.

Megaport has to prove the Latitude.sh contracts convert into attractive returns over time, not just headline contract values.

Additionally, all three are also sensitive to interest rate movements given their capital-intensive operating models.

Foolish takeaway for ASX AI stocks

NextDC, Goodman, and Megaport each capture the AI infrastructure opportunity from a different angle.

NextDC provides the capacity. Goodman provides the land and power. Megaport provides the connectivity.

For investors who believe AI-driven infrastructure demand will keep accelerating, all three deserve a place on the watchlist.

The post The best AI stocks on the ASX right now appeared first on The Motley Fool Australia.

CSL Ltd (ASX: CSL), NextDC Ltd (ASX: NXT), and Treasury Wine Estates Ltd (ASX: TWE) all promise to outperform despite varied fortunes in FY26.

Here is the bull case for each, along with the risks investors should weigh against it.

CSL: FY27 is the year the recovery has to show up

CSL cut its FY26 guidance in May, trimming revenue expectations to around US$15.2 billion. Furthermore, the company flagged roughly US$5 billion in non-cash impairments across FY26 and FY27. These were mostly tied to the underperforming CSL Vifor acquisition.

In FY26, US immunoglobulin inventory normalisation and weaker China albumin pricing did most of the damage.

Interim CEO Gordon Naylor was blunt about it:

Our growth initiatives are working, but the financial benefits will take longer than previously anticipated to materialise.

Looking ahead, CSL has said it expects revenue growth in its core Behring division in the second half of FY26. Moreover, a permanent CEO and new commercial leader is set to take over from 1 July 2026, right as FY27 begins.

This all makes FY27 an important year for the company.

CSL shares are down over 50% over the past year, which means the bar for FY27 is low. But with some potentially good news on the horizon, investors may have something to look forward to for CSL shares in FY27.  

NextDC: FY27 is when the order book becomes revenue

NextDC has spent FY26 signing contracts faster than it can build capacity for them.

Pro forma contracted utilisation jumped 60% in a single quarter to 667MW as at 31 March 2026. The company's own presentation states that its forward order book, combined with existing billing, is expected to generate contracted EBITDA in excess of A$1 billion, more than four times the midpoint of FY26 guidance.

The catch is timing.

EBITDA generated from these new contracts does not arrive in FY26. It is forecast to convert "progressively from FY26 through FY30", with FY27 being the first year the bulk of that new AI-driven capacity actually starts billing.

FY27 capital expenditure is guided at approximately $5 billion, nearly double FY26's already-elevated spend. This is a clear signal that management expects FY27 to be the year demand turns into delivered, billable capacity rather than just signed paper.

The primary risk is straightforward: that much capex, funded in part through equity raises, means poor execution or declining AI-related demand could hit the stock hard.

However, with increasing cash flow from its previous contract wins, FY27 could be the year NextDC explodes.  

Treasury Wine Estates: FY27 is when the cost-out program starts paying off

Treasury Wine has had a rough run in FY26, with shares down almost 40% over the past year as US and China inventory imbalances weighed on earnings.

At its investor day, management reaffirmed FY26 EBIT guidance of $480 million to $490 million. Management further states that FY27 earnings are expected to be at least equivalent, due to the completion of Penfolds' China inventory rebalancing during FY27.

Furthermore, the company's "TWE Ascent" cost program, targeting $100 million in annual savings, is set to deliver its first benefits starting in FY27.

The full financial impact is expected to be phased in over two to three years.

Shares jumped 10% on the reaffirmed guidance, a sign that the market is encouraged by management's steps.

As a result of all this, FY27 could be the year that TWE reverses its fortunes.

The common thread, and the common risk

All three stories share a pattern: management is asking investors to look past a difficult FY26 and focus on the catalysts in FY27.

This pattern is exactly what makes a stock interesting to watch heading into a new financial year. It is also, however, the kind of promise that may not always arrive on schedule.

Foolish takeaway

CSL, NextDC, and Treasury Wine Estates each have a specific reason FY27 could look meaningfully better than FY26.

None of these ASX shares is risk-free. In each case, the bull case depends on management meeting a target that has already been revised once.

However, after a difficult FY26, these stocks may be ripe for a rebound.

The post These ASX shares could be top buys for FY27 appeared first on The Motley Fool Australia.

The Nasdaq Composite Index (NASDAQ: .IXIC) posted its fifth consecutive losing session on Friday, dropping 0.24% to close at 25,297.62. Investors rotated out of major technology stocks and into more defensive areas of the market.

For the week, the Nasdaq fell 4.6%, its worst weekly performance in months, even as the Dow Jones Industrial Average Index (DJX: .DJI) actually rose 0.6% over the same period.

That rotation also affected ASX stocks, with the S&P/ASX 200 Index (ASX: XJO) falling 0.42%, led by many well-known tech stocks.

What drove the sell-off, and what this means for ASX tech stocks

A lot of this sell-off can be attributed to renewed caution about the entire AI infrastructure trade.

Chip stocks were weaker after reports that OpenAI is considering delaying its IPO to next year. This is due specifically to Space Exploration Technologies Corp (NASDAQ: SPCX)'s poor performance following its own debut and broader volatility in AI-related shares.

That report raised concerns about the sustainability of AI infrastructure spending, given the delay in funding from the capital markets.

This is a challenge to the thesis behind buying ASX data centre and AI infrastructure stocks this year: that mega-cap AI IPOs would keep validating and funding the buildout.

When the US sneezes, Australia catches a cold. These three ASX tech stocks all reacted in different ways to last week's underperformance.

NextDC Ltd (ASX: NXT)

NextDC is the ASX tech stock most directly exposed to this specific news. This is because OpenAI is the foundational customer for its Western Sydney AI data centre campus.

A delayed OpenAI IPO does not cancel that contracted relationship, but it does remove, at least for now, one of the strongest near-term catalysts that has supported sentiment around NextDC's AI infrastructure thesis.

The contracted capacity and capital expenditure NextDC has already committed to remain unchanged regardless of OpenAI's listing timeline.

But investors should not assume the AI IPO wave will keep providing an automatic tailwind for the stock in the way it has over recent months.

WiseTech Global Ltd (ASX: WTC)

WiseTech is sensitive to broad technology sector rotation given its premium valuation and exposure to global growth-stock sentiment. But this week the company also gave the market its own, separate reason to worry.

Reports emerged that the Australian Federal Police is investigating founder Richard White over serious allegations involving a former employee.

This sent WiseTech shares down almost 13% in a single session, on top of an already difficult year for the stock.

Until there is clarity on both the investigation and the board's response, the stock's near-term moves are likely to reflect that overhang as much as any broader rotation out of growth names.

Xero Ltd (ASX: XRO)

Xero sits closer to the US SaaS peer group than either WiseTech or NextDC. This makes it the most directly comparable of the three to whatever is driving Nasdaq software valuations specifically.

When US growth software names sell off on rate or rotation concerns, Xero's share price tends to move in parallel. This is despite the fact that the company's own performance has remained solid through the volatility.

Xero delivered operating revenue growth of 31% to NZ$2.8 billion in its most recent full-year result. The US stood out as its fastest-growing market on the back of its Melio bill pay integration.

This gives Xero shares a company-specific growth story that has little to do with whatever is driving sentiment on the Nasdaq this week.

Foolish Takeaway for ASX tech stocks

The Nasdaq's worst week in months was driven by a rotation away from growth and AI-adjacent names, sharpened by a specific report that OpenAI may delay its IPO because of SpaceX's shaky debut.

That detail matters more for NextDC than for WiseTech or Xero, given its direct contractual link to OpenAI.

For all three, however, the broader lesson is the same: ASX tech stocks are not immune to what is happening across the pond in the US.

The post The Nasdaq just had its worst week in months. Here's what that means for ASX tech stocks appeared first on The Motley Fool Australia.

This week, brokers have renewed their buy ratings and updated their 12-month price targets on several ASX 200 shares.

Let's take a look.

Judo Capital Holdings Ltd (ASX: JDO)

The Judo share price is 90 cents, down 1.6% today.

This ASX 200 bank share was smashed yesterday, collapsing 46% on a profit guidance downgrade.

Today, Morgans renewed its buy rating on Judo shares but slashed its 12-month target price from $2.15 to $1.47.

This implies a potential bounce back of more than 60% over the next year.

Morgans said:

JDO downgraded its FY26 PBT guidance by c.8% at the mid-point. Even more disappointing was first-time FY27 PBT guidance which was c.16% below expectations at the mid-point.

The share price drawdown was vicious (particularly considering the decline that had already occurred since February).

While the earnings growth outlook has moderated, we still forecast c.30% EPS growth across both FY26 and FY27 with the stock now trading on a c.6.8x PER (FY27F) and 0.6x P:BV (end-FY26).

A significant risk premium or probability of failure has been priced into the stock. BUY.

BHP Group Ltd (ASX: BHP)

The BHP share price is $57.17, up 1.1% today.

The market's largest ASX 200 mining share has lifted 29% in the year to date (YTD).

BHP shares have dropped almost 10% since last Thursday amid news of a $2.8 billion cost blow-out at its Jansen potash project.

Morgan Stanley reiterated its buy rating on BHP shares with a price target of $67.50.

This implies a potential 14% upside ahead.

Qantas Airways Ltd (ASX: QAN)

The Qantas share price is $10.65, down 0.6% on Friday.

The ASX 200 airline share has ripped 18% over the past month.

Ord Minnett reiterated its buy rating on Qantas shares this week.

The broker raised its 12-month price target from $10.50 to $11.50.

This suggests a potential 8% upside ahead.

Goodman Group (ASX: GMG)

The Goodman share price is $32.06, down 0.4% today.

The ASX 200's biggest real estate share has risen 4% YTD.

Citi renewed its buy rating on Goodman shares with a $40 target yesterday.

This suggests a potential 25% upside ahead.

NextDC Ltd (ASX: NXT)

The NextDC share price is $14.44, down 1.9% today.

This ASX 200 tech share has risen 17% YTD amid a broader sector rebound.

Citi reiterated its buy rating on NextDC shares with a price target of $19.10.

This implies potential capital growth of 32% ahead.

Electro Optic Systems Holdings Ltd (ASX: EOS)

Electro Optic Systems shares are $9.33, down 2.8% today.

The ASX 200 defence share has lost 6% of its market valuation YTD.

Bell Potter renewed its buy rating on Electro Optic Systems shares this week.

The broker increased its 12-month price target from $10.60 to $12.50.

This suggests a potential 34% upside ahead.

Lynas Rare Earths Ltd (ASX: LYC)

The Lynas Rare Earths share price is $19.02, up 1.7% today.

This ASX 200 rare earths share has ripped 56% higher YTD.

UBS upgraded Lynas Rare Earths shares to a buy rating with a $23.65 target on Thursday.

This implies a potential 24% upside ahead.

Insurance Australia Group Ltd (ASX: IAG)

The IAG share price is $8.12, down 1.2% today.

Over the past month, this ASX 200 financial share has lifted 8%.

Goldman Sachs reiterated its buy rating on IAG shares with an $8.60 target yesterday.

This suggests a potential 6% upside ahead.

The post 8 ASX 200 shares with reaffirmed buy recommendations this week appeared first on The Motley Fool Australia.

This creates opportunities for companies that sit inside these changes.

But where are the opportunities for investors?

Here are three ASX tech shares that could be well placed for a more digital world.

NextDC Ltd (ASX: NXT)

NextDC gives investors exposure to the physical backbone of the digital economy.

It develops and operates data centres, which are used by businesses, cloud providers, technology companies, and other organisations that need secure and reliable infrastructure for their data and computing workloads.

That makes NextDC a different kind of technology share. It is not selling apps or software. It is providing the highly specialised facilities that help keep the digital world running.

Demand for data centre capacity is being supported by cloud computing, artificial intelligence, enterprise digitisation, and the rising volume of data being created across the economy.

These facilities are difficult to build well. They require large amounts of capital, technical expertise, power access, cooling capability, security, and strong operating standards. That creates a meaningful barrier to entry.

Morgans recently put a buy rating and $18.00 price target on its shares.

Pro Medicus Ltd (ASX: PME)

Pro Medicus is an ASX tech share that gives investors exposure to the digital side of healthcare.

Its Visage platform helps hospitals and radiology groups manage, view, and interpret medical images. That is important because modern healthcare produces enormous amounts of imaging data. Scans need to move quickly, load reliably, and be available to clinicians when decisions are being made.

Pro Medicus has built a strong reputation in this market, particularly with large healthcare networks overseas. Its software is not just a nice extra for its customers. It can sit close to the daily workflow of radiologists and hospitals.

And with the long-term need for better medical imaging infrastructure only likely to increase as healthcare systems become more digital, Pro Medicus appears well-placed for long-term growth.

Bell Potter recently put a buy rating and $226.00 price target on its shares.

TechnologyOne Ltd (ASX: TNE)

TechnologyOne is one of the ASX's strongest enterprise software businesses.

It provides software used by large organisations such as councils, universities, government bodies, and corporations.

These customers need systems that can help manage finance, payroll, planning, assets, projects, and administration. The work happens behind the scenes, but it is essential to how these organisations function.

This gives TechnologyOne an attractive position. Its software can become deeply embedded in customer operations, which can make relationships sticky and support recurring revenue over time.

And with the company's international expansion gaining momentum, it appears well-placed for growth over the long-term.

Morgan Stanley has an overweight rating and $32.00 price target on its shares.

The post 3 buy-rated ASX tech shares with bright futures appeared first on The Motley Fool Australia.

The sell-off was centred on some of the biggest names in the artificial intelligence (AI) trade, with investors taking profits after a very strong run.

Overnight, the Nasdaq Composite Index (NASDAQ: .IXIC) fell 2.2%, while the Philadelphia Semiconductor Index (NASDAQ: SOX) dropped 7.9%.

Some of the bigger falls came from the names that have been riding the AI boom.

Micron Technology Inc (NASDAQ: MU) dropped 13% to US$1,051.77, Nvidia Corp (NASDAQ: NVDA) fell 4.1% to US$200.04, while Qualcomm Inc (NASDAQ: QCOM) and Marvell Technology Inc (NASDAQ: MRVL) lost 8% and 9.4%, respectively.

While this might sound like a warning sign for ASX tech shares, the local market has gone the other way today.

At the time of writing, several large ASX tech shares are trading higher, despite the weak US lead.

So, why are ASX tech shares rising?

ASX tech shares move higher

The main reason is that ASX tech shares aren't really chip stocks.

The overnight selling was focused on US companies closely tied to semiconductors, memory chips, and AI infrastructure.

And that is not quite the same as our local tech sector.

Xero Ltd (ASX: XRO) is an accounting software business. WiseTech Global Ltd (ASX: WTC) provides logistics software, while Pro Medicus Ltd (ASX: PME) sells medical imaging software.

So, while the US sell-off is clearly worth watching, it doesn't directly change the outlook for most ASX tech names.

There also appears to be some bargain hunting going on.

A number of local tech shares have already been hit hard in 2026, with Xero and WiseTech both under heavy pressure recently.

At the time of writing, Xero shares are up 7.1% to $69.63, while WiseTech shares are up 13.42% to $32.62.

Pro Medicus shares are 2.1% higher at $176.75, and NextDC Ltd (ASX: NXT) shares are up 2.20% to $14.85.

What should ASX investors watch now?

The key thing to watch is whether the selling stays in US chip stocks or starts spreading across the broader US tech sector.

If investors keep taking money out of the AI trade, ASX growth shares could still feel some pressure, especially those trading on higher valuations.

But for now, the local market is holding up reasonably well.

And that is likely because many ASX tech shares have already had a difficult run in 2026.

Xero and WiseTech, in particular, are both still well below where they were a year ago, despite today's bounce.

The post US chip stocks were smashed overnight. So why are ASX tech shares rising? appeared first on The Motley Fool Australia.