The “anti-data center” wave is sweeping the world! From “unable to borrow” to “unable to build”, the plight of new cloud vendors is being upgraded twice

The Zhitong Finance App notes that on Wednesday, Australian data center operator NextDC's stock price plummeted by 39.5% after the company sharply lowered its annual profit forecast due to delays in electricity supply to the Melbourne facility due to opposition from the local community and related parties.

The company lowered its revenue guidance for the 2027 fiscal year from the previous forecast of A$615 million to A$640 million to A$475 million; at the same time, the earnings before underlying interest, tax, depreciation and amortization (EBITDA) forecast was lowered from the previous forecast of A$385 million to A$410 million to A$245 million.

According to NextDC, power delays stemmed from infrastructure upgrades at its M3 Melbourne data center being suspended due to community opposition, and electricity distributor Jemena (Jemena) does not expect construction to resume until February 2027.

Gemena explained the situation on the grounds that safety concerns raised by community opposition, access to the construction site was restricted, and that the local government had not approved it before further community consultations.

Citi pointed out in a report that NextDC's power delays may affect profits after fiscal year 2027 due to delays in approval of M3 expansion and longer than expected transformer upgrades.

As Australia is increasingly concerned about the impact of data center construction on local communities, Treasury Secretary Jim Chalmers said the government is setting national investment standards.

Chalmers told the media on Wednesday that the government welcomes investments in data centers and AI infrastructure, provided these investments are in the national interest, adding that the government is finalizing national investment standards to respond to concerns surrounding AI deployment.

Australia is not the only country facing opposition to data center projects. Global resistance to data center construction is growing, and people are concerned about their impact on local communities and the environment.

The NextDC stock price has been falling for seven consecutive weeks and is on its way to close down for the eighth week in a row.

Construction delays replace interest rates and become a new noose for new cloud vendors

This is not an exception. According to statistics from regulatory data company RegLayer, 47 US data center projects have come to a standstill in 2026 due to financing difficulties, grid bottlenecks, community opposition, and chip revisions. AllianceBernstein estimates that in the end, only about 35% of the planned US data centers will be built.

The delivery period for high-voltage transformers has been extended to more than 60 months, and the grid connection queues can easily take two to four years. A major new cloud vendor confessed in its third-quarter earnings report that for every one-month delay in the construction period, the confirmation of contract revenue of about 40 million US dollars was delayed.

If traditional data centers are heavy capital businesses with “stable demand,” then new cloud vendors such as CoreWeave (CRWV.US) and Nebius (NBIS.US) are pushing the leveraged arbitrage of “first borrowing money to build a computer room and then renting out GPU computing power” to the extreme.

In the past, market concerns about them focused on high interest rates: the bonds issued by CoreWeave in August this year reached 9%, and the yield in the secondary market has soared to 15.6%; interest expenses in the second quarter reached US$640 million, which is almost the same as net loss, and the debt-to-equity ratio is as high as 8.94 times. Nebius issued US$5.75 billion convertible bonds in August this year. The term was extended from 2030 to 2034, and the cost of effective financing increased markedly.

However, what has really transformed this dilemma from “expensive” to “insurance” is the amplification effect of construction delays on high-leverage models, and it is surpassing interest rates and becoming the number one threat to new cloud vendors.

First, the revenue side. The Xinyun vendor signed a long order with a locked price, but delivery depends on the availability of electricity. As soon as the construction period was delayed, revenue confirmation was delayed, but the high interest and depreciation did not stop. The “monthly deferral of 40 million US dollars in revenue” statement means that even if the utilization rate is full, it will not be able to make up for the confirmation window that was swallowed up by the delay.

Second, the asset side. GPUs are not factory buildings; they depreciate extremely fast. Once construction is delayed until the next generation chip is on the market, the computing power of the previous generation, which has not yet been electrified in the warehouse, will instantly shrink, and the long price lock will instead turn from a “stable cash flow” to a “negative asset.” This is the logic of Citi's warning to NextDC: the impact of power delays could spill over beyond fiscal year 2027.

Third, the debt side is also the most dangerous part. Deferrals trigger downgrades and rising bond yields, which in turn raises refinancing costs, creating a negative cycle of “deferring, more difficult to finance, and further postponement”.

Rothschild Redburn analyst Alex Heisle said bluntly that the risk in the computing power layer is an “absolute decline”; Goldman Sachs data also showed that interest spreads on US high-yield AI bonds widened by 25 basis points in a week in mid-October, while interest spreads on non-AI bonds remained almost unchanged during the same period. The credit market is voting with its feet to directly price “not being able to build” into the financing costs of new cloud vendors.

What is even more alarming is that barriers have spread from “physical bottlenecks” to “social resistance”. Community opposition to NextDC is not an isolated case: Microsoft has withdrawn its 50-megawatt data center lease due to UK grid restrictions, and a $5 billion joint venture between Google and Blackstone has also been blocked at key sites. When the “neighborhood avoidance effect” becomes a global variable, construction delays change from “predictable engineering problems” to “systemic risks that are difficult to buy through with capital.”

As far as the market is concerned, the pricing logic is quietly changing: in the past, we looked at “who has more chips and bigger orders”; now we are looking at “who has the power in place and the debt is manageable”. Gartner predicts that by 2030, more than 80% of independent new cloud vendors will not be able to survive independently. High interest rates are only a straw to crush camels; the delay in construction is the only thing that is getting heavier and heavier.