Megaport plugs in to new revenue growth streams

Megaport plugs in to new revenue growth streams

Megaport (ASX: MP1) has seen its revenue surge by almost a fifth in the first quarter on the back of new data centre partnerships and a dominant theme of US expansion.

The company deployed its software defined networking (SDN) service in 13 new locations in the quarter of which nine were in the US, helping it leverage a first-mover advantage in many regions.

Notching up new partnerships with operators including DataBank, DataMSP, Cavern Technologies and STT GDC, while expanding its ties with EdgeConnex, the network as a service (NaaS) provider appears to be pushing ahead with its goal to have a presence in 300 locations by mid-2019.

"During the first quarter of Fiscal Year 2019, organic customer growth outpaced previous quarters as did new monthly recurring revenue," says Megaport CEO Vincent English (pictured).

"This is the outcome of investments we have made in our sales engine and the fruition of key partners which have opened channel opportunities," he says.

Revenue was up 19 per cent quarter-on-quarter to reach $6.86 million, while in the month of September the group achieved 1,161 customers and was operating in 234 data centres.

63 of those centres are in the Asia Pacific region with the newest sites in Adelaide, Canberra and Hong Kong, while in Europe the group also has operations in 62 centres and 109 in North America. In addition, Megaport has 109 connected cloud on-ramps globally with the addition of one during the quarter.

"We are driving the edge of our footprint further to enterprise-rich locations. Minneaopolis, Tampa and Pittsburgh are excellent examples of cities where interconnection capabilities, particularly for cloud, have been underserved," says English.

"Megaport has built a rapid expansion capability which enables us to quickly deploy to partner data centres. With our Ecosystem of over 300 service providers, our partner data centres can respond to immediate demand for direct connectivity to leading cloud and managed services.

"We work with 79 unique data operators globally. With 109 cloud onramps, Megaport is the most cloud-connected SDN-based interconnection fabric in the world."

He concludes this all puts Megaport in a position to scale a "massive growth" of cloud services as digital transformation accelerates in the digital space.

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