Fund Manager Summary on Megaport Ltd (ASX:MP1)
In February 2026, LSN Capital Partners commented that Megaport Ltd (ASX:MP1) delivered a result ahead of expectations with strong net revenue retention, annual recurring revenue and new‑logo growth, while investor disappointment centred on second‑half expense growth and negative translation from a stronger AUD, and that the Latitude.sh acquisition increases capital intensity but materially enhances the company’s customer value proposition for AI and high‑bandwidth workloads. Across fund managers the consensus is that Megaport is well positioned to capture structural tailwinds from cloud computing and AI due to a high‑quality, largely recurring revenue base (noted as 100% recurring by some), expanded product innovation, improved go‑to‑market execution and favorable competitive dynamics that are enabling market‑share gains; recent corporate actions—A$200 million institutional placement, the Latitude.sh acquisition and targeted expansion into India, partnerships (for example Aviatrix), platform advances (MVE) and ongoing sales investment—are viewed as strategic moves to deepen the addressable market and support cross‑sell of integrated networking and compute services. Key risks highlighted include historical share‑price volatility, prior governance and execution concerns, the growth‑at‑expense‑of‑margin trade‑off that may induce near‑term volatility, integration risk and higher capital intensity from the compute acquisition, dilution and margin pressure from the placement, and FX/translation and expense‑guidance sensitivity; actionable monitoring items are execution on Latitude.sh integration, delivery of promised free cash flow and net cash build, trends in NRR/ARR and new‑logo growth, margin trajectory versus reinvestment plans, and lead indicators from sales and competitive displacement in target markets.
Commentary From The Managers
There are 24 insights from 10 fund managers regarding their investment in Megaport Ltd (ASX:MP1) available on Thesis Tracker.
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Updates are made available to members within 12 hours of being released. The completeness, accuracy or current status of the investments referenced are not guaranteed.
Commentary From The Managers
LSN Capital Partners
28 Feb 2026
$8.31
Summary
- LSN Capital Partners believes Megaport delivered a result ahead of expectations and continues to hold because underlying metrics and strategic positioning point to durable growth despite near‑term FX and expense headwinds.
- Result quality: Performance was strong across net revenue retention, annual recurring revenue (ARR) and new logo growth, which drove the upside to expectations.
- Investor concerns: Sentiment was dented by the second‑half outlook, notably the implied expense growth trajectory and a negative translation impact from a stronger AUD.
- Strategic positioning: Megaport is well placed to benefit from AI‑driven demand and the rising movement of data between data centres and enterprise customers.
- Acquisition impact: The recent buy of physical compute raises capital intensity but materially enhances the customer value proposition, making bundled offerings more compelling.
- Longer‑term opportunity: Integrated networking + compute should expand Megaport’s addressable market, enable deeper customer relationships and accelerate cross‑selling of complementary services.
LSN Capital Partners
12 Feb 2026
$11.02
Summary
- LSN Capital Partners believes Megaport is a compelling infrastructure-as-a-service platform benefiting from the AI and cloud connectivity megatrend and continues to hold as an example of a technology holding positioned to benefit from AI infrastructure investment.
- Megaport operates a Network-as-a-Service (NaaS) platform that enables cloud and AI infrastructure connectivity, positioning it as critical plumbing for enterprise digital infrastructure.
- LSN views AI and cloud adoption as key drivers of utilisation growth and operating leverage within the Megaport platform, as more workloads migrate to cloud and AI environments.
- LSN projects total revenue CAGR of approximately 25% from FY24–FY30, reflecting the long compounding runway for a business at the intersection of cloud adoption and AI infrastructure buildout.
- Megaport is identified as a portfolio holding positioned to benefit from AI infrastructure and connectivity platform demand, while avoiding sectors exposed to search displacement, workflow commoditisation, and inventory disintermediation.
Montgomery Investment Management
8 Jan 2026
$12.55
Summary
- Montgomery Investment Management highlights Megaport (ASX:MP1) as a key investment opportunity.
- The recent acquisition of Latitude.sh will support Megaport's AI and machine learning initiatives.
- Megaport's share price has declined by 30% from $17.70 to $12.40, presenting a potential buying opportunity.
- The acquisition of Latitude.sh is perceived as a strategic move that could enhance the company’s valuation.
- There is optimism that the stock could be valued at over $20 in light of the acquisition.
- Montgomery Investment Management continues to hold its investment, noting the growth potential despite recent share price challenges.
Yarra Capital Management
31 Dec 2025
$12.17
Summary
- Yarra Capital Management continues to hold Megaport Ltd as an overweight position despite near-term dilution from a capital raise for the Latitude.sh acquisition.
- Megaport completed a A$200 million institutional placement to fund the Latitude.sh acquisition and support India expansion.
- While the placement caused near-term dilution and margin concerns, Yarra views the strategic rationale as sound.
- The manager sees long-term revenue and geographic expansion as more than offsetting the near-term headwinds from the capital raise.
LSN Capital Partners
8 Dec 2025
$13.43
Summary
- LSN Capital Partners notes the recent acquisition of private-cloud operator Latitude.sh by Megaport.
- The acquisition is aimed at enhancing Megaport's Indian network assets.
- Many companies now utilize a blend of public cloud and private/on-premises systems, facing challenges like costs and vendor lock-in.
- Private Cloud services align well with Megaport’s connectivity offerings.
- Megaport's network is optimized for efficient data movement, addressing barriers to switching cloud providers.
- The acquisition supports Megaport’s strategy to bolster its platform for high-bandwidth, performance-sensitive workloads, particularly in AI.
- Integration risks are associated with large acquisitions, and LSN Capital Partners will monitor the combined performance closely.
Yarra Capital Management
30 Nov 2025
$14.04
Summary
- Yarra Capital Management believes Megaport’s strategic investments position the company for durable international growth and continues to hold because the Latitude.sh acquisition and capital raise enhance capabilities and addressable markets despite near-term dilution.
- MP1, overweight — maintained positive stance based on strategic rationale rather than short-term price action.
- During the period the stock underperformed following a A$200 million institutional placement used to fund the acquisition and support expansion into India.
- The placement created near-term dilution and raised some margin concerns, weighing on sentiment and performance.
- The acquisition of Latitude.sh materially strengthens Megaport’s capabilities in bare-metal compute, adding important product depth to its networking platform.
- Combined with a solid recurring-revenue base, the deal improves cross-sell and monetisation opportunities across existing and new customers.
- Expanding into high-demand international markets, notably India, increases the company’s addressable market and growth runway.
- Net view: short-term dilution and margin pressure are acceptable trade-offs for enhanced technology, market exposure and an enlarged global footprint that support long-term growth potential.
Blackwattle Investment Partners
31 Aug 2025
$16.04
Summary
- Megaport (+9.2%) is a global telecommunications provider specializing in data centre access and network construction.
- The company’s competitive advantage lies in its ability to connect a large number of data centers globally through a proprietary software layer, providing customers with one-touch access from a central location.
- Recent share price volatility has been attributed to a changing sales strategy, which appears to be stabilizing now.
- Strong lead indicators are evident in recent results, suggesting a positive trend.
- In August, Megaport announced plans to increase investment in its sales function, indicating expectations for continued improvement in lead indicators over the next 12 months.
- Blackwattle Investment Partners continues to hold because of these positive developments and the potential for future growth.
Longwave Capital
31 Aug 2025
$16.04
Summary
- Longwave Capital initiated a new holding in Megaport Ltd (MP1) around this time last year.
- Changes included a new chair, new CEO, and a new U.S. go-to-market strategy.
- These changes are viewed as welcome improvements to the business.
- The recent results confirmed strong delivery and execution.
- Market reactions may lead to volatility as the company focuses on growth at the expense of margin.
Yarra Capital Management
30 June 2025
$14.44
Summary
- Yarra Capital Management continues to hold Megaport (MP1) as an overweight position.
- Megaport has outperformed during the period, despite no material company-specific news.
- The company is well-positioned in high-growth end markets such as cloud and AI.
- Revenue growth is driven by market share gains from new products and improved execution.
- Challenges faced by key competitors further support Megaport's growth.
- The cost base is viewed as sustainable after years of reinvestment in product and distribution.
- Yarra expects the net cash balance sheet to continue strengthening.
- This is supported by increasing positive free cash flow generation.
Yarra Capital Management
13 June 2025
$13.90
Summary
- Yarra Capital Management updates their investment thesis on Megaport Ltd, highlighting its strong growth potential.
- Megaport is a disruptor in the telecommunications space, offering a product set that is faster and more functional.
- The cost advantage of Megaport's offerings positions it at a much lower price point compared to traditional legacy telcos.
- Recent months have seen a step change level of innovation, with many new products launched over the past 18 months.
- Revenue growth outlook is supported by strong demand in high-growth markets, especially in cloud computing and AI.
- Megaport is gaining significant market share amid competitor challenges.
- Improvements in their go-to market strategy have enhanced their competitive positioning.
- With 100% recurring revenue, Megaport's financials reflect high-quality revenue streams.
- Low customer churn rates further cement Megaport's stability.
- The company's cost base is sustainable, supported by significant investments in product development and market strategy.
- Confidence around margins is bolstered by the generation of sustainable free cash flow.
- This sustainable cash flow trajectory is expected to lead to a continued build-up of net cash on the balance sheet.
Ellerston Capital
30 Apr 2025
$11.42
Summary
- Ellerston Capital continues to hold Megaport (MP1 AU) due to its unique telecommunications networks designed for data centre adjacent requirements.
- The company's networks are offered "as-a-service," allowing for instant deployment, closure, and billing on a PAYG basis.
- Megaport has a significant global market opportunity supported by strong structural tailwinds that underpin growth.
- Despite past volatility in performance linked to management changes, recent results indicate positive developments.
- The 1H25 results reflect early signs of success from the new product and sales strategy implemented under CEO Michael Reid, who is now two years into his tenure.
Wilson Asset Management
30 Apr 2025
$11.42
Summary
- Megaport is a global network services provider that connects customers to cloud services, managed services, and data centres.
- Expanded partnership with Aviatrix announced, enhancing secure, high-speed connectivity across hybrid and multicloud environments.
- The partnership eliminates the need for costly hardware-based encryption systems, streamlining deployment.
- Wilson Asset Management remains pleased with Megaport’s growth outlook.
- They continue to view Megaport as a compelling opportunity within the portfolio.
ECP Asset Management
30 Apr 2025
$11.42
Summary
- ECP Asset Management notes that Megaport (MP1) has outperformed despite a lack of material newsflow during the month.
- Management has initiated several actions contributing to a stabilisation of the NRR.
- A key development is the advancement of the MVE platform, facilitating rapid deployment of new software products without additional infrastructure investment.
- This advancement enables Megaport to leverage its existing hardware capacity and global network.
- Innovative services such as Cloud Routers and NAT Gateway are now being offered.
- This strategic shift positions Megaport for substantial growth through software innovation.
- Megaport capitalizes on the economic advantages of their blended internet product offering.
Longwave Capital
31 Mar 2025
$9.63
Summary
- Longwave Capital believes in the importance of patience with share price volatility to benefit investors over time.
- The long-term volatility of Megaport's share price has been significant, with periods of trading at various premiums and discounts to fair value.
- While the fund manager acknowledges the emotional phases of investing (Hope, Despair, Reality), Longwave Capital is not a hope-based investor.
- The fund manager initiated a position in Megaport for the first time in late 2024 after observing a shift in the company’s valuation.
- Concerns over management and governance in late 2022 prevented earlier investment, as the business was still loss-making.
- By late 2024, the situation improved significantly: the business became profitable, new management was in place, and the US GTM strategy showed positive results.
- The expansion of Megaport's product range and the de-risked nature of the business aligned with the fund manager's view on risk and return.
- Longwave Capital sees long-term volatility and patience as key opportunities for investments that align with their risk and return objectives.
ECP Asset Management
28 Feb 2025
$11.12
Summary
- Megaport Ltd (MP1) outperformed in the month following the release of its H1 FY25 results.
- The company reported a stabilisation of Net Revenue Retention (NRR).
- Innovation efforts led to new product launches, enhancing monetisation of the network fabric.
- More logos, ports, and services were added this quarter than in the previous four quarters combined.
- ECP Asset Management continues to hold because we remain positive on MP1.
- Our investment thesis is anchored on Megaport's ability to drive growth through service expansion and customer value enhancement.
Longwave Capital
28 Feb 2025
$11.12
Summary
- Longwave Capital notes the recent rise of 18% in Megaport's share price.
- This increase coincides with largely unchanged FY25 guided revenue and EBITDA numbers, which were slightly trimmed by consensus.
- Megaport has maintained its profitability while investing heavily in new go-to-market capabilities and products.
- Signs of success include a increase in net revenue retention and the launch of new products.
- New sales team efforts have resulted in acquiring new logos, adding new ports, and achieving record increases in provisioned capacity.
- These indicators suggest that revenue growth is likely to accelerate beyond FY2025 and remain profitable.
- Longwave Capital has observed Megaport for over six years and became shareholders in the December quarter 2024.
ECP Asset Management
31 Jan 2025
$8.52
Summary
- Megaport Ltd (MP1) outperformed during the month.
- ECP Asset Management notes that the company has made several key hires from their biggest competitor.
- Issues regarding front book pricing have been addressed successfully.
- ECP Asset Management remains positive on MP1.
- The investment thesis is anchored on Megaport's ability to drive growth by expanding service offerings.
- Enhancing customer value is a critical component of the investment outlook.
ECP Asset Management
30 Sept 2024
$7.32
Summary
- ECP Asset Management continues to hold Megaport Ltd (MP1) despite recent underperformance.
- Recent FY25 guidance was below market forecasts, contributing to the underperformance.
- Top line growth was 5% below consensus.
- Operating cost growth was higher than expected as the company ramps up sales resources.
- ECP remains focused on a long-term thesis that MP1 offers a unique networking infrastructure-as-a-service.
- The company has a strong competitive advantage in its sector.
- ECP is pleased to see management making strategic investments in product, sales, and marketing.
Yarra Capital Management
30 Sept 2024
$7.32
Summary
- Megaport (MP1, overweight) – software technology company has underperformed following FY24 results.
- Results for FY24 were largely in line; however, FY25 revenue and earnings guidance fell below consensus expectations.
- Yarra Capital Management continues to hold a modest position as they anticipate improved customer volume trends in the medium to long term.
- Improvements expected as market conditions and execution enhance.
- Key highlights include low customer churn, margin expansion, and lower capex.
- These factors are supporting a transition to free cashflow positive in CY24.
- Further, they see significant cashflow potential in the long term.
ECP Asset Management
31 Aug 2024
$8.27
Summary
- Megaport Ltd (MP1) underperformed in August due to FY25 guidance falling below market forecasts.
- Top line growth was 5% below consensus.
- Operating cost growth was higher than expected as the company ramps up sales resources.
- ECP Asset Management continues to hold due to a long-term thesis that MP1 is a unique networking infrastructure-as-a-service business.
- The company has a strong competitive advantage.
- ECP is pleased to see management making strategic investments in product, sales, and marketing.
Yarra Capital Management
31 Aug 2024
$8.27
Summary
- Yarra Capital Management maintains an overweight position in Megaport, a software technology company.
- Recent performance underperformed after the release of FY24 results.
- While FY24 results were largely in line, FY25 revenue and earnings guidance fell below consensus expectations.
- Continued holding reflects belief that customer volume trends will improve in the medium to long term.
- Positive expectations driven by improving market conditions and execution.
- Notable factors include low customer churn, margin expansion, and lower capex.
- These factors are anticipated to support a transition to being free cashflow positive in CY24.
- There is significant cashflow potential for the long term.
Ausbil Investment Management
30 June 2024
$10.95
Summary
- Ausbil reports a 25.2% drop in Megaport (MP1) over the quarter
- New CEO Michael Reid has renewed the company's prospects
- Focus is on rebuilding the internal sales team
- Refocusing efforts on larger deals
- Rebuilding the US sales team is a gradual process
- Ausbil continues to hold because they anticipate future traction
Yarra Capital Management
30 June 2024
$10.95
Summary
- Yarra Capital Management holds an overweight position in Megaport (MP1).
- Recent quarterly results indicated weaker than expected customer growth.
- Despite this, full year earnings guidance was reiterated.
- Yarra believes that customer volume trends will improve in the medium to long term.
- Improvements are anticipated due to better market conditions and management changes.
- Factors supporting the investment thesis include yield growth, low customer churn, and margin expansion.
- Expected lower capital expenditures (capex) will assist in transitioning to free cash flow positive status in CY24.
- There is potential for significant cash flow in the longer term.
Wilson Asset Management
31 Jan 2024
$12.71
Summary
- Wilson Asset Management continues to hold a positive outlook on Megaport Ltd.
- Megaport is an enterprise software and services organization that facilitates data connection between companies and data centers.
- In January, Megaport's share price rose due to a positive quarterly earnings update that exceeded market expectations.
- The company secured a significant contract with a large US-based healthcare customer, valued at $4.2 million over three years, marking its largest deal to date.
- Megaport is positioned to benefit from the increasing demand for data connectivity and artificial intelligence.
- Overall, Wilson Asset Management believes Megaport is well-positioned to capitalize on the growing demand for its services in the coming years.
Elston Asset Management
30 Sept 2023
$11.84
Summary
- Megaport is a Brisbane-based pioneer in networking as a service, founded in 2013 by Bevan Slattery.
- It provides essential connectivity between data centres (DCs), crucial for enterprises with complex networks, especially in the cloud era.
- Setting up connectivity is simplified through a user-friendly platform, allowing clients to scale easily and cost-effectively.
- Elston continues to hold because Megaport is well-positioned to benefit from the ongoing rise of cloud computing and the adoption of multicloud solutions.
- The company specializes in connectivity capacity, driven by escalating data requirements and the growth of software as a service and AI offerings.
- Elston notes that Megaport competes with Equinix and Console Connect, but its DC provider-agnostic model offers a unique advantage.
- Recent challenges included share price declines due to macroeconomic headwinds and business-specific issues, including balance sheet concerns.
- Strategic initiatives led by interim CEO Bevan Slattery have resulted in guidance upgrades and achieving free cash flow breakeven ahead of expectations.
- Elston emphasizes the importance of Megaport's leadership stability, with new appointments aiding in regaining market confidence.
- Megaport's extensive global network and strong customer loyalty create significant barriers for new entrants in the market.
- Elston anticipates high rates of earnings growth, driven by operating leverage and increasing sales from both existing and new customers.
- While risks exist, including challenges in the direct sales channel and potential technological disruptions, Megaport's structural advantages remain intact.
- Elston believes Megaport offers unique exposure to growing data consumption and cloud computing themes, with expected returns exceeding hurdle rates over a 5-year horizon.
The completeness, accuracy or current status of the investments referenced are not guaranteed.
Frequently Asked Questions
Who is investing in Megaport Ltd (ASX:MP1)?
Fund managers including Longwave Capital, Ausbil Investment Management, Yarra Capital Management, Elston Asset Management, Wilson Asset Management, Ellerston Capital, ECP Asset Management, Blackwattle Investment Partners, LSN Capital Partners and Montgomery Investment Management have invested in Megaport Ltd (ASX:MP1).
Why do fund managers invest in Megaport Ltd?
Fund managers invest in Megaport Ltd due to its strong growth potential in the telecommunications sector, especially in cloud and AI markets. With a newly profitable status, improved management, and a broader product range, the company has shifted from volatility to a more stable pricing environment. Additionally, Megaport's 100% recurring revenue model and low customer churn enhance its appeal. Sustained investments in go-to-market strategies further position the company for significant market share gains and sustainable cash flow growth.
What happened to Megaport Ltd (ASX:MP1)?
Fund managers are investing in Megaport Ltd due to its strategic acquisition of Latitude.sh, a private-cloud operator that enhances its connectivity services. This acquisition positions Megaport to better handle high-bandwidth, performance-sensitive workloads, including AI and machine learning applications. Despite recent share price declines, analysts believe this represents a potential buying opportunity, leveraging the synergies from the acquisition to drive future growth and improve competitive positioning against vendor lock-in and cost challenges in cloud services.
What is the short interest in Megaport Ltd (ASX:MP1)?
The short interest in Megaport Ltd (ASX:MP1) is 1.60% which makes it the 162nd most shorted stock on the ASX. Of the 177.5M shares that Megaport Ltd has on issue, 2.8M have been sold short.
What does Megaport Ltd (ASX:MP1) do?
Megaport Ltd. engages in the provision of software-defined networking based elastic interconnection services. The company products include Port, MCR, Megaport Marketplace, and MegaIX. It operates through the following geographical segments: North America, Asia-Pacific, and Europe. The company was founded by Bevan Andrew Slaterry in 2013 and is headquartered in Brisbane, Australia.