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DXN LTD (DXN) - Modular Data Centers: Building the Backbone of Global Communications

• Andrew Musgrave

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The future of data infrastructure is modular, scalable, and rapidly deployable – and DXN Limited is leading the transformation. In this revealing conversation with CEO and Managing Director Shalini Lagrutta, we explore how this Australian company has achieved remarkable 48% revenue growth by revolutionising critical infrastructure deployment across telecommunications, satellite communications, defence, and AI sectors.

Shalini breaks down DXN's three-part business model: their core prefabricated modular data centres (approaching their 100th global deployment), owned edge data centres providing recurring revenue, and their newest strategic pivot – Data Centre as a Service. This innovative approach has secured contracts with major players like Globalstar for satellite ground infrastructure in Hawaii and a US-based satellite operator in Northern Territory, demonstrating their global capabilities and trusted reputation for quality builds in remote locations.

What makes DXN stand out in competitive global tenders? Their nimble approach to customisation and ability to integrate emerging technologies gives them an edge that larger competitors can't match. The StructCore indoor solution opens new markets for brownfield telco exchange upgrades, while their hyperscale prefabrication capabilities address the Asia-Pacific region's resource constraints. Perhaps most exciting is their move into AI-enabled high-density computing environments supporting up to 120kW per rack – positioning them perfectly for the GPU-as-a-service revolution.

Discover how DXN's prefabricated approach is reshaping critical infrastructure deployment worldwide and why their strategic expansion into recurring revenue models signals a promising future. Subscribe now to stay updated on the companies building tomorrow's digital backbone.

Andrew Musgrave Host

Welcome back to ASX Briefs, where we spotlight the companies shaping Australia's future. And today we're joined by Shalini Lagrutta, the CEO and Managing Director of DXN Limited, a leader in prefabricated modular data centre solutions with momentum building across high growth infrastructure sectors, including satellite communications and AI. 
 Shalini, it's great to have you with us and welcome to the ASX Briefs podcast. 

Shalini Lagrutta Guest

Thank you for having me. 

Andrew Musgrave Host

Now Shalini. For listeners that may be unfamiliar with DXN, can you just provide a brief overview of the company? 

Shalini Lagrutta Guest

Sure, thank you. So DXN is an Australian-based listed company. We design, build, operate prefabricated data centres, modular data centres, in the industry. We effectively specialize in rapidly deployable, scalable infrastructure solutions, essentially that support critical applications across industries such as telecommunications, subsea defence, mining, satellite communications and even global internet companies. So, we have two parts to our business. Most recently we have just introduced a third part, which is a Data Centre as a Service. 

So we've got our projects business, which is our modular data centres that we prefabricate and sell to our customers. So, we actually prefabricate them in the factory and we ship them out everywhere in the world within a timeframe that a customer agrees to, to a spec that a customer agrees to, and we then deploy them globally. That is one part of our business. That's probably approximately 70/80% of our revenues today and the highest part of our growth. We also own and operate two data centres, one in Darwin and one in Tasmania. That gives us recurring revenue, that's existing clients such as government, enterprise, as well as telecoms, and that is edge data centres. 

Effectively, that's the second part of our business. Now, most recently, we've just introduced a sort of combination of the two. So once the prefabricated module, so the skills that we've developed internally on the prefabricated modular data centres, as well as the owning and operating piece. So, we've started what we call the Data Centre as a Service for specific clientele, so for small sites that are remote and global, so for global internet companies, for satellite operators who need to have a remote site that we can then own and operate on behalf of them. It's the best mix of both experience that we've got coming together and creating that recurring revenue that we absolutely need in the business, and that's been the third opportunity that we've got in the company. That's now a business case, a business model as well for us. 

Andrew Musgrave Host

Okay, and the company just wrapped up FY25 with $16 million in revenue, marking a 48% increase on the previous year. So, what were the key drivers behind this strong growth? 

Shalini Lagrutta Guest

We're very proud of our FY25 results. This is about 48%, as you said. It really is driven by strong contract execution, so we did have some significant wins in the early stages of FY25. East Micronesia this is a prefabricated cable landing station that we built for four countries that we deployed during the year. That contributed to our FY25 results. Further, we've more recently signed several blue-chip international companies GlobalStar, DP World, Ventia also under our modular business. That contributed to some of our revenue growth. Additionally, we have the Data Centre as a Service offering for a US satellite-based operator, also in the Northern Territory. That's been a part of the FY25 results as well. 

Andrew Musgrave Host

Okay, and the Data Centre as a Service which you mentioned, that contract that has just come in for $3.6 million. So, what role do you see that playing in the company's revenue model going forward? 

Shalini Lagrutta Guest

Yep, sure. So that's a key milestone. The DCaaS contract is a key milestone for us. Really. It marks a shift for us from a purely capital-based build to long-term recurring revenue within DXN. This has been a strategic pivot for us and one that we're going to continue focusing on growing. And now DCaaS aligns us more closely with our existing project space customers in the modular data centre space that typically would have purchased and acquired infrastructure from us and had us deploy and hand over. But this model enables us now to provide them as a service solution where we acquire the site, we enable power and connectivity. We build a module; we enable their services as part of their offering going forward and then post that we operate and manage that site as well. So, it sort of brings that whole ecosystem of both different businesses that we had into a new revenue stream. So, this is a significant key milestone for us for our first win for the DCaaS contract. 

Andrew Musgrave Host

Okay Now the $4.6 million contract with Globalstar for data centres in Hawaii marks a big step into the satellite communications and aerospace market. So how does this sector fit into DXN's longer term strategy? 

Shalini Lagrutta Guest

So Globalstar is a satellite operator that has global deployments. It's an exciting frontier for DXN. We are deploying in Hawaii. It's US, it's a market that's not at all close. So, it demonstrates what we've always said is possible is that we're effectively a global company that can be building and prefabricating solutions anywhere in the world and replicating it in other parts of the world, so as, for instance, in this particular industry, in the satellite space industry. Demand for space communications is growing. There is backup requirements and defence requirements that are growing in the geopolitical arena that we currently live in. That is a key milestone or key opportunity for us as we grow into the European and US markets. Being able to prefabricate this anywhere else in the world and deploy it to site. A global customer is something that we've always been looking for and that really fits very well into our strategy on a long-term basis. 


 Andrew Musgrave Host

Okay, and can you share more about what differentiated DXN and in such a competitive tendering process?
 
 Shalini Lagrutta Guest

I think there is, you know, a whole raft of reasons. Look, I mean, I would say if there was one thing that we would pick, competitive tendering globally is very competitive. Companies from all around the world from the US, from Europe, compete in this international bids. DXN's already proven ourselves. We have over, we're getting to, we're going to hit our 100th deployment now in this financial year and that's a big milestone for us. 

These are sites that are up and running live today. That's, you know, customers are currently using for critical infrastructure. So, we've kind of proven ourselves in that space. So, we tend to get that reputation is there for a quality solution and a quality build. So that's a big part of why we continue to win and grow in that space. But I think the other piece is because digital infrastructure is highly evolving really quickly as the market changes, as the technology needs changes. Our unique value proposition is that we're small and nimble enough to adapt and change and build in technology that is needed to be built into a solution that a customer wants. That, I think, is a big part of why we continue to win. 

Andrew Musgrave Host

Okay, and DXN's StructCore indoor solution seems like a game changer, especially with the $1.6 million Ventia contract. So how does that product expand your capabilities and target markets? 

Shalini Lagrutta Guest

So that is again one of the key market segments that we announced to the market last year that we were going to go after, which is indoor prefabrication, which is essentially for brownfield exchanges, and this is not just restricted to Australia, it's a global product as well. Effectively, that has enabled us to open up a new market. So, telco exchanges, for instance, need upgrading. So, a lot of telco exchanges around the world are traditionally built. They are brownfield sites which are very restricted in being able to offer high-speed internet, high-speed data services. So DXN's prefabricated solutions has, in conjunction with our client again, we've developed a lot of this product in conjunction with feedback from the client over the last few years. We've now got our first crack into actually deploying it in a site in Pier Street in Western Australia. That's going to be the first site for first deployment for us. So that's a key win for us into a new market segment. 

Andrew Musgrave Host

Okay, now you're entering FY26 with $12 million in backlog and a strong pipeline, which is a great start. So where do you see the biggest growth opportunities over the next 12 to 18 months? 

Shalini Lagrutta Guest

The immediate opportunities as far as we can see is opportunities in the satellite sector, as I mentioned, similar to Globalstar type deals. We have lots of interest in Data Centre as a Service as well. We have the cable landing station, for instance. The subsea industry continues to grow, so we will definitely see growth coming in from that market. But I think a big part of the strategic plan moving forward for DXN is also to look at and it is in one of the slides that we released to market. It is the product slide that I always refer back to. 

This is the hyperscale build, so there are lots of hyperscalers, so data centre companies who are expanding into Asia Pacific. Now Asia Pacific is the hotbed bit and Asia Pacific struggles with high-quality resources that are able to put together data centre solutions in a time frame that a customer might want. So, they're all sort of looking into prefabrication and trying to automate the non-standard pieces, which takes the longest time within a hyperscale data centre. So, we actually see partnerships, alignments that we're starting to look at in the Asia Pacific market as well as the US market for this particular product, and I think that's going to be where we're going to see quite a bit of interesting growth in the next financial year. 

Andrew Musgrave Host

Okay, and just to wrap things up, you've mentioned ambitions to expand into AI enabled and, as you mentioned, hyperscale modular data centres. So, what's that roadmap look like over the next couple of years? 

Shalini Lagrutta Guest

Yeah. So just to cover off on the hyperscale, I think I kind of covered that earlier, but that's exactly where we see the market growing. There's real and live opportunities that we're starting to see within the pipeline around hyperscale, refabrication in the hyperscale build, and that is, you know, most of the data centres that you see that is coming up across Asia Pacific. The global internet companies are demanding prefabrication as well. That is definitely within our roadmap to continue developing. AI enabled is very hot, of course. So, these are sort of 1-to-10-megawatt type GPU as a service type high density. So, I'm talking about sort of 100, 120 kilowatts per rack. These are very, very dense racks within a small area, within a small space, whether it's greenfield or brownfield, so existing sites or new sites. So, we're starting to see quite a bit of that. 

We've got a product that's developed. We work with international partners on power and cooling for these type of system integration where we think our value is in the infrastructure integration. So, building the piping, the engineering that's required to complete a greenfield site, that's where we see a lot of our value is. So, this is an ecosystem that's evolving very quickly. The price points on GPU as a service is starting to drop, so we're starting to see a lot more real-life application. So, it's hard to say what's going to happen in this next financial year, but I would definitely see this as a big hotbed, which is why we're keeping our finger on this pulse for the next sort of between the next one to five years. I see quite a few of these type of applications in this market. 

Andrew Musgrave Host

Okay, Shalini. Well, thanks for your time today. It's been great to chat, to get an update on the company and all the moving parts there, and we look forward to the next update in the upcoming months. 

Shalini Lagrutta Guest

Thank you, Andrew. Thanks for having me. 

Andrew Musgrave Host

That concludes this episode of ASX Briefs. Don't forget to subscribe and we look forward to catching you on our next episode.