Firmus Grid Ltd. had backing from Nvidia Corp. (NASDAQ:NVDA) and computing deals with Meta Platforms Inc. (NASDAQ:META) and OpenAI. But investors balked at valuing an AI data-center developer with just $51 million in annual revenue at more than $30 billion.
The Australian company scrapped its IPO Friday after failing to attract sufficient demand. The roughly $5 billion offering would have valued Firmus at $30.6 billion, about 600 times its fiscal 2026 sales, according to Bloomberg.
The $30 Billion Bet on Unbuilt Data Centers
Firmus builds facilities packed with Nvidia chips, selling computing capacity to AI companies.
Its IPO prospectus projected $5.8 billion in earnings before interest and taxes in 2029, assuming seven data centers were operational by the end of 2028, according to The Nightly.
Of its 912-megawatt development pipeline, however, just 46 megawatts had been built, Bloomberg found. Roughly 95% of its planned capacity remained unfinished.
Minotaur Capital co-founder Armina Rosenberg estimated that 97% of contracted revenue depended on facilities that hadn’t yet been constructed.
Firmus estimated it would cost $37.7 billion to build its five remaining data centers, according to its IPO documents. The company had secured $72.8 billion in future revenue commitments, but still needed to finance and deliver the infrastructure behind them.
Meanwhile, its valuation had soared from $5.5 billion in April to more than $10.5 billion in August.
Bloomberg reported that Firmus revised its financial projections following an additional Meta agreement in September, helping support its proposed $30 billion-plus valuation.
Why Investors Said No
“We think that Firmus indeed has a compelling story. It just doesn’t have a compelling valuation,” John Pearce, investment chief at Australian pension fund UniSuper, said before the IPO collapsed.
Pearce warned that Firmus would need repeated debt and equity fundraising to finance its expansion. Other investors were also concerned that existing shareholders could sell substantial holdings immediately after the listing.
As doubts mounted, bankers reportedly considered cutting the valuation from more than $30 billion to $20 billion–$25 billion and shrinking the offering. Even those concessions failed to attract sufficient demand.
With the IPO abandoned, Firmus is instead exploring a $2 billion to $3 billion private funding round with existing investors, Bloomberg reported Friday.
What It Means for Nvidia
Nvidia’s involvement goes beyond its investment in Firmus. In June, the companies announced plans for a 360-megawatt AI data-center campus in Indonesia, with up to 170,000 Nvidia chips.
The partnership also provides credit support to Firmus and gives Nvidia a share of future cloud revenue, on top of its hardware sales. Firmus expects the arrangement to generate $25 billion–$30 billion in customer revenue over six years.
Despite the failed IPO, traders on Polymarket assigned roughly 6% odds Friday to an AI-industry downturn by Dec. 31, essentially unchanged from Wednesday.
For Nvidia, the more immediate concern is whether Firmus can secure the financing needed to deliver its expansion. Any delays could push back substantial chip deployments and the cloud revenue Nvidia expects to share.
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