With a valuation of 130 billion, the computing power unicorn behind Byte is about to IPO in the United States

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With a valuation of 130 billion, the computing power unicorn behind Byte is about to IPO in the United States

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2026.11.12 09:02

· From Beijing

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The computing power supplier behind Byte is going to the United States to ring the bell.

Recently, Singaporean data center operator DayOne submitted a prospectus to the US SEC and plans to list on Nasdaq. According to Reuters, the company plans to raise up to US$5 billion, with a target valuation of US$20 billion, or approximately RMB 133.4 billion.

DayOne was born out of the overseas business of China's leading data center company GDS. Less than two years after its independent flight, DayOne raked in 3.4 billion yuan in revenue in the first half of 2026, and its half-year performance exceeded last year's full year performance.

In terms of its revenue, ByteDance alone contributed nearly 70% of its revenue, and Oracle was its second largest financier; and in terms of shareholders, top institutions such as Hillhouse, Couture Capital, and SoftBank Vision Fund were all listed.

How can a company that has only been established for four years win major customers such as ByteDance, and why can it attract so many capital bets?

Half-year revenue of 3.4 billion, behind which is cash-burning expansion

Looking at DayOne's prospectus, both growth and losses hit new highs.

In 2024, DayOne's full-year revenue will be US$178 million; in 2025, it will increase to US$484 million, a year-on-year increase of 171.9%; in the first half of 2026, revenue will further reach US$512 million, a year-on-year increase of 238%, and half-year revenue has exceeded last year's full year.

During the same period, the company's adjusted EBITDA profit margin increased from 32.3% to 40.2%, indicating that the operating performance of the main business is getting better.

But while revenue has soared, book losses have also continued to expand. The prospectus disclosed that in the first half of 2026, DayOne’s net loss reached US$77.2 million, which increased more than five times from US$12.6 million in the same period last year.

The company explained that the losses were mainly affected by factors such as large share-based payment expenses. In 2025, expenses incurred from equity incentives alone will reach US$342 million.

But compared with the losses on the books, DayOne's greater pressure comes from the construction of data centers. The data center is an asset-heavy business. It costs a lot of money to build a computer room in the early stage, and then the cost is slowly recovered by renting out cabinets and computing power.

In the first half of 2026, DayOne's capital expenditures for the purchase of fixed assets, land use rights and construction prepayments were as high as US$3.11 billion, more than 6 times its revenue in the same period; while the net cash flow generated from operating activities during the same period was only US$14.01 million.

No matter how fast income grows, it will be difficult to cover such a huge investment in construction. In order to continue to expand, DayOne needs to continue to raise funds from outside.

As of the end of June 2026, DayOne's total assets were US$12.836 billion, and total liabilities reached US$6.497 billion, of which US$4.426 billion were interest-bearing borrowings. In terms of equity financing, the company has raised approximately US$6.4 billion since its establishment. Institutions such as Hillhouse and Koutou Capital have successively participated in investments, and GDS remains an important shareholder.

In addition, some of the convertible preferred shares previously issued by DayOne also come with listing deadline requirements. If the company fails to complete the IPO before the end of 2030, qualified investors have the right to require the company to exit according to the agreed arrangement.

This also gives the listing another layer of meaning: in addition to raising funds for subsequent construction, DayOne also needs to provide exit channels for early investors.

The business of data centers is getting bigger and bigger, and the demand for funds behind it is also getting higher and higher. With so much money being burned, why is capital still willing to bet heavily? This has to start with the origin of DayOne and Byte.

Byte supports 70% of revenue, how does DayOne rely on to go global?

In the technology industry, it is not uncommon for invisible giants to grow from orders from large customers. DayOne is one of them: following ByteDance's globalization pace, this data center company has also expanded its business overseas.

This partnership can be traced back to DayOne’s predecessor, GDS. In 2020, ByteDance became a customer of GDS. As TikTok and other businesses accelerate their overseas expansion, the demand for data storage and computing in Southeast Asia and Europe continues to increase, and GDS has also begun to expand its business overseas.

In 2022, GDS established its overseas business entity GDS International. After external financing and business restructuring, this part of the business gradually became independent and was officially renamed DayOne in 2025.

After "flying solo", DayOne is still deeply tied to Byte, the number one customer. The prospectus shows that in 2025 and the first half of 2026, the company's largest customer contributed 69.4% and 69.2% of revenue respectively.

Although the prospectus did not disclose the name of the customer, according to multiple confirmations, the mysterious financial owner is ByteDance. As of September 2026, ByteDance has committed to renting DayOne’s data centers in Malaysia, Thailand and Finland, with a total of 838 MW of computing capacity.

DayOne’s global infrastructure layout is almost following ByteDance’s overseas trajectory.

Southeast Asia is DayOne's most important market. The construction of data centers in Singapore is restricted by land, electricity and approval conditions, and some computing power needs are gradually transferred to surrounding areas. The Malaysian state of Johor and the Indonesian island of Batam, which are adjacent to Singapore, have relatively low land and electricity costs and greater construction space.

DayOne seized this opportunity and combined Singapore's network connection advantages with the land and power resources of Johor and Batam to form a cross-border data center layout. This layout is already paying real dividends. In the first half of 2026, Malaysia contributed approximately 87% of DayOne’s revenue.

However, over-reliance on a single customer and market also brings risks to the company. In order to expand more revenue sources, DayOne is also actively introducing other technology giants. The prospectus shows that in the first half of 2026, the company's second largest customer Oracle contributed 15.1% of revenue, and the top two customers combined contributed 84.3%.

In June of the same year, DayOne also reached a cooperation with Firmus, an Australian AI infrastructure company supported by Nvidia, and planned to build a large-scale AI data center in Batam, Indonesia. The core tenant of the project pointed to Meta.

As of September 20, DayOne has contracted and booked capacity of 2.3 GW, global resource reserves of 4.6 GW, and business coverage in 10 markets.

In addition to traditional data centers, DayOne is also trying new computing methods. In 2026, the company cooperated with Australian start-up Cortical Labs and the National University of Singapore Medical School to launch a prototype of a biological data center that uses living neurons to participate in calculations.

This technology is still in the early exploratory stage and is still far from large-scale commercial application, but it can also be seen that DayOne is trying to expand new technical directions.

From Southeast Asia to Europe, from Bytedance to Oracle and other technology giants, DayOne has built a global computing power network.

AI computing power boom, capital begins to calculate detailed accounts

As DayOne sprints towards the Nasdaq, global AI infrastructure companies are encountering obstacles one after another in their listings.

Among them, the one that has received the most attention is Firmus, an Australian AI infrastructure company. This star company, which has received multiple rounds of investment from NVIDIA and is backed by Blackstone Group, originally planned to be listed on the ASX, with a valuation of approximately US$30.6 billion, and is expected to set the largest IPO record in Australian history.

However, during the investor inquiry stage, the market questioned the company's valuation, debt scale, and project implementation capabilities, and Firmus eventually withdrew its listing plan.

British AI cloud service provider Nscale also encountered a similar situation. The company originally aimed at a valuation of US$30 billion to US$35 billion, but institutional investors believed that the pricing was too high, and the valuation expectations given were significantly lower than the company's target. In November, there was news that Nscale was considering delaying its listing.

Why do these upstarts in computing power, who were once highly sought after by capital, encounter setbacks when they go public?

The reason is that the capital market’s attitude towards AI infrastructure is changing. In the past few years, the demand for AI computing power has grown rapidly, and the market is willing to pay for land, electricity and Nvidia chips. As long as the company can obtain resources and sign major customers, it will have the opportunity to obtain high valuations even if the data center has not yet been built.

But data centers don’t make money just by signing orders. It often takes several years for a project to acquire land, connect electricity, and be completed and put into operation, during which time funds must continue to be invested. Problems in any link, including power supply, approval progress, and equipment delivery, may affect the implementation of the project.

More importantly, signing an order does not mean you have started making money. Although some companies hold a large number of contracts, not many data centers have been actually built and put into use, and the initial construction funds have already been spent. Once the project is delayed or financing costs increase, financial pressure will quickly appear.

Nscale is an example. In the first half of 2026, the company's revenue was approximately US$141 million, but it recorded a net loss of approximately US$1.02 billion. Some data center projects are also affected by power supply and construction progress, and Microsoft has also withdrawn from related British projects. This shows that no matter how large the contract is, it still ultimately depends on whether the project can be delivered on time and whether the customer can use it normally.

In contrast, DayOne already has a certain operational foundation. In the first half of 2026, the company's revenue reached US$512 million. As of September, the billable capacity was close to 1 GW, and the contracted and booked capacity reached 2.3 GW. Compared with enterprises that are still in the large-scale construction stage, DayOne already has actual operational business and revenue support.

But it also has its own problems: nearly 70% of its revenue comes from ByteDance, which has a high degree of customer concentration; Finnish park financing also faces uncertainty caused by geopolitical and regulatory factors; capital expenditures in the first half of the year reached nearly 6 times revenue. The faster the business expands, the greater the financial pressure.

This is also the reality that the AI data center industry is facing: no matter how strong the demand for computing power is, it cannot just look at orders and planning. Whether the computer room can be built on schedule, whether customers can continue to rent it, and whether the money invested can be slowly earned back through operating income is the key to determining how far the company can go.

For DayOne, winning ByteDance is just the starting point. Next, it will not only continue to expand its customers and expand its business scale, but also reduce its dependence on a single customer, turn the orders it has signed into actual revenue, and then convert the revenue into stable cash flow.

Reference article:

"Byte's computing power supplier is about to IPO", Zhidongxi;

"AI Data Center Faces Cold War, South Korea's Largest IPO of the Year Plunges", Securities Times Network;

"The Myth of AI New Cloud Is Broken?" Star stocks plummeted, Yun Dachang canceled orders, and it was predicted that 80% would not survive four years." Zhixixi;

"Byte Data Center is about to IPO", China Investment Network;

"Bytes support nearly 70% of the business, but data center DayOne's listing in the United States was met with failure? ", Wall Street Insights;

"Singaporean data center operator DayOne is reported to be re-evaluating its US IPO plan", Financial Associated Press;

"Australia's largest IPO suffered a major setback! Nvidia-backed Firmus delays listing plan, Financial Associated Press.

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