A concept image of a ticker tape that says Going Public by iQoncept via Shutterstock
There’s soon to be a new entrant in the growing list of initial public offerings triggered by the rapid growth of artificial intelligence. Data center operator Csquare, which is backed by the investment firm Brookfield Corporation, is expected to go public on July 16. The IPO is expected to include 50 million shares of stock priced between $23 and $27, with the hope of raising $1.35 billion.
Csquare would trade on the New York Stock Exchange under the ticker CSQR.
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The offering is the latest of AI-related IPOs in recent weeks. Space Exploration Technologies (SPCX), of course, got the most attention for its record-setting IPO that raised nearly $86 billion, but there have been several others, including Cerebras Systems (CBRS), and the Blackstone Digital Infrastructure Trust (BXDC), which raised $1.75 billion in its May IPO.
Brookfield has indicated that it plans to maintain 67% voting control following the Csquare IPO, indicating its long-term commitment to the company. But the offering provides investors a new avenue to invest in a data center operator that has a much different strategy than neocloud operators CoreWeave (CRWV) and Nebius Group (NBIS).
What Makes Csquare Different?
Csquare is a Texas-based company that provides data centers throughout the United States, Canada, and the U.K. The company has a network of 64 data centers in 21 metropolitan areas. Csquare delivers about 389 megawatts of power capacity through its centers, and currently has more than 1,700 enterprise, network, cloud, and technology customers.
But notably, Csquare operates on a data center colocation model, which means the customers deploy their own IT and networking equipment inside Csquare’s facilities. That differs greatly from the locations operated by CoreWeave and Nebius Group, which are two publicly traded data center providers that have been growing over the last year. CoreWeave and Nebius own their servers and high-powered GPUs, and their revenue comes from GPU usage and AI services. But Csquare’s revenue comes from cabinets, cages, power, and cross-connecting hardware. Essentially, it acts more like a landlord to customers who are providing their own servers and GPUs.
According to the company’s prospectus, Csquare has long-term contracts with its customers, ensuring a solid revenue stream. Its average remaining contract term is 33 months, with some contracts stretching as long as seven years. Management goes on to explain:
“Because our buildings, infrastructure and fiber ecosystems are already in place, customers benefit from low-latency connectivity, reduced execution risk, and flexible, modular expansion without the complexity or capital intensity of self-build or greenfield alternatives. This value proposition has driven sustained demand and strong customer adoption.”
Csquare’s Performance
Csquare hasn’t been around for long, having first formed in 2019. But revenues have been increasing due to both organic growth and company acquisitions. The company, then operating under the name Centersquare, purchased the bankrupt Cyxtera Technologies in 2024 for $775 million, and then merged Cyxtera into its data center platform to create Csquare.
Csquare reported $270.5 million in revenue in the first quarter of this year, up from $232.8 million a year ago. Full-year revenue increased from $198.3 million in 2023 to $907.6 million in 2024, and then $987 million last year.
However, the company is not yet turning a profit as it invests in more data centers and the infrastructure involved, such as space, redundant power supplies, and advanced cooling systems. Csquare’s net loss for the first quarter was $66 million, increasing from a net loss of $34.9 million in Q1 2025. Full-year losses for 2025 were $119.9 million, while in 2024 the company recorded a profit of $458.5 million.
Csquare generates the majority of its revenue from its colocation model, which brought in $203.3 million in first quarter revenue. And the company believes that the colocation market demand will increase by 53% through 2030, jumping from $67 billion to $102 billion, with average contract rates rising by 12% on a compound annual basis.
Management says its current facilities have the potential to increase its power capacity to 670 MW. Expansion will be expensive. In fact, the company estimates it will cost $4 million to $8 million per megawatt of added capacity. But Csquare believes it will recover those costs within five years.
The company had $64.2 million in bookings in the first quarter, up 47% from a year ago.
Should You Invest in Csquare?
The biggest concern with AI investments is the up-front capital needed to supply the computing capacity and GPUs to train and run AI models. Csquare largely avoids that problem with its colocation business model.
That means that it won’t be inking the billion-dollar contracts that neocloud operators are signing, but it also won’t have the massive capex investments in next-generation chips, either.
In all, Csquare is an alternative for investors who are looking at AI infrastructure stocks. Consider it an out-of-the-box option if you want to diversify your holdings.
On the date of publication, Patrick Sanders had a position in: NBIS. All information and data in this article is solely for informational purposes. This article was originally published on Barchart.com
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