Activist hedge fund Elliott Investment Management has expanded its stake in data centre operator Equinix and is in private talks with the company, according to a report by Reuters citing an unnamed person familiar with the matter.

The increased position comes on the heels of a sharp drop in Equinix’s stock following a surprise capital expenditure announcement.

While the size of Elliott’s stake and the nature of its demands remain undisclosed, the hedge fund is known for its activist playbook in the technology space, with past campaigns targeting firms such as Salesforce, Texas Instruments, and Hewlett Packard Enterprise.

Equinix shares recovered slightly on Monday, closing up 1.5% at $789.19, though the stock is still down significantly after its 25 June analyst day. Investors were spooked by higher-than-expected capex plans unveiled during the event, the first led by newly appointed CEO Adaire Fox-Martin. The stock dropped 18% over two trading sessions in response.

Despite the volatility, analysts remain optimistic about Equinix’s long-term outlook, citing strong tailwinds from accelerating demand for data centres driven by AI infrastructure growth.