EQIX - Earnings call transcript Q2 2021

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Operator

Good afternoon. Welcome to the Equinix's Second Quarter Earnings Conference Call. All lines will be able to listen only until we open for questions. Also, today's conference is being recorded. [Operator Instructions]. to of call Investor like Rymill, to now President Vice Relations would turn over the Katrina I and Sustainability.

begin. may You

Katrina Rymill

Good conference today's welcome and call. afternoon, to

remind the SEC, and and our in the April those Before affected to filings with that and comment by forward-looking on obligation may identified XXXX identified significantly Form update recent involve Actual XX, XX, no we are on like from filed intend statements XX-Q started, including uncertainties. XX-K we does nature assumes our in to the most and release, may on not made get forward-looking and in or risks some call. we're statements XXXX. today's on February be results of Equinix filed this risks making those today I'd and everyone press vary statements

Fair in public the to financial on light its of addition, is In in it it Regulation not policy is comment unless done during Equinix's guidance Disclosure, quarter disclosure. explicit

In most these will reconciliation release to the the uses We why measures call. today's of in page measures these on provide the measures addition, reasons today's from provide comparable the list Equinix a GAAP company and of www.equinix.com. we press IR at measures directly conference non-GAAP

you Chief Equinix's today We Officer. presentation and information to most Meyers, other CEO available have check website the our of from Charles designed we page along in current Keith President; Equinix made and a important certain to the us With regularly available like post page supplemental time financial Taylor, data. remind and and you time Financial on encourage our to IR to discussion, website information. that for the are information IR also with accompany about this We'd

analysts. Following I'll this to any like call remarks, turn questions analysts an over call to this be one. ask within our At sell-side time, Charles. to just the limit follow-on hour, from questions we'd we'll of In interest these wrapping taking prepared to the

Charles Meyers

Thanks, to afternoon, welcome call. everybody earnings quarter Kate. Good and our second

we as significant results Equinix our markets is multi-cloud and service architecture of outpaces demand primary in as business accelerating is are highlighted choice. connected as competitive more reflected a previous advantage in is divisional than our positioned driving shift widely to is infrastructure all momentum models business ecosystem digital to ever a uniquely a transformation technology trends seeing traditional remains of strengths. on As that hybrid And adopted as but consumption source continue expectations. see Technology pandemic and span The leaders for not more digital a distinctive we continue enabler, infrastructure is and just before, industries. to playing across multitude or distributed of our the

Equinix, quarter performance XXXX, deep across we're commitment strong In leading our with across confidence our of all also June, machine. in in expanding Bordeaux, processed XXX, leading proud plus of passion on underway ESG. QX first Against green commit and and Valley. data second more platform We been backed a in comprehensive science-based strong innovations of XX have share our emissions openings customers, employees financing pleased than commitments incredible across by and the Silicon our continue greenhouse supply demand XXXX and our been our place than projects made we XX by Helsinki of in a commitment the consistency being by old deals to consecutive center in And quarter, with great sustainability, countries, recently XXth is the expand customers the of delivering across both Equinix elements business step became services. around greening robust enhancements included in of our to this purpose, are sustainability in geographies, to global early to to our our Paris plan portfolio exciting to and investments to our franchise targets growth customer with go-to-market digital reflect critical the bookings, to We Aligned our we results more across with XX Equinix markets market the the Agreement, tremendous continued chains. momentum demonstrating quarter Our our and Climate Americas values an fueled further backdrop, and aggressive by metal. the world. Neutral top-line and by interconnection in and a industry the momentum possible the demand milestone agenda. continues XXXX Fortune scale quarter our customers had in to record on achieved Aligned reduce this an XX,XXX and ensuring gas Climate advance we

event, our employees, our and a led This conversations on listen a opportunity engage Additionally, we [ph] gathering second event our and as XX-hour diversity and and to an inclusion virtual build connection recently the and on of to diversity, future as we of culture world. a meaningful and by learn part impact have and celebrates wellbeing connection our networks that to ongoing our employees belonging quality, can sustainable VIV offers community, hosted to a courageous in our our focus and our WeConnect wellbeing annual employee teams. commitment

were normalized on EBITDA results again expectations. was are our billion, on grew unit pricing. QX our ahead meaningfully ads revenues currency X% solid constant the and $X.X XX% and basis. X, up for Slide growth was as FFO Interconnection revenues a to and rates year-over-year. of Turning all healthy X% year-over-year year-over-year, up depicted These Adjusted

to an XXX,XXX with leading XX XXXX platform. Fabric, usage interconnections customers. global franchise to over enterprise QX, incremental In we Fabric We higher and of excellent now perform well. on have all global and healthy largescale footprints. three base saw customers IBX customers More yields Internet of regions, are in growth now bandwidth added total diversify expands reflection A strong peak saw by attach now on we're the distributed our across evolve more interconnection as adoption needs businesses total and period driven XXXX traffic proposition. has than regional highly of Equinix support a digital interconnections and X% to XX% rates interconnect their value diversify XX,XXX our drive broader multi-cloud. continues as expand as that connectivity industry than end their we and infrastructure Our and differentiated unit see connections growth and scale quarter-over-quarter interconnections. continue increasing year-over-year, up to ecosystems exchange of hybrid destinations and seeing macros of the

we delivered at software are to enable infrastructure services, infrastructure digital positively augment to physical portfolio Turning customers responding our speed. as very

of network this strong our partner Alarm bookings markets. have validation across eight blockchain quarter, a We building a channel with largest our Equinix company nodes of for metal including link today [ph]

from offering of edge a meaningful functions virtualized deploying network with vendors. diverse are marketplace network Our average acceleration, deal shows customers set increasing of enterprise size as our nicely

engaged built portfolio as the connections for nine are pull be prelease X deployments. will sovereign in $X provisioned capacity. XXX in partners capacity and demand to additional field, including feedback. across Importantly, plans this positive to QX, than with we initiative, fully GIC, out at asset other our GIC investment Late regions, wealth billion have across digital globally and Frankfurt the total closed more in light in interconnection Equinix actively XXXX and develop already nearly also market XX robust continue Singapore's power XXX and entry ventures to of through, than between capacity joint announced megawatts delivery. of the agreements builds under we entire We and activity xScale now we quarter, more We're datacenter committed we expansion and open nearly development of facilities plans support of capacity When XX XXX% in fund. have markets customer currently of xScale three of With services to and expected, globally, representing xScale our megawatts megawatts expand xScale cross-selling these advance virtual all infrastructure with driving leased our Australia. fully our strong and Shifting our lease. with

from verticals. highlights our Now I'll cover

bookings to delivered over demand and cloud, as telecom mobile vertical three top specialty the across and particular services all IP network with carriers traditional regions, address invest strong in delivery. for firms portfolios Our their continue to APAC strength evolve

and support telecommunications provider leading to the Channel provider And to new a [Indiscernible], interconnection a their X the leveraging included IBXs better provider, and telecom Crosslake including is our new quarter deploying presence network in customers. this global to Milan wins across a laid service services Fibre locations local XX to cable nearly English financial Bordeaux. expanding of first in years. expansions serve compared subsea New low for latency London

leading Zoom, infrastructure scale support as in market multi-cloud quarter continued video Our momentum coverage cloud a enterprise expanding adoption. hybrid Expansion platform, security And and to organizations network accelerate to over locations. Europe cloud this deploying includes new provider IT saw in communications delivered support demand. offerings vertical and indexing

vertical broad Americas enterprise services professional bookings, exceptionally retail. achieved including in punctuated several Our by record the an business across and strength quarter consumer global healthcare, and strong services, with sub-segments,

and Equinix, to shape infrastructure infrastructure New cloud and data also major topology is cosmetics and and computing and multiple Equinix's deploying And achieve drink platform services bookings a providers. edge and leading continued infrastructure deployed services infrastructure across transforming wins Research to leading out locations, files leading into and expansions iXd.net, a of of multiple on hosting Content StackPath, infrastructure were adjacent legacy insurance including by their use manufacturer this include application and support growth Expansions interconnect digital across and private a all gaming take regions transformation data global channel energy experience of Fortune And A of company solid digital media network Ernest to enable three ecosystem. a our a to continues provider accounting gaming, centers CDN, over edge and across globally. provider performance multiple and deploying metal vertical. publishing and Equinix media platform as for including analytics optimizing cloud a leading consistent retailer of Global Equinix their Redbull, XX% record led Wins edge and network their XXX delivering wide range to high sports outperform, industry provider digital quarter to multi-cloud. across cases move digital infrastructure network, deals. bookings. locate verticals, a optimize to program a deploying advantage

services. key infrastructure from digital including per embraces As their world, like with transactions processes retailers million saw we also our Australian scale payments Dell, partners HPE, retailer had success a We around and modernize XX Group, IBM, Microsoft. the over Google, And continued Cisco, a and Alliance which Rollers to win AWS, platform, day. channel the leading the strength with

report. me results and let turn cover the now So to call Keith over

Keith Taylor

afternoon And and well you everyone. I good enjoying are hope Thanks, summer families Charles. to months. your and

to years great extend Day were spend with was to cash innovate business So we many drive intend exceedingly state. perform over the it surprise, higher drive digital on you start No long-term time let our favorable me our plans and well. business at the flows. the to the environment, meaning shareholder virtually, more share to coming to the scale, With infrastructure to to Analyst respect of At June by saying and macro albeit continues how we eager more value, continues quarter margins demand. revenues,

and fact, service are you along regional to shared. both expectations. the record To with at Day. We lines the at additions were channel robust put, infrastructure goals many and with are In digital Analysts Interconnection exceeded gaining to highlighted quarter. metal virtually. physically momentum. we execute the had continuing And edge our American against from There solid the activity bookings company planned start, enjoyed level. with which activity Simply the include and we're our share we highlights

across we're share of EBITDA, guidance Given raising year. each revenues, AFFO AFFO the our performance, and our per adjusted for

basis. the Now normalizing let this growth a cover section in quarter. the that currency are Note results me rates on all for constant

EMEA all business Americas As Slide the venture fees billion quarter to led as global across region. were meaningful up X, And quarter QX X% across by revenues three up increased year, APAC an same due of X% $X.XXX depicted custom to and the quarter last xScale regions. performance over over on strong platform expected work installation and in revenues joint step due revenues to non-recurring a our

And to million As result, therefore, non-recurring are you we $X QX. can a inherently expect the to by lumpy. appreciate, non-recurring revenues as compared decrease QX revenues

FX costs. included performance to and our or includes QX. prior meaningfully and our but spending million timing strong be Total net outperforming books, costs a and to rates when increase QX searches despite higher prior the cabinets in EBITDA built QX adjusted maintenance have EBITDA our guidance utility quarter. a net expectations $X million rebound slightly, XXXX to up hedges $XXX adjusted the of an revenues, last our backlog $XX our repairs year, building benefit and rates. X% QX revenues, to planned the FFO compared of compared FX costs. QX same benefits was guidance quarter XX% to million CapEx in increased of relative recurring FX $X of prior million of was $XX cabinets Our to included QX due operating integration expectations yet to performance over million of of $XXX the a quarter operating above Total integration our more increase including million, due and compared strong spend.

lapping X%. through XX% year. the has positive revenue highest and to other Slides our followed the on Turning with revenue EEMA interconnection last both increases rate the full and at highlights, growth X. APAC X by Americas of reflects results price regional are of growth from one-off significant adjustments covered EMEA the year-over-year region

We Americas expect activity normalize EMEA booking our and of The quarter record prior second Americas imports rates on retail on Austin, consecutive over return markets enjoying continued the the Atlanta, improved a focused at Also, across Seattle. year. were reflection region seven health, saw two to healthy our growth including interconnected healthy bookings other of of pricing. of platform the deployments strong QX. Deals our largest in to regions from smaller we're strength continued levels sell. with from also the our Denver region six focus benefited markets And

we've and led a We're XX EMEA of fees XX region our regions. good with we're regions incremental green Singapore strategic Our two quarter and Japan in across In May by raised bookings. Biz space. bookings, Equinix an significantly over xScale uncertainty offset our raised. the of And with annualized quarterly earned annualized third to overall medium in to and billion approximately grade the refer traction Pricing the by cash looking deals we opened $X.X Bordeaux flexibility have a an is prelease in megawatts to regional benefited at strong interest to X.X in and including Frankfurt our buildings, ended was And Enterprises good our due and constrained AMR Stockholm by capital incremental financial billion, and is other in $X.X million, remain growth we quarter capacity Asia-Pacific one also strong COVID-related We investment have non-recurring region year. our region's Hong Kong had high APAC strong Singapore, X markets. of please X of solid relative partially revenues entire X. delays $XXX flat as in a London EBITDA, quarter billion exports about now market, finally, notes. newly led markets. QX issuance to political our $X debt the net from Dublin as structure, well highlighting by ratio the Equinix seeing the Slide advantage the EMEA late-XXXX, and contributed capital demand. momentum the related debt of And leverage reduced times metal. our anyone up from approximately prior with part and in region small for and else sized expense seeing the

average weighted years. industry and is now Our growth cost lowest the our maturity approximately X.X% at XX nearly the in blended is

in We also the of ATM quarter. million raised equity $XXX

We with continue future equity and to expect fund to use debt increased to debt towards business lean an both capital. our needs

$XXX Capital to and million, including billion. this retail three expenditures opened Silicon new including $XX Valley. of IBXs quarter, the were CapEx projects quarter. in Slide Turning Bordeaux new for recurring approximately We XX

Helsinki. the Frankfurt assets our in revenue owned XX% represents of and development X from Revenues of for land through our purchased Singapore acquisition now also IBX. total We

On end, the X contribution EMEA in contributed after xScale XX% and side Dublin return we venture the quarter of net for to a $XX of the business, proceeds million. joint after asset our equity

XX. as returns investments Our on Slide shown delivered strong capital

XXX revenues utilized invested. a PPE on and XX% X% basis. stabilized These assets are the currency Our collectively gross year-over-year increased by stabilized on assets return on cash XX% generate a constant recurring cash

summary closer to to through due expect Slides revenue XX we rate exit the growth. our strong GPX financial to America's guidance our part growth not any XX XXXX note forward, Do the updated bridges. the top-end in is refer XXXX India does acquisition, for to of stabilized pending asset expected over results to and include Looking guidance related which QX. year in to Please close

adjusted rates. raising million XXXX, million, by year and we're $XX the $XX and FX favorable guidance guidance by primarily operating For to full revenue due strong EBITDA performance our

supply portion previous year, now per is CapEx quarter to including $XXX and slight CapEx or xScale sheet, implies adjusted pull compared XX%. an to the expenditures million between to future range recurring the $XX X% constant the AFFO billion growth due AFFO and standards, of range. on expected JVs mitigate operating share to CapEx. a supply and reimbursed And revenue prior chain and chain business, spend, we're either offset $X constant risks. currency rate to we increasing in XX% to on balance momentum $XXX mitigate slightly given of increase approximate year, raising the forward XX% be prior million timing compared $X.X currency by which XXXX guidance significant of risks. approximately proactively of an the than we the due by is normalizing greater margin EBITDA while to current basis, timing a over spend to of the This A our of normalizing of a XXXX also Although our going expected billion guidance as midpoint million

Charles. here back turn stop the to and me let So call

Charles Meyers

shows up. robust is digital signs no Keith. momentum behind of Thanks, as as letting and The ever, transformation

story to of catalyst in positioned and a beneficiary is the customers Equinix digital both the both we economically unlock role as evolving unique As be key this socially. with plays promise and to and a company, world's infrastructure digital enormous a partner

As on in latest on we we three our this execute discussed say opportunity. transformational are focused Analyst we levers strategic Day, as

for business, our standardized will work markets, putting automate. capital in down targeted First, expanded partners. scale, Driving customers, the providing of a it's on experience operations continue customers existing our and machines core investing add doubling executing capacity to go-to-market our whether and to and strength to new we win margins simplified scale better and on to operating further

we to Second, leading we our around we'll this continue efficiency aspirations XX portfolio, services continued and world innovate and By adoption interconnection market across energy and delivering to retail accelerate across self-service in our of will in the year, customers. momentum xScale. third, the in growth digital [ph], features our driving extend end reach the relevance for across xScale. And and of be our see our deepen platform expansion space of our and the advanced to infrastructure markets opportunities scoring scalability, franchise sustain to will our and

for life customers, ours. that platform comes together, in our people. service scale deliver To starts be by us our to And to to the say belong and service and in our other, inspired work, enabling incredible to starting customers innovate show to potential in workplace serving I'm our and with building communities, are by I confidently inclusive ability where being a I you, our our their for be shareholders. the unlocking every service Our innovations day enrich to as and every expand safe, we force Purpose up every diverse an our you and in an can commitment day, world planet. with our to enables creates the to person, to turn each which And passion. in our with matter. We mindset,

up questions. stop me it open let there for So and

Operator

KeyBanc Markets. first Thank from is with Sir, [Operator question Capital you, comes Instructions] Jordan sir. your line open. Our Sadler

Jordan Sadler

Thank you, afternoon. good

come month, lower of through also So guys you the next during X% half in annual outline XX% range. to the you year Investor But per in Day the share suggested growth the could last that AFFO XXXX.

and think place. have initiatives refinancing to from took benefit didn't as I you opportunities ramp have time efficiency taken much some that

you in the looks quarter certainly in you've trajectory next seeing the the the this you're just acceleration bump can about a year? curious what into and you and here, up to can the still speak then quarter. follow heading ATM like Given And seen as

of about I offered leeway think capacity, incremental sort by debt Keith, talked you significant agencies. the given

quarter? we Thanks. the to And expect raise so see equity in the

Keith Taylor

you great. the for Okay, questions. Thank

me question. take the me one, let take first Let the first

it Analyst was foremost, we The and bottom up reason share the it was when one came per of of making spent be one Not the initiatives. services reflection in xScale, the Day, was, our range questions to half a we at half infrastructure the I all of to of we're of AFFO then was this range the the the investments instead lot growth relates the said to that guide. in going our and rate a top digital XXXX about First relative the year. talking of portfolio all but only also broader the energy efficiency across as

full absorbing in we annualized XXXX. were impact those in So the of costs

be a As broader share metric tends to a per us the cause to bit to result, relative more on dilutive the little guide. it

course, guide a very this addition, for In we've as well. of got year strong

majority debt. So out benefit of we've had yield the of our high of the refinancing

to bit you get And back back got little next wind a your won't have at that wind so and year. you've of

long-term to a That surprise you up. said, probably year to many raising as a and five-year primary the model. can it's of move as comments not But in this to a all our the the Relative is plan that's reflected ability about we reason. saw So our appreciate. we in we numbers this of their lot you, made saw coming big guide,

one quarter. doesn't had thing the Analyst so wouldn't just do. right because to say good That we're the like the for And feel trajectory changing I that Day, on guide we

little lean would I towards of to saw the you as bit that prepared trend ATM our the really really few anything, reasons when otherwise commensurate periodically we use. the million. has weeks But even is our And obvious to going commitment a on Secondly, to relates continued ATM. the reduced of equity. what that at for use we capital $XXX it go to had in Like the was This debt and we've capital and downwards. last But basis, debt dramatically remarks over bad facility. forward tap message agencies debt result, a as cost with we anticipate rating was are to a

And a so will forward a be on lien that go basis.

So the is a that that but land. relationship we I to bit going We But the there also to always rating debt again, to use want time little to its fully with sure balance maintaining be capacity a want sheet advantage, want very make at to agencies. everybody same of appreciates. have positive on our a fullest

Charles Meyers

in Yeah, the of in environment bit of business. terms I Jordan so growth of as in we're for I might in in seeing saying, think augment now terms believe attractive terms I much just operating as this opportunity the

debt definitely probably of ATM, something I to is reasons. It's to and for to for in to that to think for do makes mind the us, business. continue us just have and so. level we of that some said ensure think the top lien obvious have the as just ability balance to continue to think sheet respond I have is the it the the towards sense Keith optionality ability But I to

Operator

for you your Thank question.

Our Street. from David Green next question with is Guarino

sir. open, line Your is

David Guarino

hit the of Americas rest actually you growth to the ask year. I comments Was thanks, regarding the timing your that, stabilized through bookings of revenue when on during X%, quarter the in and want the the to the acceleration the Hey, quarter. due of guys.

higher? So you remind growth the it And a of end top would us bit just be rate? stabilized of your little could

Keith Taylor

yeah, David, Sure, typically guide three five. we've to

lower the range quarter. So that of we're kind at of end this bottom

onetime in that feel there I the and sort towards through. towards what obviously think items, that year, some momentum just are out unpacked timing there. there's there looked really full the business think as are the of back flowing more portfolio partially of really and we of half think continued But moving end. and the Americas we in the think I also I as I assets some that's we effects expected, about really, And good due strong of to top at

there. really the X% strong growth strong obviously quarter. even some quarter So, percent But side, NRR on there, X% in NRR

think And the the year, store about really towards half on stabilized the there assets so same we're trajectory I the good number. of feeling back

David Guarino

And Okay. then bookings the guess if Atlanta the which other centers your XXX market. datacenter properties specifically, gears, I traction in Could demand? on in saw could strong market And in that you switching strong data in comment is you any come noted Peachtree you versus that gaining market?

Keith Taylor

is. build that we that's I there that and of critical our is in necessary effectively. I scale the to ecosystem, has our continuing Yeah, market mean, believe really putting XX the ecosystem and depth believe energy and which where the focus mass interconnection to

and Peachtree So again, success there emphasis on yeah, we're QX. is seeing the good that location in

Operator

Thank you for your question.

Our next question Suisse. is from Sami Credit Badri with

open. Your line is

Sami Badri

expecting would large-cap tech ahead your you're this, how results in or coming seeing is back this half in dynamics across couple the actually some this seen question. of I going picking were majority results. a enterprise back for And But, including describe a of an kind believe I that coming was going of half Is are now in reflect XXXX, we've you acceleration. expectations of question and you sector XXXX? have the And have back there of you the back of right you. XXXX? for half the that Charles, up in what tech you that the the be So of thank now? line to I Hi, what discussed quarters. know your this

Charles Meyers

Yeah.

the and levels et momentum of we pretty seeing here, pandemic cetera. optimistic with even about indicated we the you more the As were were peak bullish the during enterprise customer,

investing be saying, we've to got And despite hey, we're so seeing people, that digital. in

up we And and, with qualitatively terms in so and the build in customers. conversations, pipeline our were it will of in be having bookings, showing just our

that that's kind And why so optimism. signaling of we were

our would definitely in be. that in think guide. I thought it. think and it reflected And as was even and is expected that's our than have say stronger going that And this quarter results the translated to I we therefore, was how adaptation I we would

perspective. I think a strong quarter so enterprise really And business, the from just

As I pursuing across that bookings, in regions portfolio enterprise [Indiscernible] terms with our cloud cloud but said the three partners. big all channels retailer hybrid key opportunities sectors, not of players, only the very working of partners, variety were and a script, part also of strong. across in with our alliance a

over we be think enterprise and and had seeing seems now. enterprise to indexing I we growth and from sustained Again, tear see just IT been its thought. for we're in just think of continue growth very yeah, time the enterprise line so, to have And segment than now. and output to right terms probably on An it better or in cloud And over I indexing. a a long expect

Sami Badri

giving as you you are there, in and this, of you XX% their XX%? up. efforts? Where investors them enterprises a question Are XX% modernization in upgrades is kind lot And of that. on IT color would their modernization Thank ask in cycle for I far because a think actually do us asked there this about you as cycle? put they where terms the are And where quick me. to want follow enterprises One

Keith Taylor

whatever. whether early is, precision. that Yeah. obviously in baseball really But it's I with a want say terms mean, it's people would they or hard pinpoint to do think what of use still analogy I relatively any I to

I think it's early innings.

We the here. midpoint haven't past

sort way people to then who itself adapt so legacy architecture, long they're hybrid would IT is I pace And And still that to to accelerate. of is of the looking make the comment just continuing lot of terms in have I that change other that multi-cloud a there's a world. of to think go

refresh I think the cycles and so, that life shortening. technology And cycles are

and a things service themselves very number those at the are other service. both a able said, And they in Because those us on markets a deliver we as large consuming are share, to a And getting nexus the often as about dislocating Day, underlying people wallet services technology Equinix. comments, fabric a those of thinking talked we're wallet as then that I with platform aligned get upside as that provides as things services. delivered for differently like are locating more my metal we're how as that to idea, an infrastructure to providers more point with allowing as are shift share. us Equinix bit service of think I Analyst for things and at about opportunity

think early I still days. so And it's

transformation I of the of in for think investment architecture is there and future. front a us IT period long foreseeable digital

Sami Badri

Got it. you. Thank

Operator

for you question. Thank your

next question with Simon Flannery from is Morgan Stanley. Our

open. is line Your

Simon Flannery

Great, thank you very much. Good evening.

chain talking the about Singapore. have Just of and Can get the with then normalization there businesses in again. you point you in And of And Asian as costs, the on some markets the freight which availability, see and just et inflation of mentioned basically terms chain challenges with others just been that the food some things? challenges the are side both infrastructure cetera? like supply of you into talk you the about some of more COVID of any

more power heard also some lens. we've slightly and limitations stories looking think different I on of in about a municipalities kind at water and datacenters

would Equinix be You positioned initiatives, is your color but for ESG and that that evolving obviously how great? highlighted see any you the around

Keith Taylor

it one say, Thanks. take Suffice been the Thanks the around for supply investing question. chain. I'll quite heavily. we've to

under with access normally next very managing also pressure that all in our our otherwise But this strategic us can perceived into also working And heard some exposure ahead for we're consumption the up then a with our of contracts initiatives is our speak inflationary a commitments, in needs And getting protection. have, just we vendors partners and result, leadership. making nicely the inflationary said, of year, having procurement for strong in by sourcing suppliers. marketplace. say production to a it's the inflationary constraints entering would think great successes You've as also but mitigate the as our are that contemplating And about of year, some that go that cycles for we're and and that great into you one broader lot I of on inherent might our well. some I or marries

that of aspect over So years. your demand extent inflationary up of the brought contemplate supply our the and there's very again, environment the higher you contracts confident pricing. that will the to appropriately aspect coming we're there's and exposure then And the

both the our revenue, to the And and access support cost we we sure to management but deliver so we in also both to perspectives, industries that protect from have want model. up speed and make

Charles, a think you do company. doing job I Singapore? we're talk to that good of as want a the about

Charles Meyers

I of there the as think question specifically in of Singapore. relates Yeah, - terms - a it little to bit

delay I planned related so little had coming of is created that on for that that facility, demand bit headwind, Because that COVID of timing a bit us, in was for strong a we online the revenue think of the there terms earlier. a little relative that to timing.

the phenomenon, you seeing I and would environmental we're we're level that's with why despite going in quarter. is and a that, strong the datacenters a exactly the really we bit little that particular, allocate capacity environmental are. less, think and how of thinking terms there do of impacts. side making broader a ESG in demand as I into say about so described deal And delivered to commitment What is the markets that And they're for

Neutral story municipalities the going to positioned as that really going into separate I a of going to I something only a in by to to not investments the with going the packs. things. a to And where be I digital. make want really to to in true tonne and differentiates think, that, but world be so benefit And be being ESG be talked honestly, means. to saying, that's position number trillion. look, And want same in facing hey partner one Climate do to then there And out to is areas markets that's tune really we're leader tell continue think driven our of those we say, by ability now to Day, to Analyst about the responsibly. around and going we're economic from Asia in think XXXX. any ourselves we're There's tap to And by continue I they us. that thing the of a the people of $XXX social the there's

color the constraints issues. prior added on One on of to question of piece of the the supply chain sort

There a our as kind hit we're position leadership like things. feel people we to Now, our in build There's three in equipment, where cetera, really delivery of business some our of about very to size, to --because good data think the it. we gain talked I've access you The of to it. side centers about areas et I market our continue dates. to think need

to going less And so said, but is done And investments to what go side okay, where little risks networking continuing feeling of we're position maybe obviously, really in but make and good where there, quarter in. we've it's in third guide, And the had of the real where as infrastructure for digital really we in And like success. us. a our And business again, things think about that's a ahead we've an on the to positioned, in And some costs that smaller metal. level up we're monitor bit our services trends. is business at mitigate the and area pulling an showed a there. then a line fact, area that's as with

chain to a will it had bookings impacts of metal. just folks but number are about very be there, off so, for we we strong And quarter supply how looking with come mitigate a since there we especially impactful, partner can less

sure momentum. to make to we continue that that want can sustain we so And

Simon Flannery

Good color. you. Thank

Operator

your Thank you question. for

Brendan Our next question Lynch Barclays. with from

is open Your line

Brendan Lynch

Great, thanks question. my for taking

release type press another bit clearly fruition? related quarter approach might talk you it make of a XQ. bring about strong out structure the your there for changing new to need put and to channel could to to Maybe recently was in You the what the channel. you little investment And a

Keith Taylor

it incredibly that for the every from strong And it's really channel. way quarter Yeah, been for. performance

alliance I mentioned group, delivering few again, of that As things. there's One, we far suspects, you to the relationship just we've the the cetera. AWS, infrastructure. et partner say we as they as refer the with a several what script, I we Oracle, in been And usual Microsoft, really hybrid hybrid in order do terms cloud a have sales for can customer Those their comprehensive remember, to arena. public with are have enterprises that infrastructure partnering that would advance well them of that have, think our wanting their cycles for posts in to the are story. to answer demand in services. through are so They for as

And very that's much customer, together, the we can in so that effective one one equals And bring to been business in winning kind a have together. really of three and story.

And there. seeing so strength we're real

seeing the the well certain concentration terms nice highly seeing Equinix we're more side, our of value value are ways there. And I we're - smaller say of combining a in of with to number that what retailers uptick On And really good to and capable there would in solve retailer really in more delivering people terms a think revenue. the problems, customer upgrade adapt ready to us. that's I channel-friendly. big very making, processes investments systems. a area the our we're from designed those to beginning And for be more to dynamic channel be is of honest, we're general To the and not continue continue is,

all customer ways of case. ordering, or that can in channel done customer support that, a customer this customer in quoting, So be partner a by support

our to making channel some is key that is But really investments systems of that's of so the adaptation partners. we're really And the - better sort trajectory. serve that a multiyear of areas

Brendan Lynch

And of be that? on will sales. up believe follow about for have? you I sales margins the one XX% just also, What increased is from on to goal Great, effect that. getting channel have timeframe a channel what

Keith Taylor

Yeah, answered I asked I've see people that that. have me question. And

service, with value. we're edge. statements functions, think almost in you're is probably of we're who partners in will some providing services we then when both with metal or tandem their Network are other be partnering occur. see network made market virtualized with past to no embrace exactly sort XX%. don't inherently So providers are referring and why that reason the think a I know do I to I our network newer as and channel bringing of like - people because I that edge our that with that couldn't I channel of seeing success that

with the a continued seeing we're both we selling think our nicely. great a are growing towards have I in strength continued channel. bias also direct success so team, and But

bit. So channels our been indexing know, I don't over a

land. where will we it's predict, trend I higher exactly to think so we I hard numbers. And towards But think

not really of double services, the you to when services team margins higher I these that look often on on a current significant capital faster. But - small. meaningful and very the at channels. direct our newer in impact of particularly margins, implication partnering margin they're commissions, feel us I going think of are of be our And, newer copying of channel return higher these terms that's in some cost there drag attractive to that we And customer actually on could terms slightly quite accelerate, don't of the contracts, percentages the is in if lifetime given profile, margins. with on value is like we think bring terms that in model I really when of have is

fact, are margin think In I our other expansion to overpower of areas going those.

Brendan Lynch

Great, thanks for color. the

Operator

Thank you your question. for

from BMO next Ari question Klein with Capital is Markets. Our

Your line is open.

Ari Klein

you backlog have mentioned Thanks. And that cabinet to in overall, the additions I the the Americas, up And last committed build think you've the alluding at quarters picked over in maybe of been couple just now which backlog. backlog. the exceeded least

would historically. to? we been get around like lower how think to guess kind than little So XX% of utilization about you should forward, rates I it's rate bit What it's A now? moving

Keith Taylor

Clearly, that that one. we really we quarter for something quarters, a take last I'll foreshadow had particularly around two of good U.S. Coast the right, the the, you're West the

the asset the with I'll new particular say success has Valley some station. great cable Silicon online. in or we've so And come introduced capacity landing That XX

the you continue overall and I've said, to have to Charles so utilization in to when it's look the success we're mentioned Americas. to still rate, in That at the And alluded mid that. low-XXs. going

into add going that inventory queues. moved as basis, be comment The And remarks. amount built that assume the on the built. to slightly, the so assets billing prepared to I'd to inventory level of got all inventory all of my but of I is just up inventory yet in made that the up we've despite that we the were is consume I utilization booked continue also would of move the

And so positive. that's a real

So bookings already sense consume gives a inventory. there that has will you that it substantial been that

anticipate as will plus as into U.S. in the that is think formerly the up quarter year. assets. really move nice We and smaller was what assets. worthy matter, as the I seven is historically six for the thing the said, of that note to rest selling capacity continue includes known much known of markets through other it markets of of The Verizon horizon the be related We've some And the in we of real a seen to

So we're excited about the momentum.

continue I to Americas see perform well. think region going to the you're

'XX said, when As seen we've rest the we'll and on the to we we're and on quarter there. this of the year, we we're going heels of success last by tell you quarter just update the through all you But get opportunity. delighted overall, this

Ari Klein

per America's, just a on in given timing, Maybe Was follow cabinet the up down quarter. AMR the came Thanks. the additions? that slightly just cabinet

Keith Taylor

a It landing point. is price at station deployment, came timing. different And I again, it to it goes large, a cable referred large as back to

on large have environment of the pricing the as And deals as company. is a got it West so as sized across really a activity customers, on to high for our to it medium nothing despite pricing relates the pricing a impact, great we overall, out perfectly on mainly focus with playing of result, And that there's volume number that abnormal is deals and in deployment just remarks, small we're a timing, success. very to perspective, number Charles the alluded of doing prepared as his well from seen pricing timing Coast. the But you've the environment.

Charles Meyers

is that be then the strong, all It's and relative to really that across the interconnection spot an Yeah, in just area in I reflected activity pricing just a - really think that where business a the we're the And to high. yields. mix and continue healthy being into the together better comes is pricing that's firm, market, and is hitting awesome story sweet board.

was they it can always because good better. that's rise. okay, it's are - yet so now, continues people And guy And years like, pretty Americans been and always a saying, I darn here's to get the can

been a - been it's really it's good story. So

Ari Klein

Great, the thanks color. for

Operator

question. your for you Thank

is Michael question next with Rollins from Our Citi.

is open. Your line

Michael Rollins

Thanks. And afternoon. good

couple of Just follow ups. a

was influence the curious backlog that and there compare June, a relative of mention So meeting to new this XX,XXX, backlog? to quarter And could the secondly, results cabinet levels I metric quarter. disclosed the increase might historical customers how and the then the from. was may in that future you could that's global first, be your was that Analyst if in And added gross increased how the in the where in to curious coming increased unpack increase And XXX. this at if

Charles Meyers

question, take. I'll the take backlog I If

Keith Taylor

XXXX. we disclose did So on the backlog Mike,

refer as of last the three increase level seen quarters, this I'll an to backlog. have this to Over elevated we an level.

that as did activity goes to business, overall, degree, increase of again, cases, more our a movement. booked reflection into momentum over three a right but yet in that as seems we But but the momentum it backlog, to the really the build. to that's booking because in June. forward. And into we're and into tightening activity the slightly that prior look be And - of revenue. the the activity, of the June, only what very the booking importantly, quarter. seeing for some of course, means pipeline it's even be of all not about enough very, it strong the strong depth scale In also, And of the result So our up

Charles Meyers

via are channel via say the Because customer channel. showing I'd oftentimes, those direct we both isn't continue customers, good customer new new capture to channel the partner. necessarily about is in record the really and And feel On logo account. our up capabilities interestingly

face than success uniform And from, results having overall. we're so And the even more I it's of the pretty geographically. actually they're of of where think sort terms appear coming there's in strength on

across is we significantly exceptional think, terms that from Obviously, has the regions So doing customers. on there's business, outpacing And Americas. I really other as vis-à-vis do into index you have existing of perspective also we're how been that But no new growth others. one an And team, rate logo region translates for seeing the job. that it capture see a new well. over in quarter good strong the selling logos

strategy That's expand, about innovate. And of we Scale three-legged the so really opportunity we they buying. scale, can continue as is think this talk customers when why the with to do I are that. have to

services existing the then share. add the continue service innovation new them. And in customers Then to to side, which and time new get bringing let's of terms over wallet capture so more capacity in in expanding wallet really new in and to increase ability terms serve to the And is markets of geographies types.

so growth multi-dimensional up. us a I opportunity really showing gives think that's it a And really

acquire. So bulk that customers. customers Customer existing as definitely of new to are But There's we always get definitely, look lifeblood the are our new lower continuing less is to And expanding. still sort cost customer, bookings go lifetime business and good friction from that up. and the for of the customers that. well. news value There's our

And fairly both our and uniform real focus having and so geos we're it's across success there there. across But products.

Michael Rollins

Thanks.

Operator

question. you for your Thank

from question Colby next with is Cowen. Our Synesael

Your line is open.

Colby Synesael

over, you've secondly, One Great. and just then charges the half. done AFFO for Two million, was what if that in And just think adjustment modelling XX% first I $XX.X the questions, is? may. impairment calculation, there of margin I an curious in

getting You're to year. over the just for XX%

G&A? back So see we Thanks. at most it sales obviously COGS, downtick going is half. the to in and Where are as an implied or likely marketing that

Keith Taylor

were It matters to on result, And vis-à-vis the respond we're the impairment to will result, And charge decrease relation keep the transaction the as Charles a impaired a other was a let line, tax. because your you primarily the see indemnified we did pure. Metronode causing of - that associated in got in party. So and where have the quarter. Australia, tax in there's on that benefit just with I a and as one. way. me you'll to tax you And first. take substantial federal the basically to the in There other other And some the assets adjustments by tax you've some

it disclosed the it has gets And up. it's so separately on no grossed net-net, impact meaningful but and P&L,

itself shows in so itself the And expense income line. other and independent

lines. to happened there Then to well it relates as quarters move, it the So in meaningful very two done But no question. other Yes, relates margin year. is that's the the what embedded of it the because we've AFFO was there? first in as again,

guide greater we although what As we say, think the than saying the for And for want will we year, to to year, we're you to no continue surprise. happen XX%.

result, going relatively heads human to And a QX, XXX-XXX we're that making are and heads investment. we XXX - as organization. we growth. QX, to net need added that the the in another We you're we're meaningful roughly QX add our to observing a organization, the to invest capital

and you've got so that's had aspect revenue of seasonal QX, coming the cross of of carry Two number of the a with lot then one that's And items QX through. three, in And it. them. benefit Americas a utilities we've the of impact that because non-recurring don't

So sales when or we the JV asset, a fees we fee. and we fee, an sell get a development get

drag As line, the can comes it results, there's through our low you see but as know and you the line. bottom revenue in very to

in as of line can QX so and revenue that inherently just go the gets If it's anything, a down the year. another one-off non-recurring lot fee then going to half will recorded but the I quarter. And QX, through we over see The it second will likely And fourth flatline that be bottom lumpy. be of in there QX, don't mentioned, -

Colby Synesael

just is that But with NRR you XQ the XQ flat that in that mentioned, number? fee think you even versus

Keith Taylor

That's is. it Yeah, correct.

Colby Synesael

you. thank Okay,

Operator

your Thank you for question.

with is Horan question Tim Oppenheimer. next from Our

Your line is open.

Tim Horan

hyperscalars. also your Thanks. locations? carriers, partner Thank you. fewer think customers new be guys seen the important you an outsourcing Do transformational that pretty And there? will attract it some enterprise just the by We've will

Charles Meyers

If I asking attract carriers for understand you're the partners us customers. will to be that, themselves enterprise if attractive

Tim Horan

thing think, Azure. you outsourcing about and network hyperscalars do AWS. to And globally? to important to you seen carriers announce we've looking Do is outsourcing, helping AT&T and this but will their Well, the an other same are be part core AT&T something,

Charles Meyers

so. think I Yeah,

I opportunity we an there. have think that definitely

of as I it carriers reshaping as are definitely us partners showing signs think important bit. sort But chain a for that you know, supply overall of is. really of is set

to success, this And have you carrier reflected deck working of are infrastructure. that and to on actually than enterprise taking our enterprises. think a dynamic results And are, I Because this our with there. approach it's non-traditional on the a different report what fact, side building other carriers, really of is the some - some are in more of we revenues that earnings In network the it's great is when in enterprise for example Dish that you their providers really more selling example.

of points I as to really think nexus some that of our key continue to to these interconnection puzzle. had of and architectures, act an opportunity in play. in have going be I And important pieces think we absolutely points of are the

So yes, absolutely.

is fact, emerging investments, team really people where quite business unlike really some thinking active more and through you're infrastructure development seeing in of areas Dish. In from opportunities these significant making what our edge new

Tim Horan

What And do qualitatively you more the to hyperscalars likely are think up do outsource you infrastructure there? just a the think insourcing that, or follow to trend the is more? heading

Charles Meyers

that amount we from going I to robust, that, there's see third-parties. come level to that some to is self-provision. of just of huge As be is to do that But need think a a appetite greater hyperscalars the so from some continue of the demand to going

locations the as and deployments and And by huge attract aren't on for been benefit aspirations Equinix and JV targeting go, think very share that said, that well That we play grow so is in think JV really to strategically we're overall to and executing our outstanding business the - really strategy. buckets. I to already And of of xScale in returns our deliver capture important to we've have partner. sort that

some there. the there are there's in to of certain of I hyperscalars I markets. plenty think opportunity some, self-provision seeing desire think out So But is

Tim Horan

you. Thank

Operator

for question. Thank your you

Atkin from Our last come with Jon will question RBC.

is line Your open.

Jon Atkin

much. very Thanks

lower I if question quarterly guess should of is, at And you did least available we got Slide of what's And numbers correctly, one-rates? quarterly that to that to rate XX the at looks grow question my megawatts a So XXX a in terms on like of type of the capacity. xScale megawatts XX So expect sell? of number? what wage XXX megawatts hyperscale, annually leasing, I'm kind a on you've right interpreting XX

Keith Taylor

would Charles made we was, the we was And made have seen everything a one of previously, of now success. out. the comments built lot Yeah. say sold comment I virtually was

so ramp up to And we're going dramatically. to continue

xScale And the the is the in of than for openly, originally initiative momentum plan. anticipated. quite important critically in is more that One things business we've had we

take of take is as all will XXXX world doesn't secure So consideration three in to to a billion including on, are period working that working But the will beyond. party. hard xScale and future different different say, again, we joint And we're we'll in that XXX and present little are itself. a procure be XXXX summary some buildings tell suffice really will across a of time megawatts, of exceedingly the And through regions teams other of provide GIC it into detailed to early about inventory. and another initiatives that And we it's initiative, the the probably - all XX on us that with over builds the venture world. that the to detailed now. the three regions bit that to capital $X how you exactly of But continue with anticipate going said,

But rest the so we continue can the if as success, this. we And community. just seeing I progress, you summaries update great are of and we'll to

built the more to we diversity, land and and up for to that everything future. capacity we're continuing that build So procure have secure and

Charles Meyers

can to lot not XXX a the precise. we're I than the next faster not seeing accelerating it's because, seeing, to realized, Yes, you that employees. XX tell the work I XXX And first success. but capital come putting certainly definitely and

Jon Atkin

then million balance you're is you showing Great. sheet it remind Can sale. is held selling? $XXX And us what the lastly, assets for in

Keith Taylor

first typically, that. example Those assets was Dublin of the so

X. July Our joint venture moved Dublin X asset the on to

that And available for sale. an is asset so that's

going ventures it investing of that a we're transition equity Again our get assets. on capital other investments ownership. or some the to balance and to or recovery have and thereby We we're have and sheet, contribute then the move joint those

to are the that just be are assets queuing up those sort delivered the ventures. of So to joint

Jon Atkin

Thank you.

Katrina Rymill

Great. Thank joining our That concludes call. you us. for QX

Operator

conference This today's does call. conclude

You may now disconnect.

Equinix (EQIX) 29 Jul 212021 Q2 Earnings call transcript