EQIX - Earnings call transcript Q3 2021

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Operator

Good afternoon and welcome to the Equinix Third Quarter Earnings Conference Call. All lines will be able to listen-only until we open for questions. Also, today's conference is being recorded. If anyone has objections, please disconnect at this time. I would now like to turn the conference over to Katrina Rymill, Vice President of Investor Relations and Sustainability.

begin. may You

Katrina Rymill

welcome and conference call. Good to afternoon today's

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

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

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

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

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

Charles Meyers

consecutive Good to had record our third market earnings quarter Kat. revenue quarter call. top great signal A QX. everybody, growth strong a Thanks, of afternoon, line and XXth welcome of a demand. We our clear achieving quarter, and

Our they hybrid, program models for key remains solutions. to and continued of and as transformations increasing to virtually as by accelerated a its our infrastructure triggered of partners every economy. robust and channel of see our our digital fueled results to nexus Americas demand digitize in segment strength for uniquely as the performance Equinix And globally Platform and has strong continue business The clear multi-cloud distributed, were results Equinix shift in need for point towards pandemic customers as architecture positioned business help reflect digital choice.

as our for and creating As driving customers our position value world services our shareholders, needs remains market-leading demand tapping xScale, digital and we growing and continue durable rapidly the into ecosystem digital massive to focus and our distinctive customer colocation on evolving our with incremental in growth scale Company, franchise, expanding our infrastructure of adapting through to relevance by business. in sources Cloud strengthen our

solid up outpace to with line as normalized reach, These was adjusted highlighting results and expectations. power. $X.X the connect than our XX% were by QX was quarter the currency adoption yields on fiscal are constant revenues than X,XXX growth our EBITDA Slide for basis. on customers We cross growth broad across and Interconnection X,XXX X% of our scale AFFO process digits. revenues, in a predictability rates and all booking in more and million, X% Turning continued depicted the more year-over-year, of Equinix driven Revenues year-over-year, growing to X. up year-over-year, colocation

major add capacity projects solid final in delivered of we and with XX countries. quarter the a the and more like York, in XX continue services XX in year, underway Singapore, major look and projects quarter demand Frankfurt, XX pipeline across have this markets key to markets We demand as New we in

world, times the as Our quarter-over-quarter, In QX, remains continuing to X,XXX up on the XX have major than added indication global excellent now competitor. moving customers saw significantly now nearest A the robust. incremental is More X broader end Fabric, into over portfolio. their In total within are attach interconnections saw around the rates interconnection as growth franchise Equinix metros service with Indian we continues clear traffic into integrate over Platform growth our September, than destinations we Equinix X,XXX their XX% home diversify platform. up close exchange X peak our Fabric per interconnection second, interconnections interconnected cloud. index traffic Fabric the acquisition, industry-leading the with year-over-year at solutions. terabits country, that of extended the least XX our providers an of over more to into X% GPX cloud market. entering and thrive XXX,XXX on-ramping, Equinix the right Internet on XXth businesses strategic own and

operations will xScale as data develop newly network-dense Also, continue to this X, and we in over October, X estate expand built of have than Cloud our X we an more our hyperscalers closed CX expect signed provide [Indiscernible] We the more $XXX venture top GIC of with centers market. hyper-scale world's plans announced capacity closed million to when growing Sydney, to will our a in establish venture India added in when X local international tap agreement business. half into of more point which and rapidly including development, expand megawatts with XXXX. XX phase Mexico across with collectively providers we and parallel be years ecosystem. service in companies, PGIM quarter, [Indiscernible] under fully to the XX In more and Australia a with The built-out, XX two first In they ventures GPX centers we which globally our real our investment success, the to X in fast. coming $X.X power now to and joint in Mumbai retail than xScale of XXX than than slide-outs to form joint when expected leading is tremendous megawatts into capacity Frankfurt. total fully with we GDP including facilities the XXX significantly expand with Our megawatts built. billion megawatts represents entry this the previous campus first data XX and ideal robust assets, to our of during joint in a Sydney with open currently the an country, network X announced on-ramps various

services, software Turning customers 's and growth deploy we additional business Equinix year-end, metrics. expect robust continue And metal is our strong saw the customers in network-edge available growth to network more infrastructure By at be functions at across [Indiscernible] our the embrace XX recharge metros Cloud-native as established physical network-edge speed. to our to virtual ability revenue service provider purchase world. around

highlights from cover me verticals. let our So

service network infrastructure infrastructure across services, our and Enterprise network in global fiber and leading access provider, with Our Australia's offer for sub-segments the in top With the Sydney global be Expansions continues joint communications Company products and Vocus, Electric, with specialist continued allow included building foundation quarter partners transit Zayo demand, in net business. Group, their support this Hurricane colocation the quarter customers strength globe. momentum a Fabric to in provider, solutions utilizing network go-to-market network cable to interconnection to and IP at a both and in real-time. vertical and adding capacity Equinix scale to to Melbourne a and satellite

channel record Our quarter FinTech enterprise led vertical another saw manufacturing and activity. strong in by

hubs wins branded and next-generation low and to a solution deploying offering, cooled New to Platform technology Fortune XXX center Fortune a included enable support global -named and e-commerce deploying leading of a manufacturer high the to stats analytics online environment cloud-adjacent network manufacturing Company, and expansions deploying retailer latency, hubs support their custom-liquid their retail XXX with compute, sites. across Equinix performance platform, network a

demand and Our consumer markets Adobe, X workflows and core and Mexico broad-based their to this across quarter continue streaming streaming metals Netflix, deploying Equinix for into gaming quarter services services Fabric customers cloud in expanding ecosystems. for strong. digital a port a support global deploying a Americas, provider as easily their growth. the metal their existing support as in strength to U.S. solutions bare key Expansion provider platforms and in a remains Kingsoft, offering included to Equinix sales Metal, This quarter. Platform towards top by at-home for connect resurgence had digital with support sub-segments its enabling Company and half City Equinix on channel in coverage important shine, rapid Content accounted And based and provider, to leading bookings Chinese sand new bookings existing participation XX% Expansion delivery, quarter. cloud object software Wasabi, of new expanding growth, notion cloud a user OTT led and markets on the a and and particular over spanning posted a EMEA, in to software the into this to new for Sao extending optimize this strength industry-specific our delivering security base being scale nearly logos the APAC distributor both more enterprise cloud in our go-to-market robust of Paulo. of content media and in verticals sustainable IT than great bookings, digital global of in X platform included growing total new another XX% quarter solutions. and program demand delivery be storage to and our growing catalyst continues innovation APAC infrastructures saw vertical top and a in and

SBA a automotive partners adoption our AWS, training a - strength network Group, assistance for to momentum Wins such AI included and AT&T, from We workloads and their billion pursuits wide and benefiting up tremendous key interconnected of alliance industry particular speed for NVIDIA, Microsoft. win are HPE, were IBM, and cloud supplier Continental range systems. from across seeing joint a optimize parts enterprise driver global marquee and as Dell, hybrid with verticals advanced in with worldwide

cover to the to So now the call let Keith turn for me quarter. results the over

Keith Taylor

quarter, net and afternoon for We both another and Charles, better. quarter. the we business bookings expectations had all. by opportunities, Thanks, our The by from at gross Well, continues saying are digital Great. a start go-to-market hum, leading Equinix solid the to the engine. demonstrated to me good met to market our level outstanding very macro-environment once industry and expanding let again, continues drive as infrastructure

remains backlog Our work our quarters. elevated healthy extremely to bookings few as past all significant regions. in And is both volume the substantial pipeline through we our the forward-looking business close of and install

our the and inter healthy, in was delivered platform activity. activity sales channel Our inter-region best global history our and

operating of model per our positive network MRR seen put to forth pricing no cabinets have construction Fabric, firm We've retail rolling and chain markets have by our our a assets We design basis, others market delivered targeted best-in-class of A with more yet differentiated in procurement out general compared year-to-date major with capacity and as teams. delays related delivering net critical across xScale challenges. a than global XX our sourcing again, network teams strategic cabinet reflection new megawatts metal to of also despite our support edge, of with concerns On capacity, XX,XXX while offerings. actions, OPS supply inventory efforts our service validation space. infrastructure and today of and yields the

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

to Slide the in the about represented $X.XXX to venture custom QX up region. Non-recurring X, revenue platform due EMEA across Americas and same the work X% on xScale led depicted revenues business our As an last of over performance X% year strong quarter by global due fees. increase billion, revenues installation were joint

large complete guidance strong adjusted FX Total our MRR low $XXX prior integration expect performance, rates compared end the to million due to million, $XX prior our integration of $X our XX% EBITDA, the revenues hedges costs. the seasonally consistent and FX we result of guidance net headwind recurring with hedges our teams of million was in installations. rates. net AFFO Total expect capex X.X%. QX a lower QX years, at timing of high of included when due expectations decreasing guidance million headwind of costs. our was higher we our downward, expectations. spend QX Total prior by $X when of QX operating levels to xScale sequentially projects. operating to the revenues, $XXX to million a customer QX or QX, our For at million included term was $X fees to as of QX approximately trend and of compared work to EBITDA Similar XXXX MRR adjusted timing

the for a MRR X.X%. We expect of continue to targeted our lower full range, end be up to quarterly to at X year turn

covered region's through to Turning by Americas regional are followed results revenue at highlights, Slides the X EMEA XX% our and grew whose X% on full year-over-year, X. at APAC X%.

Canada, As team, City, in markets which coming some QX platform as to notable derived year. within to sales previously rate EMEA including one-off to Seattle, quarter the benefit smaller such and strength transaction Mexico metros, Canadian and we price is broad Toronto. America continued of a global teams with increases, a Boston, Americas lap The from levels our Dell expectations. bookings with return saw region our the our interconnection across continue last increase from sell the growth as outperforming record Denver, from with we the activity expect of discussed, consecutive in adjustments normalized our positive other third distribution The

Our EMEA strength had Amsterdam, region channel bookings. while opened to and led all the Frankfurt, solid the builds of efficiency quarter sustainability XXXX positively across and as blended towards progressing meet Pacific Frankfurt Singapore. local science-based microclimate. And Madrid with a And with a had quarter drive aim enterprise standards momentum our recently our targets, to high the from model our like service as to markets coming region new customers by finally, and solid metros our contributing a IBX of we Asia

zone. continued focused activity firm small and cross-border deal our to with in New medium-sized on deployments pricing strength

in rebound and net to X. Our billion $X.X uncertainty. Hong ended the nice leverage feel now the Slide remains peers. with structure, market debt ratio a cash to capital our although our performance, to relative continues looking saw industry given bookings constrained markets please Kong our low, of quarter And about particularly refer We

liquid regards XX% we low remains Our weighted balance With rising cash and over payout years. rates with minimal to our of AFFO potentially outstanding debt interest our flexible a our in at fixed highly near-term to have we ratio. debt, have sheet exposure maturity average of X

X quarter, for and Osaka the new [Indiscernible] We Singapore, Frankfurt expenditures Frankfurt, of in Slide Helsinki. including million. projects CapEx were Barcelona, quarter, recurring opened including Turning for land and $XXX and new XX capital to in million, development approximately $XX this purchased

the assets. On business, of and opened Sao Frankfurt X we side our Zale the Paulo X

we contribution for our after media our needs. $X in proceeds closed venture also venture more joint a with million, the built contribution from X after of continue separate appropriate and suppliers components, into including first hedge our $XXX approximately the note, phase to We our an against and actively million coming XX business joint cash Sao asset of chain of the support we GIC net XX% equity parts of Paulo manage as practices, quarter supply challenges inventory ends. have On up of X

of our more asset XX% total the acquisition IBXes. and Sydney X Finally, for recurring revenues to Sydney stepped due up X

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

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

results the in from We now expect growth and to range, of our asset year Do strong and guidance revenue of to includes anticipated please acquisition, part note, the growth. our the refer September. top to XX And the due which to guidance India summary exit our XXXX Slides end bridges. to closer GPX XX updated for closed Americas stabilized

constant revenues For X% the basis. approximately full-year to XXXX, normalized we a on expect grow currency and

the basis. and our on include FX Our Revenues a A GPX million implies about from rates. reflect strong largest continued $X reflection updated our acquisition ever revenues in updated revenue step-up recurring of quarterly guidance normalized execution.

integration now XX% EBITDA costs before rates. updated and margins, adjusted Acquisition include than from $X We greater about be to million and expect reflect GPX XXXX FX

share to integration We to AFFO XXXX. the expect on X% growth And per currency deliver AFFO compared to grow of a spend we costs XX% and to normalized XX% in year of prior $XX million constant and expect XX%. to XXXX basis to

including Our and billion strong million of $X.X billion CapEx been midpoint. between accelerated commissions AFFO reimbursed XXXX recurring expected $XXX spend, by which an associated impacting $X sheet CapEx, about of portion be is elevated $XXX million spend range and bookings our CapEx a CapEx, including guidance significant on-balance or JVs, the cash AFFO some will performance. at has to recurring with xScale includes of the

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

Charles Meyers

Thanks, Keith.

businesses Our pace. well force services to driving business infrastructure delivering underpinning changing digital results these continues pandemic as been has transformation times. keep perform exceptionally to strong and consistent The must imperative, this a to and respond throughout the seek for the

go-to-market and customers, platform like We way to Directors. create, engine our deliver design, continue the of new to the evolving new end, geographically, Guerrier our will prosecute meet products market. we expanding bear our needs expand to services customers. our of growth to compelling addressable changing scaling that Ron our services To to factors, to bringing growth and We're multiple fuel and that our Board our and also I'd welcome capture

They center which in the being starting in to and in continues communities, commitment you, everything embody us show be of in-service our other, our do at Fortune perspective our allows to to close like I'd XXX as keep commitment CIO digital expressing veteran unique continue offerings customers gratitude the our today our a our we government, to innovate to to brings with an turn whose to digital corporations to every to by infrastructure employees, to for service by we our mindset, more tomorrow. up the to board our and service a As shareholders. than to leadership. XX,XXX to leaders drive Ron market and each of my Equinix customers, day to

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

Operator

for to would open [Operator question. you. the Instructions]. like now phone lines Thank We

Markets. BMO Please from ahead. Our first comes Ari Klein go question Capital from

Ari Klein

have what net where a regional bit a partnerships are there, standpoint. from the channel like you maybe up from seeing customers, really the additional seeing sounds some also doing this new you're the in year adds been Can It on and fair provide new Thanks. and channel you're customer color traction most well.

Charles Meyers

the strength talked coming ads I yes, most about we as Sure, lot is side new And script. seeing but I think I coming across the board, of where XX% a of are business, the are those, mean,-- we're the channel, customer think in really the enterprise about through from. of

more been than uptick channel seeing And bookings who with think we're our top and said really really engaged the encouraging, We're really us. seeing partners are that it's strength the of with particular, So a XX% in percent coming I channel. our big really enterprise partners through pursuit joint top in alliance

opportunities terms people In hybrid architectures. and implementing of multi-cloud hybrid pursuing

total And in X give that's accounted this -- partners top for I'll fact, book, a in bookings. of channel We bookings. the XX% so that of is alliance start. the you total And the XX% of our XX% not had quarter

really how therefore, of that AI cases, momentum it's and and about driver. the it's centrally, from data thinking on So variety people a how number verticals also a key then, of act terms with across of insights, using strong partners want data are but corporate to of number strength store it to draw resources, across as real a in channel a they, cloud and use

of good enterprises and event seeing that a win in fact -- we Connects there, had the and an for cases really was we great -- I variety We progress -- event we that that fact, had NVIDIA win think on is XXX with we had big implemented about range about talked I today really momentum. that in Fabric (ph) of use use we so think on big so the as really and for a about cases some call script, -- talking front joint we're registrations In strong. had

Ari Klein

tracking And where sustainable do well historically. it's think What's just that Thanks. churn, then on that below is been forward? in driving it's how you and moving

Charles Meyers

there. in that's that, on clearly if I at always line you potential a Again, of think downward the I times. But best churn would that fit some think line there's look the I that trend do is it's comment at lumpiness trend. been durable

use to time driver our We're we've a year. full-year the the And the of going so had to really focusing to of think forward. they're of I marketing range and be we as talked of what that's to a terms good the we're and that business. mix end think a team that we bottom %X credit of lot customers, I And right cases. expect sales sort terms targeting durable the about, driver to continue I really think is getting doing business. big I and perspective, in commercial churn it's our toward deployments, right be And in business be -- think of key right kinds of kind we from going said, do %X.X. to of in And a of the our a that's teams how

Ari Klein

Thanks color. for the

Operator

next comes from Jordan KeyBanc Sadler Markets. from Our go ahead. Capital Please question

Jordan Sadler

of pressures that Thanks. Wanted touch inflationary have some base the on been folks. affecting

if First, could had costs region. quarter you protocol rising if full-year elaborate And have could, power you talk just the hedging maybe your by may maybe impact, in your on about guide. any, the

Charles Meyers

I'll Sure. our anything, currency year, XXXX I hedged got program to if impact into multiyear XX% period. we're to our pretty the power in more think seeing really of in we a unregulated next there's said, markets in the longer-term hedging into a that and as over in our pretty Keith about be we've remainder this, really largest markets. add at. then the and we're the I'd similar that most volatility jump to you represent come extensive but which going feathers expected early guide, year cuts than hedges But of items And that looking where some power say QX X-time slight side on had wants we're on the a much small for can other he start

were again, power for you to is adjustments on allow our I working costs. heavily more they implement our to recognize based different our appropriate. But, based on adjust we're And contracts actively mix. think so us guys, businesses in underlying circuit pricing And where that's we do think

more we that seamless takes immediate experience environment. years, our with little would power do that through a terms and And more that act give it's get little environment, we're said, the pricing pass we'll base those some really that as in say costs effectively. in that actively it. a -- power finesse to us whereas of the do circa So in last confidence I've I in working over of be that able how increases cross-connect I'd to the Europe to couple say go But done

volatility no in there's So doubt the energy more markets.

those watching and we're our strategies we're closely, So going to continue to accordingly. adapt

Jordan Sadler

just what oriented. you as the ability the when of there layered And sort of in guess top-line? in is I you be portfolio this a may in circuit terms of just of of pass then through, some the would that benefit what's presenting follow-up, one, sort And the to billing factor some

Charles Meyers

the sort and is in of circuit About very that overall been We've -- how our circuit a of increases based price about we of portfolio environment. so the passing price in aggregate And increases, in power XX% that's its more matter to of of terms in power the effective again, component -- be been space underlying based. key circuit terms story. of the business, of that's through effective across power and driving of XX% based can costs of terms increase return a of form of part really the because our returns to

be going bit circuit are matter a do we we're path. So again, we we it I and whether that of won't where to think power to -- contractual to of going have just get the like it's every that, ability do

what that I approaches. but look the we'll at So that market-by-market rate and think assess

Jordan Sadler

Okay. Thank you.

Operator

ahead. next Capital question comes RBC Our Markets. from go Atkin Please Jon from

Jon Atkin

PGI maybe Thanks. for not perhaps any -- you to revenue's in And this about from AFFO, I keep year. if CapEx, of I give sort margins drivers revenue you're -- broadly to as highlight But growth more compared xScale, to was guidance and think differences then headwinds with and Thanks. on a as in in we GIC. can interested qualitative major but mind next perspective, keep for anything going as XXXX from to xScale. call, mind well tailwinds know and coming

Keith Taylor

Why don't first I second take the the might take think, And one? one. then, I Charles

is and work to relates similar. in it between developed In in construct the delighted our to Australian was a PGIM structuring different the market with of contracting structure of As GIC very GIC -- have business. while PGIM. many Again, support another deal we off ways ed with the partner

As to performance it this ability of as the we've sold the to to of from we quarter, heard our out some capacity prior -- again, you've that calls most market. our relates basically delivered

we're very to And so our continue builds. eager

eight xScale, working have hard capacity to builds currently is appropriate customers customer very and more. We the team in underway that identify for plus

to So And I'll -- just We're about. still time alluded we across more to his as leave exciting deployed prepared have you it's is talk with XX us and in the assets. to space. going $X.X xScale the for in and capital Charles money, work, is an remarks the be putting was billion of

does of beyond, revenue there we for into we highlighted as or itself you non-recurring prepared in before. QX, which So certainly seen we just is just seen recurring revenues of as non-recurring line, our But non-recurring our come more much that why those right piece don't component into it it that AFFO. remarks the a now perspective. expect see we've a xScale. 'XX of also look again as lumpiness not xScale you've that recognize start from don't step-up the see and Then to play big some create leave and of that I in in But

Charles Meyers

ads, add quarter, X The a very our best ever. really this we least the strong. of performing, in think the in to quarter past -- X,XXX X,XXX -- is want. adjusted little A never magnitude ones, how we noise I optimist that other bit Look, have because business, I I been record been the -- but is. [Indiscernible] bookings cab terms added the the of business of what an here, continues to I had QX Jon, the been, haven't billable on at fundamentals continue the for opportunity say on I'm it's perform. are quarters, I in ahead seasonally the guess

This an at adjustments markets. think in momentum to though added in quarter if over-indexing India. positive that there terms I well about digital are those responding turn, that front on like customers new earlier those Huge opportunities pricing, -- another they're script is predictability in good us Mexico firm then degree even great we we're really in places growth -- our markets. to see at relatively really pricing low-end quarter Keith in to of and continue at now earlier talked said, products services look and markets big And the as entering the of stage you Our And of growth.

in as XXXX So to really about good, look going firm tailwinds, the deal to customers bookings etc, in about be continue absolutely that. therefore headwinds, points. think good really looks good momentum, ability the feel to churn price I A and terms our feel our of mix to to key maintaining pricing support I relevance into good is

said, us operational to leverage. operating as there think efficiencies then sure -- I continue power in some a a backlog. think the to headwinds the headwind I work I a we going bit potential making As be business We continuing is more talked to key to to on drive focus about, for areas. And little in continuing that we talked about drive

book-to-bill. multi-cloud tab that got work that a of deal implementing complexity that. We partially And we've the big I of seeing we've certain hybrid through into multi-vendor, got types, continue part I that deals. as kind deals think more because to longer these big slightly of gone think backlog have backlog, we're to some got

of so hone continuing capabilities there. to And we're our sort

there. momentum into we drive guide. the really advantage go we'll the as to color And be if you of of that's obviously, think to all So bookings that continue give those we on we I able a can will take XXXX things,

Jon Atkin

there And then whether on the kind could if sorts it's you perspective? tuck-in platform of X throw bare business look but space, data of that those software I anything the in metal within M&A, from that opportunities? what from M&A non-core the what to is networking-related augment you do consolidation center or perspective, classic --to would of regularly sort at degree an anything feel And

Charles Meyers

build I of learn the say same of we're as that capabilities, -- around design some at understanding adapt approach our are in Jon. and of from perspective, investment our deployment -- -- landscape. learning and time continuing both and perspective. that that capabilities digital we're from digesting evolved business would development we question, a great Yeah. and the in to we're area A and go-to-market And energy as and kind a still well services the accelerating to both how from

there cut and opportunities we're things honor -- learn there. those in teeth do But think to real so I that continuing And market. our are really our there

looking over And to of beyond. and better active opportunities, that capabilities, at landscape so continue the and really learning year terms we'll and in year next in potential be to course and talent area of that be technology add and this both

Jon Atkin

lot. a Thanks

Operator

please from comes question Phil next from Our go Cusick JPMorgan, ahead.

Richard Choe

Hi, this is Phil. Richard for

there, and What Just you are bookings strong wanted from now modest strength in America. a long to to a environment. very about of ask the kind seeing seems continue? how growth went the growth the can It it like

Charles Meyers

hope good we certainly business. when have continues but that was going than think pretty like about you that talking abate. to I would quarters Verizon I for while. Richard, about a term Again, -- the we would Hey, we more spend I tell feel party I

right expect and rate so good that then at is about in persist scale elsewhere. other growth into sales would bookings really we the execution I'm for fact. loving And side I as talking so about levels. business, to that the really bookings both going region, now. feel that performance well now feel we the And continue say global the region of region about the that We're to to of of as good America's the tremendous elevated platform the

to leveraging very, attach of to now share driving the rates increase some large focus and continue to is channel of partners our and services base new of them with wallet our very area some that. think the of our new I customer do bringing really

So anything to Keith add

Keith Taylor

we other And alluded amount and the remember have we thing Americas that -- The a just of we capacity job our the and such selling focus platform. beyond the just thing right of great and Charles in on are as team customers, sales I'd leadership normally doing the to, substantial that utilized, we Charles core in that so have build Richard, I XX% to markets. other this continue have built would say, region's the

real. -region opportunity so is inter-region intra very that that And talked about the we we said and --

So the overall about we're region. what very seeing in Americas optimistic

Richard Choe

issue And are an see a seeing Americas, as that now you much. you lower turning, quick follow-up changed in the that not or has

Charles Meyers

sweet was a advantages Well, been, be for elevated think associated it's And a had process. were our deals XXXX-XX obviously, the when think would traditional the where honing -- of capacity through I had when that creating time assets. talked Verizon few let we're there driving space to we core etc. scrutiny, advancing has And with the then as but spot that work that really ago, time focused on back that right the for days We we would things strategy a customer on. was a that of and period we focused outside the was on. commercial our I elevated we're we use Richard say focused several we I been deal mean, value net just process us we honing that think about set competitive and when of we you'd little in greater mix time, little I go some we're think we time and fact for frame, story here of bit bit in so making of the had digested and our I a turn period that it the and candidly of was the churn in sales I kind really about early have that -- had long-term quarters that to And -- I long the that guess really sure during decision those you've those we

seeing losing is our to door as right -- said, and with, most get always the begin the to you're -- the deal way I've the in focus the now, a is. what deal so to best avoid that, best And and so that's

job I our doing really exceptional teams an on sales think are that.

great the board U.S. the leader new leader [Indiscernible] leadership dynamite Our team got incredible job, just a across is sales there. a he's and an doing sales in

some our in really [Indiscernible] driving to America. And give team [Indiscernible] to great so just It's credit I that a got thing.

Richard Choe

Thank Great. you.

Operator

ahead. comes David from Please from go Green question Our Guarino Street. next

David Guarino

being it then renewals that per would Can if Hey, elaborate U.S. And comments Charles. MRR exactly us excluding pricing Thanks. large this maybe your What firm? you helpful that's Could also, the the the and be new maybe data could just or on you about does behind deployments specifically, put firm mean what tell cabinet if footprint was, some you in on quarter? leases?

Charles Meyers

things it Sure. the big I talked actions mean, in had is pricing the positive net we've when one about when we say quarter. pricing, we of firm

terms any take that if built essentially will against So we're you are a our getting price we occur in. increase on pricing in what might that offset uplifts accelerators movement contractually downward We of increases on potential that release. --

that positive get think, that sustain rates. to of of renewal we those Our overall higher a pricing And positive X-year contract. We'll any business over in -- And to saucy that's a But I these kind see we'll adjustments. X just, move go through that. to it ability given tends escalators those our might some price little a of It's a -- reflection cycle quarter, will seeing we're bit summary within price pricing then, points. again. of have kind

the of long some price period Americas, actually last really interconnection right for the of MRR We've we've of seen couple cab in per over EMEA in of can in strong see you world, moving moving into the time. of a As up been sort the all increasing. because years the

installs slightly cab on and that the depend mean, of those the kind down is just things, XX.XX basis, exceptional on were U.S. so an we often and I think a and -- in per currency number. I constant but timing of

so find the if you relative would you the think kind itself. yield but sort And the that of far far, rest to of I be I in the of industry, to think best at look away, it industry

And terms in hyperscale in in U.S. xScale the doing do occasionally footprint, of And in strictly the if U.S. any the even really about you in space for that really business now so venture. really at normalizing the why a not anchor And large active facility, that joint will we aren't or talked large but we're look through -- almost through in we've the in is and We other xScale we're markets, an the deal footprint past. doing that the

are really form picture. here, the financial rolls financials other that the in the creative core see to our we things quite of and to And fees so, overall results that's in you think not rolling that that only into

XX% Pricing, that's in a go is think business that joint certainly, So which this be that's to through are why little that picture competitive on is continues decided kind a I but through of partner. ventures pricing. to returns do why also on capital lower where we of xScale financial

David Guarino

but then timing a to the said range would I to again commencement quarter of next growth maybe just due X% of it's revenue on And clarification low-end know on up Okay. at quarter, and just the factory leases? Keith step stabilized one too the going drag this

Keith Taylor

timing a that? what? drag, of repeat you the Is Could

David Guarino

quarter? of you just have push assume to Of going certain get we're rates. got growth. would high-end commencements the guidance in it leases near into I on to leases pretty the step-up I big next was a if revenue guess

has was revenue? I there lease a realizing So will pushed driving wondering into just in was terms got if you something QX when or it of start

Keith Taylor

the alluded Americas first the just about, region. in outstanding Well, to the Charles of from just enjoy as highest a again -- and more environment. Americas bookings we the talked we quarter will particularly as foremost, sort in pricing perspective. end, an And And

it it is that on. our of a backlog things So going Part here. that there's a of billable is of sure make but cabinet difference are conversion big also the timing, number a into will

of business scale. other could price would the I than abating, booked, starting or with Go a extraordinary that continues billing way as Churn then point backlog into seeing you've we're This and good nothing to your say a overly sorry, from netbook. we there's momentum got inventory. be is so, And item. overall just abated

David Guarino

All right. Thank you.

Operator

Simon Stanley. go from comes Flannery from Morgan ahead. question next Please Our

Simon Flannery

Could commentary. both this here, about markets your in supply on coming going been chain labor, then development, thanks for from the in in and ability of to around you sort be a of terms on the more you're you've just and landscape to and you are of to back various but availability or terms costs of focused little active the tuck-ins pass as going on talk What's Thank and Great, other development about inflation out on well seeing small of what any on xScale, a is how very that the side world timelines impacts lot. there the construction along materials? thinking good the as at M&A, raw the bit things, evening. you.

Charles Meyers

Sure.

make by that realities exceptional our I'd team generally, and job think a an the team of we start But it has our aren't really chain potential really are doing chain great doesn't continues seeing internally happen. about really has to there. I saying happens it done is sure impacts -- X we kind mitigating be as business. supply the any levels go bottom-line risks are to our and just we It the way I around risks. that world to our that message that to work navigating by So talked just relates Chuck, that that the The meaningful to been current magically supply out negative

modest ability on in projects, or more on those on really other supply-chain a The there deliver time seen typically out with impacting words, there while and those level to budget? delays first candidly. and we've some And are are constraints facility our are COVID are -- level actually delays they one few is projects of associated

and script, move separate can his is combined in inventory tune forward around. giving world sure That the number the to time. taken contractual make Typically, about on on all a commits to huge to or can projects that And be confidence projects. million, a with between that we they got that the underway. noted over we've projects fundable the we Keith able fact actually our As of deliver it's of $XXX us some sort we've of are

that, team, the in team at the just done next terms In other the there. the level. And words, of mitigating of and procurement job check services sourcing delivery really phenomenal construction have services The terms -- so the on our is team, a underlying timelines. team, the in level IBX availability

can forecast Our to Fabric, we've of the done several Metal are And purchased there capacity -- we we just support us have the what do Connect, there? confidence we've and is support give like quarters etc. to that forward network-related that. capacity services the we

And so good well. about as that feeling

are of things? deployments. IT out The have those In their if again, for materials business and -- that things third level of circumstances of we've asking delaying is grand And things build where also in scale are delays of equipment really scope while particularly needed other not deployment cages. loan the Occasionally, not, or are and to customers commencement seal level. and words, as And the last kind a other there people people of cage stockpiled level, We've there. terms which are, are just delays that just delayed -- our is non-standard into the delays. then for And we're their of terms within their in they're what needs those in getting seeing they sort there. of of But the items if sticking not in caused curve delays middle the is level customer bell our things, few meaningful. seen they

really design will perspective. a terrific to job think been to that the as course to has standpoint And or often inflationary we're our continuing -- it take to there's cost XXXX of scale some, to going a expect mitigate there, are chain as supply probably costs and We've with we've I little managing of keep things so continuing costs we're I bit trying would tell the to able advantage of think than game to some in question team -- I up, to we over think of faster from from the there's a able that So I I that think do stabilize whether we're not, up optimize a and you areas. ahead but that, designs to our those pressure been build on keep of start our people done things. asked

you there, gives but some answer perspective. hopefully long So that

Simon Flannery

And Great color. M&A? the

Charles Meyers

on we strategy. business. in digital an think from the be sort services we we But John -- -- there's of that M&A extending our the to opportunity of for continue there's say in -- there, about critical terms might we think to looking side our in opportunity sorry, accretive continued mean, M&A question I'm I would also, perspective, asked think are out I in the talked assets and the reach market I

the and go those to balance kinds sheet, after firepower so, And got things. we've of the

always continue high will a appropriate. the of as to getting active on degree deals. we right so And be with certainty They're

Simon Flannery

you. Thank Great.

Operator

ahead. from next Our comes Citi. question from Michael Please go Rollins

Michael Rollins

Thanks X and good Curious questions. for afternoon.

future. you And in datacenter XG the to do be you you of you one rather having what same if -- edge? companies out the happening partners, your the own it believe services what's companies of had do you you in than question facilities, their for assets? into increasing as it of side the that telecom might to look at as maybe first landscape? to second have ownership investing network is switching is, their more you the you are The the someday as kind fall seeing what amount your then, at look more tower customers, trying structure place the destined as infrastructure mobile make and are take when an in look wireless offices under business, telecom of network well on or that opportunity core that is legacy And And wireless portfolios and years network datacenter power for the

Charles Meyers

say a network Great it's would for the say I questions mixed bag. sure, on by side, I'd

particularly forces there that That have are as want viewing Equinix, infrastructure. portions facilities like there their that a movement building where their is to those I are I of these -- places degrees people still core facilities, of said, companies think lot own facilities also and long in large to think logical I that put within on of think and companies aggregation there's of history third-party a continue. that towards is a

active putting we think terms and into we've of of the potential how service out success front have the they development providers on there for very on think concept been so approved some been about And equipment there. seen And as value we've both facilities. sort business And as center their actively certain in some Dallas XG well of core portions I infrastructure, we proving our that of propositions. those working with have providers example,

-- with about of still will we're we're do that think more people because who into happen disruptors differently think markets I a it. coming over I stem. core lot successful So long as they think are those

are pretty -- there. and with now, some that they -- working so some that I interesting I the but there. are are right going And do so I'm there there yeah I interesting wanted I to want But few say I on won't. -- a sure can't, not names And we're think opportunities public, things

back see things. to And proximate that's are to the tell tower which Definitely there data see fit definition of edge there shop can you sweet of portfolio. for that communications a why the that their too. synergy the side, aggregated an A there have sort demand edge. sort companies in very compute, companies, they in Things significant where are may that that part, those could tower I to infrastructure, and use and is kind really further. But to we out differentiation assets most for for As of -- have and That's edge interest automation spot. the why our majority were center is. would of our at mobile and they understand I we potentially is go the strong real traffic we've some how been that like broad-based of believe assets estate cases traffic between

are from to obvious likely to there they that But partner keeping necessarily Keith, -- continue going our able cases if eyes would and the those me on view It's have real certainly think know way some in But just and think a have think don't that how to I structure. I development a different more those we're standpoint. to we do ownership that active play over see with I XG we use the will that live be I business have think markets I is to accelerate that that? on time. it's the out. you to not under same folks

Keith Taylor

[Indiscernible] Well said.

Michael Rollins

Thanks.

Operator

Rasmussen Our from Please from Erik next Stifel. question ahead. comes go

Erik Rasmussen

Thanks for the questions.

another of you've Australia. xScale, to Americas recently announcing circling progress at I lot back getting thus interesting. guess APAC the made what in And in obviously partner become Europe So a and JV far. more point back But

more As are you to the any elsewhere get characteristics market that you're starting or seeing the same exciting what this you xScale, recent look are about seeing than to scenario? expand in

Charles Meyers

Well, I think still that pricing. It others think. when on a I cutting mean, I market, throats be each -- start it's It's hard. will real not very people competitive

think would fits always not use other to opportunities doing say overall terms set be a we've to as create the set -- now xScale is further advantage circumstances under said, of so in think there the would this the because providers, I major not think I think -- particularly last just in I business in we broader we're at our lot we -- and very why not of to look you of feel the think that to Brazil distinctive is wanted I not do question. we're with accretive advantages us. not, and the relationship out for a in out if strategy the continue not very some opportunities that Obviously, us is we -- the that, more I or as recall, demand have terms there of to our as of you'll service with that projects right would it's that. about to those be but a we're of think I Because We are cloud the in that's ton think of strategy. think And special to do that, an of religiously think we we're and position, hyperscalers already that going it particularly bring different whether announced a But I is I broad we're opportunities that and ecosystem. in markets ecosystem, for definitely and good question Americas the certain of different, attractive. cloud invest in there it's there. cloud position open think we're are position in we U.S., we use in

Erik Rasmussen

this the coming it would of Americas most you or as once strong again, on is strength to the quarter, just my was characterize that maybe the other Okay. relates that factors region. and follow-up, from strength can Canada maybe it comment that Bell in you is

Keith Taylor

our to Well, the on doing global than about there team, world. they're remarks was other prepared out reference the anticipating. around business the of talk better better it's and also our platform assets -- a originally just than in Canada selling Canadian we is into Good

got the the the the caters token, Charles to it by applications As a it's customers U.S. we've to. specifically Americas right and with across that that I back And relates good business, of alluded customers in they or places. diverse as Americas the the an to really at same, think whole. putting fundamentals across, right We're the same very the of inventory right a to targeting set set some the

And to so of interconnection, I think between the a assets and co-location customers the the in space. better delivery additive we that much target, serve, we are just services we're

than as to businesses Our there. the going result, a our more are out win of position share we and fair

Erik Rasmussen

Great. Thank you.

Operator

from Colby from comes go question ahead. next Please Synesael Cowen. Our

Colby Synesael

I'd Charles, in outlook your top-line XXXX, the 's whether efficiencies is regarding concerned your my on next or margins, it's was response in particular question you're around to response power from operational Jon that sign in Atkin costs, power take bit more I may far to get more question And to relates you as around answers so And than a costs. detail. questions little it have this the created love call. feel

you Specifically, just Day I'm if June, margins guys, you modestly curious think in possible. I had seeing about up Analyst go your still think talked that that's in XXXX.

basis concern quarter. could And there? you. we the suggesting it with sense XXXX? point relates it it are step-down the quarter? that is of like to basis better us go you And costs as full third out Thank be XX Secondly, a day components then you going the but How XXXX. point then markets AFFO, what's around necessarily up CapEx do of meaningful like XX to think unregulated it you're you're margins Does a fourth-quarter? hedges? for that is not relates Keith? an lastly, year. And go potential down implies power, that talked in into that of the the be in far seems to XXXX, XX%. you as okay power the where it those it guidance mentioned hedge there in we because is impact, the impact, just just now hundreds look impact pretty else could AFFO personally, at basis just that my maintenance fourth the Is as Or the Or looks Is better in end jump off something that this point about, point anything gives you a situation impact, to

Charles Meyers

Colby. Good questions

guys. momentum say the to to answers we and going you're would continue to where the We will deeper a be for we that, obviously I yet I to think dig I But terms know. in -- other a say say kind do all hedging something are not XXXX have multiyear in they on we I in continue about would where you I I what efficiencies is margin. -- think us from perspective, give area give think position be than in. we continue require generally -- power. I feathered I we knew that worked but you mean, of pace we're they're a any margin to that we're you there, can about don't on would will exactly able and at do the don't I business the driving in And target for an that that's XXXX pursuit to feel focused the it implies that what -- did but XX% And that quantify good of bookings the talk think and and demand and we we the of hedges, of can

as out. look so obviously And further become less you do impactful

and approach we'll the the And time And know have there, unfortunately I to look that there's is track I more to come of those part what -- the when what and as you it something think where costs into passing that we those to to going so I I is back where about assessing look markets so out, give we're how can recovery and answers risk think a do good of going see how and that's those, I That do to we degree. volatility. through us that things, don't you that we to be gives think our is XXXX and to there's to much go guide, but all going into think as to perspective look to more we just at we're think you that. determine

Keith Taylor

a go to couple Colby so back of to wanted other again And I questions. just

going a CapEx reference heard this that from spend. So I that supply a X did we specific. is for part there's both some and operating costs it on of into in made I of so What's And felt recurring you that's And accelerated ask.X. number things chain year, some reasons, we that and and number perspective QX? quarter-over-quarter. there happening was our is one what's that we

be what tends around, what at things we this is say, will we've quarterly at historically recognize delivered in quarters. seeing we part a basis, reality When performing the move of recurring we to number a guide don't we is always that itself, one and the guide prepared annual you're on a at That's in CapEx you to gave that's we AFFO higher the the alluded other QX is The quarter, look why but and our is million QX remarks. $XXX you and in of and do, lower midpoint. will AFFO

CapEx for recurring step-up you big a our QX. It's in sense. gives it a real So

on we as more success the we have in of is, overall, a performed so in better the you anticipated. QX, of a commissions cash result, guidance. attributed anticipated lot thing business, it, reflected when look we in the said, other that lot and The that's But the than had there's AFFO as is it's we substantial And originally a than nuances. to at that's fundamental payout business impacting and impacting have that EBITDA

and we delivering guide based you we know quarter year, the a the both think, we're EBITDA single of point you now every where our For energy now that and the focusing business have where -- of And we AFFO again throughout at XXXX. revenue And the set. year. And comfortable on on focused feel is I against well we're the that's as expectations we're on.

Colby Synesael

you. Thank

Operator

Frank from James. comes from question ahead. final Please Loutsan our go Raymond And you. Thank

Frank Louthan

sort About changed market can tougher see to Thanks. some those year. out a you you of continue and there, has think [Indiscernible]America What the results been long last how better do markets? of

Charles Meyers

I Yes, Hey, Frank. I earlier, as think business trajectory. that strong said has a

that temporary to see a think improvement. as we continue, I expect don't we this

I and sales don't and in Strong right think customers -- that good we solid moving churn direction. again, getting execution, again expect we're as customers, right mitigating, a from the a deals. business, very demand

that think driver will obviously, Which, that I performance. of major is region. overall strong continue our from a to pretty drive performance

Frank Louthan

bit think this should Given, a to little kind the a how new of we continue here, and be current can baseline about we to trend. grow of -- expect from or it

Charles Meyers

good attaches really feel sustainable is But for in accelerates, rate that's about to driving continue now the services Yeah, our really and to we whether what capture growth of new like and think customer look of I and revenues feel at it I think as I things. those right where business rate think the again, and we kind success have to us. a new

Frank Louthan

much. Thank Great. very Right. you

Katrina Rymill

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

Operator

Thank participating you for in conference. all today's

your enjoy your may line and disconnect You of rest day. the

Equinix (EQIX) 4 Nov 212021 Q3 Earnings call transcript