EQIX - Earnings call transcript Q3 2024

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Operator

Good afternoon, and welcome to the Equinix Third Quarter Earnings Conference Call. [Operator Instructions] Also, today's conference is being recorded. If anyone has objections, please disconnect at this time.

I'd now like to turn the call over to Chip Newcom, Senior Director of Investor Relations.

You may begin.

Chip Newcom

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

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

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

for information would time a available designed our like and important remind on also Equinix will most measures. on the today's reasons to We IR information directly to on check this regularly company we and Investor page to post to release other of comparable list call, most discussion, accompany and along at Equinix that conference these We've page the measures a website www.equinix.com. uses provide website encourage data. our presentation Relations GAAP the the of a from today's We reconciliation why about available information. our those to non-GAAP press On measures current financial with measures website certain of IR supplemental made in provide of the the you time page you the we

Chief With us Equinix' Keith today Adaire and Officer. Taylor, CEO Fox-Martin, and Financial President; are

any to Following to of taking hour, these this analysts would analysts. remarks, one. interest like we will questions we ask the to in follow-on wrapping questions up our limit be sell-side In from call X prepared

this I'll turn call over the to time, Adaire. At

Adaire Fox-Martin

third quarter remains Chip. billing record Thank you, meaningfully. across pricing Good an had We solid gross afternoon, and quarter. Cabinets We each delivered strong of regions. call. outstanding earnings rates conversion with robust. deal performance bookings increased to our welcome our X had and We

of our quarter with attractive per consecutive All differentiation revenue reinforces the of our this profitability, into market scale translated XXth highlighting position. growth that AFFO share and

beyond. robust activity healthy forward-looking Importantly, for our with digital AI to across strong momentum pipeline given demand infrastructure supporting enable presales capabilities industries and remains QX and our the in regions,

strategy. Turning to our

has last our developed As our a and creating differentiated and shareholders. exceptional over successful last I quarter, Equinix the for business discussed X.X decades, customers value

interconnection. by footprint global digital Our as around our our and infrastructure the singular strength and value position company, is proposition scale, world's underpinned our neutrality our leading truly

this Customer that is customers constraints recognize development our Energy However, to positioned challenges complex. we serve increasingly Equinix well dynamic to cycles and industry To leader of as and and simplicity the growth. X clarity, and areas on an focus strategic to industry shared built opportunities seize I significant drive we focus. last long-term data and are requirements to center end, address ahead these designs industry's landscape the future particularly ability call earnings rapidly. on our is effectively. will quarter's challenges on pose evolving tenets

First, outside with customers. we start will our in

milestone every we them. enhancing on how We engage our in with our focus relationship with will customers at

and a of infrastructure is deliver to customers' achieve the our is go-to-market engine segment a most frictionless coordinated to experience workloads. partner appropriate. in we for structured intend be choice customer to manner evolve our To that Our this, goal critical

bookings our outcome. QX solution gross segment of in record and We have already seen the benefit focus

solutions and to Equinix. consume partners customers solutions Second, our deploy for that and we it at will integrated make deliver easier

interconnection and smarter have brought developing on core we Lin. services center led In to colocation single where we this, business This our win of offerings. and team team digital together by focus will efforts data Jon lead. right the initial area support the that into a our to is our Our right have solutions services extend and

innovating we center data and Third, data construction. to approach center in have been design our

We are industry-leading to means range power with service full our the delivery needs needs. to fortunate intend customers' that We campuses design builds, can location with phased have moving bills capacity fewer many the the for range and construction on Essentially, to hyperscalers. SMEs our smaller teams. from differentiated of larger balancing campuses our that from future development to customers' support to and accelerate this procurement, broad build of of access

At will same needs to industry-leading time, the right meet the business of our continuing outcome. the into by application placing returns investment we customers, for evolving delivering the remain right on footprint best focused the

Taken significant believe drive will value about these which are together, we moves, can long-term less so our I that strategic deliver more, customers, partners shareholders. doing and for

we plans greater $XX month, opportunities GIC. our Earlier lie announced a and with invest of this nearly than believe capital to investment xScale continue triple to joint We the venture agreement with Board our ahead. we Investment the form to market the billion program in the CPP

with With new on hundreds of JV, xScale the capacity through expects state-of-the-art Equinix this raised to facilities new multiple campuses capital the U.S., megawatts. of across the build each multiple

new we've for we previously, to campus in Atlanta, a already expect land which closed this to contribute power discussed XXX-megawatt JV. and on As xScale

XXX our data ahead. are forward and and call, to with last megawatts in coming believe positioned our innovate operational capacity about We leased diligence construction details ] in Equinix currently is uniquely the Since globally hyperscalers, our for established U.S. more land the excited to we center. to our under of in xScale and in incremental to XX% markets leased. have JVs, providing earnings XX opportunities leasing with quarters. total look nearly We X active in and [ power and we additional are an megawatts This Sol brings secure

preferred to of workloads. distribution customers Equinix This the coverage workloads. remain providers. competitor. low location X enjoy is is can latency demand for provider This across data and with in our countries. steadily the nearest access the Enterprise hyperscaler supporting native metros We on-ramps XX server AI requirements or AI-related on-ramps Xx on-ramps, XX building more ingestion XX metros for includes to of

Recent stack a in Their offer to provider HXXX Core Asia. is journeys. customer AI services GPU-based generative infrastructure actively production to a for wins service AI service support cloud AI of in Tensor and enhance resources Paris in Japanese Nebius, new business in key cloud Europe involved first services its Sakura include large-scale cloud explore deployment full be provider. development the cases the aims to and providing in provider, new Internet, for of opportunities use essential will among NVIDIA GPUs

and For and enterprise shipping to build chains. company who data-driven supply and AI, deployed intelligent Equinix is supporting a Equinix predictive Fortune capabilities at unlock XXX logistics logistics

through supporting This also in leading lives will images save tech real endoscopic diagnostic are We company med who a analyze time. leveraging precision. to is algorithms enhancing AI

enables unique business to requirements. Our customers' the serve full model us spectrum our of AI

is footprint inferencing positioned workloads serve varying AI retail private to of sizes. of the and enterprises Our well

providers. expanding rapidly of can requirements Our service offering xScale meet significant hyperscalers the and

Our highly downside landscape. and resilience capturing AI upside ability and a dynamic in needs satisfy to fortifies evolving in managing potential our these

quarter revenues growth year-over-year were and Turning as per Equinix strong revenue by Slide revenues X. increased and a on are These same recurring last xScale EBITDA fees. with billion, solid $X.X year, continued over year-over-year results, the to XX% profitability. growth with our was on driven QX Adjusted X% up currency basis. Interconnection strength from Fabric. share XX% all constant rates AFFO up depicted normalized

interconnection footprint. ecosystems. across increase Gross our improved the now due additions global franchise, have interconnections Fueling XXX,XXX interconnection to strong we our strong our remain hyperscale deployed total interconnection continues favorably. in industry-leading X,XXX Net and of and diversification cross to connects to pricing continued trend additions

customer continued XX% at revenue an growth greater of USD rate operating now and of Equinix attach is our annual million run across XXX base. approximately solid Fabric rate with an than global saw

gigabit Our bandwidth port fabric to XXX and grew, higher business additions connections. virtual thanks

Equinix Internet Johannesburg service peak connectivity time. data infrastructure in August, providers opened Exchange our per needs continent. for the surpass in growing traffic of first first growing center support and rapidly we to and XX enterprises In the the second terabits saw African digital

opened key X this constraints XX of also We Tokyo X capacity IBXs and our easing in York first phases our the metros. of New quarter,

footprint Customers digital partnership a provider, European analytics expanded their Zoho, Equinix chose leverage expanding they global data AI-powered with support of with customers campaigns. include taking their Equinix predictive advertising PubMatic, so firm better sovereignty who to our could for SaaS advantage their requirements. complying in ad

Our channel approximately solid another logos. of contributing new delivered program XX% quarter,

with Avant, Together, accelerate Orange and cases, customer see AI value Dell, partners and WWT, enable of blend our and range to we across QX is We customer Business the and data and private We resources, automating cloud experience with testament center a with use industry infrastructure continue modernization a technology the a this realize wins wins project multi-cloud include segments including believe for strategically wide like AI. networking place growth quarter customers AT&T. company helped enhancements to in us. partnering us from a and trust they interactions. from

over it the to cover to Keith turn I'll financials. that, With quarter's

Keith Taylor

everyone. and Adaire, Thanks, to good afternoon

by once record We finished very their in against strong of our the another highs. near another at Let while with each we The bookings our quarter. ahead. stage the me setting saying step regions years the journey execute for goals, short-term start delivered its business with again gross to continues quarter or all-time

up business strong over very bookings with net previous XX% reflection net the quarter, megawatts Our sold activity. of the density also growth our core bookings a in of our and were

closed future than a revenue EBITDA bookings end more and expectations, presold metrics. management. were We at nor our high capacity, the deals which AFFO in of more cost our result customers. And amount solid disciplined included neither of the of than X,XXX our backlog we adjusted our with growth Additionally, and X,XXX meaningful is

by driven nonfinancial key net and to billable strong billable cabinets per globally, improvements cabinets meaningful across and certain As it cabinet. relates capacity stepped NRR and our openings X,XXX higher in we up markets. interconnections metrics, bookings Net by saw

backlog through as had healthy Given interconnection additions gross interconnection at gross the end our QX step-up cabinets and elevated record its cabinet to Net sold strong of billable remain level. remains installed, net but we the our activity our yet of our not expect bookings additions a highest year.

to revenues recurring of revenues. XX% Interconnection increased

quarter, MRR and cabinet. by the an to over churn booked our while was the kilowatts per Our per $X,XXX basis X densities. trend normalized constant the on average In cabinet, cabinets cabinet increasing X% average and had to cabinet, per X.X favorably, currency density continues power density cabinet environment kilowatts a year-over-year increasing favorable pricing per metric of of driven

Equinix. As the $XX joint Adaire excited of greater is and The billion announcement our next phase another highlighted, milestone for we're venture initiative. xScale GIC than about of CPPIB with our

value given significant to Equinix we off-balance debt customers joint on of Bottom and needs traditional the while We significant our sheet infrastructure strength sheet, the to and AI serve per continue basis. of our balance investors believe workloads operational largest liquidity to enable our including cloud venture alongside create share represents xScale best our line, opportunity that the us low strategic and both leverage to delivering this believe in space. value the structure will for emerging digital partnerships, the a

the rates Now cover the all and let a this on are basis. me normalized from quarter. in growth Note constant currency section that highlights

billion, revenues to into As of at X% xScale guidance $X.XXX depicted were XXXX. due our last the on range year, quarter the midpoint fees Slide over the same X, global of QX deferral planned up

compared minimal in to meaningful sales a activities our FX For activity. FX our a fit-out impact of and revenue nonrecurring implies rates. Net there guidance step-up hedges, xScale when related prior was guidance QX, revenues to other our

of over range integration end due of guidance our to Global headwind last the net million up year, $X.XXX included of rates EBITDA was $X $X of same when at QX strong to our adjusted compared million XX% FX prior or revenues, adjusted operating quarter top our approximately and hedges billion a included the EBITDA QX guidance performance. costs. XX% FX

was the FFO up Singapore net quarter than strong million, from same interest timing operating our lease $XXX to than over due lower land performance, into a QX churn when late compared XX% to FX due Global last minimal to our the of prior September expense included year, rates. October. QX Global forecasted MRR the payment. deferral favorable of better MRR AFFO churn QX our expectations planned early and was impact guidance

in quarterly As X.X% middle to MRR expected the churn such, to the X% expect be second our we of the range. we quarterly over when year, churn guidance average the of half

On X. X%, Turning basis, highlights, are regions and regional X% our whose a through at on fastest-growing results and our full XX%, by covered to followed region X the APAC normalized year-over-year Americas respectively. growing Slides was at EMEA

actions, grew APAC X%. and price impact power grew of EMEA Excluding the XX%

very Dallas, Demand supply New Washington, favorable a continues strong to D.C. driving Valley delivered region top in pricing bookings across Silicon metros, including The many Americas X markets, outpace Tier of and our York, environment.

and also gross deal activity delivered Paris AI business and Frankfurt, our EMEA a activity, quarter metros. record with pricing Our bookings by robust firm London great Dubai, led

had also growth to continue healthy differentiation We reach and market point our emerging metros in of scale for our activity in business. be global as a

Asia and with quarterly provider, bookings finally, and had for Tokyo strong reaching in in And for the first demand revenues milestone in a and the our region quarter AI Pacific resulting near including significant Kong, Hong activity gross markets, record continued cases. $XXX time. We government service experienced enterprise great Osaka, Singapore momentum in-region the very million use Japan

please to capital our And now looking refer X. Slide structure, at

In financings $X and bond million in to investment-grade more November. approximately our investing one top of cash balance our of sheet bonds, quarter, across to we U.S. in billion while $XXX our approximately of $X.X ahead short-term largest green bond $X.X senior bonds investments issuers market. maturing as offerings Future billion we and corporate continue green Our the increased billion, euro align Swiss our in billion, across markets franc sustainability our the of our the issued has Equinix company issued To green supporting date, payment than including elevated making XX strategy. First $XX.X

the settled we to are in to purchases. markets future a both ATM and activity the market our to and fund commitment to balanced We and conditions quarter. plan as spot continue approximately $XXX including future when Additionally, million growth, favorable opportunistic accessing take approach forward capital of capital

Slide to X. Turning

planned. For capital $XX of a recurring CapEx including the were increase over quarter, expenditures as million, prior $XXX $XX million, million quarter the

delivered than XX major countries, projects quarter Tokyo. capacity Istanbul, more in We across including more data have markets xScale of than major to XXX retail opened including metros, xScale XX across and of represents and Johannesburg, XXXX. megawatts centers in We projects X through cabinets be XX XX,XXX projects. York XX the new X underway in New This

Amsterdam ground We current XX% also Asia. our spend Bangkok purchased footprint is than development Southeast we across of or own and in own continue for our land as land retail on buildings our long-term leases. expand expansion to More with

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

XXX Stabilized impact Our return generated were by a collectively increased of gross basis, year-over-year a excluding XX% the X% assets the prior price on actions. and cash-on-cash stabilized on revenues constant invested. assets currency utilized PP&E XX%

growth constant to Slides our through refer normalized for are of XX and please basis. on bridges. updated and summary finally, guidance And XX XXXX Do rates currency note, a all

year, which are For line our This Adjusted and million margins growth be FX into costs by guidance $XX X% the our to raising due a of revenue guidance bookings certain top full of by X%. $XX the rates. we're acceleration QX. favorable QX about EBITDA performance EBITDA adjusted guidance to expected million strong to XX%, rate and and implies includes

now at grow CapEx per XX% does including and net range. our share million And X% CapEx and guidance between billion $XX finally, year year, to due also expense and spend. is between acceleration now QX. favorable is our expected include into the operating million primarily full and $XXX costs to raising performance to of recurring billion, end $X.X top expected QX $X.X interest range of year over by the previous AFFO XX% about and AFFO to XX% and full guidance our the We're increase of

call me to let So I'm going Adaire. and turn to here, stop the back

Adaire Fox-Martin

delivering gross key In metrics. across achieving Keith. and had financial record great a performance we closing, third bookings and you, robust Thank quarter, nonfinancial

evolving committed opportunities AI. to vast more in are and than the ever seizing We

latest for the more investment is But joint realized. triple venture investment xScale program an nearly than of our once is vehicle fully Equinix. xScale will our capital We

multiplier. integrated this workload Our interconnection-rich in program offer globally. Only of offer scale infrastructure is xScale at enterprises across is a an Equinix to hyperscalers SMEs. to can provide force from Equinix Equinix positioned this Only spectrum architecture. to can Only requirements the

customer elements our The firmly of digital our industry to industry drive The ability execute our of future focus, a customers, to partners, continue peers. significant Equinix is value these the long-term our shareholders. our unique employees I as incredibly highly relentless market effectively marks amongst position combination our will and differentiated for believe and bright. Equinix and infrastructure

open stop to I'll here that, questions. and With up it

Operator

BMO Instructions] [Operator Aryeh question with Markets. first from Our Klein Capital will come

Aryeh Klein

you would in And that? Adaire, expect Maybe, talked value change campuses. way? little the existing about shifting a the to you Can that about does bit a the benefits strategic you large of talk focus of your bit markets proposition any some of any from little

Adaire Fox-Martin

we of very our much team part Thank the key question. together is This that strategy for a put with recently. you the

We of construction that builds that are are pipeline got long committed already a projects have and underway.

XX opportunity under of at through as will of this these time. look that, so and and some market. to As programs course, their frame that an work we builds to through this Keith major into we deliver point that earlier work look of mentioned, the and customers time phases we And capacity in our can some the accelerate to at

we industry, that requirements their I of in range to require spectrum allowing to operate our the in business at who a build lens the necessary interconnection-rich through customers through customers this context with unique enterprises hyperscalers retail to so our campuses, continuum enables entire requirements and securing and to from in in way is think with and product this the our metros at a their is the the multifaceted all us is footprint offer, fewer the to environment. to which large doing capabilities in approach really location that of campuses, power of us these intention that execute As that's look to we the look the larger to adjacent that

around to construction our trajectory. something capacity us our is, strategy and our I to how growth we the and this enable continue design think, will that market to So deliver approach on to augment

Keith Taylor

to I just may Adaire's comment other If add comment. one

today appreciate certain Ralph of are the and process. we're of stage scale talk with economies average construction is team, there And of deals have that larger. phases if the the the also just of And to along do much there's many You that are we we just where too small size seeing about inherently his global you the that sort inefficient. in industry design is are

the we as And markets and other so which of major -- it aggregate into in into through in major makes well Adaire says, those it size. as the metros metros scale it to extension just do sense and focus

relative And return so you available an the customer we with and for them. of set we outsized of get to sort where capacity were, a service larger

Aryeh Klein

market? follow-up the And the a including that significant you're in in of to D.C. you back XX that in shift preempting XX to the more like broadly next of there and on Does XX any that DC inference Are months. X you X online side. way? then essentially It the meet to even looks demand cabinets, go in else? campuses? is somewhat of to to Phase adding have something that specifically development larger cabinets over a Americas, a Is something back. maybe you're to And backlog? there number seeing just specific amount expected large come Or Is market,

Adaire Fox-Martin

of the market-wise, I think, Well, at position North we're that a demand the moment. fortunate And outstrips in true, operation. that theater supply I particularly is think American in very

the that pricing release. know looking the this the the to will forward we having of be that a also are robust able capacity opportunity our price we environment cabs we only this but command market not to for we serve where release in So needs premium customers, to into

Operator

Morgan will with Our come Stanley. next question Flannery Simon from

Simon Flannery

growth. I Keith, just wanted back come to revenue Great. to

about X% to X%. think this Investor growth growth. and but the underlying X% think pricing. And to something adjusted for revisit I demand longer being pass-through saw year, year? transition is power Could Day term, the about strong you talked a was Adaire this we last year just the I talking of you XX%

the plans we of given do 'XX about with and CapEx, how backlog head bookings new on So relates to as expansion? that your we think some into how that especially

Adaire Fox-Martin

in first in and of specificity dynamics some for Simon. and of I we the to market comment some pass just address question, that Thanks just QX Keith to maybe the of you in might over the saw on raised question there. the the that jump then

the saw there fair the saw incredible be to be certainly that And believe QX at of of bookings look would performance the And half we solid some to reasons it case. believe improvement year, we why first I these when of during even think in the some I our headwinds that that our in half was this first year. some headwinds, whilst we say underpinning are still trajectory. I persist, though

had are, bookings, sales execution this a all, First we that the our And But phenomenal record our with forward-looking environment. we facilitates is that our strong very also as that did in And demand precision that growth gross we course, pipeline of executed know, of on way which, in our teams pipeline. means led to we backlog. strong. a in

of the So there a outcomes pull result were as our forwards the sales of team. into execution no wonderful QX major

an focused began some the requirements to particular spectrum with us conversations also particular approach plays also us solutions that customers demand very deliver shape. on cornered And meet customers, in adopted market. in our the where We right for we to of we across that for context enabling sales

demand metros So it's in Tier that X And the existed interesting XX% how so our the shape the metros landing with non-Tier X our that capacity capacity we metros. to in were in actually workload look were customer concurrence that we in these and up see could at X the megawatts Q-on-Q. utilizing non-Tier

I that critical derisks way. QX in into market. very strong We've enables to to continues Keith future pipe, with quarters a in forward look QX in So robust. the where think alluded we this, us to opening Pricing and it some presale be capacity his and already coupled remarks some have undertaken delivered both this activity positive

density are is As rising. you heard, interconnection Power our strong. adds

'XX. on exit will a great we quarter have and we've be delivering So puts about another focusing so whilst into for strong takes, had us, that QX some

Keith Taylor

hit mark appreciate, So maybe really dispersed. you to business which our geographically on the as different many think ways. adding Adaire's I can so just in But comments, very Simon, is

demand markets As that said, how core price shaping reflect effect the caused impact price has to on That platform. and we're on going are build currently that that into has points. something we to Adaire there's that constrained number us -- some of said, and in and the grow all markets

to And why going bigger are important particularly markets ones. the hence, so the in we're build that most

continue I And so something is that think talk to hear us about. that that you'll

There's the about cross activity currents seeing -- are today. we're really more that these we But cross the optimization. we're beginning currents. the than year referred part to thankfully, the The of seeing at that currents still exist and gross cross outweighs

around You've to whether services, us about and previously, other their providers it's -- be very cross-connect optimize it's they companies their ends. like the DDN particularly cross-connect heard speak whether tend network that as or

are think of those forefront some our So of the that mind. things at I the are

sorry, think to rate of those our or things, it's the as think, look XXXX the allow very the a look indication -- into we that going well? believe that said, we've really we're going ability we to What So X.X off for QX. give That's to to we strong as look what a be the matrix what be That good ourselves QX like? of does QX. is coming up then the And initiative exit going xScale is set I all strong record have confidence a a will us combination business. like

last And couple maybe points. of just a

was our interconnection see remarks price revenues had cross-connect per the increased. basis. nice do moving said we the Not up is of year-over-year in we of a things point on rate growth average prepared XX%, but only a One

of of the relative increased that has revenue And seeing total increasing. increased pricing. the been you're size so And base density, componentry to our

so beyond. we it's will XXXX matters influence And rate look those into our as as well we that combination the and growth of think that

Operator

Our Atkin Jonathan come RBC. with question will next from

Jonathan Atkin

a sheet I So have balance question.

how plan And like in cash, would center trends X.Xx net data -- $X.X or have you cash follow-up. the Just the you've leverage what in with to acquisitions I potentially you talked use might or and and then whether some a be about, acquisitions? other the going that operating tuck-in given forward, just billion it land of have

Keith Taylor

the you business mean know well. I Jon, really Well,

So liquid, cash the with September as very appreciate, to the short-term investments. pay in on down balance was cash sheet debt -- of and November. to investments, that We're at the short-term use our you which are XX $X.X $X very can billion are going billion

a of growth venture. year our a to so end we closure smaller forward the sort have GIC, partner going we're CPPIB initiative plans even that going dividend, that are have all And the to then investors we're really you $XX looking probably acquisition, but of pro anticipating. also into $X.X the as tie billion-plus xScale forma other capital meaningful than said, to XXXX sort sort -- Philippines and have, a with basis, in presents of itself. And appetite capital and XX% a the you're aware, you into of opportunity that given clearly, on we probably maybe -- more and so billion X.X a cash. be 'XX the as 'XX and balance we around the we That analysts the of And

the the MEP, and utility with and long plumbing the generator, vendors. and the partners electric lead really we're sort the like. that mechanical initial of well items to to already it's demands so cash fund and the as initiative, sort well. as And going all have around seeing the of we And equipment both the the from provider do we're need power as And with in to that the what

we future, a that's balance lot again, which of coming investments. in But so consumer our ahead is of revenue a cash today. And the sheet also what big to them of on get those from as happen we will anticipate have

business. need to we dividend and growth, pay the certainly that cash so the the balance fund to the continue And scale future on sheet

Adaire Fox-Martin

on right? capital possible, as focused into getting as that quickly very We're capacity

Keith Taylor

the cash. as And is bit leverage net you industry. But for little carry great more Jon, leverage X.Xx -- a do number, Yes. is the we know, which the is levered,

still we said, a but at you of have As sheet. amount all we our -- strategic know, in when flexibility that it, you look balance tremendous

debt so with agencies. the raise parts efficient we're -- without we'll program. continue to the leverage comfort ourselves can going cash of the putting of put to to We ATM been debt more go with more the capital. a And tranches very rating way with going of any next We've harm's raise great on on in We're books world. our

And so lot a we flexibility strategic of there. have

and continually I strategic and vis-a-vis to business So say, sort liquidity we the flexibility suffice in of scale -- are position enviable a have very the the to it also -- think with we franchise. in xScale to engaging partners the the we're

Jonathan Atkin

My I -- And missed talked to you relates just about attach rates. might follow-up have digital.

I fabric. update been plans you But what just progressing see are businesses that or going you and edge metal the have how not? and those might think can for network on forward, us

Adaire Fox-Martin

X,XXX is mean almost Sure. as by as We increase see services I where certainly think point and achieved portfolio, fabric with Equinix underpinned demonstrated growth some destinations. that are to And attach exchange Fabric This natively products you has opportunity the the gigabyte additions. in rate have focus XX% rate. in success strong continue and as fabric in a I think attach customers connecting revenue The XX% us into edge. and for for attach. QX next X Thank number network diversifying who enabled than almost and potential an the some million run such greater that to cloud to success we X,XXX was moving question. there's XXX a an fabric very such from overall year. the network are forward solid digital annual digitally a port we

yet not under us metros. this we is of Edge, do a that Network obviously And of which Router, of Underpinning magnetism part evolving and is of XX that revenue service. believe moment on this time, in XXX-plus at for us but course, the digital ecosystem meaningful contributor cloud key at the our providers and portfolio. business fabric of part customers are an infrastructure. Cloud is our available using are our all it fabric is one drives this for Fabric services It we focusing

products include position into that and this absorbability, the to franchise. be interactions enhance will capabilities their grow which that portfolio evolve connect customer product in that focus that That the use our includes really to and partners our digital API the portfolio, deliver we customers for That capabilities our as portfolio providing customers. that us, experience our solutions -- can looking the the us. get around started for portal first will digital and ensure we're environment, Overall, to to services our relates deploy with great includes improved that view continuing like footprint it we interconnection for our to through though,

Jonathan Atkin

Anything the then on of discussion? to out kind round metal

Keith Taylor

point. at Not this

of Let me just another X.XX% represents just we give represent . when X% relatively you a general revenues. under quarter-over-quarter. comment, of digital itself of services, they -- that and our has general flat and our look at revenues Metal maybe Jon, in been

Operator

Next, we with Sachs. Schneider will hear Goldman from Jim

James Schneider

first the to you come that on additions pace XXXX? by of to your of new venture we xScale of Could encouraging and capacity with ratability talk how half that too new venture? was frame? joint maybe should Or joint Can that anything about is capacity we through you It the see expect early? see expect from time XXXX the And sort CPP the GIC. of

Adaire Fox-Martin

this allow Yes, engage. to the about our us spectrum of the across needs customers we right we're well and really excited very represents for opportunity as the us that that does serve

and is the work begin will model using for process our we transaction So here. transaction we this that the our the that move Atlanta in that data we of redefined centers. have will will the design shortly. we closed as agree enthusiasm have into closes, where campus a in as And with our you And that this JV, close terms that given Atlanta is soon already we

of footprint. on ensure So in our as in of kick we are But the are close terms time to introduce XX- of that's possible, transaction. formal you to XX-month process of to quickly part frame, probably that we that it's at the looking specificity give we will that and this working capacity bring right cycle a into to that believe following can as now. I hard this the capacity

Keith Taylor

Jim, Atlanta to next number the the it for little as long already I'll the a a lead just further. of And campus. relates and placed items We've bit orders elaborate

in to power power So There's Atlanta. provider X negotiating producers working currently U.S. campuses sites we're other the alongside out. enter with that into agreement. different local multiple We're the an in

Atlanta, so would to And ready the we're value time it delivery that But us to and good of much to XXXX. deliver pretty will suffice the dates. you will allow But sooner land probably of put XXXX combination something assumption the that -- exact in position in you getting than premature going bit the all those start the make much frame. to we're sooner than to a start a still give preparing little say, to

James Schneider

additions the of the here. encouraging that Great. of confidence it this And love I resumption in a And growth Maybe accelerate can talk see would some your number to then to that. get momentum underlying your was cabinet in the continue growth in of maybe either about sense of -- from as quarter. rate follow-up, drivers cabinets new or the the to a maybe

Adaire Fox-Martin

strong had number. bookings. previous over up cabinets, about were our X,XXX through we underpinning some had volume gap QX. power we We think we also came the Yes, in of The which impressive. this billable very happy quite churn, And contributed key density highlighting was all in us continuation up shows that despite the we've been and net that that I the opening for lower how measure quarters, metros, capacity of saw to

installed what's will we been As based of this early that remain we and 'XX. on forward, solid the into sold into think but backlog been not QX look

said, cab increasing to sell up, happy as how or X-kilowatt given we're density, yes, to X.X. showed power churn at even the it but very which I so have allowed this us And a with,

Operator

question from Barden next America. with of Bank come Our will David

David Barden

up want I So on follow to just Jim's question.

So Keith, no deed good goes unpunished.

affect the Slide conversation, just think, affect I So a little the be a -- the quarters. think. let by you it region? is this, adjustments I this mean -- X, adjustment on I'll I it And go, about you cabinet cabinet in made the talked have adjustment? Could highlight to adjustments what closures? have helpful make you cabinet bit some could equal Does didn't a disclosure if footnote equivalent. several for to XX I making elaborate is this we you've that How does You And then Asia. Adaire. MRR each and question per in I for then would it

Keith Taylor

Yes. a fair No, it's question.

the again, cabinet density aren't deployments more So at at capacity for them, those power about the that how -- demand exists certain and -- this profile given haven't David certain where available density to the is this maybe has looked to of notes relative today. similar really -- looked of the

we continue take so walk time beginning as a walked And through center, for to have a idle dense you that center, those -- something an the at of that we -- through the least is that data largely and a you'll site data has and that because again, this see support customer infrastructure would the from very environment. There prior taken has capacity, cage. a infrastructure that's perspective. could be from And

adjust so net cabinets. we the And

increase utilization. of density, it some many the publicly course, the density markets, that to net of But that and cabinet. you, This you inventory absent that goes adjusts And visibility yield. to is really volume And that knowing again, augmentation power out. will venues, as in because your take through points of up, certain about us said course, increasing going the price you're price we creating we in of revenue as of I've the

So we price on a kilowatt basis.

or that X revenue use from how business. you depending would the that's much they on use, where so we cabinets, the cabinet earn X,XXX And infrastructure

capacity So that available. the than some we we're it's available physical factor again, AI of to And and workloads basically here the builds we're some market that's basically quarter. say that other meaningful offsets that density that the past to some brought this of nothing given that the doing of deals adjusting of there's winning, the of cabinet

stop else and answered to on there's anything see So I David, there, let your touch or us there. if like question whether me you'd

David Barden

So [indiscernible] considered Adaire and so about X.X each new kind the I are X to incremental. has just Is want cabinets cabinet? a made -- of traditional comments these that clarify, of X.X being is to as

Keith Taylor

his to Well, this we the measure what level, a available plate of the down were as the parameters for appreciate. the job depending do it consumption would and data energy team depends on Ralph Again, great and the across of customer. allocating the asset center. floor configuration on the specifications you the And

cabinet it data builds. the newer a X, lower all much than suppose or so say center some is in Valley is that like And some of X to network Silicon per -- kilowatt is DC I the

deployment. just is that's really us so But it. And new about more that modifying it's what

cloud more that on me kilowatts in was let capacity XX has center per cabinet network that customer cabinets But now versus a example. take a much that consuming an material If out data give obviously, versus a we took a available impact was something a of center. data cabinet, if

think optimization things So that we Ralph about of team about, manage his the those are and the specifically. but it asset. really it's

hold you put we know, -- introducing of on anticipation things also blocks. power additional do We as in

of things that There's We building into phases. lot more a are go this.

of and power just And are that with depending things where so utilization if we we in be given happened might because there's temporary out something in a availability environment, that our bring on statistics.

David Barden

cabinet? MRR the is denominator kind and and is then, so -- of the -- to would which if sharing do Or you, a just sorry it is I'm MR final to so -- cabinet all Keith, denominator, for of I'm I'm equivalent, as my at opposed a what normalized that. an then cabinet insights. question going so larger the the But vested a more cabinet And on to looking MRR be cabinet? thank per

Keith Taylor

equivalent scenario have might gone measured because we a cage. what are fewer a always into cage call have but There you a a a sell cabinets. out lot things you cab that's infrastructure the of basis, where of you We've cabinet other Yes.

a basis. measure cab always we on So

David Barden

Okay. Good. And could, apologize. then, I if I

the to like interesting feel the I'm hard was it an to and talked a we remarks but not Because the that and and of of prepared the the the xScale part me, about all and it's but sheet I lot of balance this Then convince the training? kind the just not why. Equinix being through narrative revenue. because talking was sure regime this management, the almost prepared program AI remarks it's X% maybe old Equinix investments people works read change to future, effort XX% to about time was. maybe it, of So all we're this was Is a was where and inference about really it about listen

Adaire Fox-Martin

great a Thank That's question. Okay. the you it you. answer opportunity to for for

clear mean for has explain become our think we've I As and opportunity we've momentum, say be core why business. it is to our multiplier gained xScale I me journey, ex-scale a how that. retail to us navigated that an And I that let as colocation

much is very ensuring all, for that relevance Having construction which have builds. a stature see has the whole and where quickly huge in very to, where has at our top scale of deliver already manage is enable we're now, business strategic possible for to our Keith series as chain position the as as already maintain of a in our of opportunity size, to high to kind degree us design. chain this remains build we it we I alluded of this possible Equinix of and And xScale as suppliers as a First quickly benefit as revenue new all kind building and for of quadrant. supply in and a it as supply

complete addresses is xScale needs that we narrative with around set the footprint, second the that customers. evolving around product of the our a have The we xScale have element recognized that

is So balanced and of existing an that scale our about process business an our very our approach I instead feel and to very or. orientated and being

data we do us the that. gives hyperscaler workloads obviously, of and xScale large ability to requirements able, the capture with the off, First community. the hyperscalers, facility to and the are training store

to looking private to able be capability across to of even this gives large operate perhaps service who looking period demand at also number are perhaps footprint enterprises the enterprise provide to Equinix, large footprint. a geographic We've are course increased that For locations. us enables Equinix over the to unlock some the seen who our us opportunity of customers scale to time. AI with do of for And with it last providers,

Equinix are who their gave that are enterprise-based AI to examples We some and of strategies. underpin using capabilities customers in order

actually enterprises landscape respond serving to believe colocation evolve, really how this facility and rich that because I to retail-rich able So be our continuum to an and continues we now from evolves that the time. have opportunity to winning and product is landscape over the full strategy hyperscalers,

more So please and, the the want training balanced about We this see very dominated to or. an moment at in time, kilowatts leased than not pace the total being our cloud clearly articulate that this we approach point of through at have the -- significant a in AI as whilst accelerated and adoption an us, this move of is they to much particular adoption. through see workloads stages as for stages opportunity customers opportunity that move

are strategies. how to process cetera, we a one et data, where integrate And there's around consider about And et when speak architecture, cetera, hybrid your et you and strategies, our a actually store AI-enabled you projects about needs AI but talking AI-enabled to cetera. you multi-cloud that thoughtful not about just in customers

a this the and provide rich about product So an customers see understood us, across us clearly motion. full we've in momentum opportunity And to and our continuum, xScale, is that please, more it allows serving much and we for very the spectrum. as

Keith Taylor

business. the that the speaking relative just me Maybe to a on of the you means what lost small it's comment little made to because about financially bit it not it being size

goes to of accretive One back of the to AFFO. and to to XXXX, things revenues our we be that historically X% X% would X% said X% xScale and

matter was As today triple of price greater new from from we're type the going is is xScale And accretion the the probably said, of the one can value derive the given particularly it that than previously, that points, now. fact investment. size Adaire to the yields of

the in -- edge structure what a well. the contributor nonrecurring at And stream. to through get going think, We the only front fee a time I of today. indirectly over venture the see So stream, directly we're but you're fee the flow to is, as not just the it larger joint cash business,

the drive a of that JV recurring performance difference and and on JVs for you'll us to basis. and -- about share the You've we JV cash fees to that's of the going recurring or per will our ownership a seen But what's the It's value not enjoy that the our flow periodically. talk the that franchise. make and that consistent AFFO

and the substantial basis, business run of And growth talked a maybe adder sold is, value. the last plus xScale contract the revenue. we is comment of is look, into earnings already call, $XXX when we've It's a to on $X billion installed million it's X.X that last about on rate

the -- and the what highlighted. think Now businesses magnify are is that the Adaire accretes to value what as that about

last venture future not me X, about, is to is we'll And may business, most what X be lost do inventory thinking it the venture core part absolutely which comment, whether of something to maybe or that of venture which important one we that it's whichever be the an as a provider xScale, can be, it's organization.

other of people's so valuable. -- capital, portfolio And other ours, part using including to really grow our is

as And a so additive. really we see important xScale

As it Adaire making an important by our is or. we're investment and, -- decisions the This to we're how augment value future. not it's said, an substantially and is of realization to going the

Operator

Horan will last Our come with Timothy from Oppenheimer. question

Timothy Horan

on clarification a that just Keith, point.

in for process X% that now numbers are Your for xScale we the those where to to X%, in AFFO, or guide X% now? of X% longer-term

Keith Taylor

-- see on if you the that's being revenue disclosures, and Well, space Tim, small very the very recurring the a basis, know, it we've revenue it's sold in you is -- and because you as our deployed. will,

megawatts. think we're I at XXX

Adaire Fox-Martin

XXX.

Keith Taylor

very, that's a lot of very low get recurring, going deployed to So a nonrecurring. at

and So about venture, -- the appears we're nonrecurring AFFO sorry, that's that of fees that the of We and cost not one. debt we've the that get the AFFO in model, and yet. the all think lot some when fit-out work FFO how delivering then doing a incremental the you costs. the from And consumed it's

would more still when $XXX or a with which us. this plus than hope in from comp, be not joint will X.X cash -- ventures. to of you're up on the is stream and wherever get the value you yet today, feeling And meaningful a the it's something real the I And pleases fee the recurring recognizing of see but opportunity appreciate. in you run -- think So gets the that to million you flow I the the from it going than just stream the end come line it's version, the everybody. front of We much just value fee nonrecurring rate fee we the performance that stream, that

Timothy Horan

year, start that hit? like think? does does mid that when And to do you Sure. next really start to Or hit

Keith Taylor

but little we're bit to a realizing it, certainly, to of you're 'XX into Yes, see see going -- accelerate start to 'XX. through going you're it

Timothy Horan

pricing? it dry Great. supply of Has have -- to as presold up? gotten kind this, future every capacity much the Can about capacity of development been of related And started to talk you has you presold? have how single quarter progression better under

Adaire Fox-Martin

X where Americas pricing I in perspective, pricing Certainly, non-Tier But we're rate as capacity our are, Okay. metros shaping across those metros who not demand but in operation. a earlier, the the have what shaping our of also said into just megawatts robust from environments remains of towards terms and Tier all available, demand prices. seeing right particularly the premium X market we at landing

continue robust to see we So pricing.

and the replace required The the second that in are question, -- could that same power. environments high demand the much continue is take with and space We are utilizing environment part of just longer no to that sorry, particularly positive the churn me? remind them to in where higher-value see a to the to same support and opportunity, workloads environment we capacity-constrained us workloads able you

Keith Taylor

volume the X that right? on have prebooking assets of just Was -- not yet

Adaire Fox-Martin

Yes.

Keith Taylor

demand the countries. take of got That about the was many we've available Today, second it we're ready given the we was today, the question, a supply all sites sort talked unless that are talk will, let currently underway to lot that not preselling said, you into reason -- development in about Tim. if under many say, months, all for constraints, to it of suffice part give me we're team in you're previously, certainly sale X So allowed it. environment within markets live of that and don't to construction and -- supply future today. now, we XX part the something or it across us the number. not But projects you and We the is hearing book haven't

that are out are tomorrow. the XX% preselling. to give -- that talking I when about as be add so of roughly the basis, today growth And of just will just on what in about -- that. activity we're we're talking a assets things you on you think of in that order about then we That's will mean another that that or joint be what venture core And it an as did those magnitude, not magnitude, built you about XX% core, the booking. business. think to could construction we're it, order And not things of business think that recording that We're tells XX% yet if to you X under

Adaire Fox-Martin

of our course, business. our xScale we've business, Right. at retail That's And in XX%. in pre-leased

Keith Taylor

today. call. joining you for concludes call QX This conference our Thank the

Operator

Thank your again participation. That today's for you conference. concludes

You may this at disconnect time.

Equinix (EQIX) 30 Oct 242024 Q3 Earnings call transcript