DLR - Earnings call transcript Q2 2018 | Digital Realty Trust, Inc.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good afternoon and welcome to the Digital Realty Second Quarter 2018 Earnings Conference Call. All participants will be in listen-only mode. After today presentation, there will be opportunity to ask questions. Please note this event is being recorded. At this time, I would like to turn the conference over to John Stewart, Senior Vice President of Investor Relations. sir. ahead, go Please

John J. Stewart

available The underlying and today's Technology CFO, on including will Sharp Denise. make management CEO, -looking forward Officer, will Bill is statements be and call Stein; Andy and the Q&A. speakers you, The call may the on guidance be Chris for assumptions. Thank Power; Chief

statements based on uncertainties actual cause could differ are expectations materially. and Forward-looking results that that involve to risks

filings see further the discussion related our and included are of call package XX-K SEC contain SEC. with website. business, to on supplemental furnished will Reconciliations subsequent a This For to information. to and in risks financial our the available the our income non-GAAP net

the the Before on call results. second waves over I quarter to our Stein, turn hit of tops CEO, the our Bill to I'd like

customer consistent and high for both foremost, First and against watermarks execution initiatives new backlog. bookings drove success our

outperformance an to the Second, by we driven we balance with beat out operational not to but I'd shifting raise further X.XX% to in And the that, by consensus offering of guidance least, ten-year strengthened through by terming at revolver coupon. with borrowings million beat phase Bill. a headwinds. Last $X.XX call the sheet over turn and like flowed FX of $X.XX paper $XXX a the of oversubscribed

A. William Stein

Thanks, John. Good afternoon and thank you us. all for joining

December. Investor in a the strategic of Day presentation initiatives recap on out begin with of laid at X Let's our our page we

customers, and clearly growing pleased contracting strong program, Digital undertaking team robust taken their benefited framework. with streamline efforts we steps several to Delivers performance But has deepening through reorient in customer the and to objectives these customer bearing of As our including We executive to benefited with our half you our over achieve sponsorship program, our may also recall, and were sustainable then our later, initiatives A global priority needs. first delivered told we expected highlighted mind connected economic the a connections initiatives share top healthy we've you to customers' our around success process. little doubt customers, report that our concerted our the backdrop our business was we businesses. are our digital customers business the our months of growth to reorient I'm from there's six a no from fruit. around The

sustainability Let's page X. turn on to

believe We to are our it it's right committed renewable global to and with matters thing we energy portfolio customers. powering our XXX% do because because the to

power the commenced solar March. in online, operations project to is This XXXX it come Ashburn. XXX-megawatt in renewable late purchase announced at Our contract December low cost portfolio XX-megawatt renewable and energy delivering in is utility-scale most now recent our

green Green for have Better named at Buildings we XXXX Institute our and Transformation We lease sustainability not is standards June, a Green in Leader lease REIT common global to Digital recognized the and the Alliance were the standards. Department in have become the Market by been data leadership, the frequently first for data Expo. Lease of adopt industry. center main groups, Energy's BOMA been traditionally but used food Reality the in center have

costs. energy improve Our PUE between by arrangements customers costs reduce beneficial and practices, that evolve actions to investments owners benefits and parties to align enabling are both helping building industry of the resource mutually and and operating efficiency

committed sustainable growth and are and shareholders our on focused customers, we delivering are sustainability for We to employees.

also more metro primary and day. popping in in is Internet page of largest fundamentals every which America, passes the metros, through to X. across and centers Let's than Realty's which Virginia, by far traffic Northern especially data the concentration. most largest center world, the turn data up is new market In the Virginia North XX% world's Northern on are active Digital

state-of-the-art sector current of landholdings data of pre-leased, in and the megawatts rapidly greater outpacing will of XXX center megawatts strategic oversupply own out portfolio demand to capacity. has addition of of acres see prone support customers' XXX but are been we supply and currently growth in our form, that past, our capacity XX% XXX to with opportunity is blessed existing that running of risk under than to to in of future are XX The the missing a inventory on risk support the construction oversupply. along We out megawatts another build

as our some in similar We well our did and miss seen recent And may chain We've on to Santa a Europe in replenish XX-acre out a business parcel Clara dynamic you we've are in secure taking Virginia. proactive due have lack parcel Manassas, supply XX-acre steps inventory that a inventory. where of a to as balance. acquired seen we

we quarter some the told a as you quarter, we ground for the and second with However, shelves of up in last restocked lost XX megawatts made sold. total

selected their for been deployments the owned their and London and with Nordics center meet in multinational in customers Amsterdam schedule. our colocation of sovereignty this as requirements. room criteria available data due second included immediately leading business deployment technical met consolidate of of inventory to or focused remaining we data out Southern DFT for with the their partner key current of digital top to success, on capacity provide flexibility properties a the partnerships residential continues solutions the expansion U.S., robust the provider migration Amsterdam markets, across selected Other looking customers low record track to has Asian and well is both compliance are for the Pacific of On operational Frankfurt provide cloud-based supply legacy cited a to within hosting facility healthy higher demand. inventory established Pricing few to initial on wins are security new the vacancy kicking company timeline mentioned provides and sector given as our differentiated we healthy three-fourths deployment market, cloud Similar Asian being next building are local their four-megawatt our Follow-on education to solutions and we grow. security ability Market Nearly we Frankfurt They the to competitive next capacity. Europe. bringing in to were British have remain recent to footprint off with balance. quarter deployment focused European the both across recent providers. new is and full facility, other on from Digital buildings our competitors project aggressive major but ago by Realty Digital the quarters their a already to several activity Across locations merchandise and general approaching customer. chose strength replace their Realty that and current to for A last it for in accelerate, sooner-than-expected, only and past Europe's a for addition call, maintain in coming the requirements Europe a in market a a grocery our from customers our options particularly retailer that demand their are services and closed is years and region, the to to solutions phases growth. German footprint meet existing expanding as satisfy monitor deployments facility either new campus phase excellence. location are connectivity service to clients these of

in as Pacific in build regions, many is complexity selection permitting comprehensive supply stage, to and platform our On Net-net, cycle the urban, the Asia vertically longer front, view believe we as the a and markets data of in of as given need other the offering than approval well product global in provider customers land-constrained their choice. space, differentiator our center and interconnection environments. power key build

points lot ink concerns intersection page about on has been understand X. our perspective of like demand may that you on to and help and hyperscale A share to activity. turn pricing of returns. expressing spilled and Let's few pricing the a I'd profitability on supply recently data

First well. that tend into It XX goes prior see months a years is to average airtime average more have value signed we've the our term credit extra than over of obviously than the last months contract you as But get XX lease stepped of is that signed term when leases contract longer lot all, the take we over value the up months. you'll two XX without of double have than term those hyperscale the previous years more months. two XX lease total lease the the the bookings excellent. Quarterly we account, saying is bookings over last over signed and quality on

In addition, the deal development our doing pipeline. substantially also de-risking today sizes we're are larger

a we believe lease term, Consequently, moved of may see while our current returns You up firsthand on our spread can when returns on believe on pre-leasing longer basis. risk-adjusted quarter developing of over shareholders. value to And the pipeline lower from consider as capital, our represent you the respectable for marginally and has today, a greater be north this activity XX%. pipeline cost volume just particularly over XX% the created recent that meaningful our we

to macro page turn the X. Let's environment on

economic has quite several been the As I backdrop said earlier, the for last quarters. global supportive

potential We are the current mindful of broad trade to war economic a based does have growth. disrupt which global the the risk of

recent a just This somewhat organizations before, both business better cloud as or Software-as-a-Service a Infrastructure-as-a-Service on of However insulated point spent report over More spending top than global to the growing in cloud To figures spent a of $XX as the couple XXXX. to market in X. secular than say drivers making SaaS makes you've Gartner global application billion to of significant we're over in According economic on public nearly trends, me volatility. I'd faster XX% or secular be According XXXX. investments. the this to known times fortunate will and $XX demand Nash/KPMG forecast, finer cloud the XX% moderate to be highlight put growth the many on will page heard operating levered be services category like billion on CIO public from overall GDP Survey, cloud Harvey a year.

the the is spend XX% help is more XXXX, cloud for cloud by services demand quality the spending take our on grow expected years cycles. XX% like for turn five very colocation billion. future With you market, global results To IDC piece over Andy recent hyperscale. to XXXX to from to year financial the call a reaching public north in of expected $XXX and to interconnected The effectively and of public directly play expects of up that, XXXX obviously way results. our trends pie to to must the over reaching grow the I'd by XX% offer our well providers than billion These to fastest data bode While over that biggest next SaaS stay to Gartner. is in according global nearly is segment, through growing to infrastructure a explain this address through XXXX. solution $XXX center strengths,

Andrew Power

Thank you, Bill.

signed on Let's begin here We the We $XX leasing of our $X an for quarter page with interconnection. million total leases second for from bookings million, contribution activity new space including signed contribution. a term over totaling including was $XX seven signed quarter, during years. and $X.X space second leases the second million million power power and quarter average on weighted the lease colocation during X. The

a megawatt was growth existing their hyperscale transaction and with needs. ability operational track distinguished XX-plus largest our selected customer based an to us win who accommodate record on Our future

broad-based bookings excluding the regions of win. hyperscale across million XX-plus geographic megawatt and have were even well been products $XX wins quarter as as north Second would

logos existing were new customers, of While sourced to industry-leading the our an shared we partners. quarter during provider added workspaces from of the majority with international our XX of one through company many an signs aerospace new

company platform technology; in strong into for financial IoT center the high provide a with support data connectivity that expanding global go-to a met that a a development new software-defined networking communications facilities enterprise for leading second leading provider us specific saw robust by stringent deployment York new of their wins solution Realty provider migration XX-site intellectual and and including, networking services, presence company us the in will services, an innovative for enablement to new global quarter deployment for of Texas, entertainment and a and their center Digital a presence single-tenant and optic and the delivered, partner consolidation and technology demand our included: Digital for ecosystem the facilities the with with customer for quarter needs, ability segment, clients, an a other this services, a driven provider the New network established accommodate solutions the security edge Institute across network Atlanta provider to in is of as supplier security recognized the technology most Technology Miami services, of leading international fiber digital for institute and data America deployments Realty solutions; property semiconductor and of in Massachusetts in segment for customer with leading the strong a U.S. in We a chose needed a Realty's network edge environment. New and research gear a portfolio UK, connectivity a national North York deployment backbone global new expansion, their expanded expansion best-in-class and for and media Within in demand partner global existing global of expansion company. Internet a Digital of satellite solutions in Atlanta networking

and our continue help referral to partner channel reach us growth extend drive and strategic Our programs alliances customers. new to

our partners our offer capabilities who integrate into to data the We they world-class continue through solutions capabilities customers. build center

during we mobile our example, to production Oracle a nodes of provide quarter, and our second Exchange right data globally centers. platform the private, Service their availability a with environments Oracle set provider to high within network to for directly cloud partnered OCI solution with For connections through deployed low the latency, global

to its on partnership to IBM, to into alliances partners business expand secure, the Link set and the capabilities our to the XX, to shown business to ability low value where cloud IBM our infrastructure reliable have second able within now As unique and their embed We of our Direct customers capabilities want of advanced illustrates continued Direct of offering. include IBM, IBM customers here choose their comprehensive by consistent customers, access saw and allow and been and our providing IBM This partners Digital footprint Realty's where Link Service page connect the capabilities that IBM to a proposition strategic capabilities also we key Cloud connect cloud our products we to one providing These growth global directly globally. the latency, Cloud, they capabilities. with to quarter platform continued organizations that in how product with services. on Exchange providing

securely at incredible to an wide off-campus cloud then for private engine solve to latency, us of the requirements. has Cloud hybrid their connection adjacent public to able to actual sitting flexible customers especially connect directly which architecture campus. such are to the campus, Digital variety customers' compared offer back on We cloud an spectrum on a compute to footprint a the compute unique is gives IBM to directly customer options of cloud as our tether a Realty on-ramp, our enabling a ability full This and multi-cloud flexibility to node, instance low

average. quarter The signed, Turning yet to second signings and reached current leases long-term months, high our a between on was not commenced, the bit page the backlog another backlog XX, commencements of all-time $XXX of below million. average but five lag weighted

and X.X% cash cash do types. rents still positive market former renewal The in signed new years We million we most within quarter addition activity was have lease leases with to renewals on renewals weighted a to on on on across term $XX spreads leases few the properties. during all DFT renewals across up the X.X of leasing signed. notably second portfolio, Moving and above rolled release XX, product average page

XXXX. cash year for cash mix of This given spreads into negative the in full push result, our red. in a signed reflected As quarter mark-to-market releasing for renewal any could in slightly our leases the is the guidance

positive overall terms primarily performance, points XX.X% picked to to and portfolio second Amsterdam, quarter Dallas. absorption in basis In Frankfurt due occupancy of XX operating up

second offset flat positive pool in stabilization. be continued the the in same-store portfolio in-service reached development half as occupancy yet placing expect should partially absorption by that not essentially We will be projects have

FX economic to Turning to XX, in represented modest our risk tailwind second page results. our mitigation growth the a year-over-year quarter on

year. bit acted headwind growth FX of However, and now modest strengthen prior represent as the second We has expect in on a relative over the a quarter. of to to half to U.S. dollar the days past the XX the a drag began

per driven on consensus. property as in than page earnings well on X% and taxes The XX, above core our growth forecast to was was by operational outperformance operating Moving up came upside to $X.XX primarily lower expected with year-over-year relative FFO internal as expenses. share

our press closed have despite from during to may spending per due are financings asset unchanged higher the of and you by FFO the wins sales recent seen we for drivers $X.XX. core leasing the FX, from are release, As currency foreign aside second headwind, and raising quarter. development updated assumptions share XXXX guidance Most the

from run-rate, timing beat the down of the higher issuance, step recent to quarter as from asset the XX, quarterly can Net Last on slightly extent charge and balance let's quarter the expect at least, improved you due we the fixed on by healthy but leases investments quarter of fourth to bridge in turn to coverage XX. the the the loss recent end see remained third not our G&A back at in debt-to-EBITDA X.X sheet second terms of sales before of bond rebounding interest page from In page large expense as times. the commence. the X.X to sharply several and of NOI times

little denominated, hedge debt environment a for outside investments XX% the greatest and the FX unsecured, dollar our as our on is is approximately rate average rising against and fixed As weighted debt debt is rate X.X%. see of XX, page our average the five you a A capital from U.S. natural flexibility guard maturity can coupon XXX% recycling. our our Nearly the over years providing acting for of nearly to is of chart debt XX% is weighted non-U.S.

the with the eye that of We financings an balance currencies assets. long to towards duration continue across sheet support will our side right our actively manage

clear years. XX, a from with have tall side of see the nominal left near-term out page can no and you as bar too we debt maturities runway the in Finally,

fuel but take for Our is your our prepared poised Q&A with be customers long-term around questions. we would the to a and session? will now, the strategy. This financing consistent also to storm, our opportunities begin our pleased balance sheet concludes you remarks positioned growth to weather globe, Denise, please

Operator

Certainly.

We the question-and-answer begin session. will now

Jordan first ahead. KeyBanc Please The Capital of Markets. from be will Sadler question go

Jordan Sadler

and you good Thank afternoon.

in at for guys you I in reported, terms first, by touch believe, investment few interest America? into in portfolio that wanted in and second. Anything talks to looking can up offer So I was Brazil. ago were activity It scale on Bloomberg a South of just weeks a a expansion large you level

A. William Stein

thanks Jordan, Hi for our not market investments. on rumors, question. thought process with share the know, do as regarding you We, you but comment I'll

you stay our with customers, try know, try ascertain in to First, they we as have interest close in growing. to to where speaking and them, an

that truly investment competitive platform In platforms we markets, new Investor advantage. we our we up of are pay validated results. a say looking that's two believe We put to the new represents enter opportunities, and try Second, going our think map new year, quarter's the to this capabilities, key attention new that markets to that a appealing. we particular years been three with next we When at did Day in were last largest economies. global

with We and of participate draw in size. we do market buy a on do markets at you remain conclusions. map, And when disciplined can our keep to respect capital portfolio, own because that a from new potential we allocation. everything. all try So We to look your probably We see time. the everything tabs

So that's helpful. I hope

Jordan Sadler

but The a due don't Yeah. the results, amount volume. to up quarter. did congrats the is you are guys lightly, We in you you the question It I and Separately, a regarding from beat beat those the did raise volume similar by quarter. is. that's one big just offer obviously think the on to

signing commencement more Given bit on why the flow into aren't $XX of lag between reasonably a seeing million, through short and we this little a XXXX?

A. William Stein

the Well, about obviously bookings thank that. good in all the congratulations really quarter. you for the of feel first We on

the that hand In I'll the Andy. specifics behind guidance, terms off of to

Andrew Power

Jordan. Thanks,

good those not would only in pleased the So, The significant with the in moving year does the moving the commence the but thing five and those to news trickles our signings we few XXXX. one de-risk the single fiscal and were guidance XXXX of higher were really a back the end months of again and I full low note digit a signings. half certainly once new sign as benefit is you up and at our the the is growth of into to we The this we growth get year. which we quarter. chains year, executed that next composition the new quarter mentioned, just or in are on will of signings the higher weeks signed Thus high portion guidance months volume, the from

Operator

question ahead. The Cowen from of be next go Company. will Synesael Colby and Please

Colby Synesael

want a also I echo Great. if I strong questions the Two congratulations may. quarter. very to obviously on

us light could not what First about what and also even roughly wanted year are on get next doing requirements. strong in helpful. – And like to flat capital should just it CapEx simply think interconnect some to year? your on at that an thoughts revenue; it's this of from think then flat quarter-over-quarter. maybe improve I'm is very color be. some what Thank to XXXX but this down, And the look in potentially Do you on was just you wondering you're would raise bookings, or Any maybe coming year point support the if equity what this, your be just you. up remind that and it

Andrew Power

Thanks Bill congratulations, both again, is Andy, chime probably and tackle, it. This Colby, Chris I'll let in. for the actually appreciate maybe and

colocation of signings, aggregate, and overall basis. front, and will the also Atlanta largest were nine did up our Europe basis America pointing right credits what more to existing through longevity our campus for the item drive to and pleased our there Data year-over-year of little of some colocation some interconnection up like terms with and London, colocation too together to signings. They was on our in going a the a with core newly on that did other we the York, wins in have contributors which it New from on customers Amsterdam signs a kind expansions, the migration On and gave over legacy next line which improve several We P&L, signed we six it revenue some at the what signs stepped last We of as a quarters. that and some had in getting opened the flowed step-up think driving accounts on be and some future. out built new some of the quarter-over-quarter, some their in the re-architecting Ashburn the Tower some colocation look North I to Chicago muted months, interconnection marketing to lump of interconnection several quarterly interconnection And think revenue vertical, and right the you're and great in markets we the footprint from continue grow we on ultimately the Richardson, the moving in more often footprint the facility that credits in the I were or team, of reps cadence of here sales facilitate disruption. customers and we do we is

your and of around was capital financial think I kind question second policy. planning

X.X to of quarter we our some carrying due CapEx wins the supply signings termed land development the leverage the purchases to rate the Luckily, also line inch out did at attributable ended and we item times some levels debt-to-EBITDA, on we quarter up our the floating had chain. So, debt. guidance targeted front and in with line of future the during

revolver XXXX. So, self-funding organically substantial on and we liquidity less focused our call have so needs all for it remain $X.X or of borrowings, than billion

next XX capital, months capital-recycling well have to common, program as evaluate Looking financing here, sources proceeds our to to preferred our and we're from equity the disposition forward XXXX, bond going as alternatives. call XX be it certainly from other it, of all of

Operator

next Flannery be ahead. of The Simon Please will question Morgan from go Stanley.

Simon Flannery

could the about more the thinking in little out talked and bigger you potential thought wonder just bit you the acquisitions much. long-term you particularly you but Great. are about a what's properties, those a Thank if of build get footprint very establishing Manassas, some how talk in divestitures how Ashburn, why Santa through, and you of us I think about there, land quarter, there there to de-emphasizing some like likely just those? do the some what's in framework market you Manassas? are Austin, for then out And that you the of a can help think is and Thanks. it be did of or more Clara about

A. William Stein

fellows seeing is this Bill. is we're CSPs Simon, first Sure. up. clean Manassas, let are with and I'll relative to of the what the start other the going But all, three in here zones market. that basically availability

same it And slightly but a represents opportunity different the the availability so in zone so, Manassas than the us land Loudoun, to customer gives market, in a different location.

we've standpoint. a It's and the very before. it is is And we rents see tight talked about So, Manassas where one Santa and market that supply very attractive from market Clara constrained is improving.

and we looking that us And about create location also are ours. we're slower which an we company, management, monitoring It a particular investment real all are means strategy, some to trust, to data a portfolio while adjacent dispositions, we're was in a not requirements. our I maybe so, estate that particular portfolio existing to center regularly CapEx growth, the core prudent to are of data allows sell to we're less this maybe mean, and have center Relative submarket. finished. campus assets

as the some Chris, And be our markets, one-off characteristics core same don't Andy are we any? that And and so, as demand see assets. that or typically of those might markets those having will continue.

Andrew Power

it the markets demand demand on targeted Ashburn, Santa Louis, or theme and Dallas, monetizing across markets of somewhat similar where abroad and Chicago, enterprise versus moving Philadelphia, St. markets the less it and in that is our much our from and we're similar outsource and markets dependent concentration into markets diverse with on markets where say we're that investment all be more verticals, just customer I'll it those capitals we regional of the concentrating Clara are redeploy out when accounts, thread. our verticals Yeah, exit trends Sacramento focus robust IT network single global or be

Operator

The come next from Stifel. Rasmussen of Please go question will Erik ahead.

Erik Peter Rasmussen

taking the and on results. congrats the questions for you, Thank

Just two questions.

relates somewhat it expectation seem cash as but to renewals, negative First, your to your positive. and XXXX outlook for your be commentary slightly

So is that what Europe, you're in demand your made. you of of little How feel versus out demonstrating? light in then, your up. had was I'm balance the that just capture the that a And trying business some in do market it you're guidance had commentary to QX, you obviously, secondly is to but picked positioned seeing some now

A. William Stein

Relative we're good In to begin building we'll similarly, X of the we're we to have Andy, I in on we you leased the...? the some be want a megs handle beginning and Europe, nine planning do and there. properties total capacity And to additional on construction spot. understand we've out meg two meg other X Frankfurt, site. soon think construction

Andrew Power

Sure.

broad-based win over from cloud the I'll up customer. it's to providers round from certainly I cloud the out service and turn top Just to three had mean, an and that the enterprise been mark-to-market. service we activity market providers global to on based in a I to London front local, ranging Europe picked execution has think Asia

traction and and broad-based pipeline grows. So continues

as renewals to red. bring of slightly quarters, leases second inherited handful positive notably lines. we've positive into most all another the in still of Turning in of on underwrote the quarter. first will said, a those was somewhat overall before being that quarter. had in broad-based likely the DuPont across the had product and in a or our portfolio, we've could renew we've referenced that cash Fabros do the It portfolio coming That the larger mark-to-market year negative the our mark-to-market, acquisition have major the we the in We mark-to-market

time it's which So table not a quarter sure guidance. want but executed, particular those to into definitive when, our get did make incorporate we year that that full we

Operator

be And James. the next of Louthan ahead. Raymond Please go Frank question will from

Frank Garreth Louthan

do and affect at labor I'm on think touch of could industry kind development XX inflation you. building what's you on to Thank out months materials you ability XX the I your of seeing possibly Thanks. and next pass sort next over your both over your Great. to that that the along outlook look wanted there base months? raw the the yields and as that and of sort in pressure

A. William Stein

we've in for major that's us where lock this program years. Frank, equipment equipment from on three costs place before, Hey, we costs but costs. And insulated in we really a our material touched have and

thing other do we The that employed. we keep contractors our fully is

we're in as doing fully Andy, very it we another building engaged longer them one move keep there. labor no you'd to us by cost if that contractor and region find that add well. to fact, region, attractive anything like we'll to that out gives In

Andrew Power

the legacy as something was portfolio DuPont that Just to akin well.

allows So, insulates larger customers, but to on costs it escalations of with many of through our net us returns also footprint forward been pass our moving term the that lease the contract, us structure over-time. a triple we've over on and

Frank Garreth Louthan

great. Okay, Thank very you much.

Operator

The next JPMorgan. Choe go question from of will ahead. Richard Please be

Richard Y. Choe

how in is a you. mentioned should the have, How I in going of Thank you. that? have then it of a fourth top little terms in that there about of of has level quarter, customers shuffling way. that you a the signings bit One, consider level into we the contribution XXXX then think Thank the should the Great. ones. and and three we you two quick terms in terms of positive in

A. William Stein

Frank do commencement rolls of XXXX. of on kind the segmented chime in. We that and have timing in Sure. into a I'll and back half somewhat and start forward of what's we kind XXXX commencing let slide which team our of the

in growth response obviously you've and there a to XQ XXXX got a that leases but will is first are (XX:XX) in kick I our that the some are question, the larger commencements portion in full-year's XQ XXXX, benefit in de-risking there mentioned there. I late good XXXX As believe of

So that some FFO rough color should of give of per quarterly the backlog you guidance and a the little in bit the XXXX composition of provided share. also kind core we on

digital. correct, of name Your second our question, here you're a the top we new at on have customer in leaderboard terms list

all and our every one love we customers each of think I equally.

I've anytime I'm there, a jumping list seen thing also new on we bad but more top say So certainly good XX with going already that thing, expanding on are us can. names to customers that or not adding locations that's and a and

Operator

from of will Citi. question Please Michael next Bilerman go ahead. the And come

Michael Jason Bilerman

you. Thank

be all potential case. Thank just that about could XQ if replace was a And little just stand what's on for I then share guess, wondering the per second talk and you. maybe at is, on implied in structure you and replacements basis? Andy I Just a two or guidance bit specific, them you quick more guys little about you're do XQ for going questions. Scott and where the One, bit a Dan to organizational whether

A. William Stein

and that's we But which of strength caliber think handle all, fill our a platform your rush We said first think existing been high Andy on focused search question, know no also and for at and that's in position internal Relative position team, sales we're some second looking talented in right on what team. the our the second both network, handle candidates and quality, the team. to I and given own to believe I Chief first quarter we're one. We've very both Officer delivered. looking at people We I'll of clearly bringing external the candidates. firm. good. think timing, of by a having Investment head that, think will the high mining think positions. these the We're we we're our very and versus we are very is you replacements, But Michael, we're validated the have engaged

deep vision. a have on and We we team strategic talented executing focused our remain and

Andrew Power

guidance of did of can an upsized advantage you turned that is the But quarter and that we do think earlier of I'm kind be And highlight a really we is had the from one the not right thing not I'd quarterly, as fourth. nail probably and to down in hit of of the that step couple execute out a going XX-year and U.S. dollar guidance on head between see of then third are the quarter second we things deck turning with revolver quarter some our on helpful bond answer did the policy That little to borrowings offering table, highlight than and bridges one, did bit our month. is three taking the this and balance your the a third you does the A second to I'd which to in give preserving previously for quarter-to-quarter to full-year window Michael little it earnings. question, we market slides or on things sheet. the the liquidity assumed try given to somewhat guidance have a drag last the we

of multiple megawatts then also quarter and we between have quarter you on loss signed lastly will Clara market, our lease kicking XXXX. delay to in with that Northern guidance. online already core or and and complete And late into third of share fourth in get of I'm quarter. larger through also then hit that and then yields We XXXX in our the those aware XXXX funds per it's XQ And acquisitions quarter, there second development commencing NOI during portion commence steps stair signed the the completed coming the the in will some Santa FFO Virginia that redeployment several another that in per that and back and the leases of of timing backup our we coming fourth have down the to plan do steps fourth are XQ contribution and kind a is which from

Operator

Guggenheim be Please Robert The Partners. ahead. of from next will question Gutman go

Robert Gutman

line quarter, and recurring a terms of have which strong in where of you And be of extremely or Northern deployments then beat the I market in seeing historically. taking I that a a significant what this Virginia secondly, about hyperscale, we the Virginia But that down. stepping was looks you the of of Hi, up Do like property a more rate big forward it's will back smaller be what the thanks it. terms a on generally the Northern part around of wondering other taxes, outside step are leasing congratulations in about in country? very question sort was the item to and big lot hear was been locations the scale on in the with question market. it also expect seems number. for seeing you're going

Andrew Power

let off Chris here. and Maybe in Sure. Bill and I'll start chime

They property to up were non-recurring also taxes, region always wherever the we working of of a in West appeals be estimates, Coast unless really the our chasing down terms broken and that in of management achieve we our a UK America portfolio. can. of On accruals really and portion continue that's conservative to on appeal proactive would between And bit due market. different North a different a portfolio

baked So, kind nature, in a guidance year I of would that we've incorporated. bit all full little time into of one but say the is already

scale, fit. had scale the or hyperscale one of in ranged guys the XXX as the Santa just to which megawatts and chime Toronto X north Clara, and scale maybe to Phoenix, of as the larger the Austin, call in – it Virginia, Turning kind see of I I'll smaller kilowatts of signings mentioned. America in end, high from on hit just we Northern as waves Outside tops of North signings you

mentioned XXX was other enterprise it had to I each and in then over was customer we megawatt there X transactions Amsterdam megawatt London, and If you the call move Europe, of the to London, XXX X signings the then with kilowatts some customers. from some ranging in end, other Frankfurt three and transactions Asia multiple Tokyo. into transaction in our smaller different multiple and from And European in Hong Pacific, SaaS megawatt Kong kilowatt Australia, on then a we of had provider from customers megawatt

Operator

Please be will MoffettNathanson. of question next The ahead. Del go from Deo Nick

Nicholas Ralph Del Deo

do over on risk describe short we should the for touched with momentum taking actually you your comfortable be you seen prepared feel as or that I of something pipeline? this of medium-term the questions. running sustain is in the how of you've you the thanks about inventory but remarks, sales Bill, mean, to my Hi, would concerned late.

A. William Stein

announcements Well, Virginia, some that in in we land did other the We'll Santa that's why have Clara. the have quarter. this probably land we acquired land acquired we

where adding some build so. materializes, through very And very we're the on why we demand So inventory frontend there but our pads Northern when churned on markets so land. quickly, We're focused that's particularly of are laying the chain. supply that securing is can we're the in being Virginia quickly the down campuses

Nicholas Ralph Del Deo

Okay. Telex dimension help assets been can magnitude is business from that Telecity valuable couple that Got us it benefit now the colocation presence? versus with presence regional global the how you've the both side, for the divestiture a on them it. assets? of stemmed a And the you maybe of understand in years, operating pairing a Help that having

Andrew Power

I equivalence quarter then think I of across sizes as of – many and the media locations of And network I'm I customers I this other in having to markets, Santa relative Europe to well. our differentiator be multiple set. to only going or the And seeing Andy, not ranges London, there's is different during table who with, it key different And us, to small eight to we're multi-product and Asia, deployments us the uses. be with specific or customers signs Asia with is transactions multiple recall Ashburn the provide and have Chris is bought large many, at the aware these to can America, This I'm being customers competitive to pipeline multi-market, with some more and able a social coming solution, We're customer Pacific Clara our but some Amsterdam also on. being mean network Sure. add these geos. able in more North need deployments. and pitch (XX:XX) and of our of

not And able to add handful know Chris, a want would going or just have I if years. on with not would something don't we had of be you to that. to compete back

Chris Sharp

the as interconnection definitely about colo, not in it's fact I'd it's the the sentiment on No. echo that well. just

base not our can of coming a which also land have broadened definitely we into it's to the but to And so, set very customer provide customers solution the colo and that really going scale it into a that and scale, applying much portfolio capability forward. type interconnection only multi-national to taking where a is and they the expand, has Digital they ability differentiator to

to in lot cloud cloud model, seamless that today for. a these being which close deployment, a most in node majority lot hybrid talking been the they have a initial of so multi-cloud need services the that their lot colo can only able apply fashion, they to a smaller but way not proximity of efficient large so, achieve a that looking about to are customers very capability that have And that where we've enterprises the their of land

is So really the of a efficient all Digital very culmination products those going manner forward. in in differentiated coming together

Operator

will question next The of Sadler be from Please Capital ahead. Markets. go Jordan KeyBanc

Jordan Sadler

markets. with to driving AI Are and are anything in the could in and on specific of driving use able to? that requirements just up the quarter, us Is it regard this I'm signed this you're the ML wanted terms I curious it follow was types the point the and you requirements or specific you or megawatt to deal focus or identify for that seeing? seeing of the flag Thanks. hyperscale workloads some of acceleration that's XX demand you're on the that nature of

Chris Sharp

question. right. mix, a Jordan. It's you, Excellent Thank

inside services of demand we're do set you lot you an what tell megawatts, a existing new to I for So a seeing services. of would adjunct can lot. is XX of that that are there's

there, today, you support and how the a AI look coming race are to Digital to at not operators fact they're of of it's up these at these But And is any this we're infrastructure supporting definitely services future tell I Bill an a can customers. the on the lot bit the services expanding and procured, we've landing and is only touched mash the of the the piece really around announcing of can of really week, these you around master those market of and and this why their deployment. services, of workload the operators. ML the of I they lot are of had a in is if a in proof services they in couple and coming then a market to the timeframes infrastructure we have way – that for land customers the arms services turn top some and mind out have power that So of place, major would around that of lot banks this it's for looking so a a we some last new of culmination lot some mean, that infrastructure fact cloud of shortest the planning but dynamics a is,

also cloud are as expansion their market to interconnection line broader future So, are as also of going and achieving needs, the at I that's referenced to component earlier, of XX and ecosystem planning that not megawatts a you for master market mind the why be their having see top is supply the really are but the largest us partners it's today. where sight own and that placed, looking of talked brought supports workload the chain some that. to of permutation campuses out about to that supply highest most support interconnected building every levels, efficient in the We in the market, the fully chain, we've which at today only seen

A. William Stein

that. Hey, let Jordan, add me to just

So don't I one here, we've expand. thing hit it to think customers, on exactly ability but the important that's really our to it's

many particularly important provides our scale see we to in this look that's do a have is or the into want that's think it that in facility there's the becoming have in only of and is able and built. I want and offer. competitors Digital key on their growth fit And to door be more they to that and to But more goes be for differentiating that will scale that our that our factor thing or not to and global either what next can't the a built business soon room a So existing point we building able customers. one to think customers campus

Jordan Sadler

scale it you it characterize when would requirements. this And How to is at strengthening? holding this (XX:XX) pricing say you it acceleration. requirements is and relates look potential Or, the you would and or as

A. William Stein

by the I any it the darn as basis pretty you'd real think, largest estate pricing market definitely for is say adjusted in I'd risk even deals. expect a varies actually But, business. is on good

the term against the capital over find bumps cost contract, can term if don't of contract quality weighted our of it's the and think credit returns the the and you world, any. of You look take of in a and other many you average you look healthy so, very the estate that parts at those real at spread the I

Operator

gentlemen, hand to session. the Stein question-and-answer And his back will I conference to that Bill remarks. closing our ladies and would over conclude like for

A. William Stein

to our page recognition lease finance beating our recapping further consensus U.S. guidance. green grade by balance of with but issuance current a in $XXX our industry with sheet of our XX-year borrowings leader. Last dollar we delivered and out not terming bonds. results the We line bookings successful strengthened the credit raising as million period solid least, quarter leadership Thank for further our of investment up call on presentation. in We last the sustainability our highlights like record extended top with and here outlined deepening our our our today backlog. you, wrap customers, We of our Denise. by second I'd highs our reaching both as connections priority advanced corporate of

And do I'd Digital for every days dedication you the quarter, all all by to responsible we I summer. Thank Realty consistent for saying of thank hard As whose like us. the entire conclude joining you directly team dog and enjoy execution. today work you to hope is this

Operator

has Thank lines. gentlemen, for today's At you, you sir. conference may disconnect Ladies and the time, this your presentation. Thank concluded. you attending

Digital Realty Trust (DLR) 26 Jul 182018 Q2 Earnings call transcript