DLR - Earnings call transcript Q3 2024 | Digital Realty Trust, Inc.

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Operator

Good afternoon. and welcome to the Digital Realty Third Quarter 2021 Earnings Conference Call. Please note, this event is being recorded. [Operator Instructions]. I would now like to turn the call over to Jordan Sadler, Digital Realty's Senior Vice President of Public and Private Investor Relations. ahead. go please Jordan,

Jordan Sadler

and Conference to Call. operator, Quarter Realty's XXXX Earnings welcome, you, Digital everyone, Third Thank

Investment and Joining for and and on and Chief the CEO, on Chief Andy Greg me today's McLean, will Power; CFO, call Revenue Officer, call Matt are Chris and Technology Q&A. Officer, Chief are Colin President Officer, Sharp; Wright; also Mercier. available be

forward-looking on making be statements, today's will and assumptions including Management underlying call. guidance

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

For see a filings SEC. discussion our further of risks our with to related business, subsequent XX-K and the

This call SEC contain financial the website. and the in net information. Reconciliations our will are included income to non-GAAP package available furnished supplemental on to

me Before I offer third from key turn quarter. our takeaways the few call let Andy, a over to

volume leasing for own our shattered quarter. million and at possibility a $XXX expectations record prior of in our our new share, even the of realm First,

leasing standards not of XQ our fact, up in was all of year's XXXX, a in full $XXX nearly to the leases completed exceeded but signed activity In quarter backlog as by leasing than previous commenced pushing more million. growth the

X than X X posted was plus the megawatt primary to also the driver record interconnection over segment quarter. in leasing megawatt bookings greater While

on renewal Second, of rates uplift spreads XX% majority evident new into capacity, and the greater across leases, cash strong center X escalators leases improved leases quarter. was on record fundamentals than in translated and a both renewed in this pricing data for with new X% new and the record megawatt

expected as North land Shell is construction leasing successful a to pipeline a XXX And at result America. XX% and under yield nearly of average pre-leased XX% development sequentially in third, our XX% now capacity and increased by of megawatts

to sustainable improve These closer results management's to Realty growth. longer-term move objective to Digital continue

Power. CEO, that, I'd President to turn Andy like the to over and call our With

Andrew Power

one this was but Thanks, everyone I this don't Jordan, start call. certainly for for books. to our the often way, and thanks record quarter joining

As product we also record to to across enhance posted sustainable efforts to backdrop, on a long-term are of a results Digital the broad team of demand noted, capitalizing growth. value array and results drive proposition are our favorable Jordan Realty's but testament metrics. These our a

center both cloud for larger to data support remains core in growth digital both capacity markets for our Demand transformation. blocks strong, continued capacity in and and

with expertise advantage We a of of and our can gigawatts given take this full environment that together X-plus bank are robust a our partners positioned well sheet spectrum group is of footprint by favorable to an leading on support all behalf world's facilities across capital investment-grade X balance land and global strategy, development, incremental continents of it diverse together complemented enterprises. and operate the companies that the to and technology put these

million Realty deals include abundant first of leases Digital Chicago. driven at more [indiscernible] in $XXX of prior America signed this quarter than and than and for by Greater share, third megawatt the way, North Ashburn were led bookings in double quarter X year. in the our large Manassas, the hyperscale new record

up XX%. more the while up was moved than pricing this XQ leasing New nearly XX% segment volume in from record,

leasing in quarter, for megawatt JVs, X our appetite in our excess our the results Like of third Manassas. at all large $XXX we demonstrating Included our development venture in significant the data hyperscale facilities million of or greater into signings share in XXX% was XX% case. capacity. center share total was leasing The report than this in a in lease our these at

more interconnection in which million which our might accounted X-X deals business those of by to product of size over leasing. strength record small and of saw with X-X the than XX%, strategic XX% very in a under numbers, be category this in with for particular overlook -- record a our sizable topping new bookings, Given X.X our megawatt prior easy and milestone megawatt, plus $XX it important quarter

new further and momentum validates us hit very customer with full-spectrum and in also demand. bookings forgotten, in our product be view it to growing interconnection provides a steadily Not bookings a with pricing increasing record the strategy as We segment durable favorably power quarter. these

was Our the by strength also new in quarter. this a category record XXX characterized logos for

percent APAC to positioned convenience bottom X data record line the the our quarter, needs with activity to a next EMEA largely Americas. Americas top With exports leases, offers growth. were in of higher commencing manage we $XXX export priced the leading over by is accelerating way, are and customers for PlatformDIGITAL followed the reflected which years, and global favorably center the by into record simplicity million XX-plus and backlog third year-over-year their line

support another quarter, maintained megawatts In our And under growing the today. buildable customers' IT and requirements, our quarter, XXX construction and underway -- capacity new load pipeline scaled the the leasing we third increasing of X-gigawatts in the substantially in and condition. we by in almost accomplished of XX% to all of land development also shell capacity

proposition strengthened in the last we center our we Slough. As quarter, acquisition in enterprise of campus with noted data a Europe value also densely connected

and quarter, to also provide more these sources ATM on continued activities few issuances. minutes. diversify we capital bolster the a through a of our and combination During favorable details Matt sheet balance our in debt will

be have reactors with utility purchase another existing yet for deal go an examples and Over energy of few to Island, a some agreements several third, the that X-mile partnering compute seen modular fast-growing to power the seen We've will hyperscalers to lengths the enough SMRs purchase reserve to nuclear to power executing their small built. develop reactivate hyperscaler multiple we've requirements. weeks, past for that

for portfolios center are to perhaps and solutions these generate in next speak blocks help outlook years similar, the growing of that from center years. beginning long-term is for they to the are data several value and power, power the plants carbon-free demand capacity agreements capacity. energy of longer-term each to seeking Yet These away underscoring still today lower data

center management, of and construction chain to clearly proposition Realty critical Supply table. power the operating infrastructure a management overall piece available the bring that expertise value puzzle. the Digital And are and rely customers that all sourcing aspect they challenges is just of we are to data X on solve,

the deals plenty that While and place are of Realty's the private focus, cloud the bring meeting partners get value their hybrid to applications can large Digital world. customers recognizing around hyperscale and IT

wins more to reach of continue see We the partners, expanding a world. enterprises meaningful our megawatt X-X our share by influenced into our around

to to XXXX Global this challenges. provider quarter PlatformDIGITAL of provider a largest one deploy A solution who leading wins personal modernizing its geographic for logo data a Realty, advantage connectivity partner, information customers to of maintaining take PlatformDIGITAL, to also cloud came Our us and on include from our data which gravity Digital privacy. cloud care for with partners health available new alleviate health compliance while distributed infrastructure a choosing a telecom the

is differentiator. rich enterprise institution and and is scalable to logo, to robust integrated as monetary PlatformDIGITAL part global through its policy, connectivity critical optimization driving deploying on requirements base, an their financial is expanding continents provider connectivity a support in who additional expanding autonomous a A support solutions. X tech-refresh on XX to chose where initiative an new PlatformDIGITAL their top access. across And solution. international global while cloud partner capacity PlatformDIGITAL technology and semiconductor another access secure their joining to electronics customer was manufacturer cloud global XXXX presence critical company of maintaining financial Another Global Japanese of PlatformDIGITAL A require

like Before over quarter. third I'd on progress turning global it ESG Matt, our to to touch the during

first megawatts the in lead We Plus for building industry the our XXX in Swiss ever Efficiency while months, certification XX capacity, achieved Center centers green continue the Association certified our team IT data Data the last to in Zurich. Gold Swiss

Sullivan Cloud Works on including ESG the Capitals, XXXX for venture, be Data MC Year Digital recognized Global Digital our Center recognized joint Realty Award the Japanese The Digital Data XXXX continued Infrastructure Realty Company year, Global XXXX Services of Award. center AI BroadGroup's also Frost with to and Japan Action Tech the for leadership, data &

continues be Green center in a to the to Digital Finance, Moving industry. data where leader

long of EUR bond, for During the its million to projects. to green support linking debt Digital's history XXX we sustainable quarter, adding issued

maintained Digital committed company's We demonstrating delivering component of we the while all environment pricing further credit ESG. the facility, minimizing on to for remain new our stakeholders. sustainability-linked impact Additionally, growth on a Realty's sustainable to our commitment

to pleased call over I'm turn that, the our With to CFO, Mercier. Matt

Matt Mercier

Thank you, Andy.

quarter category Americas. signed million Let We the into $XXX $XXX third our which heavily results. toward than fell new leases X weighted in me third into the million jump the and was right of quarter, of greater megawatt

leases XX signed new were X-X Each million of bookings. Realty. records interconnection also for megawatt and $XX Digital of of figures these We million

leases. hyperscale the signed Importantly, of or more include dollar associated greater, with portfolio long-term our XX% rent of volume of annual X% of escalators bolsters leases than profile growth which the

some offer September, Our the increased XX% the in dramatically To of XX% backlog end of to XXXX. of and million to data the $XXX more at commencements Digital this these Realty more record as new XX% quarter's now by perspective, than by than $XXX represents outpaced center of commence revenues the share at quarter. expect leasing sequentially we million annualized leases of end backlog

year, Looking ahead, $XXX to commence XXXX, $XXX slated multiyear of commence million $XXX for million with to accelerating commence year in scheduled scheduled growth. setting million of by up next already us another over the the to and end backlog this is

to several a pulled XX.X% renewal driving During $XXX cash first million the cash leases deal year-to-date spreads driven package similar these a increase third of more to were scheduled not years. sizable XX.X%. We re-leasing by spreads that for forward -- expire a on renewal quarter, robust we was signed the to quarter, a renewal basis, at that

deal, to X.X%, consistent we package is the this overall a which were still provided X% guidance XXXX. previously for more with Excluding renewal spreads X% healthy

capitalize the X.X% the cash overall segment down pricing were predictable our re-leasing renewal a demonstrate in of in the greater in while were they up third nature. category, customers' over product current on the renewals segment by quarter, views also reflect up X spreads market, available the Breaking package spreads levers while -- by healthy X-X megawatt the in We to the environment XX%. than megawatt are and deals less

than were package megawatt renewals X the Excluding still X.X%. up deal greater

low quarter, controlled and well X.X%. the churn at For remained

In renewal middle commencements escalators third the of billion by EBITDA. FFO $X.XX capital drag and X.X% quarter per year-over-year activity grew XXXX. improved more Data of revenue as of the year-to-date continued of in the terms offset revenues and recycling we center $X.X associated adjusted with of earnings, core reported rent spreads, since than combination reflecting healthy growth share.

up transaction the center for forma XX% activity principally due point in near to flow-through Pro were from basis and revenues by improvement with year-over-year. of improved XXX the revenues increased higher EBITDA data center Adjusted data interconnection year-over-year, a XX% pricing. margin.

roughly XXX growth in increased has year-over-year third was EMEA operating the headwinds as Same be quarter, in the revenue points X.X% utility continues property same-capital by about the quarter. and bad basis capital which offset center NOI cash by higher growth increased data year-over-year, XXX basis X.X% of Year-to-date, costs by reserves debt points in elevated power prices NOI in given X.X%, to by impacted negatively in XXXX. margin of

consolidated investment on gross share third million spend our million We activity. quarter. $XXX the development $XXX to in was on the XXX% Moving spent at quarter. in development

the center Given for more data we our megawatts in XX% EMEA XXX added Americas and in the with the projects under demand doubled quarter our construction. pipeline, capacity, an almost increase in ending strong development for underway

now from XX we starts of pipeline yield is XXX quarter, megawatts the while with XX%. at another average just capacity of XXX% of delivered we new overall expected up specifically, the with in XX% end new an XQ share. at of the pipeline XX% The megawatts preleased, backfilled More

Almost stabilized Americas is XX.X%. the pre-leased of yield an expected all development underway the in with

over both with XX%. and remains Some APAC, stabilized in EMEA yields currently both development capacity expecting

the first CapEx of well the billion range we Over million partner and of original of keeping has on by spending year us development been share, $XXX expectations. year, XXX% spent full the at months balanced X our in nearly contributions, track which within $X.X

to Turning sheet. the balance

quarter, ATM. our We the sheet over raised with the continue to strengthen equity $XXX in on balance third of million

gilts side, July in XXX off an million debt the added bond EUR we in green September. $XXX million and On paid

credit our nearly quarter, billion September. extended to we our We debt-to-EBITDA At the billion end was X.Xx. had in also and ratio net third of liquidity, total the $X.X facilities upsized and of $X

Moving on debt profile. to our

maturity our is our of dollar our recycling. XX% is debt and years, Approximately is weighted capital growth average average the debt XX% and FX of approximately debt rate reflecting X for is and X.X%. our fixed unsecured, our Our hedging platform -- weighted our debt providing interest of We strategy. XX% non-U.S. ample global of flexibility over denominated, rate is net

maturities the remaining laddered we XXXX. through and XXXX, debt until Finally, early have remained no maturities well

our with conclude We -- let guidance. me

are at share, strength the XXXX opportunity of pricing, leasing this to customer increase share and of in per bankruptcies we high the partly year in of low raising for and by $X.XX the the range second guide maintaining the reflects the our range balance of and core the balanced midpoint We our FFO on increasing commencements the benefit guidance per $X.XX by are end the full range to The and year $X.XX year-to-date in stronger-than-expected end. robust the sheet our positioning of the half of impact seeing. capitalize renewal to

to to We on revenue are renewals the reimbursements are to our leasing adjusted also we and pricing. are guidance our date, from cash adjusting increasing X% Accordingly, X% X%. to volumes EBITDA Reflecting lower range assumptions. and the the also adjusting expense to success we higher guidance increasing impact our following year XX% reflect total reflect to are full operating utility of better-than-expected

year also full a of to -- are same-store We range X.XX%. guidance to we tightening X.XX%

of In tightened investing share and CapEx $X.X spend $X.X the we maintained recurring range our maintenance terms XXXX, ranges. expectations billion for billion net development our to of to

slightly we anticipated expectations Lastly, XXX year. by the raise on the financing, beginning but than of higher ahead million rates mitigated at was short-term of previous was bond completed EUR this

to Core quarter, fourth the momentum from increasingly strong to leasing poised Looking increase bottom to the remains contributes per FFO year-to-date results. line share as

backlog XXXX now to as our This remarks, pleased data and and be Looking to XXXX out environment we'll questions. prepared remain the Digital centers growth our in concludes accelerate beyond, fundamental your remains Realty's poised strong, robust for and from take levels commences.

you would Q&A please Operator, . begin session? the

Operator

[Operator Instructions].

Michael from with is question first Rollins Our Citi.

Michael Rollins

this When before you could bigger. September, and in year, was another were the we be last together mentioned there of record end the

the pulling Realty opportunity a you natural maybe and question at is the for the that forward So of Digital on much first of this. is congrats to Maybe with to how team the demand risk is? what respect

of for development today, into that sell ready capacity in how ready And that's but not power the much to market? in the that's pipeline, is the

Andrew Power

And Really it. thanks, appreciate Mike.

this of of to your slipped fourth like. quarter of going quarter those magnitude, were So any change the question, quarter really the density that where looks a obviously, sizable our deals one

was deal ] won't forward. that So I [ say pull

from But at that. the selling same near far time, we are anywhere

Some largest X Manassas capacity X and deliveries in of our our that we most blocks and with the are nearing capacity power identically sized X quarter, the selling literally blocks terms top in during being the and signs being markets of highlighted adjacent the Chicago Ashburn signings.

capacity, Africa to as have Clara Amsterdam, -- can And quickly. Paris in the South of ready your Korea Frankfurt markets U.S., today, Seoul, well not Santa America. as And Those we locations South the all many activate specific it gigawatts in those and similar rapidly. markets, be in approaching specific Dallas, next we of aggregate X those capacity and go that or powered have including comes to those second are question, they available in EMEA, necessarily that not South we deliveries -- are those capacity Shell but north

least, parcel but as additions we and release, made including in capacity we've campus more the -- in I that adjacent also saw very to Richardson some sitting to We've growth some of -- come. last Dallas, our you idle. been megawatts think attractive will XX of approaches not not and So be a

scaling Quite seeing just don't of is take factors. a from pull I here, restrained this to I place think, as demand massive the wouldn't -- forward. So numerous frankly, I call we're overall

Operator

question is Jefferies. Jon next with from The Petersen

Jonathan Petersen

leases, size some the guys. like we're given talking Great. good cases probably technology latest out the wanted use so quarter, there. AI seems Really to I of ask, of GPU these impressive and it about job clearly,

some more changes meet color power design required on are to can of the you maybe give densities? that some So these us

also rental were the cost the of also quarter. -- of But then if higher impressive. kind And looked rates signed is that on leases side the really I'm you some build curious this of it

Andrew Power

later on call the Thanks, massive quarter. team this leadership of Digital team a globally Jon. type efforts from obviously to Realty contribute is the Really to effort

spend. contributions the some of Yes, to build is in percentile movements has the incremental AI. increases in those that the of a well I'll part to relative it, power and call to from CapEx over egg, heritage percentage that requires to and it AI our costs, higher Chris seen rate seen to second, now then size bringing been we've densities what cases and build elements. use But as single-digit rental closer ham and Going the, more the hand trends inflationary and that have Colin you've inflationary of the outpaced

on color can AI we're front. the give doing Chris infrastructure Colin, maybe, then us the chime -- just composition tech from the on in you a little what on and But can

Colin McLean

Sure. real of blocks about these it capacity tranche core Yes, which from cases. supported our overall value comes heritage are larger Thanks, a XX% AI. from is high contribution in Andy. was These The demand our well our across came significant markets. obviously bookings capacity, use in large

so to that. advantage of are take certainly And clients looking

would say can less team spot Colo, I fits program moment really where in than growing part taking HD framework platform that out our in our a which the highlight have of megawatt substantial on probably X Chris it's of and also the a whole. just in sweet you we're rolled a

So Chris?

Chris Sharp

it. question. the been we've This for that I I appreciate And is something many contemplating No, Yes. years. appreciate

this we meet basis. fashion this can cloud the that around understand to bring think anticipated air, the in demand market, coming the So is retrofit a on able has of we've component case-by-case we've to core which in about play, liquid that how cooling we've lot just a liquid and being to densifying, modularity and modularity I efficient is as artificial and an into intelligence seen design, a and center about and always a maximize that on but utilization of working infrastructure data the lot of then come talked to

always so think one that in And market. of I that's elements critical the watched we've the

we're block, but other thing looking you the of the things what are design the through comes the one you I capacity a watching lot I sheer of just think part for. the always sizes, also of is data use center And how the just that. And Andy of the cases also AI walk interconnectivity aligned very think is play. inference into is heard to

recursive types types how models. allow of be it be it those we so of AI And inference, environments, different

coming understanding very solutions And so level. a watching this we've at are and granular to how been advanced what core market, to that's

Colin's us And think how out to it's then within I gets point, fitted understand important center. for to the that data

launched HD able offering called while HD we've So capability to we're interesting do XXX what's a XX back. weeks, with facilities, Colo markets, what XX you we're able Colo in a an about across a XX I takes kilowatts that to in XXX And build metros, think to rack.

X important about it a with context little HXXX what's NVIDIA put And supports is a systems to that that them single on rack.

coming the aligned play to well. latest seeing so coming We're a today of And really to as constantly what's lot is the infrastructure a state from we're -- staying GBXXXs I market. And the of how that think in lot can the NVIDIA that's to the form support factors of we market.

Operator

Bank question from Barden David next is of The America. with

David Barden

questions, that's couple if I okay, great guess quarter. Andy, could. a I of Wow, But a

were the number a got And bookings. was we the crazy normal was kind half, how $XXX scrambles and we we the million of, record talking it half we wake were of So expectations XQ, the now when in average think the quarter. strong new quarter about was a this so in people's in I from first record third And saying, first think, of the about new half. in a quarter well, what's first about in about it record this XQ, far quarter

bell what Just kind that normal the is could set about you now people of we've the new for this? level run

suggests the just record is which what to the quarter, then to, record also XX% the else what record is quarter quarter, heard, I AI And just bookings that? . XX% that speak we could And related AI second driving quarter, was you third question a that which like everything we're think bookings, was was having to? which first

Andrew Power

David. Thanks,

in reverse. tackle to try I'll maybe So

see I very of down have customers, points we're infrastructure, that be road. along of starting have there estimation we way. think AI as to highlight These estimating you today. just the and retrofit data important could it's you infrastructure applications, on the what terms numerous changing from our XX-, in terms can ability we customer our based lease XX-year references, the contracts,

capacity This think it's are nearly in about that our fundamentals XXX X-X enterprise prior major growing, not core I to through and execution important come and blocks. But AI and interconnection. a has lot and years I'm has transformation get what XX% the That's been -- category still for digital on and and on up spending preexisted our scene many fall on cloud we've been hoping in that record before to this big been $XX more came making over a new IT massive the hybrid Gen megawatt be been computing. front. it that certainly, the questions contributor logos the has more demand million is just just large of growing highlight that on

Going back are highlighted we of your normal. X think definition data to points that new A I ago that the quarters important. couple of

more record prices. megawatts was on and First XX% higher based quarter XX%

top is on record we again, more higher that, XX% XX% on volume, just prior record This versus quarter of the said. prices

volume both are price -- levers, the contributing the to growth this these algorithm. So and

don't think our have down regard, question thing. that. one we at no a in there's this so record inventory a question. with Digital [indiscernible] look especially at holidays other able you quarter like When be up to quarter no we for a QX, think put that's takeaways. us. important There's blocks, going I approaching road. this do repeat if runway I X in any to to look it, There's the not We're I like record many in But

sustainable to really piece line commence long-term and signings another Two, the hopefully contracts going from a that bottom line. growth top long-term to turning call it, are are of big into That's late these into of the in composition. down really, and great with the XXXX flows that translating lot XXXX escalations

on fluctuations in signings. After that not lastly, look And necessarily represents, quarter, but today. our a record -- the think record for quarter And backlog the call I at that during record of commencement it, a a backlog keep we're the XX% our try revenue focus backlog. let's to of that necessarily to derisking just in has I lot run quarter, potential backlog revenue come. record years not base next growing maybe our rate and But to

Operator

Atkin RBC question from Capital Next is Jonathan with Markets.

Jonathan Atkin

So just given and the future could CapEx for strong ahead backlog as and goals. just inventory given blocks sheet the if as the that wondering implications levels about leverage all you've delivery talked you about, talk demand balance well

Andrew Power

those Thanks, to walk it to Matt elements. to pass through going Jon. over you I'm

Matt Mercier

Jon. Sure. Thanks,

So look, it narrowed still within of We CapEx terms for today, down. our range. here the We're sitting I we're think in 'XX.

the terms forward, I of guidance think megawatts are suspect 'XX I I fourth lower again, just where will the ahead that in more get quarter, guidance be we're considering we'll towards we the mean, we more under we for 'XX, get for look of don't but start we'll what construction, obviously look to as and specific seeing it give year. as we than the at as

[ the your ultimately, well. done we'll things sitting within think, given already probably we're in and ahead and ] here important We've we're prudently more going we've those to place sheet stay from -- I and all put second to XXX I balance plan, sheet point, I leverage back at the as liquidity a where our leverage able somewhat be with of we But our a of, -- think to funded, we've perspective, got balance view we've targets $X targets. think that today, we've got billion

Operator

Choe The is with next Richard from JPMorgan. question

Richard Choe

these up deals. package large I follow wanted to on

done can of Or kind now. escalation that is X% are out X% all them in done? You've And being many you're that the at there looking that driving deals? for the of deals more is large are X something how done? be that

Andrew Power

Richard. Thanks,

So taking the escalation first.

CPI it's business, returns, were levers contracts. was, some escalations, when the on into some was push time and kind of and for our have, especially now, to ] believe [ a on I CPI larger more of [ looking leader the up escalating for our and all contracts clauses to think ] we rates, whether I moving time contracts, and it's We And now. even up bring been our -- duration that

of helps weighting along Obviously, larger when handful you escalation the have deals, the the higher having way. core certainly

packaged And to deals. this is very episodic. your question prior going Listen, on

I think even you X%, our X% at like is largest cash the we're if about end take the good on mark-to-market. close to news our cash the mark-to-market off high still guidance mark-to-market of on

were to So renewals you well. really referred also X done deal specific that great underlying deals as

and being them. a XX, In needs terms having of around holistic we're you of in which brings their having in with some more, can large to the and role, base, urgency kind XX, XX, help to a this these our solution is customer customer able to around having again to customers table. come a business XX, customers help XX, installed it's product requirements that from times table And seeing today, real a of like see top XX locations packages the them world

any but in I maximize think of given our the tools and them promise to breadth any quarter, speaks using or it our can't in given growth all I again, So year toolkit formula. to relationships

Operator

next The Wells is question Luebchow from Fargo. with Eric

Eric Luebchow

maintaining developed even new So about the you gigawatts the runway of leasing know either I haven't from land But been now, of deals you're that in further? yet. could markets, in Shell existing how you given new are have where about you up land size that markets the thinking potentially just that speed your curious, reach X and extend

little it on on bit Virginia. Northern touched you separately, then a And

time wait as I X-year long here seen that of think parts we've a some as reports power for in footprint.

you some capacity have think -- and Manassas still said in I in and blocks Ashburn. you

an would your delivery within just be on maybe update So helpful. power footprint

Andrew Power

we Greg first have our then speak those second are into went major to on to X to -- lot I we spending signings highlighted a what over the markets Thanks, hand In those Eric. part Northern identical I'll literally and adjacent were largest X take markets, time been he's sizes. in those buildings of year. it capacity and Virginia, of this

our load IT similar both a Dallas XXX-megawatt almost and Manassas. Digital So then in in one

of short on And I certainly in But in the coming X buildings, call to power XXXX, substation push those where not will XXXX. be deliveries, they're we've really it, XXX-ish more X, components that the be it's and end got called brought early XXXX. the thereafter, of on necessarily potentially And order another into series call think, late XXXX. will delivered actually next it with substation closer our can

call you tipping it, starts couple when us Digital we've XXX Dallas, gigawatt that to, rounding call XXX got Dallas X.X all up that in in least add of Virginia. XXX -- and getting leaves another another total not at XXX Manassas, in Digital of at closer it megawatts Northern up and another Dallas away which So megawatts Digital to

I getting getting of keeps deliveries keep precious. their growth runway long So just and near and and as say, more would it by, year more time capacity goes blocks and

other Greg, the our to why supply what the that chain? bit been to of adding on doing we've on little end don't you speak of -- a

Gregory Wright

capacity on to the question, Eric. highlight buildable I Yes. point is the Andy's Thanks, balance Andy. think Eric, sheet. Thanks about for our first thing

gigawatts markets, of So, we X Clearly, have buildable within existing over capacity.

that's think the about going think from, where to you is So of come sizable. context growth new when I pretty

I bring probably to period have time. of very think service can of relatively short we that kind in a that there's few that pipeline,

existing our particularly America, the it's buying really North would APAC. purchasing then throughout primarily look, and guess and Africa, globe, Cape whether the South is, markets. in I major and particularly across the in South in buying summarize land, Africa, and Europe, power So like we're markets, the flat markets America, Town land Johannesburg I

that's looking We changed. but markets, the of our not with best on capital. the selectively our that primary on driver we're that development think said, hasn't at And the strategy that new be risk-adjusted So, will still growth front. return

Operator

The with Raymond James. next question from is Frank Louthan

Frank Louthan

Great.

think markets of capital little you've developments So we And then for that? lot are of about still kind long-term holding and data as on the that? you some talked some looking demand you're these a XX about looking of up funding at at for us up the a Are these visibility you've larger you're to seen for earlier avoiding deployments. bit less thoughts next And should to those and some months? and center you popping of where how clear, how set is

Andrew Power

Thanks, Frank.

a to Greg's to today, maybe at well we're robust bigger doing think And Greg's I now transformation, but IT adding looking -- where operating looking on That those at dovetail continuing we're markets hybrid for our demand. bigger service call that demand, I into demand markets we as hyperscale certainly digital and expanding is where are hubs, and runway growth today. XX hand markets that the call it enterprise as what have X-plus strong The the we or think markets. it, provider, focus and cloud stages that a gigawatts. we AI point, believe but those with major demand. are scale we're -- plan a as in capacity dovetails i.e., a we're we're it, of much connectivity . We in exist call where time enterprise in scale, -- player various operating a has So well smaller to footprint our, is, operating answer. addition at diverse or metropolitan areas some this in presence, and believe

But with and contracts there'll before. XX been looking those sustainable a we're through growth. builds long-term company just a chasing to markets, won't company. believe We've for which data market been cycles relevant, public and don't as are is for reaching term. in our What to we just centers be generate we're the there And some not one-off that I for be of even I'm for think we've suggesting years long demand doing, more now is not and demand opportunities demand stake customers.

to And key diverse and when demand. that having it within comes is element a a robust customer

So do you maintain generate when renewals that your growth. pricing come, and power can sustainable

Operator

question The with from Irvin Evercore next ISI. is Liu

Jyhhaw Liu

on the Congrats strong bookings.

somewhere potential positioned your were -- on And so, closer said growth versus should about that acceleration medium XXXX your algorithm? this is should like safe be be today, thinking your digits. there assume is mid-single also medium-term expectation? growth schedule you I that for based growth where commencement indicated looks if if we upside that for But how And times multiple remarks. it in to to You correctly, growth prepared previously recall

Andrew Power

financial from Thanks, Irvin. the Matt I'll ask algorithm there. the and unpack XXXX to

Matt Mercier

will think the thought Yes. growth Thanks, Irvin. like question for because back XX the I sure feel I before I I come the minutes. first lost

So -- but thanks.

few So call months. a in of over doing, turns I keep in X.X it, that's think, year all a XX the for as spite think mid-single-digit consistent, deleveraging our in the things to think foundation XX mind, last I of of pretty growth look, been setting I I've course terms of 'XX and and that

on We continue profile. improve objective sustainable company's growth focus to to long-term the our

in the that up. we put seen You've results

things a longer, more in year. greater little of faster those for in think is and terms which megawatt I in our million comes financials bit accrue bottom the than Some importantly, sooner. renewal at XXXX. for others. X-X And Obviously, is see takes The million the backlog, of at little the a X bit that a even $XXX $XXX most line of the already our to next than little spreads you

looked you year a step of view. been, It's So, terms in have million that in where if which same would X-year that at a forward more. of kind $XXX ago

further So confident for more said growth, would quarter now. set the again, were derisks solid I out. that but plan accelerating what even we're we XX confident to and only we a the really about that. which say in foundation provides not even before beyond achieve And we this goals that, in

Operator

from is question next Goldman with Sachs. The Schneider Jim

James Schneider

of of little XX% bookings to in or XX% I the any can if you of the any customers the of the in or the of maybe sort the size that, were, talk to customers new a the of fact, -- you concentration XX% quarter. talk the was booking. roughly in meaning mark contributing that many kind those bit of in And of customers customers about maybe wondering whether how substantial Can complexion quarter?

Andrew Power

Thanks, Jim.

-- break Maybe you X to can don't it I of to some can one Colin the why down ask Colin walk categories, highlights. So through try to by one.

Colin McLean

Sure. Yes. Obviously, existing successful a across Yes. board, customers Thanks for growth. the question, impact quarter, lot the Jim. new it. of and customers, both Appreciate

those logos X,XXX This the of new large about commercial within XXX but on logos. in come more booked segment. came were have the We basis, QX. that think the and global commercial predominantly chunk focus the about new of within of A commercial, out good customers segmentation of large large enterprise more number We platform in in customers enterprise. we're putting

$XX all-time which So of million enterprise, we large about had of in an a high. that that is XX% on bookings,

references our growing talking the to with Andy's I cloud So think Again, what transformation, demand diverse that's and segment business. that a across about again, PlatformDIGITAL that's hitting digital AI.

in to So key pipeline. high, aggregate particularly that variety. see Current megawatt QX our characteristics strong we continue the all-time at X-X characteristics pipeline for

a and Maybe we're of proximity matters. to platform that seeing context the as on down what double bit the questions just little X more across

[indiscernible] core we're So top in our networks primary markets, XX our terms in XX-plus percent our of bookings, markets.

and we flexibility So big clients density support see to were our proposition will see about bookings our going to grow. XX% future so strength the XX%, be our clients. continue to to indirect to of value scalability for continue that's continue various a so pipeline, continue focus, frankly, there, our indirect for to And requirements about

adds customers, number planning in up this quarter, customers robust on new up the of and a robust to terms of very logos pretty of business. types So

Operator

Elias The Michael Cowen. next with question is TD from

Michael Elias

exceptional enterprise. run the of you curious in bookings bookings on? segment. from of the was better Digital guys? for the I'm enterprise were great that it it of Realty Or in focus switch enterprise want something you on got whole what terms a backdrop about that Congratulations changed there quarter. I team Was you prior shifted The kind really to is where go-to-market? your actually and rate What

the are what of enterprise them? renewal spread you that, questions. up And the on seeing part congratulations past to as side hike i.e., of price with ability you that to customers, you my we price what Those of just are fatigue? getting And seeing guys. Are some in again, are terms

Andrew Power

Thank you, Michael.

before Before think question, pricing back in Frank this dovetails spreads question, to bit and I a his going back I to what asked maybe and little Colin kind it on of your last bumps. but this I touched turn -- about

value strong long-term have I in it to customers. an mean we seen in That We're and record. value our momentum, sure don't provides. has we've it I the a certainly, making work looking going not that been you've important a for call strategic to And the the company, customers be is provided building quarter. a this milestone is many But proposition it, success grow. category. been to at, This growth definitely, priority incredibly the and -- this record build will this and that on given years

signings megawatt an colon on If you X-X category, in mark-to-markets. LTM the [indiscernible] There flat on the been X.X% basis. look we've cash

up about they're points quarter-over-quarter. XX just think I basis

as see You asking well. can that the rates

go we'll to make think on opportunity have appropriately to side we bring terms value the our I more more in interconnection is of commercialized. -- we the have to sure continuing customers

And this even signing record interconnection in a quarter. that's with

about at again, it or certainly AI, workflow category. global hybrid is of cloud starting side or It value looking of to about all it's helping be their giving points. infrastructure which in more customer. one-stop we're what shop their being It's deployment power densities. about all And no -- pain is So matter the the and their them that levers. enterprise about connect it It's particulate IT, to

deserves Colin turn inflection -- a well. as to I'll but on his quarter the as over him what amount credit tremendous And this of kind well. insights to of it through walk

Colin McLean

Yes. it. Thanks, I appreciate Andy.

X attractive. is is I think the is service this to company make that one enterprises. you providers not is And that This platform more a transformation, make a in multiyear point way the platform-oriented your making. and do servicing you quarter

did of Zurich in in material a couple couple in We a we in That's So this [indiscernible] quarter. attracting enterprises. Europe and announced Amsterdam. X Dallas.

now steam, but that transformation we Andy think digital the is still early full mentioned innings. it's in

enterprises to value in that because So will grow see we our platform continue PlatformDIGITAL. think

a XX% with. across X-X material a that of record customers sign platform were platform-oriented they're That's One That's really key metric but I'll megawatt. sustain good approach our expanding exports you value, leave that geos. a the into other of shows

again, contribution bring for team So this froth. across the to strong board the to

Operator

Mizuho. is with from Georgi The next question Dinkov

Georgi Dinkov

on results. Congrats strong the

second the on in and market like more compared we pipeline now of on to contracts the which just on you quarter. given terms And the high can they provide growth, cap caps are go? how yields higher So development there a also, the land see And just even And renewals? is can look rent XX%, higher? can yields development I color move the the strong is noticed development on what

Andrew Power

Thanks, Georgi.

goes to back again, on based this So that did development the higher. we XX% CapEx sizably demand. And accelerated

of to So north preleased. North you XX% we're see, XX% close preleased. America, could overall, now In

particular, actually, called of signings America, the North trail. I've on Some in in of the our end longer sign-commencing

nearly resigning Shell delivered. the megawatt in Last deal were signed that we the getting ] is [indiscernible]. they XX-ish just capacity [ quarter, So

to So they're years X elongated. to close

sold sell just what given that the we at the the circumstances. blocks we capacity didn't means term and needed nearest So customer facts

development to and life We're returns doing of the yields. deliver as products maintain, infrastructure of a right everything rates where product scaling we and not that seizing our better That's can we're making economies our improve [indiscernible] upon roll if up. scale we of sure and to to and in cycle obviously,

options, base capping In those called today's to. come when tax not real looking discussion, entertaining of and we're the escalations, certainly, estate the all we're market again, contracts to commercials in renewal tops rates, the have, levers

Operator

next is Bank. Deutsche Niknam question from Matt with The

Matthew Niknam

will to it I know was specified that I and upfront. X question, keep

Is mentioned primarily On there traditional . builders it or Or front, model newer the was players? enterprise hyperscalers contribution sovereign AI any I your bookings. of is and there half know AI you from about

Andrew Power

Really thank upon on within overall, the AI we've percentage, color little appreciate you you being quarter in of demand give for how the off, XX% us a seen First pipeline. the follower. enterprise then give it little that. and don't role but Matt, Chris, why also more much call the in some a a

Chris Sharp

appreciate I Matt. question, No, the Yes.

of AI, core across your And happening question. the a at is there's I which lot so think

of So I all And think demand pretty it's segments. just not hyperscalers. to across the that the broad is the understand about pretty important

details. and about providers, leading that Jensen one CEO, kickoff highlight, so right? data DGX but precertified, yesterday, overall us of effort. speak great of that host important the certified, particular the what's have of don't with to we things we to a been one largest I in NVIDIA, just XX-plus -- just customer able one, of any foundation already And supercomputer specific we've a were center the But Wong, DGX history is is and in NVIDIA And

is that it it that was one like the is of that interesting think the that quoted Jensen things intelligence. highlight And of factor pretty I

the that, So AI Realty just that because runs I'd highlight and deployments sustainable showing overall in something relevant like Digital portfolio. facility in in And fundamental is able piece like this private that are on XXX% it to that last our to is renewable in very is way into that, a to coming say foundational just do we're power.

Operator

David The with Street. is from next Green question Guarino

David Guarino

color megawatt greater close rental does new number. any leasing maybe GAAP . markets you than below share On on in Just that that a rates be are XXX-kilowatt But spread even on this between were would the to out Ashburn XXX basis could guessing the in number? rents XXX-kilowatt quarter. pushing X were called suggest your almost or in Americas, helpful. you relative I'm Manassas Chicago, that hyperscale that

Andrew Power

are GAAP rates, Those just reminder. a

the duration got So you the take of to lease.

David, drill, the know bumps. the terms You in and

certainly over. them they've So pushed

repeat to trailing rates time, the it, Ashburn. sure call just trailing see that or markets see not it, coalesce of at these Where other can think going customers, have you're now slightly Santa catching comparables And blocks. in Ashburn, or itself had the the higher Clara in over continue just I think always Ashburn the catch to time. certainly, up, and I the to the do been more in but up Dallas trailed, . rates Chicago, more we'll and over is capacity camp face you or higher, have immediately. XXX I'm I in XXX, going we markets type of multiple higher the go tell over call megawatts here, XXX we X n But you're from this

Operator

The next MoffettNathanson. Del question is Deo with from Nick

Nicholas Del Deo

to going on all I you're can talk a guess, got about you bit of the taking a that time, deliver without obviously that on ensure You've work hiccups? steps budget able you're little to that's development ton to underway grow.

Andrew Power

Thanks, Nick.

and years assembling this didn't business yesterday. now. many markets been get it we touched in for company it's solely consistently And just off, land call operating, We've really we've been on important I our delivering on. that XX many, focused First building very So, it these This customers just has for been the for that and years. income

with green in utility to the communities And the providers.

this that came saw we evolve did. in we scaling supply opportunity chain. certainly to what mind, is feeling was our and As that --

being chains future-proofing have and called vendors and with very sure their we with teams those Our are partners. collaborative our that making great relationships supply

training it and We're one that If our of team, a we bring our actually have X we're investing market, development utility, team lot switch team certainly scaling great economies the can of along We're of in way. another as well some in we and to our in bringing our delivering scale. capacity we're systems customers, those our operationally. gear the for market,

and of We the our to see our both of investment And our public capital. work the bearing organization in on playing the over the business runway for equity intensive of then terms labor growth supplement Massively fantastic last fruits the fruit, to the we this really lastly, great a great use out capital capital-intensive and see of come. years stabilizing of development. year some rates with private the returns interesting partnerships, here and

growth our and to for want generate we to shareholders. we And partners sure have make help stable fund long-term our to that this business customers

Operator

over call now President closing ahead. the for to portion back of Andy and concludes Power, like his call. turn Q&A remarks. please I'd That to CEO, Andy, go the today's

Andrew Power

business, accelerating remarkable the to of is am XXXX Gary. results. the how XQ, and quarter our of our customers in for our beyond. proud this challenge I environment set executed around the how support number guidance Realty We company throughout extremely growth demand in Thank records raise to quarter's a Digital reflecting position the demonstrating and team strong you, deliver meeting a Realty Digital and posted world.

outlook the about position We demand are excited market. the our for and center data in

remain digital seizing for on thank Realty, exceptional opportunity Thank our you. and at hand. the who But joining to on at us focused thank turning. most importantly, the to Digital keep everyone like we world today. I'd like dedicated I'd team

Operator

for you Thank The today's concluded. presentation. attending now conference has

now You disconnect. may

Digital Realty Trust (DLR) 24 Oct 242024 Q3 Earnings call transcript