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Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Results displayed steady growth in colocation and inter-connection revenues on the back of strong demand for digital infrastructure. During the quarter, Equinix’s total interconnections reached 478,000, rising 4% year over year. The company also revised its outlook for 2024.
Total quarterly revenues were $2.2 billion, in line with the Zacks Consensus Estimate. The top line increased 6.8% year over year.
Quarter in Detail
Recurring revenues were $2.06 billion, up 5% from the year-ago quarter. Our projection for the metric was $2.08 billion. Non-recurring revenues rose 42% to $142 million. We estimated the metric to be $124 million.
Revenues from the Americas, EMEA and the Asia Pacific rose 4.9%, 4.8% and 13.9% to $958 million, $743 million and $500 million, year over year, respectively.
The adjusted EBITDA came in at $1.05 billion, up 12% year over year. We projected the metric at $1.04 billion. Adjusted EBITDA margin was reported at 48%.
AFFO rose 12.2% to $866 million from the year-ago period.
EQIX spent $69 million on recurring capital expenditure in the third quarter, up 35.3% on a year-over-year basis. Recurring capital expenditure was 3.1% of revenues in the reported quarter. Non-recurring capital expenditure was $655 million, up 15.7% year over year.
Balance Sheet
Equinix had $7.2 billion of available liquidity as of Sept. 30, 2024. This comprised cash, cash equivalents, short-term investments and its undrawn revolver. It excludes restricted cash.
Its net leverage ratio was 3.5, and the weighted average maturity was seven years as of Sept. 30, 2024.
EQIX’s Dividend Update
Concurrently, Equinix’s board of directors announced a quarterly cash dividend of $4.26 per share. The dividend will be paid out on Dec. 11 to shareholders on record as of Nov. 13, 2024.
2024 Revised EQIX Guidance
For the fourth quarter of 2024, Equinix projects revenues between $2.262 billion and $2.302 billion, implying a 3.5% increase over the prior quarter. The adjusted EBITDA is expected to be in the range of $1.010-$1.050 billion.
For the current year, AFFO per share is estimated between $34.81 and $35.22, revised upward from the prior-guided range of $34.67-$35.30. This suggests an 8-10% increase from the previous year. The Zacks Consensus Estimate for the same is currently pegged at $35.10.
For 2024, Equinix now estimates generating total revenues of $8.748-$8.788 billion, indicating year-over-year growth of 7%. Earlier, the company had guided total revenues of $8.692-$8.772 billion.
Management predicts an adjusted EBITDA of $4.086-$4.126 billion, revised from $4.066-$4.126 billion projected earlier. Expectations for adjusted EBITDA margin were maintained at 47%.
Digital Realty Trust (DLR - Free Report) reported third-quarter 2024 core funds from operations (FFO) per share of $1.67, in line with the Zacks Consensus Estimate. This compares favorably to an FFO of $1.62 per share reported a year ago.
Results reflect healthy leasing activity and an increase in rental rates. However, the company witnessed a rise in rental property expenses and interest expenses in the quarter. DLR revised its outlook for 2024.
SBA Communications Corporation (SBAC - Free Report) reported third-quarter 2024 AFFO) per share of $3.32, which met the Zacks Consensus Estimate. However, the figure fell short of the prior-year quarter’s $3.34.
Results reflect a marginal improvement in domestic cash site-leasing revenues due to increasing carrier activity. However, lower revenues clocked by site development hurt the results to some extent. SBAC raised its 2024 outlook.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.
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Equinix's Q3 AFFO Beat on Solid Demand, Revenues Rise Y/Y
Equinix Inc.’s (EQIX - Free Report) third-quarter 2024 adjusted funds from operations (AFFO) per share of $9.05 surpassed the Zacks Consensus Estimate of $8.70. The figure improved 10.5% from the prior-year quarter.
Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.
Results displayed steady growth in colocation and inter-connection revenues on the back of strong demand for digital infrastructure. During the quarter, Equinix’s total interconnections reached 478,000, rising 4% year over year. The company also revised its outlook for 2024.
Total quarterly revenues were $2.2 billion, in line with the Zacks Consensus Estimate. The top line increased 6.8% year over year.
Quarter in Detail
Recurring revenues were $2.06 billion, up 5% from the year-ago quarter. Our projection for the metric was $2.08 billion. Non-recurring revenues rose 42% to $142 million. We estimated the metric to be $124 million.
Revenues from the Americas, EMEA and the Asia Pacific rose 4.9%, 4.8% and 13.9% to $958 million, $743 million and $500 million, year over year, respectively.
The adjusted EBITDA came in at $1.05 billion, up 12% year over year. We projected the metric at $1.04 billion. Adjusted EBITDA margin was reported at 48%.
AFFO rose 12.2% to $866 million from the year-ago period.
EQIX spent $69 million on recurring capital expenditure in the third quarter, up 35.3% on a year-over-year basis. Recurring capital expenditure was 3.1% of revenues in the reported quarter. Non-recurring capital expenditure was $655 million, up 15.7% year over year.
Balance Sheet
Equinix had $7.2 billion of available liquidity as of Sept. 30, 2024. This comprised cash, cash equivalents, short-term investments and its undrawn revolver. It excludes restricted cash.
Its net leverage ratio was 3.5, and the weighted average maturity was seven years as of Sept. 30, 2024.
EQIX’s Dividend Update
Concurrently, Equinix’s board of directors announced a quarterly cash dividend of $4.26 per share. The dividend will be paid out on Dec. 11 to shareholders on record as of Nov. 13, 2024.
2024 Revised EQIX Guidance
For the fourth quarter of 2024, Equinix projects revenues between $2.262 billion and $2.302 billion, implying a 3.5% increase over the prior quarter. The adjusted EBITDA is expected to be in the range of $1.010-$1.050 billion.
For the current year, AFFO per share is estimated between $34.81 and $35.22, revised upward from the prior-guided range of $34.67-$35.30. This suggests an 8-10% increase from the previous year. The Zacks Consensus Estimate for the same is currently pegged at $35.10.
For 2024, Equinix now estimates generating total revenues of $8.748-$8.788 billion, indicating year-over-year growth of 7%. Earlier, the company had guided total revenues of $8.692-$8.772 billion.
Management predicts an adjusted EBITDA of $4.086-$4.126 billion, revised from $4.066-$4.126 billion projected earlier. Expectations for adjusted EBITDA margin were maintained at 47%.
Equinix carries a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Equinix, Inc. Price, Consensus and EPS Surprise
Equinix, Inc. price-consensus-eps-surprise-chart | Equinix, Inc. Quote
Performance of Other REITs
Digital Realty Trust (DLR - Free Report) reported third-quarter 2024 core funds from operations (FFO) per share of $1.67, in line with the Zacks Consensus Estimate. This compares favorably to an FFO of $1.62 per share reported a year ago.
Results reflect healthy leasing activity and an increase in rental rates. However, the company witnessed a rise in rental property expenses and interest expenses in the quarter. DLR revised its outlook for 2024.
SBA Communications Corporation (SBAC - Free Report) reported third-quarter 2024 AFFO) per share of $3.32, which met the Zacks Consensus Estimate. However, the figure fell short of the prior-year quarter’s $3.34.
Results reflect a marginal improvement in domestic cash site-leasing revenues due to increasing carrier activity. However, lower revenues clocked by site development hurt the results to some extent. SBAC raised its 2024 outlook.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.