- Quarterly revenues increased 6% over the same quarter last year to
$1.470 billion , or 8% on a normalized and constant currency basis, representing the 70th consecutive quarter of revenue growth - Delivered one of the strongest quarters of interconnection growth and activity in the company's history
- Customer deployments across multiple metros comprised 88% of total recurring revenues, demonstrating the value of the
Equinix global platform
Second Quarter 2020 Results Summary
- Revenues
$1.470 billion , a 2% increase over the previous quarter- Includes a
$3 million foreign currency benefit when compared to prior guidance rates - Operating Income
$282 million , an 11% increase over the previous quarter and an operating margin of 19%- Adjusted EBITDA
$720 million , a 49% adjusted EBITDA margin- Includes a
$1 million foreign currency benefit when compared to prior guidance rates - Includes
$2 million of integration costs - Net Income and Net Income per Share attributable to
Equinix $133 million , a 12% increase over the previous quarter$1.52 per share, a 10% increase over the previous quarter- AFFO and AFFO per Share
$558 million , a 4% increase over the previous quarter$6.35 per share, a 2% increase over the previous quarter- Includes
$2 million of integration costs
2020 Annual Guidance Summary
- Revenues
$5.919 -$5.989 billion , a 6 - 8% increase over the previous year, or a normalized and constant currency increase of 8 - 9%- An increase of
$23 million due to a foreign currency benefit when compared to the prior guidance FX rates - Adjusted EBITDA
$2.781 -$2.851 billion , a 47% adjusted EBITDA margin- An increase of
$11 million due to a foreign currency benefit when compared to the prior guidance FX rates - Assumes
$20 million of integration costs - AFFO and AFFO per Share
$2.107 -$2.177 billion , an increase of 9 - 13% over the previous year, or a normalized and constant currency increase of 14 - 18%; an increase of$54 million compared to prior guidance, including an$11 million foreign currency benefit$23.87 -$24.67 per share, an increase of 5 - 8% over the previous year, or a normalized and constant currency increase of 8 - 12%; reaffirms prior full-year AFFO per share guidance while fully absorbing the dilution impact from the$1.7 billion public offering of common stock- Assumes
$20 million of integration costs
Equinix Quote
"Even in the face of an uncertain macro environment created by the global pandemic, the
Business Highlights
Equinix continued to invest in building out its global platform in response to strong customer demand and a high level of inventory utilization:- On
May 29 ,Equinix entered into an agreement to purchase a portfolio of 13 data center sites, representing 25 data centers, acrossCanada from BCE Inc. ("Bell") for approximately$750 million . The addition of these strategic assets, their associated operations and the more than 600 customers operating within the data centers will further strengthenEquinix's global platform. The acquisition will expandEquinix's coverage inCanada coast to coast, making it a market leader in data center and interconnection services. In addition to adding new capacity inToronto, Ontario , whereEquinix currently operates two International Business Exchange™ (IBX®) data centers, it will extendEquinix's interconnection services to seven new metros. Equinix continues its investment in organic growth and expansion activities with 29 major expansion projects underway in 20 markets across 14 countries.- Additionally,
Equinix completed seven new openings or phased expansions in Q2 inAmsterdam ,Chicago ,Dallas ,Hamburg ,Hong Kong ,Toronto andWashington, D.C. - In Q2,
Equinix opened the 5G and Edge Proof of Concept Center (POCC) at its Dallas Infomart campus, which provides a 5G and edge "sandbox" environment, enabling Mobile Network Operators (MNOs), cloud platforms, technology vendors and enterprises to directly connect with the largest edge data center platform in order to test, demonstrate and accelerate complex 5G and edge deployment and interoperability scenarios. The POCC will support the growing demand for companies to accelerate their evolution from traditional to digital businesses. Equinix continues to strengthen its leadership position in the cloud ecosystem through the company's hyperscale strategy, expanding its footprint to service both retail and large footprint hyperscale requirements in key markets, while leveraging its joint venture relationship with GIC.Equinix is seeing strong customer demand in its initial European xScale JV™ with GIC, and is expected to expand this JV with its PA9x asset, which is expected to open early next year and is already 100% pre-leased to a major hyperscaler.Equinix is also targeting to close its new xScale JV inJapan with GIC in Q4, adding hyperscale assets in bothOsaka andTokyo .- Interconnection revenues in Q2 grew 14% year-over-year, or 16% on a normalized and constant currency basis, steadily rising over the last few quarters, reflecting the demand across the
Equinix portfolio for interconnection products. Today,Equinix has the most comprehensive global interconnection platform, comprising over 378,000 physical and virtual interconnections. In Q2,Equinix added an incremental 8,000 interconnections, fueled by streaming, video conferencing, enterprise cloud connectivity and work-from-home local aggregation. Equinix had strong bookings across all three regions (Americas , EMEA andAsia-Pacific ) in Q2, with record bookings in theAmericas . The network vertical also achieved record bookings, driven by robust network reseller activity and network expansions to support traffic growth. The financial services vertical captured its second-highest bookings, with strength in global financial and insurance firms as they embrace digital transformation.Equinix's financial strength remains a significant and strategic advantage. In May,Equinix raised approximately$1.7 billion in common stock to support the continued organic and inorganic growth of the business and received its third investment grade rating when Moody's upgradedEquinix's corporate debt rating to Baa3 from Ba1. In June,Equinix leveraged the company's investment-grade ratings by refinancing$2.6 billion of high-yield debt at a blended interest rate of 2.07%. The interest savings from the refinancing effectively offset the dilution associated with equity raise.
COVID-19 Update
Many of the Company's IBX data centers have been identified as "essential businesses" or "critical infrastructure" by local governments for purposes of remaining open during the COVID-19 pandemic, and all IBX data centers remain operational at the time of filing of this press release. Precautionary measures have been implemented to minimize the risk of operational impact and to protect the health and safety of employees, customers, partners and communities. These include implementing tools such as an appointment-based system to control timing and frequency of visits, while also encouraging customers to leverage IBX technicians via Smart Hands® in order to restrict visits and minimize the number of people and the amount of time spent in the Company's IBX facilities. For the health and safety of
Looking ahead, the full impact of the COVID-19 pandemic on the Company's financial condition or results of operations remains uncertain and will depend on a number of factors, including its impact on
Business Outlook
For the third quarter of 2020, the Company expects revenues to range between
For the full year of 2020, total revenues are expected to range between
The
The adjusted EBITDA guidance is based on the revenue guidance less our expectations of cash cost of revenues and cash operating expenses. The AFFO guidance is based on the adjusted EBITDA guidance less our expectations of net interest expense, an installation revenue adjustment, a straight-line rent expense adjustment, a contract cost adjustment, amortization of deferred financing costs and debt discounts and premiums, income tax expense, an income tax expense adjustment, recurring capital expenditures, other income (expense), (gains) losses on disposition of real estate property and adjustments for unconsolidated joint ventures' and non-controlling interests' share of these items.
Q2 2020 Results Conference Call and Replay Information
A replay of the call will be available one hour after the call through
Investor Presentation and Supplemental Financial Information
Additional Resources
About
Non-GAAP Financial Measures
In presenting non-GAAP financial measures, such as adjusted EBITDA, cash cost of revenues, cash gross margins, cash operating expenses (also known as cash selling, general and administrative expenses or cash SG&A), adjusted EBITDA margins, free cash flow and adjusted free cash flow,
In addition, in presenting the non-GAAP financial measures,
Non-GAAP financial measures are not a substitute for financial information prepared in accordance with GAAP. Non-GAAP financial measures should not be considered in isolation, but should be considered together with the most directly comparable GAAP financial measures and the reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures.
Investors should note that the non-GAAP financial measures used by
Forward-Looking Statements
This press release contains forward-looking statements that involve risks and uncertainties. Actual results may differ materially from expectations discussed in such forward-looking statements. Factors that might cause such differences include, but are not limited to, risks to our business and operating results related to the COVID-19 pandemic; the challenges of acquiring, operating and constructing IBX data centers and developing, deploying and delivering
|
|||||||||||||||||||
Three Months Ended |
Six Months Ended |
||||||||||||||||||
|
|
|
|
|
|||||||||||||||
Recurring revenues |
$ |
1,398,138 |
$ |
1,361,694 |
$ |
1,306,045 |
$ |
2,759,832 |
$ |
2,580,873 |
|||||||||
Non-recurring revenues |
71,983 |
82,848 |
78,932 |
154,831 |
167,322 |
||||||||||||||
Revenues |
1,470,121 |
1,444,542 |
1,384,977 |
2,914,663 |
2,748,195 |
||||||||||||||
Cost of revenues |
739,344 |
736,282 |
698,179 |
1,475,626 |
1,380,209 |
||||||||||||||
Gross profit |
730,777 |
708,260 |
686,798 |
1,439,037 |
1,367,986 |
||||||||||||||
Operating expenses: |
|||||||||||||||||||
Sales and marketing |
178,124 |
180,450 |
159,201 |
358,574 |
328,916 |
||||||||||||||
General and administrative |
256,890 |
261,597 |
232,656 |
518,487 |
447,702 |
||||||||||||||
Transaction costs |
13,617 |
11,530 |
2,774 |
25,147 |
5,245 |
||||||||||||||
Impairment charges |
— |
— |
386 |
— |
14,834 |
||||||||||||||
(Gain) loss on asset sales |
(342) |
1,199 |
— |
857 |
— |
||||||||||||||
Total operating expenses |
448,289 |
454,776 |
395,017 |
903,065 |
796,697 |
||||||||||||||
Income from operations |
282,488 |
253,484 |
291,781 |
535,972 |
571,289 |
||||||||||||||
Interest and other income (expense): |
|||||||||||||||||||
Interest income |
1,685 |
4,273 |
7,762 |
5,958 |
11,964 |
||||||||||||||
Interest expense |
(108,480) |
(107,338) |
(120,547) |
(215,818) |
(243,393) |
||||||||||||||
Other income |
4,278 |
5,170 |
12,180 |
9,448 |
12,014 |
||||||||||||||
Loss on debt extinguishment |
(1,868) |
(6,441) |
— |
(8,309) |
(382) |
||||||||||||||
Total interest and other, net |
(104,385) |
(104,336) |
(100,605) |
(208,721) |
(219,797) |
||||||||||||||
Income before income taxes |
178,103 |
149,148 |
191,176 |
327,251 |
351,492 |
||||||||||||||
Income tax expense |
(44,753) |
(30,191) |
(47,324) |
(74,944) |
(89,893) |
||||||||||||||
Net income |
133,350 |
118,957 |
143,852 |
252,307 |
261,599 |
||||||||||||||
Net (income) loss attributable to non-controlling interests |
(46) |
(165) |
(325) |
(211) |
6 |
||||||||||||||
Net income attributable to |
$ |
133,304 |
$ |
118,792 |
$ |
143,527 |
$ |
252,096 |
$ |
261,605 |
|||||||||
Net income per share attributable to |
|||||||||||||||||||
Basic net income per share |
$ |
1.53 |
$ |
1.39 |
$ |
1.70 |
$ |
2.92 |
$ |
3.15 |
|||||||||
Diluted net income per share |
$ |
1.52 |
$ |
1.38 |
$ |
1.69 |
$ |
2.90 |
$ |
3.13 |
|||||||||
Shares used in computing basic net income per share |
87,303 |
85,551 |
84,399 |
86,427 |
83,114 |
||||||||||||||
Shares used in computing diluted net income per share |
87,901 |
86,144 |
84,767 |
87,065 |
83,471 |
|
|||||||||||||||||||
Three Months Ended |
Six Months Ended |
||||||||||||||||||
|
|
|
|
|
|||||||||||||||
Net income |
$ |
133,350 |
$ |
118,957 |
$ |
143,852 |
$ |
252,307 |
$ |
261,599 |
|||||||||
Other comprehensive loss, net of tax: |
|||||||||||||||||||
Foreign currency translation adjustment ("CTA") gain (loss) |
181,286 |
(413,792) |
25,127 |
(232,506) |
(56,592) |
||||||||||||||
Net investment hedge CTA gain (loss) |
(97,058) |
144,946 |
(37,857) |
47,888 |
38,993 |
||||||||||||||
Unrealized gain (loss) on cash flow hedges |
(17,868) |
(3,256) |
(3,355) |
(21,124) |
4,869 |
||||||||||||||
Net actuarial gain (loss) on defined benefit plans |
20 |
35 |
(7) |
55 |
(18) |
||||||||||||||
Total other comprehensive income (loss), net of tax |
66,380 |
(272,067) |
(16,092) |
(205,687) |
(12,748) |
||||||||||||||
Comprehensive income (loss), net of tax |
199,730 |
(153,110) |
127,760 |
46,620 |
248,851 |
||||||||||||||
Net (income) loss attributable to non-controlling interests |
(46) |
(165) |
(325) |
(211) |
6 |
||||||||||||||
Other comprehensive (income) loss attributable to non-controlling interests |
(2) |
11 |
14 |
9 |
7 |
||||||||||||||
Comprehensive income (loss) attributable to |
$ |
199,682 |
$ |
(153,264) |
$ |
127,449 |
$ |
46,418 |
$ |
248,864 |
|
|||||||
|
|
||||||
Assets |
|||||||
Cash and cash equivalents |
$ |
4,785,050 |
$ |
1,869,577 |
|||
Short-term investments |
22,069 |
10,362 |
|||||
Accounts receivable, net |
691,589 |
689,134 |
|||||
Other current assets |
330,521 |
302,880 |
|||||
Assets held for sale |
152,188 |
663 |
|||||
Total current assets |
5,981,417 |
2,872,616 |
|||||
Property, plant and equipment, net |
12,663,827 |
12,152,597 |
|||||
Operating lease right-of-use assets |
1,396,101 |
1,475,367 |
|||||
|
5,016,350 |
4,781,858 |
|||||
Intangible assets, net |
2,074,689 |
2,102,389 |
|||||
Other assets |
660,246 |
580,788 |
|||||
Total assets |
$ |
27,792,630 |
$ |
23,965,615 |
|||
Liabilities and Stockholders' Equity |
|||||||
Accounts payable and accrued expenses |
$ |
745,517 |
$ |
760,718 |
|||
Accrued property, plant and equipment |
335,013 |
301,535 |
|||||
Current portion of operating lease liabilities |
139,833 |
145,606 |
|||||
Current portion of finance lease liabilities |
102,416 |
75,239 |
|||||
Current portion of mortgage and loans payable |
75,589 |
77,603 |
|||||
Current portion of senior notes |
2,227,768 |
643,224 |
|||||
Other current liabilities |
229,635 |
153,938 |
|||||
Total current liabilities |
3,855,771 |
2,157,863 |
|||||
Operating lease liabilities, less current portion |
1,243,362 |
1,315,656 |
|||||
Finance lease liabilities, less current portion |
1,658,432 |
1,430,882 |
|||||
Mortgage and loans payable, less current portion |
1,218,049 |
1,289,434 |
|||||
Senior notes, less current portion |
8,804,633 |
8,309,673 |
|||||
Other liabilities |
624,125 |
621,725 |
|||||
Total liabilities |
17,404,372 |
15,125,233 |
|||||
Common stock |
89 |
86 |
|||||
Additional paid-in capital |
14,651,944 |
12,696,433 |
|||||
|
(127,042) |
(144,256) |
|||||
Accumulated dividends |
(4,639,041) |
(4,168,469) |
|||||
Accumulated other comprehensive loss |
(1,140,291) |
(934,613) |
|||||
Retained earnings |
1,642,621 |
1,391,425 |
|||||
Total Equinix stockholders' equity |
10,388,280 |
8,840,606 |
|||||
Non-controlling interests |
(22) |
(224) |
|||||
Total stockholders' equity |
10,388,258 |
8,840,382 |
|||||
Total liabilities and stockholders' equity |
$ |
27,792,630 |
$ |
23,965,615 |
|||
Ending headcount by geographic region is as follows: |
|||||||
|
4,103 |
3,672 |
|||||
EMEA headcount |
3,172 |
2,941 |
|||||
|
1,906 |
1,765 |
|||||
Total headcount |
9,181 |
8,378 |
|
|||||||
|
|
||||||
Finance lease liabilities |
$ |
1,760,848 |
$ |
1,506,121 |
|||
Term loans |
1,214,332 |
1,282,302 |
|||||
Mortgage payable and other loans payable |
79,306 |
84,735 |
|||||
Plus: debt discount and issuance costs, net |
2,195 |
3,081 |
|||||
Total mortgage and loans payable principal |
1,295,833 |
1,370,118 |
|||||
Senior notes |
11,032,401 |
8,952,897 |
|||||
Plus: debt issuance costs |
108,519 |
78,030 |
|||||
Less: debt premium |
(745) |
(1,716) |
|||||
Total senior notes principal |
11,140,175 |
9,029,211 |
|||||
Total debt principal outstanding |
$ |
14,196,856 |
$ |
11,905,450 |
|
||||||||||||||||||||
Three Months Ended |
Six Months Ended |
|||||||||||||||||||
|
|
|
|
|
||||||||||||||||
Cash flows from operating activities: |
||||||||||||||||||||
Net income |
$ |
133,350 |
$ |
118,957 |
$ |
143,852 |
$ |
252,307 |
$ |
261,599 |
||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||||||||||||||
Depreciation, amortization and accretion |
348,434 |
337,431 |
320,550 |
685,865 |
635,255 |
|||||||||||||||
Stock-based compensation |
75,844 |
64,499 |
61,519 |
140,343 |
110,542 |
|||||||||||||||
Amortization of debt issuance costs and debt discounts and premiums |
4,444 |
3,460 |
3,238 |
7,904 |
6,233 |
|||||||||||||||
Loss on debt extinguishment |
1,868 |
6,441 |
— |
8,309 |
382 |
|||||||||||||||
(Gain) loss on asset sales |
(342) |
1,199 |
— |
857 |
— |
|||||||||||||||
Impairment charges |
— |
— |
386 |
— |
14,834 |
|||||||||||||||
Other items |
13,891 |
6,856 |
4,745 |
20,747 |
12,969 |
|||||||||||||||
Changes in operating assets and liabilities: |
||||||||||||||||||||
Accounts receivable |
(29,539) |
15,306 |
(42,370) |
(14,233) |
(126,720) |
|||||||||||||||
Income taxes, net |
8,164 |
3,697 |
14,837 |
11,861 |
30,662 |
|||||||||||||||
Accounts payable and accrued expenses |
117 |
(25,681) |
7,476 |
(25,564) |
(3,987) |
|||||||||||||||
Operating lease right-of-use assets |
37,495 |
38,797 |
37,219 |
76,292 |
78,483 |
|||||||||||||||
Operating lease liabilities |
(36,898) |
(35,193) |
(34,919) |
(72,091) |
(73,805) |
|||||||||||||||
Other assets and liabilities |
17,858 |
(18,939) |
26,390 |
(1,081) |
17,617 |
|||||||||||||||
Net cash provided by operating activities |
574,686 |
516,830 |
542,923 |
1,091,516 |
964,064 |
|||||||||||||||
Cash flows from investing activities: |
||||||||||||||||||||
Purchases, sales and maturities of investments, net |
(1,341) |
(38,940) |
(3,063) |
(40,281) |
(11,842) |
|||||||||||||||
Business acquisitions, net of cash and restricted cash acquired |
39 |
(478,287) |
(34,143) |
(478,248) |
(34,143) |
|||||||||||||||
Purchases of real estate |
(46,194) |
(36,373) |
(41,715) |
(82,567) |
(47,436) |
|||||||||||||||
Purchases of other property, plant and equipment |
(481,948) |
(400,941) |
(444,171) |
(882,889) |
(808,138) |
|||||||||||||||
Proceeds from asset sales |
— |
— |
— |
— |
— |
|||||||||||||||
Net cash used in investing activities |
(529,444) |
(954,541) |
(523,092) |
(1,483,985) |
(901,559) |
|||||||||||||||
Cash flows from financing activities: |
||||||||||||||||||||
Proceeds from employee equity awards |
— |
30,391 |
— |
30,391 |
27,593 |
|||||||||||||||
Payment of dividend distributions |
(236,008) |
(233,479) |
(208,449) |
(469,487) |
(413,052) |
|||||||||||||||
Proceeds from public offering of common stock, net of offering costs |
1,683,106 |
101,792 |
348,121 |
1,784,898 |
1,561,555 |
|||||||||||||||
Proceeds from mortgage and loans payable |
500,790 |
250,000 |
— |
750,790 |
— |
|||||||||||||||
Proceeds from senior notes, net of debt discounts |
2,585,736 |
— |
— |
2,585,736 |
— |
|||||||||||||||
Repayment of finance lease liabilities |
(23,704) |
(18,977) |
(11,954) |
(42,681) |
(43,112) |
|||||||||||||||
Repayment of mortgage and loans payable |
(770,677) |
(18,501) |
(17,878) |
(789,178) |
(36,212) |
|||||||||||||||
Repayment of senior notes |
(150,000) |
(343,711) |
(150,000) |
(493,711) |
(150,000) |
|||||||||||||||
Debt extinguishment costs |
— |
(4,619) |
— |
(4,619) |
— |
|||||||||||||||
Debt issuance costs |
(26,266) |
— |
— |
(26,266) |
— |
|||||||||||||||
Net cash provided by (used in) financing activities |
3,562,977 |
(237,104) |
(40,160) |
3,325,873 |
946,772 |
|||||||||||||||
Effect of foreign currency exchange rates on cash, cash equivalents and restricted cash |
12,411 |
(25,287) |
2,106 |
(12,876) |
411 |
|||||||||||||||
Net increase (decrease) in cash, cash equivalents and restricted cash |
3,620,630 |
(700,102) |
(18,223) |
2,920,528 |
1,009,688 |
|||||||||||||||
Cash, cash equivalents and restricted cash at beginning of period |
1,186,511 |
1,886,613 |
1,655,515 |
1,886,613 |
627,604 |
|||||||||||||||
Cash, cash equivalents and restricted cash at end of period |
$ |
4,807,141 |
$ |
1,186,511 |
$ |
1,637,292 |
$ |
4,807,141 |
$ |
1,637,292 |
||||||||||
Supplemental cash flow information: |
||||||||||||||||||||
Cash paid for taxes |
$ |
15,752 |
$ |
45,324 |
$ |
32,669 |
$ |
61,076 |
$ |
59,693 |
||||||||||
Cash paid for interest |
$ |
122,669 |
$ |
125,924 |
$ |
113,266 |
$ |
248,593 |
$ |
259,410 |
||||||||||
Free cash flow (negative free cash flow)(1) |
$ |
46,583 |
$ |
(398,771) |
$ |
22,894 |
$ |
(352,188) |
$ |
74,347 |
||||||||||
Adjusted free cash flow (2) |
$ |
92,738 |
$ |
115,889 |
$ |
98,752 |
$ |
208,627 |
$ |
155,926 |
||||||||||
(1) |
We define free cash flow (negative free cash flow) as net cash provided by operating activities plus net cash provided by (used in) investing activities (excluding the net purchases, sales and maturities of investments) as presented below: |
|||||||||||||||||||
Net cash provided by operating activities as presented above |
$ |
574,686 |
$ |
516,830 |
$ |
542,923 |
$ |
1,091,516 |
$ |
964,064 |
||||||||||
Net cash used in investing activities as presented above |
(529,444) |
(954,541) |
(523,092) |
(1,483,985) |
(901,559) |
|||||||||||||||
Purchases, sales and maturities of investments, net |
1,341 |
38,940 |
3,063 |
40,281 |
11,842 |
|||||||||||||||
Free cash flow (negative free cash flow) |
$ |
46,583 |
$ |
(398,771) |
$ |
22,894 |
$ |
(352,188) |
$ |
74,347 |
||||||||||
(2) |
We define adjusted free cash flow as free cash flow (negative free cash flow) as defined above, excluding any purchases of real estate and business acquisitions, net of cash and restricted cash acquired as presented below: |
|||||||||||||||||||
Free cash flow (negative free cash flow) as defined above |
$ |
46,583 |
$ |
(398,771) |
$ |
22,894 |
$ |
(352,188) |
$ |
74,347 |
||||||||||
Less business acquisitions, net of cash and restricted cash acquired |
(39) |
478,287 |
34,143 |
478,248 |
34,143 |
|||||||||||||||
Less purchases of real estate |
46,194 |
36,373 |
41,715 |
82,567 |
47,436 |
|||||||||||||||
Adjusted free cash flow |
$ |
92,738 |
$ |
115,889 |
$ |
98,752 |
$ |
208,627 |
$ |
155,926 |
|
||||||||||||||||||||
Three Months Ended |
Six Months Ended |
|||||||||||||||||||
|
|
|
|
|
||||||||||||||||
Recurring revenues |
$ |
1,398,138 |
$ |
1,361,694 |
$ |
1,306,045 |
$ |
2,759,832 |
$ |
2,580,873 |
||||||||||
Non-recurring revenues |
71,983 |
82,848 |
78,932 |
154,831 |
167,322 |
|||||||||||||||
Revenues (1) |
1,470,121 |
1,444,542 |
1,384,977 |
2,914,663 |
2,748,195 |
|||||||||||||||
Cash cost of revenues (2) |
480,946 |
476,541 |
460,983 |
957,487 |
909,364 |
|||||||||||||||
Cash gross profit (3) |
989,175 |
968,001 |
923,994 |
1,957,176 |
1,838,831 |
|||||||||||||||
Cash operating expenses (4)(7): |
||||||||||||||||||||
Cash sales and marketing expenses (5) |
111,007 |
115,671 |
95,114 |
226,678 |
203,330 |
|||||||||||||||
Cash general and administrative expenses (6) |
158,127 |
168,120 |
151,870 |
326,247 |
298,336 |
|||||||||||||||
Total cash operating expenses (4)(7) |
269,134 |
283,791 |
246,984 |
552,925 |
501,666 |
|||||||||||||||
Adjusted EBITDA (8) |
$ |
720,041 |
$ |
684,210 |
$ |
677,010 |
$ |
1,404,251 |
$ |
1,337,165 |
||||||||||
Cash gross margins (9) |
67 |
% |
67 |
% |
67 |
% |
67 |
% |
67 |
% |
||||||||||
Adjusted EBITDA margins(10) |
49 |
% |
47 |
% |
49 |
% |
48 |
% |
49 |
% |
||||||||||
Adjusted EBITDA flow-through rate (11) |
140 |
% |
30 |
% |
77 |
% |
53 |
% |
70 |
% |
||||||||||
FFO (12) |
$ |
356,946 |
$ |
343,754 |
$ |
352,973 |
$ |
700,700 |
$ |
679,046 |
||||||||||
AFFO (13)(14) |
$ |
557,793 |
$ |
534,705 |
$ |
497,647 |
$ |
1,092,498 |
$ |
985,767 |
||||||||||
Basic FFO per share (15) |
$ |
4.09 |
$ |
4.02 |
$ |
4.18 |
$ |
8.11 |
$ |
8.17 |
||||||||||
Diluted FFO per share (15) |
$ |
4.06 |
$ |
3.99 |
$ |
4.16 |
$ |
8.05 |
$ |
8.14 |
||||||||||
Basic AFFO per share (15) |
$ |
6.39 |
$ |
6.25 |
$ |
5.90 |
$ |
12.64 |
$ |
11.86 |
||||||||||
Diluted AFFO per share (15) |
$ |
6.35 |
$ |
6.21 |
$ |
5.87 |
$ |
12.55 |
$ |
11.81 |
||||||||||
(1) |
The geographic split of our revenues on a services basis is presented below: |
|||||||||||||||||||
Americas Revenues: |
||||||||||||||||||||
Colocation |
$ |
447,498 |
$ |
450,954 |
$ |
444,086 |
$ |
898,452 |
$ |
884,067 |
||||||||||
Interconnection |
153,387 |
150,929 |
142,460 |
304,316 |
281,023 |
|||||||||||||||
Managed infrastructure |
28,889 |
25,529 |
22,908 |
54,418 |
44,695 |
|||||||||||||||
Other |
5,081 |
5,220 |
5,352 |
10,301 |
11,331 |
|||||||||||||||
Recurring revenues |
634,855 |
632,632 |
614,806 |
1,267,487 |
1,221,116 |
|||||||||||||||
Non-recurring revenues |
26,564 |
29,273 |
29,614 |
55,837 |
67,670 |
|||||||||||||||
Revenues |
$ |
661,419 |
$ |
661,905 |
$ |
644,420 |
$ |
1,323,324 |
$ |
1,288,786 |
||||||||||
EMEA Revenues: |
||||||||||||||||||||
Colocation |
$ |
381,144 |
$ |
362,330 |
$ |
347,795 |
$ |
743,474 |
$ |
678,920 |
||||||||||
Interconnection |
50,904 |
48,541 |
38,614 |
99,445 |
76,139 |
|||||||||||||||
Managed infrastructure |
29,012 |
30,137 |
28,397 |
59,149 |
57,485 |
|||||||||||||||
Other |
6,130 |
2,466 |
2,275 |
8,596 |
4,774 |
|||||||||||||||
Recurring revenues |
467,190 |
443,474 |
417,081 |
910,664 |
817,318 |
|||||||||||||||
Non-recurring revenues |
20,900 |
35,435 |
32,774 |
56,335 |
67,197 |
|||||||||||||||
Revenues |
$ |
488,090 |
$ |
478,909 |
$ |
449,855 |
$ |
966,999 |
$ |
884,515 |
||||||||||
Asia-Pacific Revenues: |
||||||||||||||||||||
Colocation |
$ |
228,803 |
$ |
221,093 |
$ |
213,734 |
$ |
449,896 |
$ |
423,399 |
||||||||||
Interconnection |
45,140 |
42,671 |
37,957 |
87,811 |
74,653 |
|||||||||||||||
Managed infrastructure |
22,150 |
21,824 |
22,467 |
43,974 |
44,387 |
|||||||||||||||
Recurring revenues |
296,093 |
285,588 |
274,158 |
581,681 |
542,439 |
|||||||||||||||
Non-recurring revenues |
24,519 |
18,140 |
16,544 |
42,659 |
32,455 |
|||||||||||||||
Revenues |
$ |
320,612 |
$ |
303,728 |
$ |
290,702 |
$ |
624,340 |
$ |
574,894 |
||||||||||
Worldwide Revenues: |
||||||||||||||||||||
Colocation |
$ |
1,057,445 |
$ |
1,034,377 |
$ |
1,005,615 |
$ |
2,091,822 |
$ |
1,986,386 |
||||||||||
Interconnection |
249,431 |
242,141 |
219,031 |
491,572 |
431,815 |
|||||||||||||||
Managed infrastructure |
80,051 |
77,490 |
73,772 |
157,541 |
146,567 |
|||||||||||||||
Other |
11,211 |
7,686 |
7,627 |
18,897 |
16,105 |
|||||||||||||||
Recurring revenues |
1,398,138 |
1,361,694 |
1,306,045 |
2,759,832 |
2,580,873 |
|||||||||||||||
Non-recurring revenues |
71,983 |
82,848 |
78,932 |
154,831 |
167,322 |
|||||||||||||||
Revenues |
$ |
1,470,121 |
$ |
1,444,542 |
$ |
1,384,977 |
$ |
2,914,663 |
$ |
2,748,195 |
||||||||||
(2) |
We define cash cost of revenues as cost of revenues less depreciation, amortization, accretion and stock-based compensation as presented below: |
|||||||||||||||||||
Cost of revenues |
$ |
739,344 |
$ |
736,282 |
$ |
698,179 |
$ |
1,475,626 |
$ |
1,380,209 |
||||||||||
Depreciation, amortization and accretion expense |
(250,743) |
(250,398) |
(230,696) |
(501,141) |
(459,333) |
|||||||||||||||
Stock-based compensation expense |
(7,655) |
(9,343) |
(6,500) |
(16,998) |
(11,512) |
|||||||||||||||
Cash cost of revenues |
$ |
480,946 |
$ |
476,541 |
$ |
460,983 |
$ |
957,487 |
$ |
909,364 |
||||||||||
The geographic split of our cash cost of revenues is presented below: |
||||||||||||||||||||
|
$ |
194,467 |
$ |
185,233 |
$ |
182,920 |
$ |
379,700 |
$ |
362,555 |
||||||||||
EMEA cash cost of revenues |
177,558 |
187,248 |
179,347 |
364,806 |
352,548 |
|||||||||||||||
|
108,921 |
104,060 |
98,716 |
212,981 |
194,261 |
|||||||||||||||
Cash cost of revenues |
$ |
480,946 |
$ |
476,541 |
$ |
460,983 |
$ |
957,487 |
$ |
909,364 |
||||||||||
(3) |
We define cash gross profit as revenues less cash cost of revenues (as defined above). |
|||||||||||||||||||
(4) |
We define cash operating expense as selling, general, and administrative expense less depreciation, amortization, and stock-based compensation. We also refer to cash operating expense as cash selling, general and administrative expense or "cash SG&A". |
|||||||||||||||||||
Selling, general, and administrative expense |
$ |
435,014 |
$ |
442,047 |
$ |
391,857 |
$ |
877,061 |
$ |
776,618 |
||||||||||
Depreciation and amortization expense |
(97,691) |
(87,033) |
(89,854) |
(184,724) |
(175,922) |
|||||||||||||||
Stock-based compensation expense |
(68,189) |
(71,223) |
(55,019) |
(139,412) |
(99,030) |
|||||||||||||||
Cash operating expense |
$ |
269,134 |
$ |
283,791 |
$ |
246,984 |
$ |
552,925 |
$ |
501,666 |
||||||||||
(5) |
We define cash sales and marketing expense as sales and marketing expense less depreciation, amortization and stock-based compensation as presented below: |
|||||||||||||||||||
Sales and marketing expense |
$ |
178,124 |
$ |
180,450 |
$ |
159,201 |
$ |
358,574 |
$ |
328,916 |
||||||||||
Depreciation and amortization expense |
(48,902) |
(46,234) |
(48,930) |
(95,136) |
(97,128) |
|||||||||||||||
Stock-based compensation expense |
(18,215) |
(18,545) |
(15,157) |
(36,760) |
(28,458) |
|||||||||||||||
Cash sales and marketing expense |
$ |
111,007 |
$ |
115,671 |
$ |
95,114 |
$ |
226,678 |
$ |
203,330 |
||||||||||
(6) |
We define cash general and administrative expense as general and administrative expense less depreciation, amortization and stock-based compensation as presented below: |
|||||||||||||||||||
General and administrative expense |
$ |
256,890 |
$ |
261,597 |
$ |
232,656 |
$ |
518,487 |
$ |
447,702 |
||||||||||
Depreciation and amortization expense |
(48,789) |
(40,799) |
(40,924) |
(89,588) |
(78,794) |
|||||||||||||||
Stock-based compensation expense |
(49,974) |
(52,678) |
(39,862) |
(102,652) |
(70,572) |
|||||||||||||||
Cash general and administrative expense |
$ |
158,127 |
$ |
168,120 |
$ |
151,870 |
$ |
326,247 |
$ |
298,336 |
||||||||||
(7) |
The geographic split of our cash operating expense, or cash SG&A, as defined above, is presented below: |
|||||||||||||||||||
|
$ |
164,845 |
$ |
183,059 |
$ |
152,448 |
$ |
347,904 |
$ |
309,341 |
||||||||||
EMEA cash SG&A |
66,935 |
61,503 |
60,863 |
128,438 |
123,250 |
|||||||||||||||
|
37,354 |
39,229 |
33,673 |
76,583 |
69,075 |
|||||||||||||||
Cash SG&A |
$ |
269,134 |
$ |
283,791 |
$ |
246,984 |
$ |
552,925 |
$ |
501,666 |
||||||||||
(8) |
We define adjusted EBITDA as income from operations excluding depreciation, amortization, accretion, stock-based compensation, restructuring charges, impairment charges, transaction costs and gain or loss on asset sales as presented below: |
|||||||||||||||||||
Income from operations |
$ |
282,488 |
$ |
253,484 |
$ |
291,781 |
$ |
535,972 |
$ |
571,289 |
||||||||||
Depreciation, amortization and accretion expense |
348,434 |
337,431 |
320,550 |
685,865 |
635,255 |
|||||||||||||||
Stock-based compensation expense |
75,844 |
80,566 |
61,519 |
156,410 |
110,542 |
|||||||||||||||
Impairment charges |
— |
— |
386 |
— |
14,834 |
|||||||||||||||
Transaction costs |
13,617 |
11,530 |
2,774 |
25,147 |
5,245 |
|||||||||||||||
(Gain) loss on asset sales |
(342) |
1,199 |
— |
857 |
— |
|||||||||||||||
Adjusted EBITDA |
$ |
720,041 |
$ |
684,210 |
$ |
677,010 |
$ |
1,404,251 |
$ |
1,337,165 |
||||||||||
The geographic split of our adjusted EBITDA is presented below: |
||||||||||||||||||||
|
$ |
58,423 |
$ |
47,308 |
$ |
99,195 |
$ |
105,731 |
$ |
189,206 |
||||||||||
|
182,204 |
171,439 |
167,614 |
353,643 |
334,750 |
|||||||||||||||
|