Colocation data center providers Equinix, Digital Realty, American Tower, and Iron Mountain have all published their Q3 2024 quarterly results.

All the colo providers are seeing revenue growth and are targeting further expansions.

Equinix said it was to focus on quicker and larger build-outs in future instead of smaller projects and phased roll-outs.

Digital signed $521 million in new leases, on top of $258 million in renewals.

Iron Mountain acquired land for a 200MW data center project in Richmond, Virginia.

American Tower acquired land to expand its Los Angeles campus in California, and may be exploring expanding CoreSite's footprint into more secondary markets across the US.

Equinix: Company to change build strategy

Equinix announced revenues of $2.2 billion, a two percent increase quarter-over-quarter and up seven percent year-on-year.

Operating Income was $425 million, lower than the previous quarter due to the Q2 gain on sale of the Silicon Valley 12 xScale (SV12x) asset. Adjusted EBITDA was $1.048 billion, a 1 percent increase over the previous quarter and up 12 percent YoY.

Adaire Fox-Martin, CEO and president of Equinix, said: "Our 87th consecutive quarter of revenue growth was also a record-breaking one for gross bookings, with strong results across our three regions. This performance is a testament to the trust our customers place in Equinix and the value they realize partnering strategically with us. We see continued robust demand for AI-enabling digital infrastructure from a highly diverse set of customers of varying sizes, industries, and regions. This, coupled with significant expansion of our xScale capability, further strengthens our value proposition with customers and our leading position in the market."

Since its Q2 earnings call, the company leased an incremental 20MW of capacity into its Seoul 2 (SL2x) asset.

As well as previously announced launches in Istanbul and Johannesburg, the quarter saw the company also open the first phases of its New York 3 (NY3 – 1,250 racks) and Tokyo 15 (TY15 – 1,200 racks) assets. Equinix also launches expansions in Melbourne (MEL2 phase 3 – 1,500 racks) and Bourdeaux (BX1 phase 2/3/4 – 800 racks).

Newly approved data centers include LG4 in Lagos (925 racks due live Q1 2027) and JH2 in Johor (1,100 racks due live Q1 2027). Approved expansions include sites in Washington DC, Montreal, New York, Seattle, Salalah, Frankfurt, and Zurich.

During the earnings call, Fox-Martin suggested the company would be changing its build strategy going forward to focus on large facilities.

“We intend to build for the future and accelerate our development of differentiated campuses that support the broad range of our customer’s needs,” she said. “Essentially, this means moving from many smaller builds with phased capacity delivery to fewer larger bills, balancing location with access to power on campuses that can service the full range of our customer’s needs from SMEs to hyperscalers.”

Part of that change, she said, was looking at where the company could accelerate existing builds and push previously-planned phases into earlier timeframes.

Keith Taylor, CFO at Equinix, added: “There's just too many small phases that we do along the process. And [with] the stage of where we are in the industry is inherently inefficient, and the average size of the deals that we're seeing today are much larger.”

Capital expenditures were $724 million; the company has 57 major projects underway in 35 markets across 22 countries, including 13 xScale projects. This totals 22,000 retail racks and 100MW of hyperscale capacity.

The company also purchased land for development in Amsterdam and Bangkok.

Digital Realty: Signs $521 million in new leases

Digital Realty reported Q3 2024 revenues of $1.4 billion, a five percent increase from the previous quarter and a two percent increase from the same quarter last year.

The company delivered a net income of $40 million and Adjusted EBITDA of $758 million in the third quarter, a four percent increase from the previous quarter and an 11 percent increase over the same quarter last year.

"In the third quarter, Digital Realty posted over $520 million of new leasing, more than double the record set in the first quarter. Record leasing across both the greater-than-a-megawatt and 0-1 MW plus interconnection segments drove the backlog up nearly 60 percent above our prior record," said Digital Realty president & CEO, Andy Power. "Our backlog now represents over 20 percent of annualized in-place data center revenue, enhancing our visibility and positioning Digital Realty for accelerating longer-term growth."

As well as $521 million in new leases - $450 million of which was from the Americas, with the majority in the >1MW category - the company signed renewal leases totaling $258 million.

During the quarter, Digital Realty acquired the land and shell of one of its existing data centers at Pudongweg 37 in Schiphol Rijk, Amsterdam for €43 million ($48m). The 15MW site is fully leased. Digital has also closed on the acquisition of a 6.7-acre parcel in Richardson, Texas, adjacent to Digital Realty's existing campus; the $15 million deal will support more than 80MW of new capacity.

Despite delivering just 36MW of new capacity, the company scaled its development pipeline in the third quarter, increasing the capacity underway by almost 50 percent to 644MW under construction today. The company has another 3GW of buildable IT load capacity in land and shell condition.

Iron Mountain: Acquires two ITAD companies and land in Richmond

Iron Mountain’s data center unit posted revenues of $150.8 million, and Adjusted EBITDA of $66.8 million; these are up 21.9 percent and 20.1 percent year-on-year. Q2 2023 saw the company post $147.4m and $66 million, respectively.

Overall, the company posted total revenues of $1.6 billion, a net income loss of $33.7 million, and Adjusted EBITDA of $568.1 million.

"We are pleased to report a very strong third quarter and continued strong momentum in the second half of 2024, resulting in all-time record Revenue, Adjusted EBITDA, and AFFO," said William L. Meaney, president and CEO of Iron Mountain. "Our team is making outstanding progress toward our accelerated growth objectives and our Project Matterhorn operating model continues to drive our business to greater heights by providing new and enhanced solutions for our customers."

During the quarter, the company signed 9.2MW in new or expansion leases across 56 deals, and commenced 50 leases totaling 10MW. The company also started build-to-suit leases totaling 72MW. It renewed 167 leases totaling 5.85MW.

During the earnings call, Meaney said the new deals including 2MW in Virginia with a global technology company and a 1.5MW deal in Arizona with a global fintech provider were part of a migration away from an enterprise facility.

For the year to date, Iron Mountain has signed 106MW in new or expanded leases, and 18.6MW in renewal leases (as well as the aforementioned build-to-suit leases).

The company added two Virginia sites – VA4 and 5, totaling 72MW – to its list of operating data centers. The launch of Madrid Phase 1 has been pushed back two quarters to Q1 2025, while LON-2 Phase 3 was pushed back a quarter to Q1 2025.

Meaney also noted the company had acquired a development site in Richmond, Virginia. When fully built out, the campus will operate with more than 200MW of capacity.

This quarter also saw Iron Mountain acquire two IT asset disposition companies. Wisetek expands the company’s footprint in Europe and the US, while APCD expands its offering in Australia.

Capital expenditures in the third quarter were $415 million.

American Tower: Revenue and profit steady

American Tower’s data center revenue – which includes CoreSite – totaled $234 million for the quarter. The unit turned an operating profit of $113 million. The company reported revenues of $231 million and a profit of $113 million in Q2 2024.

Total company revenues were $2.522 billion. Net income dropped 235.2 percent to a net loss of $780 million. Adjusted EBITDA decreased 0.9 percent to $1.687 billion.

Steven Vondran, American Tower’s CEO, said: “Carrier rollouts of 5G coverage are supporting robust activity levels in the US and Europe, while emerging markets, particularly in Africa, are also seeing healthy pipelines of new business driven by network upgrades and coverage expansion."

He continued: "Additionally, CoreSite delivered another fantastic quarter of new leasing, and is on pace for its third consecutive year of record sales, as accelerating hybrid-IT deployments and early signs of AI-related workloads fuel demand. Importantly, we’ve continued to execute on our previously communicated strategic priorities to enhance our portfolio, drive cost efficiencies across the business, prudently manage our capital structure, and drive a higher quality of earnings.”

In the earnings call, Vondran reaffirmed the company sees a “long runway ahead” for CoreSite’s retail-orientated approach and multi-tenant colocation facilities.

“Single-tenant hyperscale opportunities are not a priority unless there was a clear opportunity for what to serve as a seed for a new campus or if there were compelling opportunities to invest on our JV partners Stonepeak,” he said. “Today we're prioritizing the expansion of existing campuses, new ground-up facilities adjacent to existing campuses, or potentially selected expansion of our national ecosystem by establishing new campuses and new markets.”

He noted the company bought land in Los Angeles to expand its existing LA campus. He also said that the company was exploring potentially expanding its presence into a “couple of tier 2 markets” but didn’t provide details.