World leaders recently met in Glasgow for the United Nations’ Climate Change Conference (COP26) with a goal of agreeing on solutions to the inarguably climat...
CAPEX under way comes amidst a Q3 that delivered a revenue increase of 10% over the same quarter last year to $1.675 billion.
Co-founder and Editor, The Tech Capital
November 08, 2021 | 6:00 AM GMT
US data centre real estate investment trust (REIT) Equinix (NASDAQ: EQIX) said it is currently undertaking US$1.51 billion investments to expand its footprint across 16 countries covering 23 major metros.
The largest expansion slice resides in the EMEA region, where $823 million are being deployed.
This includes projects in London, Paris, Milan, Frankfurt, Muscat, Genoa, Istanbul, Munich, Warsaw Geneva, Zurich, Madrid, Manchester and Milan. A total of 13,500 cabinets are being added across these locations.
Over in Asia, Equinix is currently spending $513 million to expand its capacity by 9,700 cabinets in Hong Kong Shanghai, Singapore, Sydney Osaka Perth, Tokyo and Melbourne.
Elsewhere, the remainder of CAPEX is being diverted into the Americas region where $174 million are being used to deploy 3,750 cabinets in New York, Washington DC, Mexico City and Bogota.
You can find a detailed list of all the expansions, including CAPEX, cabinets, location, facility ownership system as well opening dates towards the end of this article.
Equinix’s footprint at the end of Q3 2021 included a portfolio of 237 facilities across 65 metro areas and 27 countries. AS many as 118 centres are fully owned by the operator.
Combined the sites cover 27.7 million gross square feet where 17.4 million represent owned space.
Africa is currently the only missing continent in Equinix’s portfolio.
Q3 results snapshot
During the third quarter of the year, Equinix amassed sales in the value of $1.675 billion, a 1% increase over the previous quarter and a 10% increase on Q3 2020. This was the company’s 75th consecutive quarter of revenue growth.
Operating income was $282 million, a 1% increase over the previous quarter and an operating margin of 17%.
EBITDA topped $786 million, a 47% adjusted EBITDA margin, and includes a $3 million negative foreign currency impact when compared to prior guidance rates, as well as $3 million of integration costs.
Net income witnessed a considerable growth to $152 million, a 123% increase over the previous quarter, primarily due to lower debt redemption costs and operating performance. Net income per share was $1.68, a 121% increase over the previous quarter.
Charles Meyers, President and CEO, Equinix, said: “The pandemic has triggered an accelerated need to digitise business models in virtually every segment of the economy, and our strong Q3 results are reflective of this increasing demand for digital services.
“As the world’s digital infrastructure company, Equinix remains uniquely positioned to help businesses as they shift towards distributed, hybrid and multicloud as the clear architecture of choice.”
For the fourth quarter of 2021, the company expects revenues to range between $1.685 and $1.705 billion, an increase of 1 – 2% compared to the prior quarter on both an as-reported and a normalized and constant currency basis.
Adjusted EBITDA is expected to range between $762 and $782 million whilst recurring capital expenditures are expected to range between $75 and $85 million.
For the full year of 2021, total revenues are expected to range between $6.614 and $6.634 billion, a 10 – 11% increase over the previous year, or a normalised and constant currency increase of approximately 8%.
This updated full year guidance includes an incremental $5 million from the GPX India acquisition, offset by a negative foreign currency impact of $20 million when compared to the prior guidance rates.
Adjusted EBITDA is expected to range between $3.119 and $3.139 billion, an adjusted EBITDA margin of 47%.
AFFO is expected to range between $2.444 and $2.464 billion, an increase of 12 – 13% over the previous year, or a normalized and constant currency increase of 10 – 11%. AFFO per share is expected to range between $27.03 and $27.25, an increase of 9 – 10% over the previous year, both as-reported and on a normalised and constant currency basis.
Total capital expenditures are expected to range between $2.738 and $2.988 billion. Non-recurring capital expenditures, including xScale-related costs, are expected to range between $2.550 and $2.790 billion, and recurring capital expenditures are expected to range between $188 and $198 million.
xScale-related on-balance sheet capital expenditures are expected to range between $425 and $475 million, which we anticipate will be reimbursed from both the current and future xScale JVs.
Below is a detailed summary of the expansions currently being carried out by Equinix across three continents. The graphs show the financial performance of each region during Q3 2021.
- London – Works are underway in LD7 and LD8 to expand the two buildings in the British Capital. Both expansions are due to come online during Q1 2022 with LD7 being an owned facility and representing an investment of $111 million to deploy 2,275 cabinets in its phase two of development. LD8 is a leased building and is set to add 550 cabinets at a cost of $36 million for its phase four.
- Paris – Equinix is spending $163 million to add 2,250 cabinets at PA10, a new owned data centre building under construction. The project is set to be brought to market during Q2 2022.
- Madrid – The Spanish capital has seen an influx in data centre deployments and Equinix is carrying out two leased expansions here. First, the operator is spending $16 million to add 375 cabinets during Q2 2022 to its MD2 data centre, in what is the facility’s fourth expansion wave. Equinix is also building a new facility, MD6, due to come online at the same time but with 600 cabinets and representing $5 million in capital commitment.
- Istanbul – A $25 million, 400 cabinet expansion at the company’s owned IL2 facility is in the final works of development and set to be brough online at any time.
- Frankfurt – One of Europe’s top four markets, the city will serve as Equinix’s largest data centre expansion during Q4 2021 as a new owned building, FR8, is brough online with 1,975 cabinets and a price tag of $109 million.
- Genoa – A new geography for Equinix where it is deploying $21 million to bring to market 150 cabinets at its owned GN1 facility during Q4 2021.
- Munich – Back in Germany, Equinix is investing $69 million to deploy 825 cabinets at its brand new and owned MU4 facility.
- Warsaw – A $29 million phase two expansion is currently being rolled out in the Polish capital to add 475 cabinets to the Wa3 centre before the end of the year.
- Muscat – Under a joint venture, $19 million are being drafted into the second phase of expansion of MC1 in the capital of Oman. A total of 475 cabinets are to be added by Q1 2022.
- Zurich – For its fourth expansion, owned facility ZH5 is receiving $42 million and will be given an extra 250 cabinets due to be brought online by Q1 2022.
- Manchester – The UK’s second largest market is gaining momentum with Equinix currently deploying $78 million to build a 600-cabinet owned facility. MA5 is due to come into market in Q2 2022.
- Milan – A unique market, especially due to its concentration of hyperscale deployments, Equinix is currently carrying out the second phase of expansion of the ML5 data centre. The works represent $20 million in capital commitment and will add 500 cabinet to the owned facility by Q3 2022.
- Hong Kong – Up to 300 cabinets are to be added at HK1, a leased facility currently it is 13-A expansion phase which caters to $30 million in investment. The expansion is now operational.
- Shanghai – China’s financial centre, Shanghai is receiving $18 million from Equinix for 575 cabinets at leased SH6 currently in its second phase of expansion.
- Singapore – Singapore represents one of Equinix’s largest CAPEX’s in any markets with $260 million going into four projects. Expansion phase 15 at SG1 is to add $22 million worth 300 cabinets. The leased facility is in operation. Secondly, a new self-owned, self-built facility, SG5, has been given $144 million of capital to bring to market 1,675 cabinets. Equinix is also investing a further $75 million for SG5’s second phase of expansion, which will add 775 cabinets during Q1 2022. A third phase of expansion for SG5 is under way, representing $19 million that translate into 700 cabinets.
- Sydney – Over in Sydney, 2,150 are being added to SQY5 in its second expansion. A total of $49 million are being deployed into the project for this owned facility.
- Osaka – In Japan, Equinix is to open its first facility in Osaka, OS3, at a CAPEX of $55 million. The leased presence will count with 900 cabinets when it comes online during Q4 2021.
- Perth – Back in Australia, Perth is getting a new Equinix data centre building, PE3. The owned facility will have 700 cabinets when it opens before the end of 2021 at an investment of $54 million.
- Tokyo – The Japanese capital continues to prove to be a stronghold for Equinix, with the company adding 900 cabinets during phase three of expansion at TY11. The leased facility’s extra scope will be brought to marketing during Q2 2022.
- Melbourne – At $16 million, Melbourne is getting 500 cabinets at ME2 for its second phase of expansion. The owned facility will be opened to customers in Q2 2022.
- New York – In the big apple, Equinix is adding 525 cabinets before the end of 2021 in its second expansion of NY6. The demand-driven buildout at the owned site comes with a price tag of $28 million.
- Washington DC – The US capital, part of the world’s largest data centre market, is getting $48 million from Equinix who is deploying 1,600 cabinets at DC15 during its second phase of development. The added capacity is due to come online during Q4 2021.
- Mexico City – Over in Mexico, Equinix is investing $54 million in owned MX2 to add 1,075 cabinets during Q1 2022.
- Bogota – One of its newest markets, Equinix is building a new facility, BG2, which will add 550 cabinets to its global footprint in Q4 2022. The expansion represents $45 million in capital commitment.
Australian investment manager AMP Capital Investors has considerably increased its stake in data ce...
US REIT Equinix, Inc. (Nasdaq: EQIX) has opened a US$55 million International Business Exchange (IB...
Equinix, Inc. (Nasdaq: EQIX) has opened a new International Business Exchange (IBX) data centre in ...