Equinix Inc.’s EQIX fourth-quarter 2024 adjusted funds from operations (AFFO) per share of $7.92 missed the Zacks Consensus Estimate of $8.11. However, the figure improved 8.5% from the prior-year quarter.

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Results reflect higher non-recurring charges undermining the performance. However, steady growth in colocation and inter-connection revenues, led by strong demand for digital infrastructure, supported the results to an extent. At year-end 2024, Equinix had total interconnections of more than 482,000, rising 4.3% year over year. The company issued its outlook for 2025 and also raised its dividend by 10% over the prior dividend payment.

Total quarterly revenues of $2.26 billion missed the Zacks Consensus Estimate marginally. However, the top line increased 7.1% year over year.

For full-year 2024, AFFO per share came in at $35.02, higher than the prior-year figure by 9.1%. However, the figure missed the Zacks Consensus Estimate of $35.19. Total revenues came in at $8.75 billion, up 6.8% year over year, but missed the consensus mark marginally.

Equinix, Inc. Price, Consensus and EPS Surprise

Equinix, Inc. price-consensus-eps-surprise-chart | Equinix, Inc. Quote

EQIX’s Fourth Quarter in Detail

Recurring revenues were $2.09 billion, up 5.8% from the year-ago quarter. Our projection for the metric was $2.13 billion. Non-recurring revenues rose 26.9% to $170 million. We estimated the metric to be $147.2 million.

Revenues from the Americas, the EMEA and the Asia Pacific rose 7.2%, 3.3% and 13.8% to $999 million, $776 million and $486 million, year over year, respectively.

The adjusted EBITDA came in at $1.02 billion, up 11% year over year. We projected the metric at $1.05 billion. The adjusted EBITDA margin was reported at 45%.

AFFO rose 11.4% from the year-ago period to $770 million.

EQIX spent $115 million on recurring capital expenditure in the fourth quarter, up 9.5% on a year-over-year basis. Recurring capital expenditure was 5.1% of revenues in the reported quarter. Non-recurring capital expenditure was $872 million, down 2.2% year over year. However, non-recurring charges relating to asset impairments, restructuring and transaction costs increased significantly year over year.

EQIX’s Balance Sheet Position

Equinix had $7.5 billion of available liquidity as of Dec. 31, 2024. This comprised cash, cash equivalents, short-term investments and its undrawn revolver. It excludes restricted cash.

As of Dec. 31, 2024, total debt was around $17.6 billion. Its net leverage ratio was 3.4, and the weighted average maturity was 7.3 years as of Dec. 31, 2024.

EQIX’s Dividend Raise

Concurrently, Equinix’s board of directors announced a quarterly cash dividend of $4.69 per share, an increment of 10% over the prior-quarter figure. The dividend will be paid out on March 19 to shareholders on record as of Feb. 26, 2024.

2025 Guidance by EQIX

For the first quarter of 2025, Equinix projects revenues between $2.19 billion and $2.23 billion, implying a 1-3% decrease over the prior quarter. The adjusted EBITDA is expected to be in the range of $1.01- $1.05 billion.

For the current year, AFFO per share is estimated between $36.69 and $37.51. This suggests a 5-7% increase from the previous year. This is lower than the Zacks Consensus Estimate of $38.30.

For 2025, Equinix estimates generating total revenues in the band of $9.03-$9.13 billion, indicating growth of 3-4% from 2024 on an as-reported basis. Management predicts an adjusted EBITDA in the range of $4.386-$4.466 billion and an adjusted EBITDA margin of 49%.

Equinix carries a Zacks Rank #4 (Sell) at present.

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Earnings Releases

We now look forward to the earnings releases of other REITs like SBA Communications SBAC and American Tower AMT, slated to report on Feb. 24 and Feb. 25, respectively.

The Zacks Consensus Estimate for SBA Communications’ fourth-quarter 2024 FFO per share is pegged at $3.36, which implies a 0.3% year-over-year decrease. SBAC currently carries a Zacks Rank #3 (Hold).

The Zacks Consensus Estimate for American Tower’s fourth-quarter 2024 FFO per share stands at $2.32, which indicates 1.3% growth year over year. AMT currently has a Zacks Rank #4.

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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