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Equinix Reports Second Quarter 2022 Results
Press Releases

Equinix Reports Second Quarter 2022 Results

REDWOOD CITY, Calif., July 27, 2022 /PRNewswire/ —

  • Quarterly revenues increased 10% on both an as-reported and normalized and constant currency basis over the same quarter last year to $1.8 billion, representing the company’s 78th consecutive quarter of revenue growth—the longest streak of any S&P 500 company
  • Delivered record quarterly gross and net bookings led by the Americas and EMEA regions— sizably surpassing the prior peak
  • Achieved record channel bookings in Q2, accounting for more than 35% of total bookings
  • Exceeded 435,000 interconnections in Q2, highlighting the company’s critical role in the digital infrastructure of today’s businesses

  • Revenues
    • $1.8 billion, a 5% increase over the previous quarter
    • Includes a negative $20 million foreign currency impact when compared to prior guidance rates
  • Operating Income
    • $318 million, a 19% increase over the previous quarter and an operating margin of 17%
  • Net Income and Net Income per Share attributable to Equinix
    • $216 million, a 47% increase over the previous quarter, primarily due to strong operating performance and a favorable tax settlement
    • $2.37 per share, a 46% increase over the previous quarter
  • Adjusted EBITDA
    • $860 million, an 8% increase over the previous quarter and an adjusted EBITDA margin of 47%
    • Includes a negative $10 million foreign currency impact when compared to prior guidance rates
    • Includes $4 million of integration costs
  • AFFO and AFFO per Share
    • $691 million, a 6% increase over the previous quarter, primarily due to strong operating performance, partially offset by higher taxes due to increased profitability
    • $7.58 per share, a 6% increase over the previous quarter
    • Includes $4 million of integration costs

    2022 Annual Guidance Summary

    • Revenues
      • $7.259$7.299 billion, an increase of 9 – 10% over the previous year, or a normalized and constant currency increase of 10 – 11%
      • An increase of $65 million compared to prior guidance, offset by a $102 million foreign currency impact compared to prior guidance rates
    • Adjusted EBITDA
      • $3.323$3.353 billion, a 46% adjusted EBITDA margin
      • An increase of $33 million compared to prior guidance excluding integration costs, offset by a $49 million foreign currency impact compared to prior guidance rates
      • Assumes $30 million of integration costs
    • AFFO and AFFO per Share
      • $2.636$2.666 billion, an increase of 8 – 9% over the previous year, or a normalized and constant currency increase of 8 – 10%
      • An increase of $33 million compared to prior guidance, offset by a $42 million foreign currency impact compared to prior guidance rates
      • $28.77$29.10 per share, an increase of 6 – 7% over the previous year, or 8 – 9% on a normalized and constant currency basis
      • Assumes $30 million of integration costs

    Equinix does not provide forward-looking guidance for certain financial data, such as depreciation, amortization, accretion, stock-based compensation, net income (loss) from operations, cash generated from operating activities and cash used in investing activities, and as a result, is not able to provide a reconciliation of GAAP to non-GAAP financial measures for forward-looking data without unreasonable effort. The impact of such adjustments could be significant.

    Equinix Quote

    Charles Meyers, President and CEO, Equinix:

    “With record Q2 gross bookings that sizably surpassed the prior peak, Equinix had an outstanding first half of 2022, and our business continued to deliver strong and consistent results. The demand environment and our pipeline remain robust despite a complex global macroeconomic and political landscape, as we continue to enable digital leaders on their transformation journey.”

    Business Highlights

    • As customers continue to embrace Equinix as the best manifestation of the interconnected digital edge, the company continues to invest in the expansion of its global platform:
      • 49 major projects are currently underway across 34 metros in 21 countries, including new data center builds in Dublin, Montréal, New York, Paris, Warsaw and the company’s first build in Chennai, India.
      • In May, Equinix closed the acquisition of four data centers from Empresa Nacional De Telecomunicaciones S.A. (“Entel”), a leading Chilean telecommunications provider (the “Entel Chile Acquisition”), extending Platform Equinix® into Chile and bringing its global footprint to 70 metros across 31 countries.
      • Equinix expects to close on the acquisition of one additional data center from Entel to enter Lima, Peru, in Q3.
    • Equinix continued to strengthen its leadership position in the cloud ecosystem through the company’s xScaleTM program, which experienced strong leasing activity from top hyperscalers in Q2. The xScale portfolio has now leased more than 170 megawatts globally, with 11 xScale builds currently under development, of which more than 80% is pre-leased.
    • Equinix’s Future First sustainability strategy was recently recognized by Sustainalytics as among the best large-cap REITs for ESG. Equinix was also ranked seventh on the U.S. Environmental Protection Agency’s National Top 100 list of the largest green power users.
    • Equinix continued the growth of its indirect selling initiatives, with channel sales delivering a fifth consecutive quarter of record bookings, accounting for over 35% of Q2 bookings and nearly 60% of new logos in the quarter. Wins were across a wide range of industry verticals and use cases, with continued strength from strategic partners including AT&T, Cisco, Dell, Google, Microsoft and Orange Business Services. In Q2, Equinix was recognized as HPE GreenLake’s Momentum Partner of the Year for 2022 as the two companies work together to deliver a consistent hybrid multicloud experience for joint customers.

    Business Outlook

    For the third quarter of 2022, the Company expects revenues to range between $1.827 and $1.847 billion, a 1 – 2% increase over the prior quarter on both an as-reported and normalized and constant currency basis. This guidance includes a negative $12 million foreign currency impact when compared to the average FX rates in Q2 2022. Adjusted EBITDA is expected to range between $831 and $851 million. Adjusted EBITDA includes a negative $5 million foreign currency impact when compared to the average FX rates in Q2 2022 and $9 million of integration costs from acquisitions. Recurring capital expenditures are expected to range between $42 and $52 million.

    For the full year of 2022, total revenues are expected to range between $7.259 and $7.299 billion, a 9 – 10% increase over the previous year, or a normalized and constant currency increase of 10 – 11%. This updated full-year guidance includes an underlying raise of $35 million from better-than-expected business performance, $30 million from the Entel Chile Acquisition and a negative $102 million foreign currency impact when compared to the prior guidance rates. Adjusted EBITDA is expected to range between $3.323 and $3.353 billion, an adjusted EBITDA margin of 46%. This updated full-year guidance includes an underlying raise of $25 million from better-than-expected business performance excluding integration costs, $18 million from the Entel Chile Acquisition, offset by $10 million due to a lease accounting classification change and a negative $49 million foreign currency impact when compared to the prior guidance rates. For the year, the Company now expects to incur $30 million in integration costs related to acquisitions. AFFO is expected to range between $2.636 and $2.666 billion, an increase of 8 – 9% over the previous year, or a normalized and constant currency increase of 8 – 10%. This updated AFFO guidance excluding integration costs includes an underlying raise of $17 million, a $3 million net benefit due to a lease accounting classification change, $13 million from the Entel Chile Acquisition and a negative $42 million foreign currency impact when compared to the prior guidance rates. AFFO per share is expected to range between $28.77 and $29.10, an increase of 6 – 7% over the previous year on an as-reported basis, or 8 – 9% on a normalized and constant currency basis. Total capital expenditures are expected to range between $2.313 and $2.563 billion. Non-recurring capital expenditures, including xScale-related capital expenditures, are expected to range between $2.133 and $2.373 billion, and recurring capital expenditures are expected to range between $180 and $190 million. xScale-related on-balance sheet capital expenditures are expected to range between $85 and $135 million, which we anticipate will be reimbursed to Equinix from both the current and future xScale JVs.

    The U.S. dollar exchange rates used for 2022 guidance, taking into consideration the impact of our current foreign currency hedges, have been updated to $1.14 to the Euro, $1.31 to the Pound, S$1.39 to the U.S. Dollar, ¥136 to the U.S. Dollar, A$1.45 to the U.S. Dollar, HK$7.85 to the U.S. Dollar, R$5.20 to the U.S. Dollar and C$1.29 to the U.S. Dollar. The Q2 2022 global revenue breakdown by currency for the Euro, British Pound, Singapore Dollar, Japanese Yen, Australian Dollar, Hong Kong Dollar, Brazilian Real and Canadian Dollar is 19%, 9%, 8%, 6%, 4%, 3%, 3% and 3%, respectively.

    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 2022 Results Conference Call and Replay Information

    Equinix will discuss its quarterly results for the period ended June 30, 2022, along with its future outlook, in its quarterly conference call on Wednesday, July 27, 2022, at 5:30 p.m. ET (2:30 p.m. PT). A simultaneous live webcast of the call will be available on the company’s Investor Relations website at www.equinix.com/investors. To hear the conference call live, please dial 1-517-308-9482 (domestic and international) and reference the passcode EQIX.

    A replay of the call will be available one hour after the call through Wednesday, October 26, 2022, by dialing 1-866-363-4001 and referencing the passcode 2022. In addition, the webcast will be available at www.equinix.com/investors (no password required).

    Investor Presentation and Supplemental Financial Information

    Equinix has made available on its website a presentation designed to accompany the discussion of Equinix’s results and future outlook, along with certain supplemental financial information and other data. Interested parties may access this information through the Equinix Investor Relations website at www.equinix.com/investors.

    Additional Resources

    About Equinix

    Equinix (Nasdaq: EQIX) is the world’s digital infrastructure company, enabling digital leaders to harness a trusted platform to bring together and interconnect the foundational infrastructure that powers their success. Equinix enables today’s businesses to access all the right places, partners and possibilities they need to accelerate advantage. With Equinix, they can scale with agility, speed the launch of digital services, deliver world-class experiences and multiply their value.

    Non-GAAP Financial Measures

    Equinix provides all information required in accordance with generally accepted accounting principles (“GAAP”), but it believes that evaluating its ongoing operating results may be difficult if limited to reviewing only GAAP financial measures. Accordingly, Equinix uses non-GAAP financial measures to evaluate its operations.

    Equinix provides normalized and constant currency growth rates, which are calculated to adjust for acquisitions, dispositions, integration costs, changes in accounting principles and foreign currency.

    Equinix presents adjusted EBITDA, which is a non-GAAP financial measure. Adjusted EBITDA represents net income excluding income tax expense, interest income, interest expense, other income or expense, gain or loss on debt extinguishment, depreciation, amortization, accretion, stock-based compensation expense, restructuring charges, impairment charges, transaction costs and gain or loss on asset sales.

    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, Equinix excludes certain items that it believes are not good indicators of Equinix’s current or future operating performance. These items are depreciation, amortization, accretion of asset retirement obligations and accrued restructuring charges, stock-based compensation, restructuring charges, impairment charges, transaction costs and gain or loss on asset sales. Equinix excludes these items in order for its lenders, investors and the industry analysts who review and report on Equinix to better evaluate Equinix’s operating performance and cash spending levels relative to its industry sector and competitors.

    Equinix excludes depreciation expense as these charges primarily relate to the initial construction costs of a data center, and do not reflect its current or future cash spending levels to support its business. Its data centers are long-lived assets, and have an economic life greater than 10 years. The construction costs of a data center do not recur with respect to such data center, although Equinix may incur initial construction costs in future periods with respect to additional data centers, and future capital expenditures remain minor relative to the initial investment. This is a trend it expects to continue. In addition, depreciation is also based on the estimated useful lives of the data centers. These estimates could vary from actual performance of the asset, are based on historic costs incurred to build out our data centers and are not indicative of current or expected future capital expenditures. Therefore, Equinix excludes depreciation from its operating results when evaluating its operations.

    In addition, in presenting the non-GAAP financial measures, Equinix also excludes amortization expense related to acquired intangible assets. Amortization expense is significantly affected by the timing and magnitude of acquisitions, and these charges may vary in amount from period to period. We exclude amortization expense to facilitate a more meaningful evaluation of our current operating performance and comparisons to our prior periods. Equinix excludes accretion expense, both as it relates to its asset retirement obligations as well as its accrued restructuring charges, as these expenses represent costs which Equinix also believes are not meaningful in evaluating Equinix’s current operations. Equinix excludes stock-based compensation expense, as it can vary significantly from period to period based on share price and the timing, size and nature of equity awards. As such, Equinix and many investors and analysts exclude stock-based compensation expense to compare its operating results with those of other companies. Equinix excludes restructuring charges from its non-GAAP financial measures. The restructuring charges relate to Equinix’s decision to exit leases for excess space adjacent to several of its IBX® data centers, which it did not intend to build out, or its decision to reverse such restructuring charges. Equinix also excludes impairment charges generally related to certain long-lived assets. The impairment charges are related to expense recognized whenever events or changes in circumstances indicate that the carrying amount of assets are not recoverable. Equinix also excludes gain or loss on asset sales as it represents profit or loss that is not meaningful in evaluating the current or future operating performance. Finally, Equinix excludes transaction costs from its non-GAAP financial measures to allow more comparable comparisons of the financial results to the historical operations. The transaction costs relate to costs Equinix incurs in connection with business combinations and formation of joint ventures, including advisory, legal, accounting, valuation and other professional or consulting fees. Such charges generally are not relevant to assessing the long-term performance of Equinix. In addition, the frequency and amount of such charges vary significantly based on the size and timing of the transactions. Management believes items such as restructuring charges, impairment charges, transaction costs and gain or loss on asset sales are non-core transactions; however, these types of costs may occur in future periods.

    Equinix also presents funds from operations (“FFO”) and adjusted funds from operations (“AFFO”), both commonly used in the REIT industry, as supplemental performance measures. Additionally, Equinix presents AFFO per share, which is also commonly used in the REIT industry. AFFO per share offers investors and industry analysts a perspective of Equinix’s underlying operating performance when compared to other REIT companies. FFO is calculated in accordance with the definition established by the National Association of Real Estate Investment Trusts (“NAREIT”). FFO represents net income or loss, excluding gain or loss from the disposition of real estate assets, depreciation and amortization on real estate assets and adjustments for unconsolidated joint ventures’ and non-controlling interests’ share of these items. AFFO represents FFO, excluding depreciation and amortization expense on non-real estate assets, accretion, stock-based compensation, stock-based charitable contributions, restructuring charges, impairment charges, transaction costs, an installation revenue adjustment, a straight-line rent expense adjustment, a contract cost adjustment, amortization of deferred financing costs and debt discounts and premiums, gain or loss on debt extinguishment, an income tax expense adjustment, recurring capital expenditures, net income or loss from discontinued operations, net of tax and adjustments from FFO to AFFO for unconsolidated joint ventures’ and non-controlling interests’ share of these items. Equinix excludes depreciation expense, amortization expense, accretion, stock-based compensation, restructuring charges, impairment charges and transaction costs for the same reasons that they are excluded from the other non-GAAP financial measures mentioned above.

    Equinix includes an adjustment for revenues from installation fees, since installation fees are deferred and recognized ratably over the period of contract term, although the fees are generally paid in a lump sum upon installation. Equinix includes an adjustment for straight-line rent expense on its operating leases, since the total minimum lease payments are recognized ratably over the lease term, although the lease payments generally increase over the lease term. Equinix also includes an adjustment to contract costs incurred to obtain contracts, since contract costs are capitalized and amortized over the estimated period of benefit on a straight-line basis, although costs of obtaining contracts are generally incurred and paid during the period of obtaining the contracts. The adjustments for installation revenues, straight-line rent expense and contract costs are intended to isolate the cash activity included within the straight-lined or amortized results in the consolidated statement of operations. Equinix excludes the amortization of deferred financing costs and debt discounts and premiums as these expenses relate to the initial costs incurred in connection with its debt financings that have no current or future cash obligations. Equinix excludes gain or loss on debt extinguishment since it represents a cost that is not a good indicator of Equinix’s current or future operating performance. Equinix includes an income tax expense adjustment, which represents the non-cash tax impact due to changes in valuation allowances and uncertain tax positions that do not relate to the current period’s operations. Equinix excludes recurring capital expenditures, which represent expenditures to extend the useful life of its IBX and xScale data centers or other assets that are required to support current revenues. Equinix also excludes net income or loss from discontinued operations, net of tax, which represents results that are not a good indicator of our current or future operating performance.

    Equinix presents constant currency results of operations, which is a non-GAAP financial measure and is not meant to be considered in isolation or as an alternative to GAAP results of operations. However, Equinix has presented this non-GAAP financial measure to provide investors with an additional tool to evaluate its operating results without the impact of fluctuations in foreign currency exchange rates, thereby facilitating period-to-period comparisons of Equinix’s business performance. To present this information, Equinix’s current and comparative prior period revenues and certain operating expenses from entities with functional currencies other than the U.S. dollar are converted into U.S. dollars at a consistent exchange rate for purposes of each result being compared.

    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. Equinix presents such non-GAAP financial measures to provide investors with an additional tool to evaluate its operating results in a manner that focuses on what management believes to be its core, ongoing business operations. Management believes that the inclusion of these non-GAAP financial measures provides consistency and comparability with past reports and provides a better understanding of the overall performance of the business and its ability to perform in subsequent periods. Equinix believes that if it did not provide such non-GAAP financial information, investors would not have all the necessary data to analyze Equinix effectively.

    Investors should note that the non-GAAP financial measures used by Equinix may not be the same non-GAAP financial measures, and may not be calculated in the same manner, as those of other companies. Investors should, therefore, exercise caution when comparing non-GAAP financial measures used by us to similarly titled non-GAAP financial measures of other companies. Equinix does not provide forward-looking guidance for certain financial data, such as depreciation, amortization, accretion, stock-based compensation, net income or loss from operations, cash generated from operating activities and cash used in investing activities, and as a result, is not able to provide a reconciliation of GAAP to non-GAAP financial measures for forward-looking data without unreasonable effort. The impact of such adjustments could be significant. Equinix intends to calculate the various non-GAAP financial measures in future periods consistent with how they were calculated for the periods presented within this press release.

    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 current inflationary environment; foreign currency exchange rate fluctuations; increased costs to procure power and the general volatility in the global energy market; the challenges of acquiring, operating and constructing IBX and xScale data centers and developing, deploying and delivering Equinix products and solutions; unanticipated costs or difficulties relating to the integration of companies we have acquired or will acquire into Equinix; a failure to receive significant revenues from customers in recently built out or acquired data centers; failure to complete any financing arrangements contemplated from time to time; competition from existing and new competitors; the ability to generate sufficient cash flow or otherwise obtain funds to repay new or outstanding indebtedness; the loss or decline in business from our key customers; risks related to our taxation as a REIT and other risks described from time to time in Equinix filings with the Securities and Exchange Commission. In particular, see recent and upcoming Equinix quarterly and annual reports filed with the Securities and Exchange Commission, copies of which are available upon request from Equinix. Equinix does not assume any obligation to update the forward-looking information contained in this press release.

     


    EQUINIX, INC.

    Condensed Consolidated Statements of Operations

    (in thousands, except per share data)

    (unaudited)



    Three Months Ended


    Six Months Ended


    June 30,

    2022


    March 31,

    2022


    June 30,

    2021


    June 30,

    2022


    June 30,

    2021

    Recurring revenues

    $ 1,707,451


    $   1,642,324


    $ 1,542,462


    $ 3,349,775


    $ 3,053,395

    Non-recurring revenues

    109,703


    92,123


    115,457


    201,826


    200,588

    Revenues

    1,817,154


    1,734,447


    1,657,919


    3,551,601


    3,253,983

    Cost of revenues

    930,257


    915,875


    865,120


    1,846,132


    1,676,337

    Gross profit

    886,897


    818,572


    792,799


    1,705,469


    1,577,646

    Operating expenses:










    Sales and marketing

    193,727


    192,511


    185,610


    386,238


    368,437

    General and administrative

    370,348


    352,687


    322,005


    723,035


    623,461

    Transaction costs

    5,063


    4,240


    6,985


    9,303


    8,167

    (Gain) loss on asset sales

    (94)


    1,818


    (455)


    1,724


    1,265

    Total operating expenses

    569,044


    551,256


    514,145


    1,120,300


    1,001,330

    Income from operations

    317,853


    267,316


    278,654


    585,169


    576,316

    Interest and other income (expense):









    Interest income

    4,508


    2,106


    374


    6,614


    1,103

    Interest expense

    (90,826)


    (79,965)


    (87,231)


    (170,791)


    (176,912)

    Other expense

    (6,238)


    (9,549)


    (39,377)


    (15,787)


    (46,327)

    Gain (loss) on debt extinguishment

    (420)


    529


    (102,460)


    109


    (115,518)

    Total interest and other, net

    (92,976)


    (86,879)


    (228,694)


    (179,855)


    (337,654)

    Income before income taxes

    224,877


    180,437


    49,960


    405,314


    238,662

    Income tax expense

    (8,635)


    (32,744)


    18,527


    (41,379)


    (14,101)

    Net income

    216,242


    147,693


    68,487


    363,935


    224,561

    Net (income) loss attributable to non-controlling interests

    80


    (240)


    (148)


    (160)


    140

    Net income attributable to Equinix

    $     216,322


    $      147,453


    $       68,339


    $     363,775


    $     224,701

    Net income per share attributable to Equinix:

    Basic net income per share

    $           2.38


    $             1.62


    $           0.76


    $           4.00


    $           2.51

    Diluted net income per share

    $           2.37


    $             1.62


    $           0.76


    $           3.99


    $           2.50

    Shares used in computing basic net income per share

    91,036


    90,771


    89,648


    90,904


    89,490

    Shares used in computing diluted net income per share

    91,262


    91,162


    90,104


    91,213


    90,024

     

    EQUINIX, INC.

    Condensed Consolidated Statements of Comprehensive Income

    (in thousands)

    (unaudited)



    Three Months Ended


    Six Months Ended


    June 30,

    2022


    March 31,

    2022


    June 30,

    2021


    June 30,

    2022


    June 30,

    2021

    Net income

    $     216,242


    $     147,693


    $       68,487


    $     363,935


    $     224,561

    Other comprehensive income (loss), net of tax:







    Foreign currency translation adjustment (“CTA”) gain (loss)

    (740,428)


    (122,534)


    110,466


    (862,962)


    (184,680)

    Net investment hedge CTA gain (loss)

    353,953


    91,358


    (37,036)


    445,311


    133,139

    Unrealized gain (loss) on cash flow hedges

    20,617


    64,037


    (5,700)


    84,654


    23,778

    Net actuarial gain (loss) on defined benefit plans

    (19)


    (21)


    15


    (40)


    27

    Total other comprehensive income (loss), net of tax

    (365,877)


    32,840


    67,745


    (333,037)


    (27,736)

    Comprehensive income (loss), net of tax

    (149,635)


    180,533


    136,232


    30,898


    196,825

    Net (income) loss attributable to non-controlling interests

    80


    (240)


    (148)


    (160)


    140

    Other comprehensive (income) attributable to non-controlling interests

    35


    (3)


    (11)


    32


    (10)

    Comprehensive income (loss) attributable to Equinix

    $   (149,520)


    $     180,290


    $     136,073


    $       30,770


    $     196,955

     

    EQUINIX, INC.

    Condensed Consolidated Balance Sheets

    (in thousands)

    (unaudited)



    June 30, 2022


    December 31, 2021

    Assets




    Cash and cash equivalents

    $                  1,891,311


    $              1,536,358

    Accounts receivable, net

    812,769


    681,809

    Other current assets

    514,313


    462,739

    Assets held for sale

    71,554


    276,195

              Total current assets

    3,289,947


    2,957,101

    Property, plant and equipment, net

    15,455,180


    15,445,775

    Operating lease right-of-use assets

    1,453,233


    1,282,418

    Goodwill

    5,585,330


    5,372,071

    Intangible assets, net

    1,982,434


    1,935,267

    Other assets

    1,272,090


    926,066

              Total assets

    $                29,038,214


    $            27,918,698

    Liabilities and Stockholders’ Equity




    Accounts payable and accrued expenses

    $                     841,473


    $                 879,144

    Accrued property, plant and equipment

    244,267


    187,334

    Current portion of operating lease liabilities

    140,667


    144,029

    Current portion of finance lease liabilities

    144,100


    147,841

    Current portion of mortgage and loans payable

    34,086


    33,087

    Other current liabilities

    204,351


    214,519

              Total current liabilities

    1,608,944


    1,605,954

    Operating lease liabilities, less current portion

    1,291,447


    1,107,180

    Finance lease liabilities, less current portion

    1,985,498


    1,989,668

    Mortgage and loans payable, less current portion

    655,331


    586,577

    Senior notes, less current portion

    12,077,756


    10,984,144

    Other liabilities

    789,644


    763,411

              Total liabilities

    18,408,620


    17,036,934

    Common stock

    91


    91

    Additional paid-in capital

    16,259,311


    15,984,597

    Treasury stock

    (98,792)


    (112,208)

    Accumulated dividends

    (6,736,338)


    (6,165,140)

    Accumulated other comprehensive loss

    (1,418,756)


    (1,085,751)

    Retained earnings

    2,624,268


    2,260,493

              Total Equinix stockholders’ equity

    10,629,784


    10,882,082

    Non-controlling interests

    (190)


    (318)

              Total stockholders’ equity

    10,629,594


    10,881,764

                    Total liabilities and stockholders’ equity

    $                29,038,214


    $            27,918,698





    Ending headcount by geographic region is as follows:




              Americas headcount

    5,275


    5,056

              EMEA headcount

    3,728


    3,611

              Asia-Pacific headcount

    2,448


    2,277

                        Total headcount

    11,451


    10,944

     

    EQUINIX, INC.

    Summary of Debt Principal Outstanding

    (in thousands)

    (unaudited)



    June 30, 2022


    December 31, 2021





    Finance lease liabilities

    $                 2,129,598


    $                 2,137,509





    Term loans

    626,417


    549,343

    Mortgage payable and other loans payable

    63,000


    70,321

    Minus: mortgage premium, debt discount and issuance costs, net

    (208)


    (1,276)

               Total mortgage and loans payable principal

    689,209


    618,388





    Senior notes

    12,077,756


    10,984,144

    Plus: debt discount and issuance costs

    125,154


    117,986

              Total senior notes principal

    12,202,910


    11,102,130





    Total debt principal outstanding

    $              15,021,717


    $              13,858,027

     

    EQUINIX, INC.

    Condensed Consolidated Statements of Cash Flows

    (in thousands)

    (unaudited)




    Three Months Ended


    Six Months Ended



    June 30,

    2022


    March 31,

    2022


    June 30,

    2021


    June 30,

    2022


    June 30,

    2021












    Cash flows from operating activities:


    Net income

    $    216,242


    $    147,693


    $      68,487


    $    363,935


    $    224,561


    Adjustments to reconcile net income to net cash provided by operating activities:


    Depreciation, amortization and accretion

    432,828


    436,386


    417,758


    869,214


    812,076


    Stock-based compensation

    104,682


    89,952


    94,335


    194,634


    172,685


    Amortization of debt issuance costs and debt discounts and premiums

    4,536


    4,204


    4,430


    8,740


    8,370


    (Gain) loss on debt extinguishment

    420


    (529)


    102,460


    (109)


    115,518


    Loss (gain) on asset sales

    (94)


    1,818


    (455)


    1,724


    1,265


    Other items

    5,832


    6,050


    11,296


    11,882


    22,478


    Changes in operating assets and liabilities:


    Accounts receivable

    (26,302)


    (100,727)


    (39,709)


    (127,029)


    (57,329)


    Income taxes, net

    (33,663)


    13,881


    (55,661)


    (19,782)


    (65,935)


    Accounts payable and accrued expenses

    55,128


    (75,980)


    19,161


    (20,852)


    (57,201)


    Operating lease right-of-use assets

    38,839


    35,400


    20,851


    74,239


    61,775


    Operating lease liabilities

    (34,632)


    (31,740)


    (63,765)


    (66,372)


    (100,328)


    Other assets and liabilities

    37,765


    54,715


    20,009


    92,480


    (147,580)

    Net cash provided by operating activities

    801,581


    581,123


    599,197


    1,382,704


    990,355

    Cash flows from investing activities:


    Purchases, sales and maturities of investments, net

    (26,391)


    (38,558)


    (2,595)


    (64,949)


    (20,944)


    Business acquisitions, net of cash and restricted cash acquired

    (883,668)




    (883,668)



    Real estate acquisitions

    (30,257)


    (3,074)


    (33,900)


    (33,331)


    (87,637)


    Purchases of other property, plant and equipment

    (484,830)


    (412,518)


    (692,232)


    (897,348)


    (1,255,830)


    Proceeds from asset sales

    56,024


    195,391



    251,415


    Net cash used in investing activities

    (1,369,122)


    (258,759)


    (728,727)


    (1,627,881)


    (1,364,411)

    Cash flows from financing activities:


    Proceeds from employee equity awards


    43,876



    43,876


    40,034


    Payment of dividend distributions

    (283,048)


    (289,669)


    (258,053)


    (572,717)


    (521,092)


    Proceeds from public offering of common stock, net of offering costs



    99,599



    99,599


    Proceeds from mortgage and loans payable


    676,850



    676,850



    Proceeds from senior notes, net of debt discounts

    1,193,688



    2,587,910


    1,193,688


    3,878,662


    Repayment of finance lease liabilities

    (28,783)


    (40,773)


    (66,293)


    (69,556)


    (98,877)


    Repayment of mortgage and loans payable

    (9,199)


    (551,833)


    (675,873)


    (561,032)


    (696,059)


    Repayment of senior notes



    (1,400,000)



    (1,990,650)


    Debt extinguishment costs



    (90,664)



    (99,185)


    Debt issuance costs

    (10,365)


    (7,366)


    (21,950)


    (17,731)


    (25,102)

    Net cash provided by (used in) financing activities

    862,293


    (168,915)


    174,676


    693,378


    587,330

    Effect of foreign currency exchange rates on cash, cash equivalents and restricted cash

    (101,129)


    4,593


    4,965


    (96,536)


    (17,054)

    Net increase in cash, cash equivalents and restricted cash

    193,623


    158,042


    50,111


    351,665


    196,220

    Cash, cash equivalents and restricted cash at beginning of period

    1,707,496


    1,549,454


    1,771,804


    1,549,454


    1,625,695

    Cash, cash equivalents and restricted cash at end of period

    $ 1,901,119


    $ 1,707,496


    $ 1,821,915


    $ 1,901,119


    $ 1,821,915

    Supplemental cash flow information:

    Cash paid for taxes

    $      53,609


    $      20,150


    $      32,667


    $      73,759


    $      82,637

    Cash paid for interest

    $    106,249


    $    104,051


    $    128,636


    $    210,300


    $    229,691












    Free cash flow (negative free cash flow) (1)

    $   (541,150)


    $    360,922


    $   (126,935)


    $   (180,228)


    $   (353,112)












    Adjusted free cash flow (negative adjusted free cash flow) (2)

    $    372,775


    $    363,996


    $     (93,035)


    $    736,771


    $   (265,475)












    (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

    $    801,581


    $    581,123


    $    599,197


    $ 1,382,704


    $    990,355


    Net cash used in investing activities as presented above

    (1,369,122)


    (258,759)


    (728,727)


    (1,627,881)


    (1,364,411)


    Purchases, sales and maturities of investments, net

    26,391


    38,558


    2,595


    64,949


    20,944


    Free cash flow (negative free cash flow)

    $   (541,150)


    $    360,922


    $   (126,935)


    $   (180,228)


    $   (353,112)












    (2)

    We define adjusted free cash flow (negative adjusted free cash flow) as free cash flow (negative free cash flow) as defined above, excluding any 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

    $   (541,150)


    $    360,922


    $   (126,935)


    $   (180,228)


    $   (353,112)


    Less business acquisitions, net of cash and restricted cash acquired

    883,668




    883,668



    Less real estate acquisitions

    30,257


    3,074


    33,900


    33,331


    87,637


    Adjusted free cash flow (negative adjusted free cash flow)

    $    372,775


    $    363,996


    $     (93,035)


    $    736,771


    $   (265,475)

     

    EQUINIX, INC.

    Non-GAAP Measures and Other Supplemental Data

    (in thousands)

    (unaudited)




    Three Months Ended


    Six Months Ended



    June 30,

    2022


    March 31,

    2022


    June 30,

    2021


    June 30,

    2022


    June 30,

    2021


    Recurring revenues

    $  1,707,451


    $  1,642,324


    $  1,542,462


    $  3,349,775


    $  3,053,395


    Non-recurring revenues

    109,703


    92,123


    115,457


    201,826


    200,588


    Revenues (1)

    1,817,154


    1,734,447


    1,657,919


    3,551,601


    3,253,983













    Cash cost of revenues (2)

    599,368


    583,703


    544,196


    1,183,071


    1,055,006


    Cash gross profit (3)

    1,217,786


    1,150,744


    1,113,723


    2,368,530


    2,198,977













    Cash operating expenses (4)(7):










    Cash sales and marketing expenses (5)

    120,739


    124,706


    115,282


    245,445


    228,335


    Cash general and administrative expenses (6)

    236,715


    226,326


    201,164


    463,041


    400,133


    Total cash operating expenses (4)(7)

    357,454


    351,032


    316,446


    708,486


    628,468













    Adjusted EBITDA (8)

    $     860,332


    $     799,712


    $     797,277


    $  1,660,044


    $  1,570,509













    Cash gross margins (9)

    67 %


    66 %


    67 %


    67 %


    68 %













    Adjusted EBITDA margins(10)

    47 %


    46 %


    48 %


    47 %


    48 %













    Adjusted EBITDA flow-through rate (11)

    73 %


    43 %


    39 %


    51 %


    72 %













    FFO (12)

    $     498,349


    $     432,644


    $     340,873


    $     930,993


    $     758,136













    AFFO (13)(14)

    $     691,392


    $     652,632


    $     631,937


    $  1,344,024


    $  1,258,765













    Basic FFO per share (15)

    $            5.47


    $            4.77


    $            3.80


    $          10.24


    $            8.47













    Diluted FFO per share (15)

    $            5.46


    $            4.75


    $            3.78


    $          10.21


    $            8.42













    Basic AFFO per share (15)

    $            7.59


    $            7.19


    $            7.05


    $          14.79


    $          14.07













    Diluted AFFO per share (15)

    $            7.58


    $            7.16


    $            7.01


    $          14.74


    $          13.98























    (1)

    The geographic split of our revenues on a services basis is presented below:













    Americas Revenues:






















    Colocation

    $     541,988


    $     522,171


    $     497,659


    $  1,064,159


    $     985,118


    Interconnection

    187,491


    181,103


    167,618


    368,594


    332,505


    Managed infrastructure

    55,329


    49,222


    40,734


    104,551


    79,219


    Other

    5,581


    5,134


    451


    10,715


    2,489


    Recurring revenues

    790,389


    757,630


    706,462


    1,548,019


    1,399,331


    Non-recurring revenues

    40,475


    42,791


    44,181


    83,266


    77,252


    Revenues

    $     830,864


    $     800,421


    $     750,643


    $  1,631,285


    $  1,476,583













    EMEA Revenues:






















    Colocation

    $     433,339


    $     414,569


    $     398,703


    $     847,908


    $     786,978


    Interconnection

    66,845


    68,140


    65,258


    134,985


    126,908


    Managed infrastructure

    30,447


    30,990


    31,176


    61,437


    63,287


    Other

    22,048


    6,414


    3,682


    28,462


    8,728


    Recurring revenues

    552,679


    520,113


    498,819


    1,072,792


    985,901


    Non-recurring revenues

    46,522


    30,367


    39,110


    76,889


    70,745


    Revenues

    $     599,201


    $     550,480


    $     537,929


    $  1,149,681


    $  1,056,646













    Asia-Pacific Revenues:






















    Colocation

    $     281,635


    $     282,615


    $     259,573


    $     564,250


    $     514,131


    Interconnection

    60,841


    59,987


    54,898


    120,828


    108,080


    Managed infrastructure

    19,916


    20,642


    22,094


    40,558


    44,843


    Other

    1,991


    1,337


    616


    3,328


    1,109


    Recurring revenues

    364,383


    364,581


    337,181


    728,964


    668,163


    Non-recurring revenues

    22,706


    18,965


    32,166


    41,671


    52,591


    Revenues

    $     387,089


    $     383,546


    $     369,347


    $     770,635


    $     720,754













    Worldwide Revenues:






















    Colocation

    $  1,256,962


    $  1,219,355


    $  1,155,935


    $  2,476,317


    $  2,286,227


    Interconnection

    315,177


    309,230


    287,774


    624,407


    567,493


    Managed infrastructure

    105,692


    100,854


    94,004


    206,546


    187,349


    Other

    29,620


    12,885


    4,749


    42,505


    12,326


    Recurring revenues

    1,707,451


    1,642,324


    1,542,462


    3,349,775


    3,053,395


    Non-recurring revenues

    109,703


    92,123


    115,457


    201,826


    200,588


    Revenues

    $  1,817,154


    $  1,734,447


    $  1,657,919


    $  3,551,601


    $  3,253,983


































    (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

    $     930,257


    $     915,875


    $     865,120


    $  1,846,132


    $  1,676,337


    Depreciation, amortization and accretion expense

    (319,011)


    (321,729)


    (310,916)


    (640,740)


    (602,856)


    Stock-based compensation expense

    (11,878)


    (10,443)


    (10,008)


    (22,321)


    (18,475)


    Cash cost of revenues

    $     599,368


    $     583,703


    $     544,196


    $  1,183,071


    $  1,055,006













    The geographic split of our cash cost of revenues is presented below:

















    Americas cash cost of revenues

    $     243,636


    $     239,403


    $     234,679


    $     483,039


    $     428,139


    EMEA cash cost of revenues

    215,983


    202,848


    196,661


    418,831


    395,844


    Asia-Pacific cash cost of revenues

    139,749


    141,452


    112,856


    281,201


    231,023


    Cash cost of revenues

    $     599,368


    $     583,703


    $     544,196


    $  1,183,071


    $  1,055,006






    (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

    $     564,075


    $     545,198


    $     507,615


    $  1,109,273


    $     991,898


    Depreciation and amortization expense

    (113,817)


    (114,657)


    (106,842)


    (228,474)


    (209,220)


    Stock-based compensation expense

    (92,804)


    (79,509)


    (84,327)


    (172,313)


    (154,210)


    Cash operating expense

    $     357,454


    $     351,032


    $     316,446


    $     708,486


    $     628,468












    (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

    $     193,727


    $     192,511


    $     185,610


    $     386,238


    $     368,437


    Depreciation and amortization expense

    (49,817)


    (47,621)


    (49,549)


    (97,438)


    (101,620)


    Stock-based compensation expense

    (23,171)


    (20,184)


    (20,779)


    (43,355)


    (38,482)


    Cash sales and marketing expense

    $     120,739


    $     124,706


    $     115,282


    $     245,445


    $     228,335












    (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

    $     370,348


    $     352,687


    $     322,005


    $     723,035


    $     623,461


    Depreciation and amortization expense

    (64,000)


    (67,036)


    (57,293)


    (131,036)


    (107,600)


    Stock-based compensation expense

    (69,633)


    (59,325)


    (63,548)


    (128,958)


    (115,728)


    Cash general and administrative expense

    $     236,715


    $     226,326


    $     201,164


    $     463,041


    $     400,133












    (7)

    The geographic split of our cash operating expense, or cash SG&A, as defined above, is presented below:













    Americas cash SG&A

    $     211,004


    $     204,463


    $     190,040


    $     415,467


    $     378,028


    EMEA cash SG&A

    87,836


    87,287


    78,742


    175,123


    154,713


    Asia-Pacific cash SG&A

    58,614


    59,282


    47,664


    117,896


    95,727


    Cash SG&A

    $     357,454


    $     351,032


    $     316,446


    $     708,486


    $     628,468












    (8)

    We define adjusted EBITDA as net income excluding income tax expense, interest income, interest expense, other income or expense, loss or gain on debt extinguishment, depreciation, amortization, accretion, stock-based compensation expense, restructuring charges, impairment charges, transaction costs, and gain or loss on asset sales as presented below:













    Net income

    $     216,242


    $     147,693


    $        68,487


    $     363,935


    $     224,561


    Income tax expense (benefit)

    8,635


    32,744


    (18,527)


    41,379


    14,101


    Interest income

    (4,508)


    (2,106)


    (374)


    (6,614)


    (1,103)


    Interest expense

    90,826


    79,965


    87,231


    170,791


    176,912


    Other expense

    6,238


    9,549


    39,377


    15,787


    46,327


    (Gain) loss on debt extinguishment

    420


    (529)


    102,460


    (109)


    115,518


    Depreciation, amortization and accretion expense

    432,828


    436,386


    417,758


    869,214


    812,076


    Stock-based compensation expense

    104,682


    89,952


    94,335


    194,634


    172,685


    Transaction costs

    5,063


    4,240


    6,985


    9,303


    8,167


    (Gain) loss on asset sales

    (94)


    1,818


    (455)


    1,724


    1,265


    Adjusted EBITDA

    $     860,332


    $     799,712


    $     797,277


    $  1,660,044


    $  1,570,509













    The geographic split of our adjusted EBITDA is presented below:

















    Americas net income (loss)

    $       38,199


    $     (19,572)


    $  (179,570)


    $        18,627


    $  (190,634)


    Americas income tax expense (benefit)

    8,516


    32,744


    (18,522)


    41,260


    13,725


    Americas interest income

    (3,904)


    (1,728)


    (401)


    (5,632)


    (748)


    Americas interest expense

    82,160


    70,730


    77,169


    152,890


    156,682


    Americas other (income) expense

    (55,803)


    (23,390)


    46,609


    (79,193)


    14,616


    Americas (gain) loss on debt extinguishment

    420


    (261)


    102,460


    159


    115,669


    Americas depreciation, amortization and accretion expense

    230,099


    230,086


    222,413


    460,185


    425,119


    Americas stock-based compensation expense

    73,677


    63,917


    69,982


    137,594


    128,244


    Americas transaction costs

    2,715


    2,991


    6,239


    5,706


    6,478


    Americas (gain) loss on asset sales

    145


    1,038


    (455)


    1,183


    1,265


    Americas adjusted EBITDA

    $     376,224


    $     356,555


    $     325,924


    $     732,779


    $     670,416













    EMEA net income

    $     101,638


    $        98,388


    $     136,924


    $     200,026


    $     219,034


    EMEA income tax expense

    119




    119


    376


    EMEA interest income

    (525)


    (267)


    (31)


    (792)


    (17)


    EMEA interest expense

    (112)


    916


    2,002


    804


    3,207


    EMEA other (income) expense

    57,169


    29,171


    (7,737)


    86,340


    28,343


    EMEA depreciation, amortization and accretion expense

    116,070


    114,866


    115,702


    230,936


    226,915


    EMEA stock-based compensation expense

    19,168


    16,112


    15,114


    35,280


    27,244


    EMEA transaction costs

    2,094


    1,157


    552


    3,251


    987


    EMEA (gain) loss on asset sales

    (239)


    2



    (237)



    EMEA adjusted EBITDA

    $     295,382


    $     260,345


    $     262,526


    $     555,727


    $     506,089













    Asia-Pacific net income

    $       76,405


    $        68,877


    $     111,133


    $     145,282


    $     145,282


    Asia-Pacific income tax benefit



    (5)




    Asia-Pacific interest income

    (79)


    (111)


    58


    (190)


    (190)


    Asia-Pacific interest expense

    8,778


    8,319


    8,060


    17,097


    17,097


    Asia-Pacific other expense

    4,872


    3,768


    505


    8,640


    8,640


    Asia-Pacific gain on debt extinguishment


    (268)



    (268)


    (268)


    Asia-Pacific depreciation, amortization and accretion expense

    86,659


    91,434


    79,643


    178,093


    160,042


    Asia-Pacific stock-based compensation expense

    11,837


    9,923


    9,239


    21,760


    17,197


    Asia-Pacific transaction costs

    254


    92


    194


    346


    702


    Asia-Pacific loss on asset sales


    778



    778



    Asia-Pacific adjusted EBITDA

    $     188,726


    $     182,812


    $     208,827


    $     371,538


    $     348,502












    (9)

    We define cash gross margins as cash gross profit divided by revenues.

















    Our cash gross margins by geographic region are presented below:

















    Americas cash gross margins

    71 %


    70 %


    69 %


    70 %


    71 %


    EMEA cash gross margins

    64 %


    63 %


    63 %


    64 %


    63 %


    Asia-Pacific cash gross margins

    64 %


    63 %


    69 %


    64 %


    68 %












    (10)

    We define adjusted EBITDA margins as adjusted EBITDA divided by revenues.













    Americas adjusted EBITDA margins

    45 %


    45 %


    43 %


    45 %


    45 %


    EMEA adjusted EBITDA margins

    49 %


    47 %


    49 %


    48 %


    48 %


    Asia-Pacific adjusted EBITDA margins

    49 %


    48 %


    57 %


    48 %


    48 %






    (11)

    We define adjusted EBITDA flow-through rate as incremental adjusted EBITDA growth divided by incremental revenue growth as follows:













    Adjusted EBITDA – current period

    $     860,332


    $     799,712


    $     797,277


    $  1,660,044


    $  1,570,509


    Less adjusted EBITDA – prior period

    (799,712)


    (787,577)


    (773,232)


    (1,573,875)


    (1,448,647)


    Adjusted EBITDA growth

    $       60,620


    $        12,135


    $        24,045


    $        86,169


    $     121,862













    Revenues – current period

    $  1,817,154


    $  1,734,447


    $  1,657,919


    $  3,551,601


    $  3,253,983


    Less revenues – prior period

    (1,734,447)


    (1,706,378)


    (1,596,064)


    (3,381,554)


    (3,083,882)


    Revenue growth

    $       82,707


    $        28,069


    $        61,855


    $     170,047


    $     170,101













    Adjusted EBITDA flow-through rate

    73 %


    43 %


    39 %


    51 %


    72 %












    (12)

    FFO is defined as net income or loss, excluding gain or loss from the disposition of real estate assets, depreciation and amortization on real estate assets and adjustments for unconsolidated joint ventures’ and non-controlling interests’ share of these items.













    Net income

    $     216,242


    $     147,693


    $        68,487


    $     363,935


    $     224,561


    Net (income) loss attributable to non-controlling interests

    80


    (240)


    (148)


    (160)


    140


    Net income attributable to Equinix

    216,322


    147,453


    68,339


    363,775


    224,701


    Adjustments:











    Real estate depreciation

    278,046


    280,196


    271,500


    558,242


    528,144


    (Gain) loss on disposition of real estate property

    1,850


    2,845


    (518)


    4,695


    2,612


    Adjustments for FFO from unconsolidated joint ventures

    2,131


    2,150


    1,552


    4,281


    2,679


    FFO attributable to common shareholders

    $     498,349


    $     432,644


    $     340,873


    $     930,993


    $     758,136























    (13)

    AFFO is defined as FFO, excluding depreciation and amortization expense on non-real estate assets, accretion, stock-based compensation, stock-based charitable contributions, restructuring charges, impairment charges, transaction costs, an installation revenue adjustment, a straight-line rent expense adjustment, a contract cost adjustment, amortization of deferred financing costs and debt discounts and premiums, gain or loss on debt extinguishment, an income tax expense adjustment, net income or loss from discontinued operations, net of tax, recurring capital expenditures and adjustments from FFO to AFFO for unconsolidated joint ventures’ and non-controlling interests’ share of these items.













    FFO attributable to common shareholders

    $     498,349


    $     432,644


    $     340,873


    $     930,993


    $     758,136


    Adjustments:











    Installation revenue adjustment

    (34)


    845


    4,539


    811


    8,451


    Straight-line rent expense adjustment

    4,207


    3,660


    3,381


    7,867


    7,742


    Amortization of deferred financing costs and debt discounts and premiums

    4,536


    4,204


    4,447


    8,740


    8,370


    Contract cost adjustment

    (7,891)


    (14,939)


    (13,381)


    (22,830)


    (27,392)


    Stock-based compensation expense

    104,682


    89,952


    94,335


    194,634


    172,685


    Stock-based charitable contributions

    14,039




    14,039



    Non-real estate depreciation expense

    103,349


    105,575


    93,062


    208,924


    178,040


    Amortization expense

    51,875


    49,569


    51,679


    101,444


    105,074


    Accretion expense (adjustment)

    (442)


    1,046


    1,517


    604


    818


    Recurring capital expenditures

    (34,775)


    (23,881)


    (45,331)


    (58,656)


    (65,661)


    (Gain) loss on debt extinguishment

    420


    (529)


    102,460


    (109)


    115,518


    Transaction costs

    5,063


    4,240


    6,985


    9,303


    8,167


    Impairment charges (1)



    33,552



    33,552


    Income tax expense adjustment (1)

    (49,683)


    (323)


    (47,440)


    (50,006)


    (46,675)


    Adjustments for AFFO from unconsolidated joint ventures

    (2,303)


    569


    1,259


    (1,734)


    1,940


    AFFO attributable to common shareholders

    $     691,392


    $     652,632


    $     631,937


    $  1,344,024


    $  1,258,765













    (1)  Impairment charges for 2021 relate to the impairment of an indemnification asset in Q2 2021 resulting from

         the settlement of a pre-acquisition uncertain tax position, which was recorded as Other Income (Expense)

         on the Condensed Consolidated Statements of Operations. This impairment charge was offset by the

         recognition of tax benefits in the same amount, which was included within the Income tax expense

         adjustment line on the table above.












    (14)

     Following is how we reconcile from adjusted EBITDA to AFFO:











    Adjusted EBITDA

    $     860,332


    $     799,712


    $     797,277


    $  1,660,044


    $  1,570,509


    Adjustments:











    Interest expense, net of interest income

    (86,318)


    (77,859)


    (86,857)


    (164,177)


    (175,809)


    Amortization of deferred financing costs and debt discounts and premiums

    4,536


    4,204


    4,447


    8,740


    8,370


    Income tax (expense) benefit

    (8,635)


    (32,744)


    18,527


    (41,379)


    (14,101)


    Income tax expense adjustment (1)

    (49,683)


    (323)


    (47,440)


    (50,006)


    (46,675)


    Straight-line rent expense adjustment

    4,207


    3,660


    3,381


    7,867


    7,742


    Stock-based charitable contributions

    14,039




    14,039



    Contract cost adjustment

    (7,891)


    (14,939)


    (13,381)


    (22,830)


    (27,392)


    Installation revenue adjustment

    (34)


    845


    4,539


    811


    8,451


    Recurring capital expenditures

    (34,775)


    (23,881)


    (45,331)


    (58,656)


    (65,661)


    Other expense

    (6,238)


    (9,549)


    (39,377)


    (15,787)


    (46,327)


    (Gain) loss on disposition of real estate property

    1,850


    2,845


    (518)


    4,695


    2,612


    Adjustments for unconsolidated JVs’ and non-controlling interests

    (92)


    2,479


    2,663


    2,387


    4,759


    Adjustments for impairment charges (1)



    33,552



    33,552


    Adjustment for gain (loss) on sale of assets

    94


    (1,818)


    455


    (1,724)


    (1,265)


    AFFO attributable to common shareholders

    $     691,392


    $     652,632


    $     631,937


    $  1,344,024


    $  1,258,765













    (1)  Impairment charges for 2021 relate to the impairment of an indemnification asset in Q2 2021 resulting from

         the settlement of a pre-acquisition uncertain tax position, which was recorded as Other Income (Expense)

         on the Condensed Consolidated Statements of Operations. This impairment charge was offset by the

         recognition of tax benefits in the same amount, which was included within the Income tax expense

         adjustment line on the table above.












    (15)

    The shares used in the computation of basic and diluted FFO and AFFO per share attributable to Equinix is presented below:













    Shares used in computing basic net income per share, FFO per share and AFFO per share

    91,036


    90,771


    89,648


    90,904


    89,490


    Effect of dilutive securities:










    Employee equity awards

    226


    391


    456


    309


    534


    Shares used in computing diluted net income per share, FFO per share and AFFO per share

    91,262


    91,162


    90,104


    91,213


    90,024













    Basic FFO per share

    $            5.47


    $            4.77


    $            3.80


    $          10.24


    $            8.47


    Diluted FFO per share

    $            5.46


    $            4.75


    $            3.78


    $          10.21


    $            8.42













    Basic AFFO per share

    $            7.59


    $            7.19


    $            7.05


    $          14.79


    $          14.07


    Diluted AFFO per share

    $            7.58


    $            7.16


    $            7.01


    $          14.74


    $          13.98

     

    Equinix.  (PRNewsFoto/Equinix) (PRNewsfoto/Equinix, Inc.)

     

    Cision View original content to download multimedia:https://www.prnewswire.com/news-releases/equinix-reports-second-quarter-2022-results-301594558.html

    SOURCE Equinix, Inc.

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