Switch & Data Also Unshaken

As with Equinix last week, datacenter specialist Switch & Data reported earnings Tuesday and didn’t even blink in these difficult times.  Revenues of $44.1M and EBITDA of $14.0M were in-line with guidance, and EPS of $0.00 was lower because costs were a bit higher than in past quarters as expected due to the rollout of new datacenters in advance of revenue derived from them.

The company actually increased 2008 guidance slightly to $171.5M in revenue and $56M in EBITDA, which works out to Q4 revenue of $45.7M and EBITDA of $15.3M.  They also provided 2009 guidance for revenues of $207-210M, EBITDA of $71-73M, and capex of $65M.  That corresponds to over 20% revenue growth, and presumably it comes from those new facilities coming online as we enter next year.  All in all, a very good quarter I’d have to say, and they seem to have good visibility.

Switch & Data did not slow its expansion in the face of a difficult economic environment as I thought they might in my earnings preview, their existing projects seem to be going full steam ahead.  However, the 2009 capex number implies that once those projects are online they aren’t planning more.  That makes total sense of course in this environment, and if things get better they can change their minds.  For the colocation and datacenter sector in general, it seems that sales are strong and steady, but funding limitations will slow the growth in supply.

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Categories: Datacenter · Financials