Equinix Reports, Plans Aggressive DC Expansion

Data center builder and operator Equinix (NASDAQ:EQIX, news, filings) filed its Q4 earnings yesterday, turning in its usual workmanlike growth report.  Of course, the stock has risen sharply since the beginning of the year and probably overshot a bit on expectations, but at its core Equinix seems to have had a fine quarter overall in which it met guidance and maintained its forward projections.  Here’s a quick tabular summary:

$ in millions	Q4/10	Q1/11	Q2/11	Q3/11	Q4/11	Q1/12 (guidance)	FY/12 (guidance)
– Recurring	326.3	343.9	376.5	397.4	410.7
– Non-recurring	18.9	19.1	18.4	20.2	20.6
Revenues	345.2	363.0	394.9	417.6	431.3	443-446	>1870
COS	193.6	194.6	215.6	228.2	229.3
Cash SG&A	70.8	73.1	76.0	81.4	89.7	90-95	370-400
Adjusted EBITDA	148.9	167.3	181.3	191.6	198.2	200-205	>850
Earnings Per Share	0.29	0.53	0.64	0.20	0.35
Ongoing Capex	32.4	32.7	28.0	26.6	~28	30	120
Expansion Capex	111.0	139.8	160.9	104.9	124-144	150-170	580-680

Revenue and adjusted EBITDA were above expectations, but earnings per share were 9 or 10 cents off what analysts had apparently been projecting, and the company did not increase 2012 projections.  Cloud euphoria or not, the datacenter business has long cycle times and its growth profile doesn’t change speed and direction as swiftly as some others, so I’m not sure what the street was expecting.  Growth looks solid to me and guidance is probably a tad conservative as usual.

Meanwhile, Equinix unveiled plans for expansion in the Washington DC metro area.  First of all, they will be building their eleventh IBX facility, which shall go by the predictable name DC11.  According to plans, DC 11 will be located next to the existing DC-6 IBX and will feature 232,000 gross square feet of space.  Phase one will put 42,800 square feet of customer floor space in service at a cost of $88M in capex, with completion expected in early 2013. Equinix is also planning to move onto the $21M phase 2 expansion of DC10, with phase one’s 15,456 square feet set to open next month.  All this work in DC is already included in the company’s guidance.

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Categories: Datacenter · Financials