Digital Realty Trust (DLR) 27 Jul 232023 Q2 Earnings call transcript

Good afternoon, and welcome to the Digital Realty Second Quarter 2023 Earnings Call. Please note this event is being recorded.

During today's presentation, all parties will be in a listen-only mode.

Following the presentation we will conduct a question-and-answer session. Callers will be limited to one question, plus a follow-up, and we'll aim to conclude at the bottom of the hour.

to Senior call and Vice Relations. like Sadler, to Private now Realty's Digital President would turn over the Jordan Investor I of Public go Please ahead.

XXXX to Thank Realty's welcome operator, call. everyone you, second and quarter earnings conference Digital

the and available Revenue Joining and Andy are Officer, Officer, Wright; Colin CFO, me Chris for Officer, on Investment Power; Chief Chief McLean, CEO, Technology are call Mercier; Sharp; on be call Greg today's Q&A. and President will Matt and also Chief

underlying and guidance on including statements, forward-looking make may call. assumptions Management today’s

Forward-looking based uncertainties expectations materially. involve that that could differ statements to on are risks cause and actual results

For filings a of with to related subsequent see SEC. our business, further discussion the and our XX-K risks

package financial Reconciliations and certain call SEC income furnished available contain on This our supplemental to to information. will website. the are non-GAAP net the included in

turn I takeaways key our Before let Andy, call to a the me few offer second quarter. from over

confirmed We of growth dispositions one spreads JVs of First, interconnection of in peak quarter and and to value another reduced which $X a healthy than And bolstered and sources growth more a in grew over X.X% we under resonate. leverage continues greater to now years consecutive best zero by past supported yet much our and with marking the a levels NOI billion fundamentals billion rebound at ATM. than cash year, equity quarter positive our diversified our almost second inflection environment. issued off $X than stands billion the same continued our liquidity, speaking strongest about well And further capital and this second, nine $X through the more in total our third, for years. and we have of of pricing megawatt strong proposition quarter our megawatt by and were in saw leasing. past of delivered the strong Releasing been segment the stabilized customer plus leasing three

With and to over the our Power. turn like I'd call to President that, CEO, Andy

everyone an half joining focused call. we delivering to Thanks, strategic of have Jordan, our our dynamic plus the first thanks of our advancing customers. behalf X,XXX backdrop and Against and priorities on for on of the remained year, extraordinarily

in delevering will strong play critical of in second improvements, digital quarter improving with centers revenue, EBITDA We plan role sheet. made transformation and data in on support CFFO share, development and results, liquidity, increasing organizational progress our Realty that progress Digital the artificial growth balance recognition operational the posted increased the of improved continued and an and liquidity bolstering both intelligence. while per sequential adjusted returns, funding

quarter, that During I three on progress earlier this the priorities each strategic the key year. of out laid we made

value by revenue double posting we quarter and second enhancing interconnection First, highest connectivity history. strengthened the proposition customer digit of our more additions record options, with new of logo interest our company communities growth in

and enhancements partnership performance with additional integrating broadening enhancements consistent leveraging designed delivering to our while high and HXXX organizational structure including efficiency. and our and support improve experience, cooling also ready centers of to Second, innovated with AI data deliver DGx by certification our we design, the integrated, data effectiveness center first compute, enabling while existing a with liquid NVIDIA solutions, to support data

stabilized second and interest centers that during partner partner Subsequent joint a three the acquired facilities at an new sources Virginia. transaction center including Chicago. venture capital today, hyperscale of joint capital of ATM. new X.X% to capital venture our for an private And in similar two a we raised Texas diverse a attractive in sale formed we stabilized access announced hyperscale in with we equity data non-core a private Northern alongside in data the Third, end quarter, rate asset the quarter under a the cap

position the through focused now balance the halfway than XXXX putting into well on of infrastructure ahead remain demand to and our across sheet for original Digital opportunity The is support growing more There the year, little center and landscape midpoint products. funding we the that capacity a widespread for of is we plan healthy. data very center Realty's our of are lies various current ahead. state regions Just data

However, there tight availability due new is conditions. supply power limited to financial and decreased

we by of both of transformation continuous escalating data Cloud of The and digital demand. global with expansion AI clients importance requests shaping for on numerous underscores AI Computing Presently, the with are data enterprises collaborating The in focused including paired enhanced and initial latency. in applications which a and anticipated to implementations. performance proposals expected is inferencing surge followed are necessitate reduce private training sets, access rise applications intensive power in to

is the integral with nature align capacity extensive product larger these necessitating our models seamlessly which of blocks Additionally, suite.

enterprises, applications meeting AI strategic full solutions, the the global point. digital data transformation exchange place center Realty and at a vantage journeys. provider spectrum facilitating As integration efficient allows stands their within of data for a of Digital us to to of needs their cater This

private secured framework approaches and the unveiled consumption from recognized to tool X.X, data for Gravity were comprehensive a architecture designed Data data science. we data access patent centers, as generation these. both public their insights in quarter, clouds Index Data enterprises In Gravity innovative data. is represents a to effects in extended to Moreover, the center our second manage drive offering data and This and commitment and we enterprise which our of

Our patent the remain to their a enterprises relevant future. architectures further offers ensure in roadmap

shifted a clear, we entering data to physical now which have a The is a evidence is the economy economy, new form, digital from economy.

devices rising to attributed private infrastructure, training and server by and same AI augmented in that storage further Our cloud due inference the demand research regulation. At processes. is demand time, public for be shows the the both can to grow needs of to poised surge data

our Let's move to quarter second results.

in inflection fundamental quarters. highlighting the portfolio the core quarter in continued several we've recovery the over past This been our

in across strong also spreads with Our but again pipeline remains to in during all drive and releasing helping regions. supporting strong pricing the positive rebound leasing types product quarter, sequential volume a all

$XXX signings. megawatt a quarter the strength one continued quarters to increased was XX% our XX% leasing, by the during in million over megawatt than by with one interconnection zero plus Greater of in of sequentially, strongest ever leasing led which represented New EMEA. total

and with along saw demand and supportive of our Realty the enhancing best growth expected NOI spreads availability climbed joined that proposition be growing nearly we've releasing second capital reduced in on to pricing, to I of returns. recognition are Strong same since we helping XXXX. our cash value seen Digital continue X% basis, trends the quarter, drive to a cash In

and nice XXX streak plus ever in low added transformation strong enterprise of and we validation platform going. we at we This During new of and digital the is new recognize value second the and customers, continuation have churn the logo digital. are of IT a the that that second XXX our X.X% remained of best quarter, seeing a customers stability spend quarter

solutions. with reduce an data control Our to Platform Platform by tasked applications, on sites oriented US provider hub Data interconnecting costs federal infrastructure ecosystem agency Realty deployed stranded key key sustainability, are that for module innovative intensive included being support while partners. Digital's to AI compute improve workloads their and Digital and major a edge wins into sustainability utilizing network energy chose Digital

And is A expanding A sovereignty security, infrastructure presence points company to restaurant strategy A hybrid is strong with most leveraging systems ensure existing [P largest leading XXX production upgrade Digital Pharmaceuticals updating compliance the and sourcing secure to to key for chain their bank IT Digital and global a a of distribution Manufacture Digital business. on the centers. in growth help Fortune to and cloud of their governance support data services by Auto architecture XXXX quick while support important connect in Europe Platform (ph) compliance. the chose to European their Platform to Digital serve reliability improve data network chose XXXX connectivity. internal regulations, global simplify Platform their available with Central new and [indiscernible] e-commerce adding Platform global and Cloud]

Moving new that provider the to market we've work and over constraints for years the growth Northern continue customers provide in churn opportunities. power through development made and our largest power with In will our our the we customers this to to confirm select that constructively market, to capacity the commitments learned since to Virginia.

with that of utility we've of XXX able almost on to able last support XX capacity partners, billable been underway bring to and nearly megawatts of course months the to available we within megawatts expect forward includes local the the current development pipeline market megawatts. prior XXXX. capacity to move This be to to the another Over potential of incremental our identify several XX

development. Ashburn site Manassas in In is our to megawatt focus now in position we've capacity, development XXX on progress this addition meaningful nearly made which begin to

customers. We about availability the term this our optimistic offer potential are to near to

investment our to on activity. Moving

our for XXXX As poised call. since we has in their our some of investments and the harvested February, an year fruit of was labor be team to been active last outlined

of in ample transaction, the we associated campus for million. growth. load a center could purchased XX Schiphol runway quarter, to During support the our Amsterdam, service highly for IT we which with where lease we separate previously and adjacent shell $XX connected second land provider leased acquired potential data proofing another additional in both interest future the held In hold a land megawatts providing previously Amsterdam, enterprise and

as executed primary important Realty. first its on previously cap are just billion in more In a ventures shell of proceeds remain two and Ashburn. for new premium. in mid-May power $X we validation This of net at disposition delivering at we resulting data stabilized the occupants. acceleration and in cap significant joint as an centers year were of capital hyperscale on a saw Realty. over was strategy Chicago one closed $XXX million of at also shareholder hyperscale cash separate a was non-core July, transactions and Digital We raised digit initiatives, assets current These to on of Digital deals X.X% leased development rate our than returns average the through unlevered These monetization to of our and of net X% at a stabilized the recycling closing on to proceeds sold double facility in focused rate value

substantially that But efficiency sheet. avenue our can the we capital of increasing without capital our execute that while ahead of equally balance reliant as any individual on so and lies diversified bolstered sources private being on of also opportunity important, the we've overly

his Wright, team goes Greg and of on through are While we've resting these our laurels. for rest due traction had credit not markets the remarkable platform environment, and capital a top-notch tumultuous transactions our on we to executing all

our We well on as plan bucket hyper we'll and see hyperscale venture ample joint updates demand appropriate. discussed provide that the of development ahead plan, previously sale are we joint have venture our stabilized we for but

[BAM] Company in builds the (ph) Digital delighted our expanded in to of partner welcome also newest our venture with digital on I'm on, ecosystem by moving large partnership foundation Before the XX% massive joint strong private connectivity Jio's to The as through and Reliance of Realty, enterprises India. [indiscernible] relationships strong laid addition Industries India. enterprise

ESG to during like over touch it progress to Matt, turning Before on I'd the our quarter.

renewable XXX% wherever contracting by solar energy renewable of gigawatt match second targets, toward our XXX for the enabled fifth the us outlining our we in The our success progress carbon XXXX. contract our X enabled and so have report possible we During US. made data to by our XXXX. under with for quarter, XX% have annual of energy ESG centers This wind has We've emission our report issued the initiatives energy. global highlights science-based that commitment reduce to by we

the pack. from In a adherence center quarter, data of neutral also the second climate we received certificate

As to with Realty's the are our on climate of growth impact Digital XXXX. to neutral minimizing a track overarching while that environment, member for we certify the of of all delivering meet to goal stakeholders. founding committed the auditors the by for the to industry become Digital worked We remain Realty independent pack on pack, sustainable

pleased I'm over to CFO, that, our turn Matt to With call Mercier. the

Andy. you, Thank

We into of of part since plus the right accounting jump interconnection $XX megawatt $XXX and for overall in a last XX% in results. with million zero bookings region. me in category, quarter each plus of megawatt to million one leases quarter, We new Let the signed across to zero one our our approximately second the becoming total broad-based strength year. segment . second bookings larger interconnection leased

XX-month record a interconnection, Interconnection strong million. results is one Realty at has years, past These a Zero bookings, in a among megawatt bookings the and one bookings excluding over Digital more once strongest concluding tripling over demonstrate our to combination plus way strategy four our to inorganic segment the that long $XX through working. ever come were zero megawatt again at organic million, than full of $XX interconnection spectrum were our period. growth.

$XX totaled including strength Johannesburg, quarter's the also we last standout, contributions and bounce EMEA while strong bookings in and Paris saw in Greater pause. quarter, from than a million Virginia megawatt [indiscernible] from back the Tokyo. a was meaningful Northern timing-oriented notable

escalators with fixed We inflation-linked escalators quarter leases also our newly CPI-based the balance. new in the within continue to leases overindex rate towards XX% increases signed on contained of with the

markets. in a opportunistically X the the original nearly our improved With response market, we capacity doubling from it and Illustrating year customer took during last substantial quarter a quarter, first lease past over premium. changing lease back of the of the of Virginia, largest rates to customer an in Ashburn, in many has was Pricing constraints. megawatts seen supply another The tide Northern to signed existing released year. at in

lease. than new the only quarter the annualized uplift the achieved the in of rather prior value versus rent represents for the lease full leasing new our Accordingly,

around opportunity increased and and have development Northern connectivity Virginia, previously are encouraged enthusiasm and this market. mark-to-market in potential our growing we potential offering we in recent this by tempered transaction While colocation the

the in in also Virginia, APAC. EMEA from we Aside and have well an as rates seen the improvement seen as Americas Northern across shift in

product forward, with types and geographies. Looking strength funnel demand remains our healthy across

newly and approved next through be growth to contributor an important ongoing expect year. capacity our to We development

not Turning commencements as at well current yet leasing. new million $XXX backlog once to end were over backlog leases by again $XXX but was slide. our The signed of balanced million, quarter commenced

the quarters. the We commencements was of and the and somewhat XX signings remaining customers await half be million certain The evenly expect between commencements months hyperscale lag in to XXXX quarter as the of third completions. build-out between $XXX fourth weighted in second

quarter, strength our improvement three was reflect during second our the are $XXX rates broad-based in product across increases basis, full signed regions, across quarter pricing we During of success we leases first segments over half year-to-date with years. three the shared we guidance X.X% raising a today's in on better spreads X% the the renewal fundamental renewal our million for renewal and cash both renewal with year of last pricing This environment. continuing saw improved combined, trending to strongest

Renewal since even third were spreads increase second considerable in an quarter of sixth consecutive quarter on X million quarter cash increased by million renewals the largest on climb of within Greater category megawatt quarter X.X% the renewals, increase this megawatt spreads of X.X% in for the second the as zero $XX releasing category stronger of one the XXXX. to to in continued $XXX the to volume. than

Turning to operating results. our

Our than in continued bit operating of and interconnection well-controlled quarter another quarter core financial the revenue many second performance, by record quarter. our last the improvement highlighted performance of factors a was better expenses. our expectations and The in we highlighted operating same

currency expectations. share X% quarter reported FFO share, In constant second terms we second $X.XX we quarter reported FFO XXXX. earnings a quarter On better growth, core the versus in to of of $X.XX the per and consensus of per $X.XX the basis, prior was core relative

revenue reimbursements, both in the are of was Most sequentially. XX% costs growth costs up XX Europe volatility particularly past and impacted customers. was the The the over this utility year inclusion and months. Teraco passed these our year-over-year directly significant of energy through and X% revenue to Total in year-over-year by

utility reimbursements, Excluding XX% was revenue year-over-year. up total

bankruptcy million our revenues onetime and rental a of tenant during a $XX $X that the Critically, quarter declared related quarter. in second rent reserve write-off debt to noncash included straight-line bad the million the

rent core share. off combined we related Northern excluded executed also to noncash of $XX These the write-offs of $X are We rent million approximately straight-line FFO Virginia. straight in opportunity wrote per of noncash from line re-leasing million

X% year-over-year the sequentially. revenue by in a increasing quarter, at was Interconnection and record XX% level

core in up revenue organic three ongoing regions footprint. X% the were all in Bookings strength activations our in quarter. Teraco, Excluding ServiceFabric and interconnection the higher doubled year-over-year, reflecting was

in expenses than operating of as X% insurance were Other EBITDA utility expenses and costs, were well and resulting sequentially. both contained rental property growth XX% sequentially, flat year-over-year adjusted

in and NOI X.X% have the XXXX, escalators point turn in as in capital the Improvement in pool spreads. up our churn improvement been driven growth from releasing continued that marked same demonstrating with our upside an commencements and year-over-year same basis increase X.X% capital stabilized fundamentals and year-over-year second cash by we with quarter, performance operating stronger-than-expected sequentially. was strongest since occupancy XX This rent The highlighting. outpace the

encouraged recent very filing. to metric customer by of seen for we've does the in the tempered appear trend to and improvement indeed we're to friend, this half be While our a related enthusiasm date second the XXXX is our uncertainty bankruptcy the by

potential the time the more to impact quarter know expect we by results. report We about third

to Turning the sheet. balance

we meaningfully you of that in are for Andy we out as week, the outlined As remarks, in plan laid of his ahead funding this February.

an already development joint stabilized and joint sales to additional the in of have progress asset billion make ventures closed We of year. and second this approximately expect ventures $X.X half on

on Specifically, closed campus, the Ashburn we announced of of gross our stabilized raising interest in an another sale afternoon, stabilized proceeds. XX% XX% $X.X hyperscale centers on earlier two July, on we as interest proceeds. three data of in a gross raising Chicago data sold hyperscale this billion And in $XXX campus, million centers our

Including a the rate over sale this of month, of over in proceeds average raised the at last in far year. $X we've so we X% noncore from just asset cap announced blended billion capital Texas,

from issuance. this raised the recycling second $XXX approximately during was million total were this to week. this in as $X.X equity forward earlier million billion activity, ATM. These the quarter structured Included of under our capital X.X of was sale million that shares or addition of In we settled shares shares XX proceeds equity

transactions JV by track was X.X year-end. of quarter ratio leverage charge our forward near the times, and times, X.X us putting at end outstanding on toward time target was end coverage X while the fixed for Our Pro equity the was reported the forma leverage at X.X times. quarter settlement

to on debt Moving our profile.

average XX% ample five Our our growth of our is debt our is flexibility weighted weighted our years of global recycling. providing Approximately interest maturity net fixed dollar non-US reflecting denominated, rate is of X.X%. XX% XX% for our average debt unsecured, and the and nearly of Approximately is debt debt rate is platform. capital

Finally, during maturity we years. near-term year a $XXX schedule minimal maturing this the throughout have only of and with debt the out well-laddered rest million maturities

Lastly, let's our to turn guidance.

recycling recent and our as of billion are EBITDA year adjusted range NOI. the releasing $X.X balanced same full in to been acceleration revenue capital cash and $X.X by guidance at better-than-expected the spreads We capital $X.X guidance of affirming billion billion midpoint has

bankruptcy adjusting stabilized joint equity $X uncertainty share share to recent for core over however, venture FFO and share write-off following: the are, $X.XX customer and to a sales per and share $X.XX (ph) of our rent We full core straight-line $X.XX of to tied ranges our termination per X.XX] rent for issuance. additional funding about to noncash per $X.XX tied constant new and Virginia. billion by greater-than-expected acceleration Northern [X.XX plan, $X.XX of in near-term currency the FFO releasing the to including per to the share year and the unpaid guidance of to lower XXXX reflect per range related of opportunistic

the range bankruptcy assets points customer our X% quarter, basis anticipated capital spreads sales by the portfolio by our quarter, XX%, XX% to year operating greater to our stabilized X% than greater including growth a guidance, Given X% in greater this organic occupancy ventures. are respectively. our and largely the into than X%, of XXX re-leasing balanced moving potential to metrics the in cash cash than full NOI hyperscale supporting to partly reduction impact the also revised during updating in of on we joint continued guidance the increase same a year-end An turn progress up and reflecting to GAAP fundamentals the assumption of despite

asset plan, fall on of better-than-expected we of needed to financing a We've our liquidity currently debt of range also updated result ATM given $X JV the disposition and JV date, sales, JVs for nearly raised. Given raised equity billion our as funding billion, within now the the up guidance reduced our funding our also to have expect billion. of long-term dispositions full amount in year to current to We available $X the total support in execution $X.X plan capital. capital

This would Q&A concludes take our prepared remarks, questions. be session? please Operator, and the you to your now begin pleased we'll

ahead. for question We open the Please And [Operator Instructions] Barden first comes questions. Bank will now from of up of our call David America. go

for question. everyone. afternoon, Good taking my Thanks

for the new You Congrats have Waters] JV Dave. (ph) [Alex on deal. on

JV can could wanted XXXX, walk looking have Just through line speak pipeline? pipeline. then sight the you development if to to kind what of us know how funding you are of for with you comfortable you And the into

business, greater the the you've had And releasing X then on spreads than strong secondly, megawatt core side. on

the on into this curious for second bucket heading Just what of the year into half and Thanks. are expectations your XXXX.

Hey happened terms half Greg maybe thanks, call turn XXXX. to Appreciate Alex. development up on capital on of tie to going And can where going I'm pick speak to back words. in raising in next we're the the of kind to what's JVs, into I core it portfolio. year this

to comfortable the as the returns now that with they we time, the Look, Sounds we're roughly transactions joint billion good. stabilized billion we're if over JV demand $X with which to previously. these highest between half or parts, seeing that And ventures, remain out there billion. $X.X moving that's and still though. $X.X lot the (ph), Thanks, And joint engaged these of plug, That's what billion on guidance, becomes the development respect development JV a year just guidance the obviously second have will, the give to JVs for the there's full last you we Alex. provided offer particularly strong $X.X our take. year. development of given [XXX] with Look, ventures,

a to tend these little strategic take So given the longer. considerations here,

optimistic on those. for track I'd remain we say So, and

turn back and over I'll to that, Andy. Matt it With

Alex. Thanks,

that multiple if proposition the core in certainly value and results see pricing we as was through as saw well signings guidance it, you power flow and ROIs -- year-to-date which our growth. we year. that what for We the saw call and updated strong We our had operating on stats, we the in how our on correct. I year, those saw think I'm of mark-to-market quarter on about, lease your in cash same-store to quarter pleased quite the the new fronts second for the full We're question a and through. our and back coming

right these think the and that pricing cash will XXXX. into mark-to-markets half we trends now, of on power the continue back as So of

I across Yeah, quarter this all territory, than that, were our in all add includes megawatt as well. and just might we regions that again of saw positive greater renewals

The next question comes from Jon Petersen of Jefferies. Please go ahead.

Great. Thank what sorry, kilowatt to in were you break what down you to out, than rents push hour you where questions. in the job X you to very America? I ability the take your had wanted JV I about the X I'm of rents. an higher? much but for greater about on the it, were that deal. in ask taking like the And the can you maybe those Good know per on talked kind rents execution megawatts uplift drove if megawatts

Thanks, John.

very obviously we dynamics, on the quote new for. that need let was of through to market. they Matt with the base, if didn't and the -- mean a on have had been see supply give walk market installed that rate sense our tight idle working or capacity customer anyone is is I'll this we’ve deal near-term -- So, the actual I'll a that I you

contract a that So lower call it, back customer a of ago since contract hence, you able different sign that help at and had at able year was a were much immediate needs a that able stats? a take out we don't to rate. customer signed, capacity to we and let higher walk why to we from a through much But Matt, And the them rate. were we're

Yes, sure.

going you're to to is within are What here we be you'll that not showing clearly -- stats. signing incremental net stats. that you just the that talking So the our included And at recognize more clear, a is than our revenue -- when in renewal see and we're you're we expect about our you're deal that deal the doing supplemental, just incremental associated and to look to X see KW rate, in greater only a attached XXX Page America, because megawatt, in that's not going of it. see the the North we're megawatts to the revenue particular, showing

If would the XXXKW. call was you that XXX XX% put that It to But substantial down again, you we in-place currently. it, had was it come lease. higher deal got KW a uplift than in XXX%, what at, over from

that's sorry, XXXKW XXX KW deal? the X-megawatt excluding X-megawatt on the or deal I'm

our if Page Including, you in that our look would supplemental be okay. XXXKW, at blended rate, X the versus

Okay.

Okay. And to follow-up, with then one NOVA. stick just just

seeing demand the has nothing long with So, far Are XXXX. as come power commit really as that constraints leases like it online could people you new seems sign until nothing advance? are changed, to and there already leasing for that wanting in

an in facts, NOVA of the would supply. same demand say, John, created outpacing environment really So, the and utility well transmission I remain market, the terms of lines arrival of power, has which

on focused at honestly, based exactly the uncertainty of don't now XXXX per commence maximizing power improvement. so north ago. rise. the was kilowatt. We've that not That signings right XXs, we're when sure XXX in Again, less say, until making larger I'd that on are, that us. for signed market opportunity XXXX price hand quite We the has that long the seen of market categories, or in call that it, deals And dramatic in

And the capacity able really to and we've good customers reported, cobble news, given and breadth our that provider market, we as in utility incremental together with our our for history across work campuses. our been growth

have it, megawatts that if of you growth which not we XXXX, in call the approaching, by you're addition is arrival, Manassas. capacity XXX to them in call it, growth all up, If sooner, Ashburn, XXXX add capacity in prior to our

question from next Elias ahead. of Please go comes Michael The Cowen. TD

To seen of right deals the guys. megawatts. start, taking increase. over to point, are for XXX there that question market are many thanks the the Great, volume size recent we've requirements on and And that in now months

shareholder it As a you intention moving or And value? you deals up development lined considered if understanding your follow-up. these long-term these JV forward, the projects without with to deals? that these is And will compete the a with are I have for pursue strategy drive to then so, willing

you, tell didn't deals megawatt can XXX I quarter. this sign any So, in we

on, customers of its best are our footprint helping We opportunities. our in focused the around We're some for these use certainly way can. and maximizing best highest very call it, we

Some that the those our capacity. can tell domain for AI models, I itself of scales obviously the look footprint. you contiguous towards at of large deals trading need led have

help locations of extensive the that those around have globe we can We customers. types

back We are our capital our growth. into made customers' in of just July, great got footing support literally you we've saw both sources, in really month the -- progress as firmer to

I fire development think that to growth. Adding a support on more we'll put that fuel to partner, even

So, to bigger terms we I locations bank, sure opportunity in maximizing think of land our call and the I runway. is make capacity in Digital bigger our land it make and inventory we're in really -- our that precious in for sales our Realty what right when deals, to they the in got and sure comes

And sharpening I which just clear the piggyback driving you the you looked return. of If investments of go to that that Great. were the third back lens at to were guys intention then opportunity. about risk-adjusted point XXXX, maximizing you the on with to quarter higher

hyperscaler? spread worth us and turnkey an lease hyperscaler hyperscale which what basis. should into entire to about capital your be it to of As about framework Could single a make Thank give we appropriate a on for unlevered yield deals you. the lease it would it to thinking the you think a cost you in development your between

Michael. Thanks,

-- that that thinking call kind still think is X% down this cost it, I of supply projects North weighting thought where almost was and that, in not cost of the by Jordan to future feels it, averages. of to investing been But just And our reaching can XXX cycle we where dollars. to you the development includes bar see our open or book demand in has going the vain capital weighted outpacing projects, region, Americas you That of question. raising underway, honestly, he America about megawatts the we been on even whole were, call and plus made see the XX% been ask where because, close schedule the it haven't have that ROI. we're our we've legacy on because is those life not that can anything skinny north down yield that is

Singapore, blocks and Frankfurt you we're supply/demand we're unlevered even really opportunities capacity elsewhere, call tight markets, in it well than digits into more which ROIs, to capital double dynamics of it, for deploying exceeds risk-adjusted tell I it be down coming can the Northern these be Virginia, just, the or be seeing that larger certainly these it premiums. is it I think

these model. the the our the our value investments did partners creation JVs brought And look and I a six-ish new fold lot seeing and some transacting work I on cap in on think the we if great called in think of of you at team area you're

Atkin comes next of The from Please question ahead. Jon RBC. go

you to of can those given kind we going year. come? of high what parts Thanks. wondered to the But how issue around trajectory there A to And possible whatnot? or debt into of more the how forth, leverage some asset -- are think about any the sales I fives said any perhaps getting questions. of so and other think couple not moving of -- you're this more

I then any assets And forward? partner just was your about secondly, Is curious Thanks. India. prospectively going contributing

in I and in then to funding uses the can can and guidance Matt [indiscernible] leverage, our the sources India Chris speak and and the piece?

I broader important. billion we've today, of There's execution Jon. of One as liquidity, are team. of of couple to thanks the so think, Yes, to got reiterate, a thanks aspects $X here, the

what's on to left cycle, somewhere terms year. our we're (ph) year where spent, be needs spend you spent, funding what's this going [X.X to in the to guidance this at our looking talking based life in look are of left be about X.X] If at to our forward, remaining

significant continued gives pretty be us to a XXXX and runway into the we that able going fund to growth forward. So that opportunities see

this be help and capital us fund of your On execution out terms also as top asset the joint well, capital in sales will that broader leverage. even stopping that that potential some of able to as for the access which into rounds that, noted, question to well we're also on continuing to we're into not year not seek give need we but of partners XXXX, venture to potentially on us development as as an only

as on made progress front We've that again considerable well.

we're X.X% prepared you the remarks, at in pro basis, noted I now. look at forma a us As on

So made considerable that. progress on

as that to top You unchanged, will layer we've continue seek of grow line EBITDA as development on us view deleveraging partners of venture to continue left guidance our that that expected again, that well on our continuing joint as to help process.

So, leverage. on progress liquidity date to and we feel pretty about good both

turn topic. over it to I'll And JV the on India Greg

great, really the touch a the opportunities I in India, a obviously, here. more Jio what table maybe -- it’s growth, to development the we with but new partner about to just of -- going And partnership. It's bring assets. be mean, Chris think about can market think to it's huge they I they're lot fantastic share less and Just in a on on

appreciate I Jon. the conversation, Absolutely.

be extensive market. reach to one really, years I enterprises fact but like-for-like think allow think Greg and wanted expertise us or Brookfield a ability that's going looking data to center of it's differentiate right, been Jio interconnect already this is platforms culmination And really local able Jio bring local So, to and to ability the throughout I of And I India. deliver expertise is destinations that to the But we their within and you our many that expertise for operating expertise, talking think not media a digital and at of India. product. about successful many brings where other to I have we to something what the that brings largest critical know, be mobile is investing maybe

lot our large which, well. and broader a has Jio customer unique partnership And -- base, enterprise is the the so to elevated it's quite ability our really as customers of hyperscale that service Reliance in frankly, with

of excited market about. coming So we're something the amalgamation that trio is in to that innings. early still We're

it excited pretty about in India. So, see opportunity you'll the time, evolve over but

forward particular grooming or role see quickly If it might point? a reason anything on in and play just at expect is the pressure cases because trends of all of I use interconnect add going terms this any trajectory, new why Thanks. in to interconnect AI and the could acceleration at of because

Sure. Appreciate it, Jon.

something into that's quickly. jump is evolving that. I interconnection, rather further to Just think, Yes,

to intelligence early definitely its evolving, stages artificial date. think is in it's I and

the we've we remarks it's straight and shown is I watching the what two and through where prepared I been highest quarters has fact the growth, that think year surpassing five referenced think in $XXX million.

and that I in very platform unique think that's we us the market. the represent to

access to at that all placed which also that destinations kind of been the customers streamlining where would which of core ServiceFabric, frankly, upon have that say question around think have some your to of technical the I access these is have the is of doing we've I been artificial tailored resides, quite to data the data. to barriers you where intelligence, at, activities

a deployments. And to of able frankly, that private open of access be largest so, platforms one these oceans data the being public both of to quite allows part and customers

in customers us stay the of AI I And we're be think foundation I as the but portfolio. pay these again, with AI, is starting a inside did early what with very and we at that platform And what of cloud, would state you'll represent stable evolving as well. is going innings demand see evolved steady off. to that, excited to lot we say a be our able of to we're of about

next Street. ahead. Please David Green The of go question comes from Guarino

Thanks.

at looking cap you stays, assets pretty like can fixed sell that at are the development assets developing tables, healthy guys rates. So margin. spread on XX% stabilized your if a feels development you That's yields and profit at

at I that just range you've need to disposition guess more since set Why out why hit look your development more was I you wondering, you do point? sell do to JV stabilized initial target see not already this just So, the assets?

we laid the look you reason development for our here. today, billion. and it the year, the even laid well when when beyond finding opportunity $XX at out, take these I a at think Greg out business of is, this the Andy it's beginning Look, in look, at David, as balance partners you look goes hyperscale sheet --

it look needs So you the that meet business. capital is customers' -- at to when for got what that, within you tells globe throughout to have the third-party you

going we So think we to as said, as have, our [indiscernible] were look today, here sit best strategically shareholders. this create value business fund that the to and we on we what for forward, we've though do. even guidance our way that's to exceeded at you go

with going And that's move So it. forward it that's the why we to think continue most through development. fund prudent to we're to way

with you which guys public And if I you tenant And waiting Can you center maybe soon a renegotiate can I then switching you topics to walk happens through former not now think space? space? that's eventually the Matt, the Okay. is on Are the that what start releasing us bankruptcy, about, case, talking tenants? how data just to that company. were guess,

customers could David, of and becoming keeps with our to balance that world. that market opportunity be cloud is demand. and computing an I getting another more help and funded to is [indiscernible] accelerated backdrop and we partners add having call part just balance great capacity this And -- we the AI front. part the the way our your some tackle growth bottom been driving partnerships line And was X sheet efficient sheet to around of returns expanding more the that the to there's a lift the an Hence, alongside just to is on see quickly wave demand. results gigawatts and it large In question, of north to of second driving believe has, of question. opportunity begin with, lines. bigger, hyperscale it, capital incremental to -- this the results bottom and to last on I while think our best support The today in

make or And the business. accepting can't as middle obviously, bankruptcy, playbook customer decisions creditors either is the is on to that, customer assets to in this comes essentially share typical of a so have the it The rejecting of for too or the much. bankruptcies When process part the leases. run

so any have not, had leases far. date, rejected to We

the colocation leases, While in our years landlord lens, able you that and accepted. that they expand every despite a offering can interconnection But our one from leases support we other of be or have strategic providers this think I fact end capabilities and customers. rejected to is be why ago increased assume will don't

in So support capabilities. financial and when have and have and if issues, when the essentially sell end [indiscernible] to customers customers adequate and can the -- we step outcomes we would

third customer way to and report as bit through So see the this its think call. that there's wait works have little a I by we'll more quarter and of bankruptcy,

ahead. comes question Citi. next go The Mike of Please Rollins from

Thanks good and afternoon.

Just a couple of follow-ups.

of also, doing first, then be the or portfolio, portfolio? could So and So you're opportunity whether what's capital joint And considered can recycling? overall you same at data for an value the update left occupancy you us you're of within in that Thanks. for as to occupancy how the opportunities what's improve, terms just it's that center provide the future own looking assets ventures? on

it Sure. in our I mean as hyperscale is and a of development our going still our lot a business what's large certainly stands. of piece of current into pipeline installed terms base

slowest would round ballpark think essentially I in call $XX it, we of of portfolio. the value to interconnection-rich, our the with rich. customer Less bill parts growers in core just Digital lease of fit fully campus, of, -- REIT, we average similar Honestly, but terms assets stabilized, billion things month Core organic transactions the the creation as less a that came announced hyperscale-oriented conjunction long-weighted an the to our estimation length. of of in of July,

customers minus I or Digital customers in plus We've sold, here think the XX more X,XXX recent in Realty. We're portfolios. supporting call them. it,

that the And comes think partnerships the ownership drive an that? to still to pieces the build up you there's of in great it of that hard of on growing growth, like terms puzzle. Matt, these we announced. been When don't to our pushing the maintain why same-store partnerships pick to continue we've opportunity levers essentially, that we highest So able just to be XXX%

Yes.

of couple I a call things. out So

would what, So I I so to far. say, good is progress been first, we making great mean, have

in. capacity We're stabilized requirements to to improve next customers. a XX pool. look that have, essentially to And be growing at fill we need larger of this you for last that year, we we given If to opportunities to mix global believe over spaces of where We're target the our continue, for density going opportunity into we're a think, were points year. find to continue twofold, across going that and it year that versus going there's going to up on that's basis the course that portfolio

But more is to overall space part and even demand because co-lo it market grow higher productized of are of can a why take -- that today. over we we also continue I that occupancy and it's going bit convert takes time think further to the to looking return that enterprise it the a some is little part the and able growing of to from we we're which have time where see we improve need to and where lease do that want penetrate a that we we be capitalize for to want able that in be where to

of from ahead. comes Raymond Louthan question next The go James. Please Frank

other government here? of a that you other Can you. looking from Singapore, situation strategies. look this Thank the with that allowing the think do you at go to of sources on some kind at recycling, new I know this pricing Is can diversification areas kind at the finish guess, then out? there? to where of And you are Or players do capital the I few affects coming what Great. you How sort that continuing in you capital Thanks. in. of are look reach goal? comment

years that small our seeing big market is, XX-megawatt think, in clips. still was, increments after I mean, very think literally When the and first need. get of latest is out the that four to build mean supply I relatively Singapore, players no I unveiling So almost I on double of one modest. the data supply, on what a center is rational at metered size different getting you're

So -- Singapore. not happening is this and with only

we're continents campuses outpacing the across a supply against for ratcheting growth. [indiscernible], power pleased the supply. runway broader why constraints, from more is on and long And or that growth chain supply our and generation, rational. quite transmission to this be just with is balance customers six demand their on it have moratoriums, all constraints to seeing a sheet, You're be we our metros environmental the the of concerns, support making XX-plus our backdrop That's where

to you on next recycling? do reiterate Greg, capital where go the want we

question how your of about done job asked it. pretty other about. you as far. Yes. continue said, sources whole, specifically, to year we we've answer capital, on good development think we're I to on the to our we talked this as But joint Thanks. focus of Look, so think a -- about we remainder I we're our think going ventures Look, efforts a

Singapore. As core REIT we in the said, dedicated we have

that's So vehicle. a public

see transactions the not interest partners TPG. we wealth as infrastructure would the two we funds, GI we continue characterize both see We've in [indiscernible], announced and investment And distinguished blue across just obviously sovereign look, like. funds, chip and to board, strong just companies insurance but what pension funds, so

So demand at stabilized looking transactions, seeing broad-based we're and assets development assets. core here, both a

So we way And look look, prudent when we we're on at our to that. that bullish growth the that's again, fund think going forward.

next of comes The question Luebchow from Eric Fargo. Wells

the taking question. for Thanks Great.

I Andy, you've times down getting leverage think term. So X.X longer about to talked

look more is share And of instead development goal more this so the JVs you get the So need maybe year. using capital yourself beyond that or can might you recycling to to you much capital how if you economics the you could here ultimately past there path just think And walk or other of year? this self-funding partners? of forms through incremental becoming

Yes.

plan our work. X.X is to Again, a I to this get So We to X have longer-term be this that that. mean take to considerable is said year, amount Matt. closer I we'd we've -- of times. times. we do think done closer look down I'll

with get X.X%. have we down X.X and be we've ventures raised grow, to to at on pro leasing back on look in from comes We're going believe at help joint the the are so assets, and further which to forma us path And the that what look execute the come see forward based has equity times through $X which going on us done billion that and You far going online, to execute we've we XXXX. stabilized executed are the as continue start even achieved in. on at components, our to billion of date, We we so EBITDA we've to far that as we ventures. to joint target two these those backlog down continues to major getting development

yet, give I -- XXXX But a that are improve to at going position be think those we're to we're not our leverage levers looking our continue guidance to in sheet and to balance the position. in time point our X but drive main and at this

follow-up. Great. Okay. one then just And

becoming out had I some how you markets still there think you less to out portfolios in some kind look you've those do noncore are the transact as so on priority far, you And been Or market of I plan still of capital successful today. is that recycling today? given of forward? that a guess with

look, have good a Look, good already we've And been Eric, this said, the XX% we've we noncore year. these are fortunate all assets on. had and way -- piece is we're as of other always you the our demand in said and good execution we're -- But transactions through, we very, past, very we're news we working us portfolio. for as very, the of small

the is making have and fair we think So benefit disciplined get, we being of we value. sure

again, as continue like we So we're we're have to that seeing But approach those going them. demand continue to pursue historically with assets and for well.

we'll So you and we'll post things work to have to continue as to on continue it, talk we about.

of Evercore comes ahead. ISI. go from question Irvin Liu Please next The

you for one have and the question. Thank a Hi. I follow-up.

our bookings this of from sort AI whether quarter, improved any AI-related your deployments are within was there or call able to customers? out contribution any So from you

our Hi, over bit talk saw quarter line we more little grabbed ran customers. it what who I'm to question. AI front and to give the and Colin terms McLean, through Irvin, maybe a and finish great to bookings in just on really the that's on color the new going strong, to a the turn baton of CRO,

is a Yes. of Yes, our becoming Thanks, pipeline question, growing Andy. Irvin. in conversation Appreciate AI the overall. certainly, part

board, to that megawatt, pipeline we've one particularly zero of say, of part revert strong a growing to it would just the dynamics not is the healthy piece and the definitely hyperscale the had the but the to bit pipeline overall in also part of AI a strong, Just describe on is across some I back zero contributions and and we're diverse one the overall, megawatt on business, front. that strong side seeing,

entirety to needs, and demand to feel itself, hyperscalers. our both So pipeline of really pivot the client serving validation testimony really the and results overall, we the like enterprise the be a in the of network,

both success and front some say hybrid cloud seeing we're and the IT, would conversations I So clients. on AI with growing the frankly, really and growing

AI. and And that's be So I we pervasive serving optimistic as the both a move as growing portfolio clients going to think needs as part remain forward. of of well our we

Got there. it. the for Thank you color

is trended that second saw linearity question the quarters. share QX? past pricing one strong pricing over you trends So and quarter-to-quarter you we're of on two just with my the into Can that pricing us how the now month overall

of would, that and quarters winded several [indiscernible] and the it, pendulum call growing. been, The now our supply-demand I saying been commentary -- back we've on the that Irvin fundamentals for has continuation

broad-based, XXX think product was new highest quarter base from has signings received. I -- installed with base. existing our has from more regions new been mentioned, proposition of that more growing our logo us. customers. customer And types. well new or as of our from customers been Matt with value our second the That's it and Majority and also who's were Our across logos That's been

inflecting, bit little the [indiscernible] been category, megawatt, than megawatt it's less And obviously more it's like-for-like positive the been fashion. volatile than a a steady In in on more greater but call it, a increases. but

supply of not really become remained blocks does future be fewer large to has between if far demand whatsoever. not capacity seem that have and further course changing the term bottlenecks precious increased near As intact, and

over That Power, to and President closing call turn today's portion question-and-answer for to concludes call. remarks. now of Andy CEO, the I'd his back the like

you, second a Andrea. had quarter. Thank strong Realty Digital

place that with resonating results proposition customers. Our meeting value demonstrate is our

$X results the Just organic center last the core the we strong the inflection ahead. since billion opportunities tremendous data over with new operating lie for that of posted positioning business. confirming call, results continued capital, company our our raised We in

team like for who recognize to turning. at thank Digital digital keep exceptional you. our I'd Realty, and Thank everyone world dedicated the us today joining and

for conference presentation. now now disconnect. concluded. today's you attending you And has The may Thank