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SEC Filings

10-Q
EQUINIX INC filed this Form 10-Q on 11/02/2018
Entire Document
 

Our FFO and AFFO for the three and nine months ended September 30, 2018, and 2017 were as follows (in thousands):
 
Three Months Ended
September 30,
 
Nine Months Ended
September 30,
 
2018
 
2017
 
2018
 
2017
Net income
$
124,825

 
$
79,900

 
$
255,337

 
$
167,767

Adjustments:
 
 
 
 
 
 
 
Real estate depreciation
220,017

 
200,313

 
663,901

 
535,114

(Gain) loss on disposition of real estate property
(4,812
)
 
5,877

 
1,072

 
3,779

Adjustments for FFO from unconsolidated joint ventures

 
29

 

 
85

FFO
$
340,030

 
$
286,119

 
$
920,310

 
$
706,745

 
 
 
 
 
 
 
 
 
Three Months Ended
September 30,
 
Nine Months Ended
September 30,
 
2018
 
2017
 
2018
 
2017
FFO
$
340,030

 
$
286,119

 
$
920,310

 
$
706,745

Adjustments:
 
 
 
 
 
 
 
Installation revenue adjustment
3,209

 
6,161

 
6,208

 
17,775

Straight-line rent expense adjustment
1,551

 
2,297

 
5,516

 
5,721

Contract cost adjustment
(5,271
)
 

 
(13,010
)
 

Amortization of deferred financing costs and debt discounts and premiums
3,148

 
4,390

 
10,609

 
20,100

Stock-based compensation expense
47,588

 
45,654

 
139,849

 
129,602

Non-real estate depreciation expense
33,917

 
29,205

 
103,281

 
87,021

Amortization expense
51,792

 
48,893

 
153,443

 
128,068

Accretion expense (adjustment)
592

 
(692
)
 
986

 
(1,085
)
Recurring capital expenditures
(55,382
)
 
(44,914
)
 
(132,819
)
 
(105,455
)
(Gain) loss on debt extinguishment
(1,492
)
 
22,156

 
39,214

 
42,103

Acquisition costs
(1,120
)
 
2,083

 
33,932

 
31,510

Income tax expense adjustment
(16,312
)
 
(10,058
)
 
(22,567
)
 
(6,575
)
Adjustments for AFFO from unconsolidated joint ventures

 
(5
)
 

 
(17
)
AFFO
$
402,250

 
$
391,289

 
$
1,244,952

 
$
1,055,513

Our AFFO results have improved due to the improved operating results discussed earlier in "Results of Operations," as well as due to the nature of our business model which consists of a recurring revenue stream and a cost structure which has a large base that is fixed in nature as discussed earlier in "Overview."
Constant Currency Presentation
Our revenues and certain operating expenses (cost of revenues, sales and marketing and general and administrative expenses) from our international operations have represented and will continue to represent a significant portion of our total revenues and certain operating expenses. As a result, our revenues and certain operating expenses have been and will continue to be affected by changes in the U.S. dollar against major international currencies such as the Euro, British Pound, Japanese Yen, Singapore Dollar, Australian Dollar and Brazilian Real. In order to provide a framework for assessing how each of our business segments performed excluding the impact of foreign currency fluctuations, we present period-over-period percentage changes in our revenues and certain operating expenses on a constant currency basis in addition to the historical amounts as reported. Our constant currency calculation does not take into consideration our existing hedging activities. Presenting constant currency results of operations 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, we have presented this non-GAAP financial measure to provide investors with an additional tool to evaluate our operating results. To present this information, our current and comparative prior period revenues and certain operating expenses from entities reporting in currencies other than the U.S. dollar are converted into U.S. dollars at constant exchange rates rather than the actual exchange rates in effect during the respective periods (i.e. average rates in effect for the nine months ended September 30, 2017

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