Equinix Reports Third Quarter 2016 Results
Third Quarter 2016 Results Summary
- Revenues from continuing operations
$924.7 million , a 3% increase over the previous quarter- Includes
$39.7 million of revenues from Bit-isle - Includes
$107.3 million of revenues fromTelecity
- Operating Income
$169.9 million , a 12% increase over the previous quarter
- Adjusted EBITDA
$420.0 million , a 45% adjusted EBITDA margin- Includes
$13.1 million of adjusted EBITDA from Bit-isle - Includes
$44.1 million of adjusted EBITDA fromTelecity - Includes
$19.0 million of integration costs for acquisitions ($2.5 million incremental to prior guidance) - Absorbs an incremental
$5 million of cash-neutral U.S. GAAP adjustments related toTelecity
- Net Income from Continuing Operations
$48.8 million
- AFFO
$284.2 million , a 2% decrease from the previous quarter- Includes
$19.0 million of integration costs for acquisitions
2016 Annual Guidance Summary
- Revenues from continuing operations
$3,609 million - $3,615 million , a 32.5% increase over the previous year; an organic and constant currency growth rate of greater than 14%- Assumes
$556 million in revenues from Bit-isle andTelecity
- Adjusted EBITDA
$1,650 million - $1,656 million or a 45.8% adjusted EBITDA margin- Includes approximately
$250 million from Bit-isle andTelecity - Assumes
$59 million of integration costs for acquisitions ($4.0 million incremental to prior guidance) - Absorbs incremental
$10 million of primarily cash-neutral U.S. GAAP adjustments related toTelecity
- AFFO
$1,059 million - $1,065 million , a 27.6% increase over the previous year- Assumes a
$64 million foreign currency loss related to theTelecity acquisition - Assumes
$59 million of integration costs for acquisitions
"We had a great third quarter, delivering record bookings with double-digit growth in the cloud, financial and enterprise segments," said
Business Highlights
Equinix continues to expand the scale and reach of its global platform with 18 announced expansion projects underway, and todayEquinix announced:- New expansions in
Dallas ,Dublin ,Frankfurt ,Helsinki andZurich totaling more than$100 million of capital expenditures. - The purchase of six acres of real estate adjacent to the Equinix Chicago area CH3 IBX which will be developed over time to expand
Equinix's Elk Grove campus – a key location for cloud and financial customers.
- New expansions in
Equinix added 10 Fortune 500 customers in Q3 2016, including:Target , a leading retailer;J.B Hunt , a transportation company; and Aetna, a healthcare and insurance provider.Equinix has now penetrated nearly one-third of the Fortune 500 and a quarter of Global 2000 companies. Additional customer momentum from the quarter:Equinix recorded its second highest bookings quarter in the enterprise segment in Q3, as enterprises continue to re-architect their IT delivery to better interconnect people, locations, clouds and data. Wins included one of the top three auto manufacturers that has selectedEquinix to optimize their network topology and connect to Microsoft Azure via Equinix Cloud Exchange.- The financial services vertical achieved record bookings, and key customer wins included: an expansion with
PayPal , an important customer in the digital payments ecosystem that is interconnecting to business partners to improve performance and latency; andLloyd's , which is deploying a cloud-based risk modeling platform for the insurance industry. - The cloud and IT services vertical recorded its second best bookings quarter in Q3, with expansions from
Amazon.com ,Cisco Systems , Dell EMC, Marketo and others.Equinix continues to enhance its value as the home of the interconnected cloud by increasing cloud density, making it easy for enterprises to find and consume cloud services from leading SaaS and IaaS partners, including AWS, Azure, IBM Softlayer,Google andOracle . - As companies seek to locate their infrastructure closer to the digital edge,
Equinix customer deployments across all three regions (Americas , APAC, EMEA) represented 55% of total recurring revenue for the quarter.
- Additional business highlights announced in Q3 2016 included:
- Momentum for
Equinix continues as a strategic partner for the submarine cable industry with its selection as the US cable landing station for the Monet Submarine Cable System , which is owned by Algar Telecom, Angola Cables, Antel and Google. The Monet project linksNorth and South America from points inMiami and São Paulo. In addition to this most recent win,Equinix has been selected as an interconnection partner in 12 of the current submarine cable projects that are experiencing high growth driven primarily by exponential increases in cloud services and innovation in optical equipment. - The ninth quarter in a row in which
Equinix has added more than 5,000 cross-connects. As more businesses adopt an IT architecture that enables direct interconnection with key partners and customers,Equinix now has more than 188,000 cross-connects between customers. - The rollout of Equinix Internet Exchange in
Helsinki , expanding coverage of this platform to 19 markets worldwide. - The rollout of the Equinix Media Cloud Ecosystem for Entertainment (EMCEE™), an ecosystem of interconnected media and content providers, along with content delivery networks (CDNs) and cloud service providers, that optimizes content creation, global distribution and services across the entire media and entertainment (M&E) industry. As digital disruption changes the way that content is created, enhanced, transported, stored and distributed, more than 500 content and media companies use EMCEE to peer with the industry's largest concentration of CDNs, multiple system operators (MSOs) and social media platforms.
- Momentum for
Business Outlook
For the fourth quarter of 2016 --
For the full year of 2016 -- Total revenues are expected to range between
The U.S. dollar exchange rates used for 2016 guidance, taking into consideration the impact of our foreign currency hedges, have been updated to
Q3 Results Conference Call and Replay Information
A replay of the call will be available one hour after the call, through
Investor Presentation and Supplemental Financial Information
Additional Resources
About
Non-GAAP Financial Measures
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,
In addition, in presenting the non-GAAP financial measures,
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 financials measures.
Investors should note that the non-GAAP financial measures used by
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, the challenges of acquiring, operating and constructing IBX centers and developing, deploying and delivering
EQUINIX, INC. |
||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS |
||||||||||||
(in thousands, except per share data) |
||||||||||||
(unaudited) |
||||||||||||
Three Months Ended |
Nine Months Ended |
|||||||||||
September 30, |
June 30, |
September 30, |
September 30, |
September 30, |
||||||||
2016 |
2016 |
2015 |
2016 |
2015 |
||||||||
Recurring revenues |
$ 877,494 |
$ 851,771 |
$ 646,721 |
$ 2,526,359 |
$ 1,883,069 |
|||||||
Non-recurring revenues |
47,182 |
48,739 |
39,928 |
142,983 |
112,336 |
|||||||
Revenues |
924,676 |
900,510 |
686,649 |
2,669,342 |
1,995,405 |
|||||||
Cost of revenues |
470,302 |
456,967 |
325,468 |
1,354,949 |
939,538 |
|||||||
Gross profit |
454,374 |
443,543 |
361,181 |
1,314,393 |
1,055,867 |
|||||||
Operating expenses: |
||||||||||||
Sales and marketing |
110,936 |
107,832 |
83,709 |
325,358 |
243,573 |
|||||||
General and administrative |
181,239 |
168,462 |
123,237 |
515,605 |
356,455 |
|||||||
Impairment charges |
7,698 |
- |
- |
7,698 |
- |
|||||||
Acquisition costs |
12,505 |
15,594 |
13,352 |
64,635 |
24,374 |
|||||||
Gains on asset sales |
(27,945) |
- |
- |
(33,187) |
- |
|||||||
Total operating expenses |
284,433 |
291,888 |
220,298 |
880,109 |
624,402 |
|||||||
Income from continuing operations |
169,941 |
151,655 |
140,883 |
434,284 |
431,465 |
|||||||
Interest and other income (expense): |
||||||||||||
Interest income |
762 |
841 |
934 |
2,528 |
2,375 |
|||||||
Interest expense |
(92,200) |
(100,332) |
(76,269) |
(293,395) |
(219,556) |
|||||||
Other income (expense) |
2,938 |
1,555 |
(12,836) |
(56,217) |
(11,964) |
|||||||
Loss on debt extinguishment |
(9,894) |
(605) |
- |
(10,499) |
- |
|||||||
Total interest and other, net |
(98,394) |
(98,541) |
(88,171) |
(357,583) |
(229,145) |
|||||||
Income from continuing operations before income taxes |
71,547 |
53,114 |
52,712 |
76,701 |
202,320 |
|||||||
Income tax expense |
(22,778) |
(13,812) |
(11,580) |
(25,957) |
(25,277) |
|||||||
Net income from continuing operations |
48,769 |
39,302 |
41,132 |
50,744 |
177,043 |
|||||||
Net income from discontinued operations, net of tax |
2,681 |
5,409 |
- |
14,306 |
- |
|||||||
Net income |
$ 51,450 |
$ 44,711 |
$ 41,132 |
$ 65,050 |
$ 177,043 |
|||||||
Net income per share: |
||||||||||||
Basic net income per share from continuing operations |
$ 0.69 |
$ 0.56 |
$ 0.72 |
$ 0.73 |
$ 3.11 |
|||||||
Basic net income per share from discontinued operations |
0.04 |
0.08 |
- |
0.21 |
- |
|||||||
Basic net income per share |
$ 0.73 |
$ 0.64 |
$ 0.72 |
$ 0.94 |
$ 3.11 |
|||||||
Diluted net income per share from continuing operations |
$ 0.68 |
$ 0.56 |
$ 0.71 |
$ 0.72 |
$ 3.08 |
|||||||
Diluted net income per share from discontinued operations |
0.04 |
0.08 |
- |
0.20 |
- |
|||||||
Diluted net income per share |
$ 0.72 |
$ 0.64 |
$ 0.71 |
$ 0.92 |
$ 3.08 |
|||||||
Shares used in computing basic net income per share |
71,190 |
69,729 |
57,082 |
69,689 |
56,894 |
|||||||
Shares used in computing diluted net income per share |
71,908 |
70,364 |
57,708 |
70,389 |
57,521 |
EQUINIX, INC. |
||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) |
||||||||||||
(in thousands) |
||||||||||||
(unaudited) |
||||||||||||
Three Months Ended |
Nine Months Ended |
|||||||||||
September 30, |
June 30, |
September 30, |
September 30, |
September 30, |
||||||||
2016 |
2016 |
2015 |
2016 |
2015 |
||||||||
Net income |
$ 51,450 |
$ 44,711 |
$ 41,132 |
$ 65,050 |
$ 177,043 |
|||||||
Other comprehensive loss, net of tax: |
||||||||||||
Foreign currency translation adjustment ("CTA") loss |
(32,603) |
(298,361) |
(72,677) |
(215,065) |
(149,546) |
|||||||
Unrealized gain (loss) on available-for-sale securities |
1,487 |
1,199 |
(21) |
2,382 |
99 |
|||||||
Unrealized gain (loss) on cash flow hedges |
(4,153) |
14,726 |
3,309 |
3,789 |
(425) |
|||||||
Net investment hedge CTA gain (loss) |
(34,721) |
55,196 |
4,426 |
4,163 |
(5,963) |
|||||||
Net actuarial gain on defined benefit plans |
7 |
8 |
124 |
21 |
266 |
|||||||
Other comprehensive loss, net of tax: |
(69,983) |
(227,232) |
(64,839) |
(204,710) |
(155,569) |
|||||||
Comprehensive income (loss), net of tax |
(18,533) |
(182,521) |
(23,707) |
(139,660) |
21,474 |
EQUINIX, INC. |
||||||
CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||
(in thousands) |
||||||
(unaudited) |
||||||
Assets |
September 30, |
December 31, |
||||
2016 |
2015 |
|||||
Cash and cash equivalents |
$ 987,915 |
$ 2,228,838 |
||||
Short-term investments |
443 |
12,875 |
||||
Accounts receivable, net |
377,528 |
291,964 |
||||
Current portion of restricted cash |
25,305 |
479,417 |
||||
Other current assets |
172,370 |
212,929 |
||||
Assets held for sale |
96,923 |
33,257 |
||||
Total current assets |
1,660,484 |
3,259,280 |
||||
Long-term investments |
15,036 |
4,584 |
||||
Property, plant and equipment, net |
7,251,399 |
5,606,436 |
||||
Goodwill |
3,118,686 |
1,063,200 |
||||
Intangible assets, net |
803,260 |
224,565 |
||||
Other assets |
248,692 |
198,630 |
||||
Total assets |
$ 13,097,557 |
$ 10,356,695 |
||||
Liabilities and Stockholders' Equity |
||||||
Accounts payable and accrued expenses |
$ 534,602 |
$ 400,948 |
||||
Accrued property, plant and equipment |
185,683 |
103,107 |
||||
Current portion of capital lease and other financing obligations |
92,120 |
40,121 |
||||
Current portion of mortgage and loans payable |
518,985 |
770,236 |
||||
Convertible debt |
- |
146,121 |
||||
Other current liabilities |
149,516 |
192,286 |
||||
Liabilities held for sale |
14,660 |
3,535 |
||||
Total current liabilities |
1,495,566 |
1,656,354 |
||||
Capital lease and other financing obligations, less current portion |
1,446,455 |
1,287,139 |
||||
Mortgage and loans payable, less current portion |
1,058,418 |
472,769 |
||||
Senior notes |
3,809,332 |
3,804,634 |
||||
Other liabilities |
664,076 |
390,413 |
||||
Total liabilities |
8,473,847 |
7,611,309 |
||||
Common stock |
72 |
62 |
||||
Additional paid-in capital |
7,371,024 |
4,838,444 |
||||
Treasury stock |
(147,617) |
(7,373) |
||||
Accumulated dividends |
(1,842,834) |
(1,468,472) |
||||
Accumulated other comprehensive loss |
(713,769) |
(509,059) |
||||
Accumulated deficit |
(43,166) |
(108,216) |
||||
Total stockholders' equity |
4,623,710 |
2,745,386 |
||||
Total liabilities and stockholders' equity |
$ 13,097,557 |
$ 10,356,695 |
||||
Ending headcount by geographic region is as follows: |
||||||
Americas headcount |
2,472 |
2,329 |
||||
EMEA headcount |
2,051 |
1,188 |
||||
Asia-Pacific headcount |
1,411 |
1,525 |
||||
Total headcount |
5,934 |
5,042 |
EQUINIX, INC. |
||||||
SUMMARY OF DEBT PRINCIPAL OUTSTANDING |
||||||
(in thousands) |
||||||
(unaudited) |
||||||
September 30, |
December 31, |
|||||
2016 |
2015 |
|||||
Capital lease and other financing obligations |
$ 1,538,575 |
$ 1,327,260 |
||||
Term loan, net of debt discount and debt issuance costs |
1,055,950 |
454,503 |
||||
Brazil financings, net of debt issuance costs |
1,585 |
26,668 |
||||
Mortgage payable and other loans payable |
519,868 |
436,212 |
||||
Revolving credit facility borrowings |
- |
325,622 |
||||
Plus: debt discount, debt issuance costs and premium, net |
12,011 |
694 |
||||
Total mortgage and loans payable principal |
1,589,414 |
1,243,699 |
||||
Senior notes, net of debt issuance costs |
3,809,332 |
3,804,634 |
||||
Plus: debt issuance costs |
40,668 |
45,366 |
||||
Total senior notes principal |
3,850,000 |
3,850,000 |
||||
Convertible debt, net of debt discount and debt issuance costs |
- |
146,121 |
||||
Plus: debt discount and debt issuance costs |
- |
3,961 |
||||
Total convertible debt principal |
- |
150,082 |
||||
Total debt principal outstanding |
$ 6,977,989 |
$ 6,571,041 |
EQUINIX, INC. |
|||||||||||||
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
|||||||||||||
(in thousands) |
|||||||||||||
(unaudited) |
|||||||||||||
Three Months Ended |
Nine Months Ended |
||||||||||||
September 30, |
June 30, |
September 30, |
September 30, |
September 30, |
|||||||||
2016 |
2016 |
2015 |
2016 |
2015 |
|||||||||
Cash flows from operating activities: |
|||||||||||||
Net income |
$ 51,450 |
$ 44,711 |
$ 41,132 |
$ 65,050 |
$ 177,043 |
||||||||
Adjustments to reconcile net income to net cash provided by operating activities: |
|||||||||||||
Depreciation, amortization and accretion |
215,370 |
213,719 |
133,268 |
631,242 |
384,068 |
||||||||
Stock-based compensation |
42,346 |
39,323 |
33,969 |
115,730 |
98,575 |
||||||||
Amortization of debt issuance costs and debt discounts |
2,684 |
5,517 |
3,972 |
13,709 |
11,557 |
||||||||
Loss on debt extinguishment |
10,181 |
318 |
- |
10,499 |
- |
||||||||
Impairment charges |
7,698 |
- |
- |
7,698 |
- |
||||||||
Gains on asset sales |
(27,945) |
- |
- |
(33,187) |
- |
||||||||
Gains on sale of discontinued operations |
(4,242) |
- |
- |
(4,242) |
- |
||||||||
Other items |
3,905 |
7,311 |
3,589 |
16,087 |
12,696 |
||||||||
Changes in operating assets and liabilities: |
|||||||||||||
Accounts receivable |
(30,440) |
(31,055) |
(220) |
(72,807) |
(42,002) |
||||||||
Income taxes, net |
24,776 |
4,901 |
(18,376) |
1,021 |
(84,523) |
||||||||
Accounts payable and accrued expenses |
(901) |
29,592 |
25,926 |
(11,526) |
75,219 |
||||||||
Other assets and liabilities |
39,290 |
(35,509) |
(8,858) |
(22,004) |
27,042 |
||||||||
Net cash provided by operating activities |
334,172 |
278,828 |
214,402 |
717,270 |
659,675 |
||||||||
Cash flows from investing activities: |
|||||||||||||
Purchases, sales and maturities of investments, net |
(2,123) |
8,764 |
94,217 |
10,060 |
523,477 |
||||||||
Business acquisitions, net of cash acquired |
(165,901) |
- |
- |
(1,767,528) |
(10,247) |
||||||||
Purchases of real estate |
- |
(11,710) |
- |
(28,118) |
(38,282) |
||||||||
Purchases of other property, plant and equipment |
(279,477) |
(249,867) |
(216,046) |
(727,044) |
(587,508) |
||||||||
Proceeds from asset sales |
805,372 |
- |
- |
828,197 |
- |
||||||||
Other investing activities |
(21,851) |
(117) |
14,274 |
444,736 |
(493,371) |
||||||||
Net cash provided by (used in) investing activities |
336,020 |
(252,930) |
(107,555) |
(1,239,697) |
(605,931) |
||||||||
Cash flows from financing activities: |
|||||||||||||
Proceeds from employee equity awards |
16,504 |
1,335 |
13,290 |
34,143 |
29,855 |
||||||||
Payment of dividend distributions |
(127,457) |
(121,858) |
(98,041) |
(374,151) |
(291,009) |
||||||||
Proceeds from loans payable |
9,154 |
- |
- |
710,404 |
490,000 |
||||||||
Repayment of capital lease and other financing obligations |
(55,528) |
(12,103) |
(6,576) |
(100,863) |
(20,213) |
||||||||
Repayment of mortgage and loans payable |
(13,354) |
(36,707) |
(10,818) |
(986,414) |
(529,447) |
||||||||
Repayment of convertible debt |
- |
(51) |
- |
(51) |
- |
||||||||
Debt extinguishment costs |
(10,181) |
- |
- |
(10,181) |
- |
||||||||
Debt issuance costs |
(11,709) |
23 |
- |
(11,751) |
(617) |
||||||||
Other financing activities |
1,465 |
(564) |
732 |
1,465 |
1,663 |
||||||||
Net cash used in financing activities |
(191,106) |
(169,925) |
(101,413) |
(737,399) |
(319,768) |
||||||||
Effect of foreign currency exchange rates on cash and cash equivalents |
4,313 |
18,540 |
(6,098) |
22,658 |
(9,424) |
||||||||
Change in cash balances included in assets held for sale |
21,356 |
(25,111) |
- |
(3,755) |
- |
||||||||
Net increase (decrease) in cash and cash equivalents |
504,755 |
(150,598) |
(664) |
(1,240,923) |
(275,448) |
||||||||
Cash and cash equivalents at beginning of period |
483,160 |
633,758 |
336,133 |
2,228,838 |
610,917 |
||||||||
Cash and cash equivalents at end of period |
$ 987,915 |
$ 483,160 |
$ 335,469 |
$ 987,915 |
$ 335,469 |
||||||||
Supplemental cash flow information: |
|||||||||||||
Cash paid (refunded) for taxes |
$ (73) |
$ 12,361 |
$ 28,333 |
$ 31,503 |
$ 103,137 |
||||||||
Cash paid for interest |
$ 111,094 |
$ 85,897 |
$ 68,568 |
$ 271,530 |
$ 164,367 |
||||||||
Free cash flow (1) |
$ 672,315 |
$ 17,134 |
$ 12,630 |
$ (532,487) |
$ (469,733) |
||||||||
Adjusted free cash flow (2) |
$ 839,681 |
$ 28,280 |
$ 34,035 |
$ 1,264,624 |
$ (352,462) |
||||||||
(1) |
We define 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 |
$ 334,172 |
$ 278,828 |
$ 214,402 |
$ 717,270 |
$ 659,675 |
||||||||
Net cash used in investing activities as presented above |
336,020 |
(252,930) |
(107,555) |
(1,239,697) |
(605,931) |
||||||||
Purchases, sales and maturities of investments, net |
2,123 |
(8,764) |
(94,217) |
(10,060) |
(523,477) |
||||||||
Free cash flow (negative free cash flow) |
$ 672,315 |
$ 17,134 |
$ 12,630 |
$ (532,487) |
$ (469,733) |
||||||||
(2) |
We define adjusted free cash flow as free cash flow (as defined above) excluding any purchases of real estate, acquisitions, any excess tax benefits from employee equity awards, cash paid for taxes associated with reclassifying our assets for tax purposes triggered by our conversion into a real estate investment trust ("REIT") and costs related to the REIT conversion, as presented below: |
||||||||||||
Free cash flow (as defined above) |
$ 672,315 |
$ 17,134 |
$ 12,630 |
$ (532,487) |
$ (469,733) |
||||||||
Less business acquisitions, net of cash |
165,901 |
- |
- |
1,767,528 |
10,247 |
||||||||
Less purchases of real estate |
- |
11,710 |
- |
28,118 |
38,282 |
||||||||
Less excess tax benefits from employee equity awards |
1,465 |
(564) |
732 |
1,465 |
1,663 |
||||||||
Less cash paid for taxes resulting from the REIT conversion |
- |
- |
20,033 |
- |
65,146 |
||||||||
Less costs related to the REIT conversion |
- |
- |
640 |
- |
1,933 |
||||||||
Adjusted free cash flow |
$ 839,681 |
$ 28,280 |
$ 34,035 |
$ 1,264,624 |
$ (352,462) |
||||||||
We categorize our cash paid for taxes into cash paid for taxes resulting from the REIT conversion (as defined above) and other cash taxes paid. |
|||||||||||||
Cash paid for taxes resulting from the REIT conversion |
$ - |
$ - |
$ 20,033 |
$ - |
$ 65,146 |
||||||||
Other cash taxes paid |
(73) |
12,361 |
8,300 |
31,503 |
37,991 |
||||||||
Total cash paid for taxes |
$ (73) |
$ 12,361 |
$ 28,333 |
$ 31,503 |
$ 103,137 |
EQUINIX, INC. |
||||||||||||
NON-GAAP MEASURES AND OTHER SUPPLEMENTAL DATA |
||||||||||||
(in thousands) |
||||||||||||
(unaudited) |
||||||||||||
Three Months Ended |
Nine Months Ended |
|||||||||||
September 30, |
June 30, |
September 30, |
September 30, |
September 30, |
||||||||
2016 |
2016 |
2015 |
2016 |
2015 |
||||||||
Recurring revenues |
$ 877,494 |
$ 851,771 |
$ 646,721 |
$ 2,526,359 |
$ 1,883,069 |
|||||||
Non-recurring revenues |
47,182 |
48,739 |
39,928 |
142,983 |
112,336 |
|||||||
Revenues (1) |
924,676 |
900,510 |
686,649 |
2,669,342 |
1,995,405 |
|||||||
Cash cost of revenues (2) |
304,821 |
292,033 |
211,617 |
867,954 |
608,483 |
|||||||
Cash gross profit (3) |
619,855 |
608,477 |
475,032 |
1,801,388 |
1,386,922 |
|||||||
Cash operating expenses (4): |
||||||||||||
Cash sales and marketing expenses (5) |
79,515 |
78,071 |
68,323 |
237,278 |
197,201 |
|||||||
Cash general and administrative expenses (6) |
120,298 |
110,115 |
85,237 |
343,127 |
251,239 |
|||||||
Total cash operating expenses (7) |
199,813 |
188,186 |
153,560 |
580,405 |
448,440 |
|||||||
Adjusted EBITDA (8) |
$ 420,042 |
$ 420,291 |
$ 321,472 |
$ 1,220,983 |
$ 938,482 |
|||||||
Cash gross margins (9) |
67% |
68% |
69% |
67% |
70% |
|||||||
Adjusted EBITDA margins (10) |
45% |
47% |
47% |
46% |
47% |
|||||||
Adjusted EBITDA flow-through rate (11) |
(1%) |
70% |
48% |
43% |
65% |
|||||||
FFO (12) |
$ 187,831 |
$ 201,515 |
$ 151,197 |
$ 505,221 |
$ 497,755 |
|||||||
AFFO (13) (14) |
$ 284,179 |
$ 290,529 |
$ 210,361 |
$ 784,554 |
$ 653,505 |
|||||||
(1) |
The geographic split of our revenues on a services basis is presented below: |
|||||||||||
Americas Revenues: |
||||||||||||
Colocation |
$ 295,927 |
$ 289,578 |
$ 268,156 |
$ 867,826 |
$ 789,022 |
|||||||
Interconnection |
92,803 |
89,860 |
79,902 |
268,599 |
232,090 |
|||||||
Managed infrastructure |
14,830 |
13,255 |
11,788 |
39,255 |
37,920 |
|||||||
Other |
902 |
786 |
841 |
2,417 |
2,314 |
|||||||
Recurring revenues |
404,462 |
393,479 |
360,687 |
1,178,097 |
1,061,346 |
|||||||
Non-recurring revenues |
20,680 |
19,992 |
21,943 |
64,910 |
56,700 |
|||||||
Revenues |
425,142 |
413,471 |
382,630 |
1,243,007 |
1,118,046 |
|||||||
EMEA Revenues: |
||||||||||||
Colocation |
244,420 |
240,421 |
143,721 |
699,019 |
415,938 |
|||||||
Interconnection |
21,464 |
22,425 |
15,227 |
63,589 |
41,715 |
|||||||
Managed infrastructure |
16,359 |
15,391 |
5,875 |
50,310 |
17,577 |
|||||||
Other |
3,947 |
3,573 |
1,333 |
8,463 |
4,413 |
|||||||
Recurring revenues |
286,190 |
281,810 |
166,156 |
821,381 |
479,643 |
|||||||
Non-recurring revenues |
15,060 |
18,799 |
11,407 |
48,334 |
36,510 |
|||||||
Revenues |
301,250 |
300,609 |
177,563 |
869,715 |
516,153 |
|||||||
Asia-Pacific Revenues: |
||||||||||||
Colocation |
140,194 |
132,670 |
99,775 |
396,258 |
284,847 |
|||||||
Interconnection |
21,222 |
19,955 |
15,439 |
59,495 |
43,082 |
|||||||
Managed infrastructure |
21,797 |
20,078 |
4,664 |
60,132 |
14,151 |
|||||||
Other |
3,629 |
3,779 |
- |
10,996 |
- |
|||||||
Recurring revenues |
186,842 |
176,482 |
119,878 |
526,881 |
342,080 |
|||||||
Non-recurring revenues |
11,442 |
9,948 |
6,578 |
29,739 |
19,126 |
|||||||
Revenues |
198,284 |
186,430 |
126,456 |
556,620 |
361,206 |
|||||||
Worldwide Revenues: |
||||||||||||
Colocation |
680,541 |
662,669 |
511,652 |
1,963,103 |
1,489,807 |
|||||||
Interconnection |
135,489 |
132,240 |
110,568 |
391,683 |
316,887 |
|||||||
Managed infrastructure |
52,986 |
48,724 |
22,327 |
149,697 |
69,648 |
|||||||
Other |
8,478 |
8,138 |
2,174 |
21,876 |
6,727 |
|||||||
Recurring revenues |
877,494 |
851,771 |
646,721 |
2,526,359 |
1,883,069 |
|||||||
Non-recurring revenues |
47,182 |
48,739 |
39,928 |
142,983 |
112,336 |
|||||||
Revenues |
$ 924,676 |
$ 900,510 |
$ 686,649 |
$ 2,669,342 |
$ 1,995,405 |
|||||||
(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 |
$ 470,302 |
$ 456,967 |
$ 325,468 |
$ 1,354,949 |
$ 939,538 |
|||||||
Depreciation, amortization and accretion expense |
(162,165) |
(161,493) |
(111,337) |
(477,241) |
(323,684) |
|||||||
Stock-based compensation expense |
(3,316) |
(3,441) |
(2,514) |
(9,754) |
(7,371) |
|||||||
Cash cost of revenues |
$ 304,821 |
$ 292,033 |
$ 211,617 |
$ 867,954 |
$ 608,483 |
|||||||
The geographic split of our cash cost of revenues is presented below: |
||||||||||||
Americas cash cost of revenues |
$ 114,934 |
$ 109,296 |
$ 105,864 |
$ 333,250 |
$ 303,275 |
|||||||
EMEA cash cost of revenues |
116,587 |
114,950 |
64,443 |
333,046 |
185,368 |
|||||||
Asia-Pacific cash cost of revenues |
73,300 |
67,787 |
41,310 |
201,658 |
119,840 |
|||||||
Cash cost of revenues |
$ 304,821 |
$ 292,033 |
$ 211,617 |
$ 867,954 |
$ 608,483 |
|||||||
(3) |
We define cash gross profit as revenues less cash cost of revenues (as defined above). |
|||||||||||
(4) |
We define cash operating expenses as operating expenses less depreciation, amortization, stock-based compensation and |
|||||||||||
acquisition costs. We also refer to cash operating expenses as cash selling, general and administrative expenses or |
||||||||||||
"cash SG&A". |
||||||||||||
(5) |
We define cash sales and marketing expenses as sales and marketing expenses less depreciation, |
|||||||||||
amortization and stock-based compensation as presented below: |
||||||||||||
Sales and marketing expenses |
$ 110,936 |
$ 107,832 |
$ 83,709 |
$ 325,358 |
$ 243,573 |
|||||||
Depreciation and amortization expense |
(19,719) |
(19,047) |
(6,213) |
(55,893) |
(18,566) |
|||||||
Stock-based compensation expense |
(11,702) |
(10,714) |
(9,173) |
(32,187) |
(27,806) |
|||||||
Cash sales and marketing expenses |
$ 79,515 |
$ 78,071 |
$ 68,323 |
$ 237,278 |
$ 197,201 |
|||||||
(6) |
We define cash general and administrative expenses as general and administrative expenses less depreciation, |
|||||||||||
amortization and stock-based compensation as presented below: |
||||||||||||
General and administrative expenses |
$ 181,239 |
$ 168,462 |
$ 123,237 |
$ 515,605 |
$ 356,455 |
|||||||
Depreciation and amortization expense |
(33,486) |
(33,179) |
(15,718) |
(98,108) |
(41,818) |
|||||||
Stock-based compensation expense |
(27,455) |
(25,168) |
(22,282) |
(74,370) |
(63,398) |
|||||||
Cash general and administrative expenses |
$ 120,298 |
$ 110,115 |
$ 85,237 |
$ 343,127 |
$ 251,239 |
|||||||
(7) |
Our cash operating expenses, or cash SG&A, as defined above, is presented below: |
|||||||||||
Cash sales and marketing expenses |
$ 79,515 |
$ 78,071 |
$ 68,323 |
$ 237,278 |
$ 197,201 |
|||||||
Cash general and administrative expenses |
120,298 |
110,115 |
85,237 |
343,127 |
251,239 |
|||||||
Cash SG&A |
$ 199,813 |
$ 188,186 |
$ 153,560 |
$ 580,405 |
$ 448,440 |
|||||||
The geographic split of our cash operating expenses, or cash SG&A, is presented below: |
||||||||||||
Americas cash SG&A |
$ 108,077 |
$ 109,147 |
$ 102,596 |
$ 328,138 |
$ 296,981 |
|||||||
EMEA cash SG&A |
63,195 |
52,204 |
31,717 |
170,257 |
93,818 |
|||||||
Asia-Pacific cash SG&A |
28,541 |
26,835 |
19,247 |
82,010 |
57,641 |
|||||||
Cash SG&A |
$ 199,813 |
$ 188,186 |
$ 153,560 |
$ 580,405 |
$ 448,440 |
|||||||
(8) |
We define adjusted EBITDA as income from continuing operations plus depreciation, amortization, accretion, stock-based |
|||||||||||
compensation expense, impairment charges, acquisition costs and gains on asset sales as presented below: |
||||||||||||
Income from continuing operations |
$ 169,941 |
$ 151,655 |
$ 140,883 |
$ 434,284 |
$ 431,465 |
|||||||
Depreciation, amortization and accretion expense |
215,370 |
213,719 |
133,268 |
631,242 |
384,068 |
|||||||
Stock-based compensation expense |
42,473 |
39,323 |
33,969 |
116,311 |
98,575 |
|||||||
Impairment charges |
7,698 |
- |
- |
7,698 |
- |
|||||||
Acquisition costs |
12,505 |
15,594 |
13,352 |
64,635 |
24,374 |
|||||||
Gains on asset sales |
(27,945) |
- |
- |
(33,187) |
- |
|||||||
Adjusted EBITDA |
$ 420,042 |
$ 420,291 |
$ 321,472 |
$ 1,220,983 |
$ 938,482 |
|||||||
The geographic split of our adjusted EBITDA is presented below: |
||||||||||||
Americas income from continuing operations |
$ 89,004 |
$ 87,100 |
$ 81,914 |
$ 264,643 |
$ 241,033 |
|||||||
Americas depreciation, amortization and accretion expense |
82,204 |
78,874 |
70,118 |
237,798 |
205,621 |
|||||||
Americas stock-based compensation expense |
29,309 |
27,790 |
25,810 |
81,428 |
75,184 |
|||||||
Americas acquisition costs |
1,614 |
1,264 |
(3,672) |
2,992 |
(4,048) |
|||||||
Americas gains on asset sales |
- |
- |
- |
(5,242) |
- |
|||||||
Americas adjusted EBITDA |
202,131 |
195,028 |
174,170 |
581,619 |
517,790 |
|||||||
EMEA income from continuing operations |
51,829 |
29,096 |
29,865 |
73,506 |
111,516 |
|||||||
EMEA depreciation, amortization and accretion expense |
78,555 |
82,929 |
33,055 |
237,972 |
87,574 |
|||||||
EMEA stock-based compensation expense |
8,138 |
7,060 |
4,338 |
21,433 |
12,342 |
|||||||
EMEA acquisition costs |
10,891 |
14,370 |
14,145 |
61,446 |
25,535 |
|||||||
EMEA gains on asset sales |
(27,945) |
- |
- |
(27,945) |
- |
|||||||
EMEA adjusted EBITDA |
121,468 |
133,455 |
81,403 |
366,412 |
236,967 |
|||||||
Asia-Pacific income from continuing operations |
29,108 |
35,459 |
29,104 |
96,135 |
78,916 |
|||||||
Asia-Pacific depreciation, amortization and accretion expense |
54,611 |
51,916 |
30,095 |
155,472 |
90,873 |
|||||||
Asia-Pacific stock-based compensation expense |
5,026 |
4,473 |
3,821 |
13,450 |
11,049 |
|||||||
Asia-Pacific impairment charges |
7,698 |
- |
- |
7,698 |
- |
|||||||
Asia-Pacific acquisition costs |
- |
(40) |
2,879 |
197 |
2,887 |
|||||||
Asia-Pacific adjusted EBITDA |
96,443 |
91,808 |
65,899 |
272,952 |
183,725 |
|||||||
Adjusted EBITDA |
$ 420,042 |
$ 420,291 |
$ 321,472 |
$ 1,220,983 |
$ 938,482 |
|||||||
(9) |
We define cash gross margins as cash gross profit divided by revenues. |
|||||||||||
Our cash gross margins by geographic region is presented below: |
||||||||||||
Americas cash gross margins |
73% |
74% |
72% |
73% |
73% |
|||||||
EMEA cash gross margins |
61% |
62% |
64% |
62% |
64% |
|||||||
Asia-Pacific cash gross margins |
63% |
64% |
67% |
64% |
67% |
|||||||