Equinix Reports Third Quarter 2018 Results
- Quarterly revenues increased 11% year-over-year to
$1.284 billion ; a 9% year-over-year increase on a normalized and constant currency basis - Significant number of new wins in multiple verticals in Q3, with notable outperformance from content and digital media and enterprise
- Seven new expansions announced
Third Quarter 2018 Results Summary
- Revenues
$1.284 billion , a 2% increase over the previous quarter- Operating Income
$266 million , a 24% increase over the previous quarter, an operating margin of 21%- Adjusted EBITDA
$613 million , a 48% adjusted EBITDA margin- Includes
$9 million of integration costs for acquisitions - Net Income
$125 million , an 85% increase over the previous quarter- Includes
$9 million of integration costs for acquisitions - Diluted earnings per share of
$1.55 , an 82% increase compared to prior quarter - AFFO
$402 million , a 6% decrease from the previous quarter- Includes
$9 million of integration costs for acquisitions
2018 Annual Guidance Summary
- Revenues
$5.060 - $5.070 billion , a 16% increase over the previous year or a normalized and constant currency increase of 9%; an$8 million increase compared to prior guidance after absorbing a$7 million negative FX impact- Adjusted EBITDA
$2.400 - $2.410 billion or a 48% adjusted EBITDA margin, an increase of$6 million compared to prior guidance after absorbing a$3 million negative FX impact- Assumes
$40 million of integration costs for acquisitions - AFFO
$1.619 - $1.639 billion , a 13% increase over the previous year, an increase of$13 million compared to prior guidance after including a$3 million FX benefit- Assumes
$40 million of integration costs for acquisitions
Quote
"I am extremely proud of our track record of success in my eight years as a member of the leadership team, and that track record continues this quarter with our 63rd quarter of consecutive revenue growth. Since 2010, we have more than quadrupled the size of our business, and we have invested
Q3 Business Highlights
- In September,
Equinix announced the appointment ofCharles Meyers as President and CEO. Meyers is an eight-year veteran of the company having held the previous positions of President of Strategy, Services and Innovation and Chief Operating Officer forEquinix . Equinix continued to invest in building out its global platform in Q3 in response to strong customer demand and a high level of inventory utilization:Equinix completed nine expansion projects in eight markets including Culpeper,Frankfurt ,Houston ,Melbourne ,Miami ,Rio de Janeiro ,Singapore and two in São Paulo.- Continuing its investment in organic growth and expansion,
Equinix has 30 expansion projects currently underway across 21 markets in all three regions, including seven newly announced expansions inFrankfurt ,Helsinki ,London ,Madrid ,Osaka ,Seattle andWarsaw . - Customers continue to leverage the global scope of Platform Equinix® to achieve a distributed digital edge. In Q3, more than 59% of revenues came from customers deployed across all three regions, and 85% came from customers deployed across multiple metros.
Equinix achieved a significant number of new wins across multiple verticals in Q3. The content and digital media vertical experienced record bookings this quarter led byAsia-Pacific with customer expansions fromAlibaba andTencent . The enterprise vertical continued to be the company's fastest growing vertical, led by the manufacturing, healthcare and travel sub-segments.- Interconnection revenues continued to outpace colocation revenues in Q3, reflecting the movement towards Interconnection Oriented Architecture® (IOA®) strategies and the adoption of hybrid multicloud as the preferred IT deployment model. Cross connects between customers increased to more than 294,000, and the Equinix Cloud Exchange Fabric™ (ECX Fabric™) platform now serves more than 1,300 customers.
Business Outlook
For the fourth quarter of 2018, the Company expects revenues to range between
For the full year of 2018, total revenues are expected to range between
The U.S. dollar exchange rates used for 2018 guidance, taking into consideration the impact of our current foreign currency hedges, have been updated to
The adjusted EBITDA guidance is based on the revenue guidance less our expectations of cash cost of revenues and cash operating expenses. The AFFO guidance is based on the adjusted EBITDA guidance less our expectations of net interest expense, an installation revenue adjustment, a straight-line rent expense adjustment, a contract cost adjustment, amortization of deferred financing costs and debt discounts and premiums, gains (losses) on debt extinguishment, an income tax expense adjustment, recurring capital expenditures and adjustments for unconsolidated joint ventures' and non-controlling interests' share of these items.
Q3 2018 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 financial 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 data centers and developing, deploying and delivering
EQUINIX, INC. |
|||||||||||||||||||
Three Months Ended |
Nine Months Ended |
||||||||||||||||||
September 30, |
June 30, |
September 30, |
September 30, |
September 30, |
|||||||||||||||
Recurring revenues |
$ |
1,207,806 |
$ |
1,187,749 |
$ |
1,089,033 |
$ |
3,546,184 |
$ |
2,997,521 |
|||||||||
Non-recurring revenues |
75,945 |
74,194 |
63,228 |
215,387 |
170,686 |
||||||||||||||
Revenues |
1,283,751 |
1,261,943 |
1,152,261 |
3,761,571 |
3,168,207 |
||||||||||||||
Cost of revenues |
660,309 |
651,801 |
582,360 |
1,934,540 |
1,573,524 |
||||||||||||||
Gross profit |
623,442 |
610,142 |
569,901 |
1,827,031 |
1,594,683 |
||||||||||||||
Operating expenses: |
|||||||||||||||||||
Sales and marketing |
157,920 |
154,202 |
157,619 |
471,898 |
428,112 |
||||||||||||||
General and administrative |
206,902 |
210,489 |
185,336 |
620,548 |
558,090 |
||||||||||||||
Acquisition costs |
(1,120) |
30,413 |
2,083 |
33,932 |
31,510 |
||||||||||||||
Gain on asset sales |
(6,013) |
— |
— |
(6,013) |
— |
||||||||||||||
Total operating expenses |
357,689 |
395,104 |
345,038 |
1,120,365 |
1,017,712 |
||||||||||||||
Income from operations |
265,753 |
215,038 |
224,863 |
706,666 |
576,971 |
||||||||||||||
Interest and other income (expense): |
|||||||||||||||||||
Interest income |
2,912 |
3,958 |
2,291 |
11,480 |
9,820 |
||||||||||||||
Interest expense |
(130,566) |
(134,673) |
(121,828) |
(391,516) |
(352,554) |
||||||||||||||
Other income (expense) |
3,744 |
8,866 |
(1,076) |
9,546 |
545 |
||||||||||||||
Gain (loss) on debt extinguishment |
1,492 |
(19,215) |
(22,156) |
(39,214) |
(42,103) |
||||||||||||||
Total interest and other, net |
(122,418) |
(141,064) |
(142,769) |
(409,704) |
(384,292) |
||||||||||||||
Income before income taxes |
143,335 |
73,974 |
82,094 |
296,962 |
192,679 |
||||||||||||||
Income tax expense |
(18,510) |
(6,356) |
(2,194) |
(41,625) |
(24,912) |
||||||||||||||
Net income |
$ |
124,825 |
$ |
67,618 |
$ |
79,900 |
$ |
255,337 |
$ |
167,767 |
|||||||||
Net income per share: |
|||||||||||||||||||
Basic net income per share |
$ |
1.56 |
$ |
0.85 |
$ |
1.02 |
$ |
3.21 |
$ |
2.20 |
|||||||||
Diluted net income per share |
$ |
1.55 |
$ |
0.85 |
$ |
1.02 |
$ |
3.19 |
$ |
2.18 |
|||||||||
Shares used in computing basic net income per share |
79,872 |
79,479 |
78,055 |
79,533 |
76,283 |
||||||||||||||
Shares used in computing diluted net income per share |
80,283 |
79,752 |
78,719 |
79,956 |
76,948 |
||||||||||||||
EQUINIX, INC. |
|||||||||||||||||||
Three Months Ended |
Nine Months Ended |
||||||||||||||||||
September 30, |
June 30, |
September 30, |
September 30, |
September 30, |
|||||||||||||||
Net income |
$ |
124,825 |
$ |
67,618 |
$ |
79,900 |
$ |
255,337 |
$ |
167,767 |
|||||||||
Other comprehensive income (loss), net of tax: |
|||||||||||||||||||
Foreign currency translation adjustment ("CTA") gain (loss) |
(77,566) |
(421,233) |
100,909 |
(352,948) |
408,830 |
||||||||||||||
Net investment hedge CTA gain (loss) |
27,214 |
226,115 |
(60,723) |
180,694 |
(191,121) |
||||||||||||||
Unrealized gain (loss) on available-for-sale securities |
— |
— |
245 |
— |
(85) |
||||||||||||||
Unrealized gain (loss) on cash flow hedges |
6,184 |
35,280 |
(13,070) |
37,384 |
(52,468) |
||||||||||||||
Net actuarial gain on defined benefit plans |
14 |
13 |
13 |
35 |
39 |
||||||||||||||
Total other comprehensive income (loss), net of tax |
(44,154) |
(159,825) |
27,374 |
(134,835) |
165,195 |
||||||||||||||
Comprehensive income (loss), net of tax |
$ |
80,671 |
$ |
(92,207) |
$ |
107,274 |
$ |
120,502 |
$ |
332,962 |
EQUINIX, INC. |
|||||||
September 30, |
December 31, |
||||||
Assets |
|||||||
Cash and cash equivalents |
$ |
870,486 |
$ |
1,412,517 |
|||
Short-term investments |
15,415 |
28,271 |
|||||
Accounts receivable, net |
662,401 |
576,313 |
|||||
Other current assets |
258,685 |
232,027 |
|||||
Total current assets |
1,806,987 |
2,249,128 |
|||||
Long-term investments |
— |
9,243 |
|||||
Property, plant and equipment, net |
10,682,826 |
9,394,602 |
|||||
Goodwill |
4,852,549 |
4,411,762 |
|||||
Intangible assets, net |
2,383,377 |
2,384,972 |
|||||
Other assets |
562,332 |
241,750 |
|||||
Total assets |
$ |
20,288,071 |
$ |
18,691,457 |
|||
Liabilities and Stockholders' Equity |
|||||||
Accounts payable and accrued expenses |
$ |
739,117 |
$ |
719,257 |
|||
Accrued property, plant and equipment |
276,314 |
220,367 |
|||||
Current portion of capital lease and other financing obligations |
98,219 |
78,705 |
|||||
Current portion of mortgage and loans payable |
73,288 |
64,491 |
|||||
Current portion of senior notes |
150,557 |
— |
|||||
Other current liabilities |
123,824 |
159,914 |
|||||
Total current liabilities |
1,461,319 |
1,242,734 |
|||||
Capital lease and other financing obligations, less current portion |
1,386,260 |
1,620,256 |
|||||
Mortgage and loans payable, less current portion |
1,327,477 |
1,393,118 |
|||||
Senior notes, less current portion |
8,318,782 |
6,923,849 |
|||||
Other liabilities |
634,060 |
661,710 |
|||||
Total liabilities |
13,127,898 |
11,841,667 |
|||||
Common stock |
81 |
79 |
|||||
Additional paid-in capital |
10,592,960 |
10,121,323 |
|||||
Treasury stock |
(145,216) |
(146,320) |
|||||
Accumulated dividends |
(3,145,430) |
(2,592,792) |
|||||
Accumulated other comprehensive loss |
(922,148) |
(785,189) |
|||||
Retained earnings |
779,926 |
252,689 |
|||||
Total stockholders' equity |
7,160,173 |
6,849,790 |
|||||
Total liabilities and stockholders' equity |
$ |
20,288,071 |
$ |
18,691,457 |
|||
Ending headcount by geographic region is as follows: |
|||||||
Americas headcount |
3,404 |
3,154 |
|||||
EMEA headcount |
2,695 |
2,560 |
|||||
Asia-Pacific headcount |
1,656 |
1,559 |
|||||
Total headcount |
7,755 |
7,273 |
EQUINIX, INC. |
|||||||
September 30, 2018 |
December 31, 2017 |
||||||
Capital lease and other financing obligations |
$ |
1,484,479 |
$ |
1,698,961 |
|||
Term loans |
1,353,763 |
1,406,686 |
|||||
Mortgage payable and other loans payable |
47,002 |
50,923 |
|||||
Plus: debt discount and issuance costs, net |
5,033 |
8,615 |
|||||
Total mortgage and loans payable principal |
1,405,798 |
1,466,224 |
|||||
Senior notes |
8,469,339 |
6,923,849 |
|||||
Plus: debt issuance costs |
78,961 |
78,151 |
|||||
Less: debt premium |
(6,100) |
— |
|||||
Total senior notes principal |
8,542,200 |
7,002,000 |
|||||
Total debt principal outstanding |
$ |
11,432,477 |
$ |
10,167,185 |
EQUINIX, INC. |
||||||||||||||||||||
Three Months Ended |
Nine Months Ended |
|||||||||||||||||||
September 30, 2018 |
June 30, |
September 30, 2017 |
September 30, 2018 |
September 30, |
||||||||||||||||
Cash flows from operating activities: |
||||||||||||||||||||
Net income |
$ |
124,825 |
$ |
67,618 |
$ |
79,900 |
$ |
255,337 |
$ |
167,767 |
||||||||||
Adjustments to reconcile net income to net cash provided by operating activities: |
||||||||||||||||||||
Depreciation, amortization and accretion |
306,318 |
308,828 |
277,719 |
921,611 |
749,118 |
|||||||||||||||
Stock-based compensation |
47,588 |
49,725 |
45,654 |
139,849 |
129,602 |
|||||||||||||||
Amortization of debt issuance costs and debt discounts and premiums |
3,148 |
3,362 |
4,390 |
10,609 |
20,100 |
|||||||||||||||
(Gain) loss on debt extinguishment |
(1,492) |
19,215 |
22,156 |
39,214 |
42,103 |
|||||||||||||||
Gain on asset sales |
(6,013) |
— |
— |
(6,013) |
— |
|||||||||||||||
Other items |
5,730 |
2,322 |
(744) |
16,940 |
11,411 |
|||||||||||||||
Changes in operating assets and liabilities: |
||||||||||||||||||||
Accounts receivable |
(46,685) |
32,834 |
(50,530) |
(85,126) |
(202,430) |
|||||||||||||||
Income taxes, net |
(10,010) |
(7,485) |
(19,681) |
(32,876) |
(53,608) |
|||||||||||||||
Accounts payable and accrued expenses |
29,107 |
10,818 |
28,781 |
4,782 |
44,952 |
|||||||||||||||
Other assets and liabilities |
(35,354) |
51,491 |
2,865 |
(7,530) |
35,339 |
|||||||||||||||
Net cash provided by operating activities |
417,162 |
538,728 |
390,510 |
1,256,797 |
944,354 |
|||||||||||||||
Cash flows from investing activities: |
||||||||||||||||||||
Purchases, sales and maturities of investments, net |
6,452 |
13,240 |
(28,258) |
19,195 |
(25,059) |
|||||||||||||||
Business acquisitions, net of cash and restricted cash acquired |
1,808 |
(830,993) |
1,128 |
(829,185) |
(3,628,526) |
|||||||||||||||
Purchases of real estate |
(94,830) |
(27,082) |
(16,384) |
(136,612) |
(64,964) |
|||||||||||||||
Purchases of other property, plant and equipment |
(545,541) |
(520,239) |
(320,234) |
(1,415,509) |
(946,048) |
|||||||||||||||
Proceeds from asset sales |
12,154 |
— |
— |
12,154 |
47,767 |
|||||||||||||||
Net cash used in investing activities |
(619,957) |
(1,365,074) |
(363,748) |
(2,349,957) |
(4,616,830) |
|||||||||||||||
Cash flows from financing activities: |
||||||||||||||||||||
Proceeds from employee equity awards |
24,243 |
13 |
21,506 |
50,103 |
41,625 |
|||||||||||||||
Payment of dividend distributions |
(185,983) |
(181,760) |
(159,541) |
(554,742) |
(463,914) |
|||||||||||||||
Proceeds from public offering of common stock, net of offering costs |
265,671 |
8,202 |
— |
273,873 |
2,126,341 |
|||||||||||||||
Proceeds from loans payable |
424,650 |
— |
— |
424,650 |
1,059,800 |
|||||||||||||||
Proceeds from senior notes |
— |
— |
1,199,700 |
929,850 |
2,449,700 |
|||||||||||||||
Repayment of capital lease and other financing obligations |
(19,799) |
(14,069) |
(15,792) |
(89,655) |
(60,252) |
|||||||||||||||
Repayment of mortgage and loans payable |
(404,083) |
(18,816) |
(21,215) |
(429,498) |
(63,520) |
|||||||||||||||
Repayment of senior notes |
— |
— |
(500,000) |
— |
(500,000) |
|||||||||||||||
Debt extinguishment costs |
— |
148 |
(11,766) |
(20,556) |
(23,020) |
|||||||||||||||
Debt issuance costs |
(635) |
— |
(16,267) |
(12,218) |
(56,886) |
|||||||||||||||
Other financing activities |
— |
— |
— |
— |
(900) |
|||||||||||||||
Net cash provided by (used in) financing activities |
104,064 |
(206,282) |
496,625 |
571,807 |
4,508,974 |
|||||||||||||||
Effect of foreign currency exchange rates on cash, cash equivalents and restricted cash |
(5,104) |
(33,743) |
9,582 |
(30,944) |
26,450 |
|||||||||||||||
Net increase (decrease) in cash, cash equivalents and restricted cash |
(103,835) |
(1,066,371) |
532,969 |
(552,297) |
862,948 |
|||||||||||||||
Cash, cash equivalents and restricted cash at beginning of period |
1,002,239 |
2,068,610 |
1,103,226 |
1,450,701 |
773,247 |
|||||||||||||||
Cash, cash equivalents and restricted cash at end of period |
$ |
898,404 |
$ |
1,002,239 |
$ |
1,636,195 |
$ |
898,404 |
$ |
1,636,195 |
||||||||||
Supplemental cash flow information: |
||||||||||||||||||||
Cash paid for taxes |
$ |
77,648 |
$ |
17,681 |
$ |
16,590 |
$ |
127,090 |
$ |
62,411 |
||||||||||
Cash paid for interest |
$ |
152,887 |
$ |
115,071 |
$ |
129,014 |
$ |
375,015 |
$ |
342,408 |
||||||||||
Free cash flow (negative free cash flow) (1) |
$ |
(209,247) |
$ |
(839,586) |
$ |
55,020 |
$ |
(1,112,355) |
$ |
(3,647,417) |
||||||||||
Adjusted free cash flow (adjusted negative free cash flow) (2) |
$ |
(116,225) |
$ |
18,489 |
$ |
70,276 |
$ |
(146,558) |
$ |
46,073 |
||||||||||
(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 |
$ |
417,162 |
$ |
538,728 |
$ |
390,510 |
$ |
1,256,797 |
$ |
944,354 |
||||||||||
Net cash used in investing activities as presented above |
(619,957) |
(1,365,074) |
(363,748) |
(2,349,957) |
(4,616,830) |
|||||||||||||||
Purchases, sales and maturities of investments, net |
(6,452) |
(13,240) |
28,258 |
(19,195) |
25,059 |
|||||||||||||||
Free cash flow (negative free cash flow) |
$ |
(209,247) |
$ |
(839,586) |
$ |
55,020 |
$ |
(1,112,355) |
$ |
(3,647,417) |
||||||||||
(2) |
We define adjusted free cash flow as free cash flow (as defined above) excluding any purchases of real estate and business acquisitions, net of cash and restricted cash acquired as presented below: |
|||||||||||||||||||
Free cash flow (as defined above) |
$ |
(209,247) |
$ |
(839,586) |
$ |
55,020 |
$ |
(1,112,355) |
$ |
(3,647,417) |
||||||||||
Less business acquisitions, net of cash and restricted cash acquired |
(1,808) |
830,993 |
(1,128) |
829,185 |
3,628,526 |
|||||||||||||||
Less purchases of real estate |
94,830 |
27,082 |
16,384 |
136,612 |
64,964 |
|||||||||||||||
Adjusted free cash flow (adjusted negative free cash flow) |
$ |
(116,225) |
$ |
18,489 |
$ |
70,276 |
$ |
(146,558) |
$ |
46,073 |
||||||||||
EQUINIX, INC. |
||||||||||||||||||||
Three Months Ended |
Nine Months Ended |
|||||||||||||||||||
September 30, |
June 30, |
September 30, |
September 30, |
September 30, |
||||||||||||||||
Recurring revenues |
$ |
1,207,806 |
$ |
1,187,749 |
$ |
1,089,033 |
$ |
3,546,184 |
$ |
2,997,521 |
||||||||||
Non-recurring revenues |
75,945 |
74,194 |
63,228 |
215,387 |
170,686 |
|||||||||||||||
Revenues (1) |
1,283,751 |
1,261,943 |
1,152,261 |
3,761,571 |
3,168,207 |
|||||||||||||||
Cash cost of revenues (2) |
433,186 |
421,733 |
377,767 |
1,250,441 |
1,025,776 |
|||||||||||||||
Cash gross profit (3) |
850,565 |
840,210 |
774,494 |
2,511,130 |
2,142,431 |
|||||||||||||||
Cash operating expenses (4)(7): |
||||||||||||||||||||
Cash sales and marketing expenses (5) |
93,339 |
91,468 |
96,873 |
282,876 |
286,350 |
|||||||||||||||
Cash general and administrative expenses(6) |
144,700 |
144,738 |
127,302 |
432,209 |
368,880 |
|||||||||||||||
Total cash operating expenses (4) (7) |
238,039 |
236,206 |
224,175 |
715,085 |
655,230 |
|||||||||||||||
Adjusted EBITDA (8) |
$ |
612,526 |
$ |
604,004 |
$ |
550,319 |
$ |
1,796,045 |
$ |
1,487,201 |
||||||||||
Cash gross margins (9) |
66 |
% |
67 |
% |
67 |
% |
67 |
% |
68 |
% |
||||||||||
Adjusted EBITDA margins (10) |
48 |
% |
48 |
% |
48 |
% |
48 |
% |
47 |
% |
||||||||||
Adjusted EBITDA flow-through rate (11) |
39 |
% |
53 |
% |
48 |
% |
50 |
% |
53 |
% |
||||||||||
FFO (12) |
$ |
340,030 |
$ |
289,525 |
$ |
286,119 |
$ |
920,310 |
$ |
706,745 |
||||||||||
AFFO (13) (14) |
$ |
402,250 |
$ |
428,126 |
$ |
391,289 |
$ |
1,244,952 |
$ |
1,055,513 |
||||||||||
(1) |
The geographic split of our revenues on a services basis is presented below: |
|||||||||||||||||||
Americas Revenues: |
||||||||||||||||||||
Colocation |
$ |
433,828 |
$ |
433,895 |
$ |
422,244 |
$ |
1,294,848 |
$ |
1,096,281 |
||||||||||
Interconnection |
134,159 |
131,720 |
124,377 |
395,132 |
341,475 |
|||||||||||||||
Managed infrastructure |
18,698 |
18,292 |
18,359 |
55,525 |
50,425 |
|||||||||||||||
Other |
5,161 |
4,980 |
1,056 |
11,220 |
3,878 |
|||||||||||||||
Recurring revenues |
591,846 |
588,887 |
566,036 |
1,756,725 |
1,492,059 |
|||||||||||||||
Non-recurring revenues |
33,838 |
29,388 |
30,502 |
89,861 |
74,534 |
|||||||||||||||
Revenues |
$ |
625,684 |
$ |
618,275 |
$ |
596,538 |
$ |
1,846,586 |
$ |
1,566,593 |
||||||||||
EMEA Revenues: |
||||||||||||||||||||
Colocation |
$ |
305,072 |
$ |
293,518 |
$ |
268,365 |
$ |
886,651 |
$ |
781,303 |
||||||||||
Interconnection |
34,640 |
33,969 |
27,574 |
103,586 |
73,580 |
|||||||||||||||
Managed infrastructure |
28,387 |
29,731 |
22,465 |
88,804 |
59,342 |
|||||||||||||||
Other |
2,552 |
2,364 |
2,475 |
6,682 |
7,842 |
|||||||||||||||
Recurring revenues |
370,651 |
359,582 |
320,879 |
1,085,723 |
922,067 |
|||||||||||||||
Non-recurring revenues |
26,104 |
23,586 |
17,954 |
73,830 |
54,557 |
|||||||||||||||
Revenues |
$ |
396,755 |
$ |
383,168 |
$ |
338,833 |
$ |
1,159,553 |
$ |
976,624 |
||||||||||
Asia-Pacific Revenues: |
||||||||||||||||||||
Colocation |
$ |
191,143 |
$ |
186,172 |
$ |
152,071 |
$ |
543,513 |
$ |
438,849 |
||||||||||
Interconnection |
33,318 |
31,924 |
27,593 |
96,011 |
78,233 |
|||||||||||||||
Managed infrastructure |
20,848 |
21,184 |
22,454 |
64,212 |
66,313 |
|||||||||||||||
Recurring revenues |
245,309 |
239,280 |
202,118 |
703,736 |
583,395 |
|||||||||||||||
Non-recurring revenues |
16,003 |
21,220 |
14,772 |
51,696 |
41,595 |
|||||||||||||||
Revenues |
$ |
261,312 |
$ |
260,500 |
$ |
216,890 |
$ |
755,432 |
$ |
624,990 |
||||||||||
Worldwide Revenues: |
||||||||||||||||||||
Colocation |
$ |
930,043 |
$ |
913,585 |
$ |
842,680 |
$ |
2,725,012 |
$ |
2,316,433 |
||||||||||
Interconnection |
202,117 |
197,613 |
179,544 |
594,729 |
493,288 |
|||||||||||||||
Managed infrastructure |
67,933 |
69,207 |
63,278 |
208,541 |
176,080 |
|||||||||||||||
Other |
7,713 |
7,344 |
3,531 |
17,902 |
11,720 |
|||||||||||||||
Recurring revenues |
1,207,806 |
1,187,749 |
1,089,033 |
3,546,184 |
2,997,521 |
|||||||||||||||
Non-recurring revenues |
75,945 |
74,194 |
63,228 |
215,387 |
170,686 |
|||||||||||||||
Revenues |
$ |
1,283,751 |
$ |
1,261,943 |
$ |
1,152,261 |
$ |
3,761,571 |
$ |
3,168,207 |
||||||||||
(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 |
$ |
660,309 |
$ |
651,801 |
$ |
582,360 |
$ |
1,934,540 |
$ |
1,573,524 |
||||||||||
Depreciation, amortization and accretion expense |
(222,523) |
(225,461) |
(200,682) |
(670,993) |
(537,748) |
|||||||||||||||
Stock-based compensation expense |
(4,600) |
(4,607) |
(3,911) |
(13,106) |
(10,000) |
|||||||||||||||
Cash cost of revenues |
$ |
433,186 |
$ |
421,733 |
$ |
377,767 |
$ |
1,250,441 |
$ |
1,025,776 |
||||||||||
The geographic split of our cash cost of revenues is presented below: |
||||||||||||||||||||
Americas cash cost of revenues |
$ |
181,826 |
$ |
180,057 |
$ |
168,901 |
$ |
526,138 |
$ |
430,549 |
||||||||||
EMEA cash cost of revenues |
160,173 |
155,085 |
133,137 |
468,072 |
379,797 |
|||||||||||||||
Asia-Pacific cash cost of revenues |
91,187 |
86,591 |
75,729 |
256,231 |
215,430 |
|||||||||||||||
Cash cost of revenues |
$ |
433,186 |
$ |
421,733 |
$ |
377,767 |
$ |
1,250,441 |
$ |
1,025,776 |
||||||||||
(3) |
We define cash gross profit as revenues less cash cost of revenues (as defined above). |
|||||||||||||||||||
(4) |
We define cash operating expense as selling, general, and administrative expense less depreciation, amortization, and stock-based compensation. We also refer to cash operating expense as cash selling, general and administrative expense or "cash SG&A". |
|||||||||||||||||||
Selling, general, and administrative expense |
$ |
364,822 |
$ |
364,691 |
$ |
342,955 |
$ |
1,092,446 |
$ |
986,202 |
||||||||||
Depreciation and amortization expense |
(83,795) |
(83,367) |
(77,037) |
(250,618) |
(211,370) |
|||||||||||||||
Stock-based compensation expense |
(42,988) |
(45,118) |
(41,743) |
(126,743) |
(119,602) |
|||||||||||||||
Cash operating expense |
$ |
238,039 |
$ |
236,206 |
$ |
224,175 |
$ |
715,085 |
$ |
655,230 |
||||||||||
(5) |
We define cash sales and marketing expense as sales and marketing expense less depreciation, amortization and stock-based compensation as presented below: |
|||||||||||||||||||
Sales and marketing expense |
$ |
157,920 |
$ |
154,202 |
$ |
157,619 |
$ |
471,898 |
$ |
428,112 |
||||||||||
Depreciation and amortization expense |
(50,415) |
(48,626) |
(46,899) |
(149,042) |
(103,517) |
|||||||||||||||
Stock-based compensation expense |
(14,166) |
(14,108) |
(13,847) |
(39,980) |
(38,245) |
|||||||||||||||
Cash sales and marketing expense |
$ |
93,339 |
$ |
91,468 |
$ |
96,873 |
$ |
282,876 |
$ |
286,350 |
||||||||||
(6) |
We define cash general and administrative expense as general and administrative expense less depreciation, amortization and stock-based compensation as presented below: |
|||||||||||||||||||
General and administrative expense |
$ |
206,902 |
$ |
210,489 |
$ |
185,336 |
$ |
620,548 |
$ |
558,090 |
||||||||||
Depreciation and amortization expense |
(33,380) |
(34,741) |
(30,138) |
(101,576) |
(107,853) |
|||||||||||||||
Stock-based compensation expense |
(28,822) |
(31,010) |
(27,896) |
(86,763) |
(81,357) |
|||||||||||||||
Cash general and administrative expense |
$ |
144,700 |
$ |
144,738 |
$ |
127,302 |
$ |
432,209 |
$ |
368,880 |
||||||||||
(7) |
The geographic split of our cash operating expense, or cash SG&A, as defined above, is presented below: |
|||||||||||||||||||
Americas cash SG&A |
$ |
147,855 |
$ |
144,263 |
$ |
135,536 |
$ |
438,941 |
$ |
387,173 |
||||||||||
EMEA cash SG&A |
56,785 |
57,268 |
59,232 |
174,691 |
179,187 |
|||||||||||||||
Asia-Pacific cash SG&A |
33,399 |
34,675 |
29,407 |
101,453 |
88,870 |
|||||||||||||||
Cash SG&A |
$ |
238,039 |
$ |
236,206 |
$ |
224,175 |
$ |
715,085 |
$ |
655,230 |
||||||||||
(8) |
We define adjusted EBITDA as income from operations excluding depreciation, amortization, accretion, stock-based compensation, restructuring charges, impairment charges, acquisition costs and gain or loss on asset sales as presented below: |
|||||||||||||||||||
Income from operations |
$ |
265,753 |
$ |
215,038 |
$ |
224,863 |
$ |
706,666 |
$ |
576,971 |
||||||||||
Depreciation, amortization and accretion expense |
306,318 |
308,828 |
277,719 |
921,611 |
749,118 |
|||||||||||||||
Stock-based compensation expense |
47,588 |
49,725 |
45,654 |
139,849 |
129,602 |
|||||||||||||||
Acquisition costs |
(1,120) |
30,413 |
2,083 |
33,932 |
31,510 |
|||||||||||||||
Gain on asset sales |
(6,013) |
— |
— |
(6,013) |
— |
|||||||||||||||
Adjusted EBITDA |
$ |
612,526 |
$ |
604,004 |
$ |
550,319 |
$ |
1,796,045 |
$ |
1,487,201 |
||||||||||
The geographic split of our adjusted EBITDA is presented below: |
||||||||||||||||||||
Americas income from operations |
$ |
106,536 |
$ |
87,711 |
$ |
105,785 |
$ |
295,983 |
$ |
261,934 |
||||||||||
Americas depreciation, amortization and accretion expense |
156,920 |
160,337 |
151,665 |
475,283 |
364,998 |
|||||||||||||||
Americas stock-based compensation expense |
32,818 |
35,104 |
33,419 |
97,799 |
94,964 |
|||||||||||||||
Americas acquisition costs |
(271) |
10,803 |
1,232 |
12,442 |
26,975 |
|||||||||||||||
Americas adjusted EBITDA |
$ |
296,003 |
$ |
293,955 |
$ |
292,101 |
$ |
881,507 |
$ |
748,871 |
||||||||||
EMEA income from operations |
$ |
88,830 |
$ |
73,046 |
$ |
64,197 |
$ |
225,979 |
$ |
164,105 |
||||||||||
EMEA depreciation, amortization and accretion expense |
89,190 |
88,828 |
74,625 |
270,510 |
229,549 |
|||||||||||||||
EMEA stock-based compensation expense |
8,532 |
8,403 |
6,791 |
24,074 |
19,451 |
|||||||||||||||
EMEA acquisition costs |
(742) |
538 |
851 |
2,240 |
4,535 |
|||||||||||||||
EMEA gain on asset sales |
(6,013) |
— |
— |
(6,013) |
— |
|||||||||||||||
EMEA adjusted EBITDA |
$ |
179,797 |
$ |
170,815 |
$ |
146,464 |
$ |
516,790 |
$ |
417,640 |
||||||||||
Asia-Pacific income from operations |
$ |
70,387 |
$ |
54,281 |
$ |
54,881 |
$ |
184,704 |
$ |
150,932 |
||||||||||
Asia-Pacific depreciation, amortization and accretion expense |
60,208 |
59,663 |
51,429 |
175,818 |
154,571 |
|||||||||||||||
Asia-Pacific stock-based compensation expense |
6,238 |
6,218 |
5,444 |
17,976 |
15,187 |
|||||||||||||||
Asia-Pacific acquisition costs |
(107) |