Digital Realty Trust, Inc. Q1 FY2026 Earnings Call

· Earnings call transcript and AI-powered summary

Quarter Overview

  • Digital Realty posted one of the strongest quarters in company history, including the second highest bookings ever.
  • Record performance in the 0–1 MW and interconnection category, and the largest single lease in company history: a 200 MW AI inference-oriented deal in Charlotte.
  • Core FFO reached $2.04 per share, up 15% year-over-year, exceeding expectations.
  • Management raised 2026 Core FFO guidance to $8.00–$8.10 per share (9% growth at midpoint vs. 2025).
  • Backlog reached a record $1.8B ($1B at Digital Realty’s share), supporting visibility into 2027–2028.
  • Development pipeline increased over 50% sequentially to 1.2 GW under construction and $16.5B in total pipeline value; now 61% pre-leased.
  • Leverage improved to 4.7×, a multiyear low, with strong retained capital and expanded private capital platform.

Leasing & Demand Trends

  • Total new leasing: $707M annualized (100% share), $423M at DLR share.
  • 0–1 MW + interconnection record: $98M in new signings, up 40% from Q1 2025.
  • Interconnection bookings rose 24% YoY to $18.6M.
  • AI demand expanding across size segments:
    • 21% of 0–1 MW bookings were AI-driven.
    • Large-scale AI inference deployments driving 10+ MW and 200+ MW deals.

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Operator: Good afternoon, and welcome to the Digital Realty First Quarter 2026 Earnings Call. Please note, this event is being recorded. [Operator Instructions] I would now like to turn the call over to Jordan Sadler, Digital Realty's Senior Vice President of Public and Private Investor Relations. Jordan, please go ahead. Jordan Sadler: Thank you, operator, and welcome, everyone, to Digital Realty Trust's First Quarter 2026 Earnings Conference Call. Joining me on today's call are President and CEO, Andy Power; and CFO, Matt Mercier. Chief Investment Officer, Greg Wright; Chief Technology Officer, Chris Sharp; and Chief Revenue Officer, Colin McLean, are also on the call and will be available for Q&A. Management will be making forward-looking statements, including guidance and underlying assumptions on today's call. Forward-looking statements are based on expectations that involve risks and uncertainties that could cause actual results to differ materially. For a further discussion of risks related to our business, see our 10-K and subsequent filings with the SEC. This call will contain certain non-GAAP financial information. Reconciliations to the most directly comparable GAAP measure are included in the supplemental package furnished to the SEC and available on our website. Before I turn the call over to Andy, let me offer a few key takeaways from our first quarter results. First, we delivered the second highest bookings quarter ever for Digital Realty, underscoring the dive

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