Digital Realty Trust, Inc. Q2 FY2025 Earnings Call

· Earnings call transcript and AI-powered summary

Quarter Overview

  • Record quarterly performance driven by strong leasing activity, particularly in the 0–1 MW plus interconnection segment.
  • Core FFO per share reached an all‑time high of $1.87, up 13% year‑over‑year and 6% sequentially (vs. Q1 2025).
  • Raised full‑year 2025 guidance for revenue, adjusted EBITDA, and core FFO per share based on stronger‑than‑expected first‑half results.
  • Backlog remains large at $826 million, providing multi‑year visibility into growth.
  • U.S. Hyperscale Data Center Fund surpassed $3 billion in LP commitments, on track to support roughly $10 billion of hyperscale development.
  • Total liquidity exceeds $7 billion, with leverage at 5.1x—below the company’s long‑term target of 5.5x.

Operational & Leasing Highlights

  • Total gross bookings: $177 million (Digital Realty share: $135 million).
  • 0–1 MW plus interconnection bookings: Record $90 million, 18% above prior record (Q4 2024), and up 36% versus the trailing 4‑quarter average.
  • Large‑scale (>1 MW) bookings: $45 million, with contracts ranging from 2–12 MW across multiple regions.
  • Renewal leasing: $177 million signed with a blended 7.3% cash uplift (above previous 4–6% annual guidance).
  • Churn fell to 1%, with negligible churn in >1 MW segment.
  • Global expansion momentum strong: 139 new customer logos added.

Financial Performance

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Operator: Good afternoon, and welcome to the Digital Realty Second Quarter 2025 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's Second Quarter 2025 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 second quarter results. First, we posted $177 million of new bookings in the quarter at 100% share, including $135 million of Dig

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