Equinix, Inc. Q3 FY2020 Earnings Call

· Earnings call transcript and AI-powered summary

Quarter Overview

  • Q3 revenue was $1.52 billion, up 9% year-over-year, marking the 71st consecutive quarter of revenue growth. Growth was measured on a normalized, constant currency basis.
  • Adjusted EBITDA reached $737 million, up 11% year-over-year, supported by strong operations, lower-than-expected bad debt reserves, and timing differences in maintenance costs.
  • AFFO was $580 million, coming in above expectations due to solid operations and lower tax expense.
  • Interconnection revenue grew 15% year-over-year, with 8,500 net new interconnects added in Q3, more than the next 15 competitors combined.
  • Peak internet exchange traffic was up 43% year-over-year and 7% quarter-over-quarter as demand normalized after an earlier COVID surge.
  • Equinix Fabric surpassed a $100 million annualized run-rate with more than 2,300 customers.
  • Equinix Metal (formerly Packet) launched, though revenue will land slightly below prior expectations due to timing of platform integration and go-to-market strategy.

Geographic Performance

  • EMEA was the fastest-growing region at 16% year-over-year, supported by strong bookings and high interconnection growth.
  • APAC revenue grew 11% year-over-year with strong performance in Singapore and Japan.

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Operator: Good afternoon, and welcome to the Equinix Third Quarter Earnings Conference Call. All lines will be able to listen-only, until we open for questions. Also, today's conference is being recorded. If anyone has any objections, please disconnect at this time. I'd now like to turn the call over to Katrina Rymill, Vice President of Investor Relations and Sustainability. You may begin. Katrina Rymill: Good afternoon, and welcome to today's conference call. Before we get started, I'd like to remind everyone that some of the statements we'll be making today are forward-looking in nature and involve risks and uncertainties. Actual results may vary significantly from those statements and may be affected by the risks we identified in today's press release and those identified in our filings with the SEC, including our most recent Form 10-K filed on February 21, 2020, and 10-Q filed on July 31, 2020. Equinix assumes no obligation and does not intend to update or comment on forward-looking statements made on this call. In addition, in light of Regulation Fair Disclosure, it is Equinix' policy not to comment on its financial guidance during the quarter, unless it is done through an explicit public disclosure. In addition, we will provide non-GAAP measures on today's conference call. We provide a reconciliation of those measures to the most directly comparable GAAP measures and a list of the reasons why the company uses these measures in today's press release on the Equinix IR pa

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