GDS Holdings Limited Q2 FY2022 Earnings Call

· Earnings call transcript and AI-powered summary

Business & Market Overview

  • Despite China’s difficult macro backdrop (COVID lockdowns, supply-chain constraints, weakening tech sector), GDS delivered solid results.
  • Q2 2022 revenue grew 24% year-over-year; adjusted EBITDA grew 18% year-over-year.
  • Management stressed the resilience of the data center industry and GDS’s diversified customer base across cloud, internet, and enterprise verticals.
  • Demand environment is softer, but GDS continues to win new business and sees a large multi-year backlog supporting future growth.

Key Operational Highlights

  • Three major hyperscale wins in Q2:
    • A global car manufacturer in Hong Kong 1 (HK1), adding to strong anchor tenants including top global and China cloud players.
    • A China cloud customer near Beijing, viewed as a typical “land-and-expand” deployment.
    • A major Chinese bank in Shanghai; financial institutions and large enterprises accounted for ~40% of new bookings in Q2.
  • Bookings:
    • 31,000 sqm new bookings in 1H 2022.
    • Management remains confident of achieving 70,000 sqm in net additional committed area for FY 2022.
    • Long-term target: 80,000–90,000 sqm annually, with 15–20% expected from regional (international) markets.

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Operator: Hello, ladies and gentlemen. Thank you for standing by for the GDS Holdings Limited Second Quarter 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After managements prepared remarks, there will be a question-and-answer session. Today's conference call is being recorded. I'd now like to turn the call over to your host, Ms. Laura Chen, Head of Investor Relations for the company. Please go ahead, Laura. Laura Chen: Thank you. Hello, everyone. Welcome to the second quarter 2022 earnings conference call of GDS Holdings Limited. The company's results were issued via Newswire Services earlier today and are posted online. A summary presentation, which we will refer to during this conference call can be viewed and downloaded from our IR website at investorsgdsservices.com. Leading today's call is Mr. William Huang, GDS Founder, Chairman and CEO, who will provide an overview of our business strategy and performance; Mr. Dan Newman, GDS CFO, will then review the financial and operating results; Ms. Jamie Khoo, our COO, is also available to answer questions. Before we continue, please note that today's discussion will contain forward-looking statements made under the Safe Harbor provisions of the US Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, the company's results may be materially different from the views expressed today. Further information regarding th

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