Slide 1: Q4 2020 Earnings Conference Call
Q4 2020 Earnings Conference Call NASDAQ: EQIX Presented on February 10, 2021 © 2021 Equinix.com 1
Slide 2: Public Disclosure Statement
Public Disclosure Statement Forward-Looking Statements Except for historical information, this presentation contains forward-looking statements which include words such as “believe,” “anticipate,” and “expect”. These forward-looking statements involve risks and uncertainties that may cause Equinix’s
Slide 3: 2020 Financial Highlights
2020 Financial Highlights Recurring Revenues Non-recurring Revenues Revenues Revenues Growth Q4 20 FY20 ($M) $5,999 QoQ YoY YoY $5,562 $5,072 $4,368 Acquisition Revenues: As-reported 3% 10% 8% $3,612 Axtel: $20M Packet: $30M Normalized and (1) 1% 8% 8% $5,658 Bell: $28M Constant Currency $4,777 $5,2
Slide 4: Q4 2020 Consolidated Results
Q4 2020 Consolidated Results $M except for AFFO per Share and Q4 20 FY20 Non-Financial Metrics Guidance Actual QoQ YoY Guidance Actual YoY (1) Revenues $1,549 - 1,569 $1,564 3% 10% $5,983 - 6,003 $5,999 8% Cash Gross Profit $1,024 0% 9% $4,007 8% Cash Gross Margin % 65.5% 66.8% Cash SG&A $313 9% 19%
Slide 5: Americas Performance
Americas Performance Revenues Organic Revenues Axtel/Bell/Packet $712 Q4 20 ($M) $662 $661 $672 Revenues Growth $654 $43 QoQ YoY $8 $13 $13 Axtel: $5M Packet: $10M As-reported 6% 9% Bell: $28M Normalized and (1) 1% 4% Constant Currency $654 $654 $648 $659 $669 (1) Normalized MRR 1% 4% Adjusted EBITD
Slide 6: EMEA Performance
EMEA Performance Revenues Revenues Q4 20 ($M) $518 $488 $511 Growth QoQ (3) YoY $464 $479 As-reported 1% 10% Normalized and (1) 1% 11% Constant Currency (1) Normalized MRR 2% 10% Adjusted EBITDA Q4 20 (4) Growth QoQ YoY Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 As-reported 10% 15% Adjusted EBITDA Adjusted EBITD
Slide 7: Asia-Pacific Performance
Asia-Pacific Performance Revenues Revenues Q4 20 $341 ($M) $321 $329 $300 $304 Growth QoQ YoY As-reported 3% 14% Normalized and (1) 3% 11% Constant Currency (1) Normalized MRR 3% 11% Adjusted EBITDA Q4 20 Growth QoQ YoY Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 Adjusted EBITDA Adjusted EBITDA Adjusted EBITDA Ma
Slide 8: Capital Structure
Capital Structure (1) Available Liquidity Q4 2020 Capital Markets Activity $3.5B • Repaid €1.5B of legacy high yield Senior Notes with proceeds from the sale of $1.85B Senior Notes, which included our inaugural green bond issuance Rating • Paid $150M installment related to Infomart notes Baa3 / BBB-
Slide 9: Capital Expenditures
Capital Expenditures Recurring Capital Expenditures 5.7% 4.8% ($M) $81 • Recurring capital expenditures have 9% $74 10% historically trended between 2% and 5% of 12% 5% 2.5% revenues, annually 2.1% $38 • Maintenance capital expenditures can vary by 1.2% $30 12% 78% 23% 15% 85% quarter based on maint
Slide 10: Stabilized IBX Growth
(1) (2) Stabilized IBX Growth Stabilized, Expansion & New IBXs Stabilized IBX Profitability ($M) Last Quarter $9,639 $3,941 $2,687 $81 Reported # of IBXs Q4 20 Revenues ($M) 27% annual Cash Gross Profit on Gross PP&E investment (5) Expansion: Stabilized: 13%(3) Growth YoY Stabilized: 209 84% Utilize
Slide 11: 2021 Financial Guidance
(1) 2021 Financial Guidance ($M except AFFO per Share) FY 2021 Q1 2021 (2) (3) Revenues $6,580 - 6,640 $1,587 - 1,607 (4) (5) Adjusted EBITDA $3,067 - 3,127 $737 - 757 Adjusted EBITDA Margin % ~47% 46 - 47% Recurring Capital Expenditures $175 - 185 $17 - 27 % of revenues ~3% 1 - 2% Non-recurring Cap
Slide 12: FY21 Revenues Guidance
FY21 Revenues Guidance Normalized growth of 7 - 8% on a significantly increasing base Normalized Constant Currency ($M) +10 - 11% YoY Growth $6,580 - 6,640 +8% $5,999 +10% $5,562 (2) 7 - 8% $5,072 (1) 8% (1) 9% (1) 9% FY18 Reported FY19 Reported FY20 Reported FY21 Guidance (1) Normalized for the acq
Slide 13: FY21 Adjusted EBITDA Guidance
FY21 Adjusted EBITDA Guidance Continued investment in growth and scale Includes impact of: • Product & xScale investments 47.6% As-reported Margin 46.8% • Scaling initiatives • Expansion drag (3) (1) • ASU 2018-15 impact 47.8% Margin ex. 47.3% • Partially offset by operational scale Integration Cost
Slide 14: Q1 21 Guidance
Q1 21 Guidance Revenues Adjusted EBITDA As-reported Margin 45.5% 46.0% 47.3% 46.8% ($M) +1% $1,587 - 1,607 +4% $746 - 766 $737 - 757 $1,582 $727 -$9 $711 $16 $18 $1,564 (1) (1) (2) (3) (4) Q4 20 Reported Normalizing Q4 20 Normalized Q1 21 Guidance Q4 20 Reported Normalizing Q4 20 Q1 21 Integration Q
Slide 15: FY21 AFFO and AFFO per Share Guidance
(1) FY21 AFFO and AFFO per Share Guidance (2) Strong full year growth in AFFO (9 - 11%) and AFFO per share (8 - 10%) Share Count (Diluted) ($M except AFFO per Share) AFFO per Share (Diluted) AFFO (3) 9 - 11% Normalized Constant Currency YoY Growth 80.2M 84.7M 88.4M 90.3M 90.3M $20.69 $22.81 $24.76 $
Slide 16: Dividend Outlook
Dividend Outlook Annual Cash Dividend ($M) ~10% +13% ~$1,029 $936 $826 $727 $612 2021E Cash Dividend of ~$1,029M • Continued growth of our annual total cash dividend amount 43% 44% 43% 43% 43% Payout Payout Payout Payout Payout Ratio Ratio Ratio Ratio Ratio • First quarter dividend of $2.87 to be pa
Slide 17: Supplemental Financial and Operating Data
Supplemental Financial and Operating Data All the Right All the Right All the Right PLACES PARTNERS POSSIBILITIES Place Infrastructure Connect to Everything Seize Opportunity with Wherever You Need It You Need to Succeed Agility, Speed and Confidence Global Footprint Global Ecosystem Experience 227
Slide 18: Equinix Overview
Equinix Overview (1) • Global footprint: 227 data centers in 63 metros Unique Portfolio of Data • Network dense: 1,800+ networks; 100% of Tier 1 Network Routes Center Assets • Cloud dense: 2,950+ Cloud & IT service providers • Interconnected ecosystems: 392,000+ Total Interconnections • 2021 expecte
Slide 19: Pressing Our Advantage in All Markets
Pressing Our Advantage in All Markets Equinix global reach expanding across 63 metro areas and 26 countries 5 Continents 26 Countries 63 Metro areas 227 Data centers AMERICAS EMEA ASIA-PACIFIC % of Customers in Platform Equinix • Geographic footprint is 27 Metros (1) 24 Metros 12 Metros 104 Data Cen
Slide 20: xScale: Amplifying Our Balance Sheet to Extend Cloud Leadership
xScale: Amplifying Our Balance Sheet to Extend Cloud Leadership Current Phase Objective Status Phase Open Cost ($M) Capacity • JV structures enable pursuit of strategic Hyperscale London 13x EMEA JV Open Open Open deployments to minimize dilution of Equinix returns and limits consumption of balance
Slide 21: Customer Revenues Mix
Customer Revenues Mix Diversified Revenues across Customer, Region and Industry segments Revenues Mix Customers and Churn Top 10 Customers Financial Services Rank Type of Customer %MRR Region Count IBX Count EMEA 16% 33% 1 Network 2.5% 3 143 INT 18% 2 Cloud & IT Services 2.5% 3 65 Network Asia- Ente
Slide 22: Non-Financial Metrics
Non-Financial Metrics (1) FY 2019 FY 2020 Acquisitions/ Organic Total Organic Adjustments (2) Q4 Q1 Q2 Q3 Q4 Q4 QoQ Interconnections Americas 153,900 155,700 158,000 160,500 162,800 - 162,800 2,300 EMEA 124,800 127,000 128,600 131,200 133,300 (800) 132,500 2,100 Asia-Pacific 62,200 63,400 65,600 67,
Slide 23: Equinix Announced Retail IBX Expansions
Equinix Announced Retail IBX Expansions (1) Cabinet 2021 2022 Total Capex(1) Equivalent Capacity In Expansion Highlights IBX Data Center Status Q4 Q1 Q2 Q3 Q4 Q1 Q2 $US millions Ownership Future Phases DC21 phase 1 (Washington D.C.) Open 925 $95 Owned 2,275 • We have 44 major builds underway SP4 pha
Slide 24: Long-Term Lease Renewals
Long-Term Lease Renewals Weighted average lease maturity of greater than 18 years including extensions (1) Global Lease Portfolio Expiration Waterfall Equinix Owned Sites (2) • Own 106 of 227 Data Centers % Leases Renewing by Square Footage 72% • 16.0M of 26.4M total gross square feet Last Possible
Slide 25: Same Store Operating Performance
Same Store Operating Performance (1) Revenues ($M) Cash Cost, Gross Profit and PP&E ($M) Cash Cost Trailing 4-Qtr Inter- Services/ Total Non- Total of Cash Gross Cash Gross Gross Cash Return on Category Colocation connection Other Recurring recurring Revenues Revenues Profit Margin % PP&E Gross PP&E
Slide 26: Consolidated Portfolio Operating Performance
Consolidated Portfolio Operating Performance (1) Cabinets Billed Q4 20 Revenues ($M) Total Cabinet Owned % Cabinet Cabinets Utilization Total of Total Category # of IBXs Capacity Billed % Recurring Recurring Americas Owned (2) 49 85,000 59,300 70% $428 Leased 39 34,400 27,500 80% $195 Americas Total
Slide 27: Data Center Portfolio Composition
Data Center Portfolio Composition Metro Count Stabilized Expansion New Acquisition xScale Owned Leased Atlanta 5 AT2, AT3, AT4, AT5 AT1 AT4 AT1, AT2, AT3, AT5 Change Summary (1) (2) Bogota 1 BG1 BG1 Boston 2 BO1 BO2 BO2 BO1 Calgary 3 CL1, CL2, CL3 CL3 CL1, CL2 Chicago 5 CH1, CH2, CH4, CH7 CH3 CH3, C
Slide 28: Data Center Portfolio Composition
Data Center Portfolio Composition Metro Count Stabilized Expansion New Acquisition xScale Owned Leased Abu Dhabi 1 AD1 AD1 Change Summary (1) Amsterdam 9 AM1, AM2, AM3, AM5, AM8 AM4, AM6, AM7, AM11 AM1*, AM2*, AM3*, AM4, AM5, AM6, AM7 AM8, AM11 Barcelona 1 BA1 BA1 Dubai 2 DX1, DX2 DX1, DX2 Dublin 4
Slide 29: Adjusted Corporate NOI
(1) Adjusted Corporate NOI ($M, except # of IBXs) Calculation Of Adjusted Corp NOI Q4 2020 Q3 2020 Q2 2020 Q1 2020 Q4 2019 # of IBXs (1) 225 212 211 208 204 (2) Recurring Revenues $1,453 $1,420 $1,385 $1,355 $1,333 Recurring Cash Cost of Revenues Allocation (466) (431) (416) (423) (425) Cash Net Ope
Slide 30: Adjusted NOI Composition – Organic
Adjusted NOI Composition – Organic (1) Q4 2020 Q4 2020 Total Cabinet Recurring Quarterly # of Cabinet Cabinets Utilization Revenues Adjusted NOI Category IBXs Capacity Billed % ($M) ($M) % NOI Stabilized Owned (2) 54 94,600 80,400 85% $477 $309 37% Leased 93 88,700 74,100 84% $480 $280 33% Stabilize
Slide 31: Components of Net Asset Value
Components of Net Asset Value Operating Portfolio Q4 20 Quarterly Ownership Reference Adjusted NOI Adjusted NOI ($M) Stabilized Owned Adjusted NOI Segments $309 Stabilized Leased Adjusted NOI Segments $280 Expansion Owned Adjusted NOI Segments $164 Expansion Leased Adjusted NOI Segments $85 Other Re
Slide 32: Shares Forecast
Shares Forecast (M) Fully Diluted Weighted Average Shares Common Stock Outstanding 89.1 89.1 -0.3 ~90.3 88.5 0.6 ~89.9 85.9 85.3 0.8 89.1 1.6 1.5 1.3 1.3 1.3 Shares Est. Employee Est. Shares Est. Weighted Est. Weighting Est. Fully Diluted Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 Outstanding @ Equity Awards Out
Slide 33: Capital Expenditures Profile
Capital Expenditures Profile ($M) Q4 2020 Q3 2020 Q2 2020 Q1 2020 Q4 2019 Recurring IBX Maintenance 63 28 19 9 63 Sustaining IT & Network 4 6 5 5 10 Re-configuration Installation 8 4 7 4 8 Subtotal - Recurring 74 38 30 18 81 Non-Recurring IBX Expansion 582 417 372 310 496 Transform IT, Network & Off
Slide 34: FX Rates, Hedging and Currencies
FX Rates, Hedging and Currencies (4) Currency % of Revenues Revenue FX Rates (1) (4) (2) Blended (2) Blended % of CHF GBP Currency Guidance Rate Hedge Rate (3) (4) Guidance Rate Hedge % Revenues 1% 10% EUR HKD USD 1.00 39% 20% 4% EUR to USD 1.22 1.16 1.19 53% 20% AUD 4% GBP to USD 1.37 1.31 1.33 61%
Slide 35: Industry Analyst Reports
Industry Analyst Reports Solution Category Reports • Interconnection Amplifies the Value of Bare Metal Deployments - Enterprise Strategy Group, 10/20 • Interconnection 2020 – The Future is Programmable - 451 Research, 8/20 Interconnection • IDC names Equinix a Leader in Colocation & Interconnection
Slide 36: Equinix Leadership and Investor Relations
Equinix Leadership and Investor Relations Executive Team Equinix Investor Relations Contacts Equity Research Analysts Katrina Rymill Bank of America Michael Funk VP, IR and Sustainability Barclays Tim Long 650-598-6583 Berenberg Nate Crossett krymill@equinix.com BMO Capital Markets Ari Klein Keith T
Slide 37: Appendix: Non-GAAP Financial Reconciliations & Definitions
Appendix: Non-GAAP Financial Reconciliations & Definitions © 2021 Equinix.com 37
Slide 38: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2021 Equinix.com 38
Slide 39: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2021 Equinix.com 39
Slide 40: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2021 Equinix.com 40
Slide 41: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2021 Equinix.com 41
Slide 42: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2021 Equinix.com 42
Slide 43: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2021 Equinix.com 43
Slide 44: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2021 Equinix.com 44
Slide 45: Non-GAAP Reconciliations
Non-GAAP Reconciliations Consolidated NOI calculation Q4 2020 Q3 2020 Q2 2020 Q1 2020 Q4 2019 (unaudited and in thousands) Revenues $ 1,564,115 $ 1,519,767 $ 1,470,121 $ 1,444,542 $ 1,417,135 Non-Recurring Revenues (NRR) (1) 95,149 82,550 68,832 77,920 75,369 Other Revenues (2) 16,384 17,510 16,208
Slide 46: Non-GAAP Reconciliations
Non-GAAP Reconciliations (unaudited and in thousands) Q4 2020 Q3 2020 Q2 2020 Q1 2020 Q4 2019 Income from Operations $ 228,606 $ 288,350 $ 282,488 $ 253,484 $ 312,974 Adjustments: Depreciation, Amortization and Accretion Expense 378,859 362,286 348,434 337,431 328,295 Stock-based Compensation Expens
Slide 47: Non-GAAP Reconciliations
Non-GAAP Reconciliations NAREIT Funds From Operations (NAREIT FFO) - We calculate Funds From Operations in accordance with the standards established by the National Association of Real Estate Investment Trusts (“NAREIT”). NAREIT FFO represents net income (loss), excluding gains (or losses) from disp
Slide 48: Definitions: Non-financial Metrics, IBX growth, REIT and Capital Expenditures
Definitions: Non-financial Metrics, IBX growth, REIT and Capital Expenditures Non-financial Metrics MRR per Cab: Monthly recurring revenues per billed cabinet: (current quarter monthly recurring revenues / 3) divided by ((quarter end cabinets billing prior quarter + quarter end cabinets billing curr
Slide 49: © 2021 Equinix.com
ull FQUINIX WHERE OPPORTUNITY CONNECTS