Slide 1: Q2 2017 Earnings Conference Call
Q2 2017 Earnings Conference call NASDAQ: EQIX Presented on August 2, 2017 © 2017 Equinix Inc. 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 Equi
Slide 3: Q2 2017 Financial Highlights
Q2 2017 Financial Highlights Revenues ($M) Recurring Revenues Non-recurring Revenues $1,066.4 Revenues of $1,066.4 Million $942.6 $949.5 $900.5 $924.7 • Revenues up 12% QoQ and 18% YoY on an as- reported basis, $980 million organic and $87 million (1) from the Verizon data center acquisition $1,010.
Slide 4: Q2 2017 Consolidated Results
Q2 2017 Consolidated Results (1) Quarter (1) ($M Except for Non-Financial Metrics) Q2 17 (2) Q2 17 Q1 17 Q2 16 Q2 17 vs. Q2 17 vs. Guidance Actual Actual Actual Q1 17 % ∆ Q2 16 % ∆ Revenues $976 - 982 $ 1,066.4 $ 949.5 $ 900.5 12% 18% Cash Gross Profit 722.0 646.0 608.5 12% 19% Cash Gross Profit Mar
Slide 5: Americas Performance
Americas Performance Q2 Highlights Q2 Business Conditions ($M) $533.6 $86.7 • Q2 revenues up 22% QoQ and 29% YoY on an as-reported basis (1); $425.1 $436.5 $436.4 $413.5 on a normalized and constant currency basis (2) up 3% QoQ and up $446.9 8% YoY $258.2 • Q2 Adjusted EBITDA up 30% QoQ and 32% YoY
Slide 6: EMEA Performance
EMEA Performance Q2 Highlights Q2 Business Conditions ($M) $314.8 $322.9 $300.6 $301.3 $301.6 • Q2 revenues up 3% QoQ and 7% YoY on an as-reported basis; on a normalized and constant currency basis (1) up 2% QoQ and 12% YoY $141.6 • Q2 Adjusted EBITDA up 9% QoQ and 6% YoY on an as-reported $133.5 $1
Slide 7: Asia-Pacific Performance
Asia-Pacific Performance Q2 Highlights Q2 Business Conditions ($M) $204.5 $209.9 $198.3 $198.2 • Q2 revenues up 6% QoQ and 13% YoY on an as-reported basis; $186.4 on a normalized and constant currency basis (1) up 3% QoQ and 15% YoY $99.4 $109.5 • Q2 Adjusted EBITDA up 10% QoQ and 19% YoY on an as-
Slide 8: Capital Structure and Sources and Uses of Cash
Capital Structure and Sources and Uses of Cash • Ample liquidity to fund growth and dividend • Flexible capital structure with additional capacity Capitalization Table Debt Maturity Profile (5) ($M) Q2 17 Q1 17 ($M) Loans Payable, Capital Lease & Other Financing Obligations Capital Leases $ 1,647 $
Slide 9: AFFO and Dividend Outlook
AFFO and Dividend Outlook ($M) AFFO outlook • 2017 guidance range of $1,382 - 1,392M • Implies growth of 29% YoY on an as-reported basis and 13% on a normalized and constant (2) (1) currency basis (3) Dividend growth potential • AFFO growth provides capacity for long-term dividend growth 2017E Divid
Slide 10: FY17 AFFO Per Share
FY17 AFFO Per Share Verizon Accretive Day 1 As-Reported Share Counts AFFO per Share Normalized Constant Currency YoY Growth 71.6M 77.5M 77.4M 77.4M $15.06 $15.66 (1) $17.92 >13.2% $18.59 ($M) ~28.6% $1,434 - 1,444 -$22 $1,382 - 1,392 $52 -$12 $197 - 207 >$1,214 $3 $2 $1,078 FY16 Reported Prior FY17
Slide 11: Capex
Capex Q2 2017 Capex and Regional Breakout ($M) Recurring Non-Recurring Recurring capital expenditures APAC, 11% • Expenditures to extend useful life of Sustaining IT & IBXs or other Equinix assets in Network, 29% Americas, 43% support of current revenues Maintenance, 57% Installation, EMEA, 46% • Re
Slide 12: Stabilized IBX Growth – Organic (excludes Verizon)
Stabilized IBX Growth – Organic (excludes Verizon) (1) (1) (1) Stabilized, Expansion & New IBXs Stabilized IBX Profitability Last Quarter ($5,597) $2,396 $1,672 $46 Reported 6 44 (2) +18% 99 (2) 82% +6% (2) (3) (4) (4) (6) (1) New IBXs where Phase 1 began operating after January 1, 2016; SV10 added
Slide 13: FY17 Revenues Guidance
FY17 Revenues Guidance Raise full year revenues guidance by $19M ($M) Normalized (1) Constant Currency >11.1% YoY Growth ~19.7% $330 - 340 $4,317 - 4,327 >$3,987 $3,612 1 2 FY16 Reported Organic FY17 Guidance Verizon FY17 Guidance 1 Raise Organic revenues guidance 2 Raise Verizon revenues guidance A
Slide 14: FY17 Adjusted EBITDA Guidance
FY17 Adjusted EBITDA Guidance Raise full year adjusted EBITDA guidance by $17M Normalized ($M) Constant Currency YoY Growth 45.9% >11.3% (1) 48.5% 47.3% ~23.3% $197 - 207 $2,090 - 2,100 -$52 $2,038 - 2,048 >$1,893 3 $1,657 1 2 (2) (3) FY16 Reported Organic FY17 Verizon Adjusted FY17 Guidance excl. I
Slide 15: Q3 17 Guidance
Q3 17 Guidance ($M) Revenues Adjusted EBITDA Normalized (2) Constant Currency ~3% 47.8% 49.8% 48.8% 47.4% QoQ Growth ~2.3% ~0.4% $1,133 - 1,141 $551 - 559 $553 -$16 $1,111 $535 - 543 $45 $44 $1,066 $509 (1) (1) (3) Q2 17 Normalizing Q2 17 Q3 17 Q2 17 Normalizing Q2 17 Q3 17 Integration Q3 17 Reporte
Slide 16: FY17 AFFO Guidance
FY17 AFFO Guidance ($M) As-Reported Change from Prior Guidance Constant Currency Change from Prior Guidance +$183 +$2 $0 -$12 $0 +$173 +$22 +$195 +$180 +$2 $0 -$12 $0 +$170 +$22 +$192 $2,038 - 2,048 -$445 -$60 $1,434 - 1,444 -$175 $1,382 - 1,392 $52 $24 (1) FY17 Adjusted Interest Expense Tax Recurri
Slide 17: 2017 Financial Guidance
2017 Financial Guidance $M FY 2017 Q3 2017 (1) (2) Revenues $4,317 - 4,327 $1,133 - 1,141 Cash Gross Margin % 67 - 68% ~67% Cash SG&A $868 - 878 $218 - 226 Cash SG&A % 19 - 20% 19 - 20% (3) (4) Adjusted EBITDA $2,038 - 2,048 $535 - 543 Adjusted EBITDA Margin % ~47.3% ~47.4% Capex $1,250 - 1,300 $313
Slide 18: Supplemental Financial and Operating Data
Supplemental Financial and Operating Data Business Interconnection Ecosystems Global Proven Solutions Reach 9,500+ Companies Expertise 242,000+ Cross-connects 210+ of Fortune 500 182 Data Centers 99.9999% Uptime Record 44 Metros 5 Continents 100% Renewable Power Pledge © 2017 Equinix Inc. Equinix.co
Slide 19: Equinix Overview
(1) Equinix Overview Unique portfolio of data center assets Development pipeline • Global footprint: 182 data centers in 44 metros • Long history of development success through • Network dense: 1,600+ networks expansions, campuses and known demand pipeline • Cloud dense: 2,800+ Cloud & IT service pr
Slide 20: Equinix Global Platform
(1) Equinix Global Platform Equinix offers broad geographic reach and significant scale within each region Platform Equinix • Geographic footprint is unmatched and remains a unique differentiator • Multi-region deployments outpace single- region deployments Expansion strategy • Use unique market int
Slide 21: Customer Revenues Mix
Customer Revenues Mix Diversified Revenues by Customer, Region & Industry 7% Customer % of Recurring Revenues (5) 28% Cloud & IT Recurring 16% Services Multi-Metro Customers 84% MIS & Others Multi-Region Customers 70% Content & 14% Digital Media Customers in 3 Regions 58% Top 50 Customers 36% 95% In
Slide 22: Non-Financial Metrics
(1) Non-Financial Metrics FY 2016 FY 2017 Q2 Q3 Q4 Q1 Q2 ∆ QoQ INTERCONNECTION # of Cross-connects Americas 101,200 104,200 106,300 109,700 111,400 1,700 1,600+ Networks EMEA 45,500 46,300 82,900 84,900 87,400 2,500 242,000+ Cross-connects Asia-Pacific 36,200 37,900 41,000 42,700 43,600 900 100% of
Slide 23: Equinix Announced Expansions 2017 - 2018
Equinix Announced Expansions 2017 - 2018 Overview of major Equinix IBX data center expansions AMERICAS Sellable Cabinet Total CAPEX* IBX Center Target Open Date Equivalents* (millions U.S.$) Comments GLOBAL TOTALS SP3 phase I (São Paulo) Opened Q1 2017 725 $69 Additional capacity for 2,050 cabinet e
Slide 24: Long-Term Lease Renewals
Long-Term Lease Renewals Average lease maturity greater than 19 years including extensions (1) Global Lease Portfolio Expiration Waterfall (2) % Leases Renewing by Square Footage Equinix Owned Sites Last Possible Expiration Date • Own 59 of 182 IBXs 71% • 8.6M of 18.6M total gross square feet (3) •
Slide 25: REIT Disclosure Update
REIT Disclosure Update Equinix real estate portfolio valuation disclosures Same-Store Operating Performance (previously disclosed) – Provides a year-over-year comparison of revenues composition and cash gross margin for a constant set of Stabilized and Expansion properties. Property operating status
Slide 26: Same Store Operating Performance – Organic (excludes Verizon)
(1) Same Store Operating Performance – Organic (excludes Verizon) Stabilized and Expansion – Cash Gross Profit grew 8.8% driven by Interconnection growth Revenues #039;000s Cash Cost, Gross Profit and PP&E #039;000s Cash Cost Trailing 4-Qtr Inter- Services/ Total Non- Total of Cash Gross Cash Gross Gross
Slide 27: Consolidated Portfolio Operating Performance
(1) Consolidated Portfolio Operating Performance By Region & Ownership – With Verizon-Owned Assets Generated 42% of Our Recurring Revenues Cabinets Billed Revenues (Q2 2017) #039;000s Total Cabinet Owned % of Cabinet Cabinets Utilization Inter- Services/ Total Non- (4) Total Category # of IBXs Capacity
Slide 28: Portfolio Composition – IBX mapping
Portfolio Composition – IBX mapping Same-Store Same-Store Same-Store Same-Store IBX Location Ownership IBX Location Ownership IBX Location Ownership IBX Location Ownership Classification Classification Classification Classification Americas Americas (Continued) EMEA (Continued) Asia-Pacific AT1 Atla
Slide 29: Adjusted Corporate NOI
(1) Adjusted Corporate NOI Calculation Of Adjusted Corp NOI (unaudited) Q2 2017 Q1 2017 Q4 2016 Q3 2016 Q2 2016 # of IBXs (1) 179 149 145 145 144 (2) Recurring Revenues $ 1,008,424 $ 895,613 $ 887,748 $ 874,149 $ 847,108 Recurring Cash Cost of Revenues Allocation (298,822) (260,570) (258,663) (271,8
Slide 30: Adjusted NOI Composition – Organic (excludes Verizon)
(1) Adjusted NOI Composition – Organic (excludes Verizon) By Stabilization and Ownership – Owned Assets and NOI are predominantly in campus locations in our largest global markets Total Cabinet Adjusted NOI by Region Q2 2017 Q2 2017 # of Cabinet Cabinets Utilization Recurring Quarterly Territory IBX
Slide 31: Components of NAV
Components of NAV (unaudited) Operating Portfolio Adjusted % of Adjusted NOI Q2 17 Quarterly Ownership Reference NOI AMER EMEA APAC Adjusted NOI Stabilized Owned 78% 21% 1% Adjusted NOI Segments $119,133 Stabilized Leased 59% 10% 31% Adjusted NOI Segments 256,190 Expansion Owned 13% 87% 0% Adjusted
Slide 32: Market Capitalization & Debt Summary
Market Capitalization & Debt Summary Spread / (1) June 30, Debt Coupon Interest Rate Maturity Balance 2017 Revolver L + 120 2.50% Dec-19 - Market Capitalization Summary (3) Term Loan A L + 125 1.34% Dec-19 397,905 Common shares outstanding 77,945 (4) Term Loan B-1 L + 250 / 300 3.65% Jan-23 632,385
Slide 33: Fully Diluted Weighted Average Shares Forecast
Fully Diluted Weighted Average Shares Forecast (‘K) ~78,254 648 775 -1,490 ~77,412 ~6,069 71,409 Shares outstanding Equity Raise Est. Employee Est. Shares Est. Dilutive Est. Weighting of Est. Fully Diluted @ 12/31/16 - Actual for Verizon Equity Awards Outstanding Unissued Shares All Share Activities
Slide 34: Capex Profile
Capex Profile Q2 2017 Q1 2017 Q4 2016 Q3 2016 Q2 2016 Recurring Sustaining IT & Network $ 10,872 $ 7,284 $ 8,774 $ 11,380 $ 7,204 IBX Maintenance 21,677 10,466 21,753 25,229 19,631 Re-configuration Installation 5,320 4,922 5,950 5,001 5,094 Subtotal - Recurring 37,869 22,672 36,476 41,610 31,928 Non
Slide 35: FY17 Revenues FX Hedging
FY17 Revenues FX Hedging Revenue FX Rates (4) Currency % of Revenues Blended Guidance (2) Blended (3) % of Currency (1) Hedge Rate Guidance (4) Rate (2) Hedge % Revenues Rate CHF GBP USD 1.0000 46% EUR 1% 9% HKD EUR to USD 1.1416 1.1014 1.1177 60% 18% 18% 4% AUD GBP to USD 1.3013 1.4142 1.3857 75% 9
Slide 36: Equinix Leadership and Investor Relations
Equinix Leadership and Investor Relations Executive Team Equinix Investor Relations Contacts Katrina Rymill Chip Newcom VP, Investor Relations Director, Investor Relations 650-598-6583 650-598-6262 krymill@equinix.com cnewcom@equinix.com Equinix Media Contacts Steve Smith Keith Taylor Charles Meyers
Slide 37: Appendix: Non-GAAP Financial Reconciliations & Definitions
Appendix: Non-GAAP Financial Reconciliations & Definitions © 2017 Equinix Inc. Equinix.com 37
Slide 38: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2017 Equinix Inc. Equinix.com 38
Slide 39: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2017 Equinix Inc. Equinix.com 39
Slide 40: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2017 Equinix Inc. Equinix.com 40
Slide 41: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2017 Equinix Inc. Equinix.com 41
Slide 42: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2017 Equinix Inc. Equinix.com 42
Slide 43: Non-GAAP Reconciliations
Non-GAAP Reconciliations (1) Represents the non-cash impact due to changes in valuation allowances and uncertain tax positions and deferred taxes that do not relate to current period’s operations © 2017 Equinix Inc. Equinix.com 43
Slide 44: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2017 Equinix Inc. Equinix.com 44
Slide 45: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2017 Equinix Inc. Equinix.com 45
Slide 46: Non-GAAP Reconciliations
Non-GAAP Reconciliations Consolidated NOI calculation Q2 2017 Q1 2017 Q4 2016 Q3 2016 Q2 2016 (unaudited and in thousands) Revenues $ 1,066,421 $ 949,525 $ 942,647 $ 924,676 $ 900,510 Non-Recurring Revenues (NRR) (2) 55,179 50,256 49,980 46,739 47,770 Other Revenues (3) 2,818 3,656 4,920 3,788 5,632
Slide 47: Non-GAAP Reconciliations
Non-GAAP Reconciliations (unaudited and in thousands) Q2 2017 Q1 2017 Q4 2016 Q3 2016 Q2 2016 Income from continuing operations $ 184,895 $ 167,213 $ 184,455 $ 169,941 $ 151,655 Adjustments: Depreciation, amortization and accretion expense 252,386 219,013 212,268 215,370 213,719 (unaudited and in th
Slide 48: 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 49: © 2017 Equinix Inc. Equinix.com
© 2017 Equinix Inc. Equinix.com 49