Equinix, Inc. · NASDAQ:EQIX

Equinix — Q3 2021 Earnings Presentation

49 slides from Equinix's earnings presentation, Nov 3, 2021

  1. Slide 1: Q3 2021 Earnings Conference Call

    Q3 2021 Earnings Conference Call NASDAQ: EQIX Presented on November 3, 2021 © 2021  Equinix.com 1

  2. 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

  3. Slide 3: Q3 2021 Financial Highlights

    Q3 2021 Financial Highlights Revenues Recurring Revenues Non-recurring Revenues Revenues Growth Q3 21 ($M) $1,596 $1,658 $1,675 QoQ YoY $1,520 $1,564 As-reported 1% 10% Normalized and (1) 2% 8% $1,466 $1,511 $1,542 $1,564 Constant Currency $1,432 (1) Normalized MRR 2% 7% Q3 20 Q4 20 Q1 21 Q2 21 Q3 2

  4. Slide 4: Q3 2021 Consolidated Results

    Q3 2021 Consolidated Results $M except for AFFO per Share and Q3 21 Non-Financial Metrics Guidance Actual QoQ YoY Revenues (1) $1,668 - 1,688 $1,675 1% 10% Cash Gross Profit $1,111 0% 8% (5) Cash Gross Margin % 66.3% Cash SG&A $324 3% 13% Cash SG&A % 19.4% Adjusted EBITDA(2) $766 - 786 $786 -1% 7% A

  5. Slide 5: Americas Performance

    Americas Performance Revenues Organic Revenues Bell ($M) $751 $763 Q3 21 $712 $726 Revenues Growth $36 $38 QoQ YoY $672 $28 $32 As-reported 2% 13% Normalized and (1) 2% 7% Constant Currency $684 $694 $715 $725 (1) Normalized MRR 2% 7% Adjusted EBITDA Q3 21 Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Growth QoQ Yo

  6. Slide 6: EMEA Performance

    EMEA Performance (1) Revenues Revenues Q3 21 ($M) $545 $511 $519 $538 Growth QoQ YoY $518 As-reported 1% 5% Normalized and (2) 2% 6% Constant Currency (2) Normalized MRR 2% 5% Adjusted EBITDA Q3 21 Growth QoQ YoY Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 As-reported 2% 2% Adjusted EBITDA Adjusted EBITDA Adjuste

  7. Slide 7: Asia-Pacific Performance

    Asia-Pacific Performance Revenues Revenues Q3 21 ($M) $369 $367 Growth QoQ YoY $341 $351 $329 As-reported 1% 11% Normalized and (1) 1% 11% Constant Currency (1) Normalized MRR 2% 10% Adjusted EBITDA Q3 21 Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 (3) Growth QoQ YoY Adjusted EBITDA Adjusted EBITDA Adjusted EBITD

  8. Slide 8: Capital Structure

    Capital Structure Our predominantly fixed-rate debt structure aims to protect against a rising rate environment (1)(2) Available Liquidity $3.3B ($M) (1)(3)(4) $2,547 Debt Maturity Profile Ratings Baa3 / BBB / BBB (1) Net Leverage Ratio 4.0x (1)(3) Total Gross Debt $1,300 $1,200 $1,079 $1,050 $1,200

  9. Slide 9: Capital Expenditures

    Capital Expenditures Recurring Capital Expenditures ($M) 4.8% • Recurring capital expenditures have $74 2.8% historically trended between 2% and 5% of 2.7% 2.5% 10% 5% revenues, annually $45 $48 $38 17% 13% • Maintenance capital expenditures can vary by 1.3% 12% 12% 17% quarter based on maintenance

  10. Slide 10: Stabilized IBX Growth

    (1) (2) Stabilized IBX Growth Stabilized, Expansion & New IBXs Stabilized IBX Profitability ($M) Last Quarter $12,299 $4,735 $3,269 $102 Reported # of IBXs Q3 21 Revenues ($M) $14,000 $12,355 $12,000 27% annual Cash Gross 10 Expansion: Profit on Gross PP&E 16% (3) investment (5) $368 $10,000 52 Grow

  11. Slide 11: 2021 Financial Guidance

    (1) 2021 Financial Guidance ($M except AFFO per Share) FY 2021 Q4 2021 (3) (2) Revenues $6,614 - 6,634 $1,685 - 1,705 (4) (5) Adjusted EBITDA $3,119 - 3,139 $762 - 782 Adjusted EBITDA Margin % ~47% 45 - 46% Recurring Capital Expenditures $188 - 198 $75 - 85 % of revenues ~3% 4 - 5% (6) Non-recurring

  12. Slide 12: FY21 Revenues Guidance

    FY21 Revenues Guidance Increase full year revenues by $5M for GPX India acquisition; offset by $20M FX headwind Normalized (1) Constant Currency ~8% YoY Growth 10 – 11% ($M) $6,614 – 6,634 $5 $6,609 – 6,629 1 $5,999 FY20 Reported FY21 Organic Guidance GPX India FY21 Guidance 1 Raise revenues guidanc

  13. Slide 13: FY21 Adjusted EBITDA Guidance

    (1) FY21 Adjusted EBITDA Guidance Increase full year adjusted EBITDA by $10M for GPX India acquisition and lower integration costs; offset by $9M FX headwind 47.6% As-reported Margin 47.5% 47.2% 9 – 10% $3,137 – 3,157 $3,134 - 3,154 $3 ($M) -$18 $3,119 – 3,139 $2,853 1 2 (1) FY20 Reported FY21 Organ

  14. Slide 14: Q4 Guidance

    Q4 21 Guidance Revenues Adjusted EBITDA As-reported Margin Q4 normalized growth of 1 - 2% following elevated Q3 Non- Adjusted EBITDA impacted by timing of spend shifting recurring Revenues to fourth quarter 46.9% 47.2% 46.0% 45.6% ($M) 1 - 2% -~1% $1,685 – 1,705 $790 $786 $3 $770 - 790 -$7 $762 - 78

  15. Slide 15: FY21 AFFO and AFFO per Share Guidance

    (1) FY21 AFFO and AFFO per Share Guidance (2) Maintain full year AFFO guidance; AFFO per share growth to 9 - 10% Share Count (Diluted) ($M except AFFO per Share) Normalized Constant Currency YoY Growth AFFO per Share (Diluted) (3) AFFO 10 - 11% 88.4M 90.4M 90.4M 1 Maintain AFFO guidance $24.76 $27.2

  16. Slide 16: Dividend Outlook

    Dividend Outlook Annual Cash Dividend ($M) ~10% +13% ~$1,030 $936 $826 $727 $612 2021E Cash Dividend of ~$1,030M • Continued growth of our annual total cash dividend amount 43% 44% 43% 43% 42% Payout Payout Payout Payout Payout Ratio Ratio Ratio Ratio Ratio • Third quarter dividend of $2.87 to be pa

  17. 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 237

  18. Slide 18: Equinix Overview

    Equinix Overview (1) • Global footprint: 237 data centers in 65 metros Unique Portfolio of Data • Network dense: 1,800+ networks; 100% of Tier 1 Network Routes Center Assets • Cloud dense: 3,000+ Cloud & IT service providers • Interconnected ecosystems: 414,000+ Total Interconnections • 2021 expecte

  19. Slide 19: Pressing Our Advantage in All Markets

    Pressing Our Advantage in All Markets Equinix global reach expanding across 65 metro areas and 27 countries (2) 5 Continents 27 Countries 65 Metro areas 237 Data centers AMERICAS EMEA ASIA-PACIFIC % of Customers in Platform Equinix 27 Metros 13 Metros • Geographic footprint is 25 Metros (1) 104 Data

  20. Slide 20: xScale: Amplifying Our Balance Sheet to Extend Cloud Leadership

    xScale: Amplifying Our Balance Sheet to Extend Cloud Leadership Phase Phase Phase Cost JV Status Capacity Leasing Opening ($M) (MW) (MW) Q3 2021 Leasing Activity São Paulo 5x-1 JV Open $52 5 0 Americas • Pre-leased 2MW of Frankfurt 11x asset Mexico City 3x-1 JV Ready Q1 2022 $58 4 0 Frankfurt 9x-1 J

  21. Slide 21: Customer Revenues Mix

    Customer Revenues Mix Diversified Revenues across Customer, Region and Industry segments Revenues Mix Customers and Churn (5) Top 10 Customers Rank Type of Customer %MRR Region Count IBX Count EMEA 1 Cloud & IT Services 2.6% 3 68 Enterprise 33% 34% INT 2 Cloud & IT Services 2.5% 3 71 19% Asia- Netwo

  22. Slide 22: Non-Financial Metrics

    Non-Financial Metrics (1) FY 2020 FY 2021 Q3 Q4 Q1 Q2 Q3 QoQ Interconnections Americas 160,500 162,800 165,000 167,100 168,900 1,800 EMEA 131,200 132,500 133,700 135,800 137,600 1,800 Asia-Pacific 67,500 67,200 69,000 70,500 72,200 1,700 Worldwide Cross Connections 359,200 362,500 367,700 373,400 37

  23. Slide 23: Equinix Announced Retail IBX Expansions

    Equinix Announced Retail IBX Expansions Cabinet (1) Expansion Highlights Equivalent 2021 2022 2023 (1) Total Capex Capacity In • We have 31 major builds underway IBX Data Center Status Q3 Q4 Q1 Q2 Q3 Q4 Q1 $US millions Ownership Future Phases NY6 phase 2 (New York) Open 525 $28 Owned* - in 23 market

  24. 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, 3) % Leases Renewing by Square Footage • Own 118 of 237 Data Centers Last Possible Expiration Date • 17.4M of 27.7M total gro

  25. 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

  26. Slide 26: Consolidated Portfolio Operating Performance

    Consolidated Portfolio Operating Performance (1) Cabinets Billed Q3 21 Revenues ($M) Total Cabinet Owned % of Cabinet Cabinets Utilization Total Total Category # of IBXs Capacity Billed % Recurring Recurring (5) Americas (2) Owned 52 88,700 64,000 72% $462 Leased 38 34,100 27,500 81% $201 Americas T

  27. 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 1 BO2 BO2 Calgary 3 CL1, CL2, CL3 CL3 CL1, CL2 New xScale Chicago 5 CH1, CH2, CH4, CH7 CH3 CH3

  28. 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) (2) (3) (4) Amsterdam 9 AM1, AM2, AM3, AM5, AM6, AM8 AM4, AM7, AM11 AM1*, AM2*, AM3*, AM4*, AM5, AM6, AM7* AM8, AM11 Barcelona 1 BA1 BA1 Bordeaux 1 BX1 BX1 Ne

  29. Slide 29: Adjusted Corporate NOI

    (1) Adjusted Corporate NOI ($M, except # of IBXs) Calculation Of Adjusted Corp NOI Q3 2021 Q2 2021 Q1 2021 Q4 2020 Q3 2020 (1) # of IBXs 230 225 224 225 212 (2) Recurring Revenues $1,545 $1,529 $1,497 $1,453 $1,420 Recurring Cash Cost of Revenues Allocation (471) (454) (434) (466) (431) Cash Net Ope

  30. Slide 30: Adjusted NOI Composition – Organic

    Adjusted NOI Composition – Organic (1) Q3 2021 Q3 2021 Total Cabinet Recurring Quarterly # of Cabinet Cabinets Utilization Revenues Adjusted NOI Category IBXs Capacity Billed % ($M) ($M) % NOI Stabilized Owned (2) 62 123,300 107,100 87% $611 $404 43% Leased 91 98,400 84,100 85% $538 $337 36% Stabili

  31. Slide 31: Components of Net Asset Value

    Components of Net Asset Value Operating Portfolio Q3 21 Quarterly Ownership Reference Adjusted NOI Adjusted NOI ($M) Stabilized Owned Adjusted NOI Segments $404 Stabilized Leased Adjusted NOI Segments $337 Expansion Owned Adjusted NOI Segments $152 Expansion Leased Adjusted NOI Segments $41 Other Re

  32. Slide 32: Debt Summary

    Debt Summary Interest (1) Balance(3) Debt Maturity(2) Rate ($M) Revolver 1.030% 12-Dec-2022 - (4) GBP Term Loan A 1.085% 12-Dec-2022 556 Senior Notes 2.625% USD Senior Notes due 2024 2.625% 18-Nov-2024 1,000 1.250% USD Senior Notes due 2025 1.250% 15-Jul-2025 500 1.000% USD Senior Notes due 2025 1.0

  33. Slide 33: Shares Forecast

    Shares Forecast (M) Fully Diluted Weighted Average Shares Common Stock Outstanding 90.0 -0.3 ~90.4 89.8 0.7 89.6 ~90.1 89.1 89.1 0.1 1.6 1.6 1.3 1.3 1.4 0.8 89.1 Shares Est. Employee ATM Offering Est. Shares Est. Weighted Est. Weighting Est. Fully Diluted Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Outstanding @

  34. Slide 34: Capital Expenditures Profile

    Capital Expenditures Profile ($M) Q3 2021 Q2 2021 Q1 2021 Q4 2020 Q3 2020 Recurring IBX Maintenance 36 30 13 63 28 Sustaining IT & Network 6 8 3 4 6 Re-configuration Installation 6 8 5 8 4 Subtotal - Recurring 48 45 20 74 38 Non-Recurring IBX Expansion 487 515 453 582 417 Transform IT, Network & Off

  35. Slide 35: FX Rates, Hedging and Currencies

    FX Rates, Hedging and Currencies (4) Currency % of Revenues Revenue FX Rates (4) (1) (2) Blended (2) (3) (4) CHF GBP Guidance Blended % of Currency Hedge Rate Guidance 1% Rate Hedge % Revenues EUR 9% Rate HKD 20% 3% USD 1.00 38% AUD 4% EUR to USD 1.16 1.17 1.16 63% 20% GBP to USD 1.35 1.31 1.32 72%

  36. Slide 36: Future First Sustainability @ Equinix

    Future First Sustainability @ Equinix Our commitment to sustainability is driven by our belief in a future of possibility. AWARDS ESG RATINGS Do what it takes • Commitment to become Climate Neutral Globally to protect our by 2030 and science-based targets aligned to 1.5°C planet. • Issued $3.7B+ in

  37. Slide 37: Industry Analyst Reports

    Industry Analyst Reports Solution Category Reports • Achieving Business Agility Using Interconnected Hybrid Networks - IDC, 7/21 Interconnection • Datacenter Colocation & Interconnection Services 2021 Vendor Assessment - IDC, 6/21 • Equinix: The Global Digital Platform Facilitator – IDC, 1/21 • Equi

  38. Slide 38: 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 Brendan Lynch 650-598-6583 Berenberg Nate Crossett krymill@equinix.com BMO Capital Markets Ari Klein Ke

  39. Slide 39: Appendix: Non-GAAP Financial Reconciliations & Definitions

    Appendix: Non-GAAP Financial Reconciliations & Definitions © 2021  Equinix.com 39

  40. Slide 40: Non-GAAP Reconciliations

    Non-GAAP Reconciliations © 2021  Equinix.com 40

  41. Slide 41: Non-GAAP Reconciliations

    Non-GAAP Reconciliations © 2021  Equinix.com 41

  42. Slide 42: Non-GAAP Reconciliations

    Non-GAAP Reconciliations © 2021  Equinix.com 42

  43. Slide 43: Non-GAAP Reconciliations

    Non-GAAP Reconciliations © 2021  Equinix.com 43

  44. Slide 44: Non-GAAP Reconciliations

    Non-GAAP Reconciliations © 2021  Equinix.com 44

  45. Slide 45: Non-GAAP Reconciliations

    Non-GAAP Reconciliations Consolidated NOI calculation Q3 2021 Q2 2021 Q1 2021 Q4 2020 Q3 2020 (unaudited and in thousands) Revenues $ 1,675,176 $ 1,657,919 $ 1,596,064 $ 1,564,115 $ 1,519,767 Non-Recurring Revenues (NRR) (1) 97,808 92,658 80,899 95,149 82,550 Other Revenues (2) 32,630 36,635 18,537

  46. Slide 46: Non-GAAP Reconciliations

    Non-GAAP Reconciliations (unaudited and in thousands) Q3 2021 Q2 2021 Q1 2021 Q4 2020 Q3 2020 Income from Operations $ 282,121 $ 278,654 $ 297,662 $ 228,606 $ 288,350 Adjustments: Depreciation, Amortization and Accretion Expense 419,684 417,758 394,318 378,859 362,286 Stock-based Compensation Expens

  47. 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

  48. 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

  49. Slide 49: © 2021  Equinix.com

    ull FQUINIX WHERE OPPORTUNITY CONNECTS

Equinix — Q3 2021 Earnings Presentation on 6ix