Slide 1: Q3 2020 Earnings Conference Call
Q3 2020 Earnings Conference Call NASDAQ: EQIX Presented on October 28, 2020 © 2020 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: Q3 2020 Financial Highlights
Q3 2020 Financial Highlights Revenues Recurring Revenues Non-recurring Revenues Revenues Q3 20 ($M) Growth QoQ YoY $1,445 $1,470 $1,520 $1,397 $1,417 Acquisition Revenues: As-reported 3% 9% Axtel: $5M Packet: $9M Normalized and (1) 2% 9% Constant Currency $1,319 $1,338 $1,362 $1,398 $1,432 (1) Norma
Slide 4: Q3 2020 Consolidated Results
Q3 2020 Consolidated Results $M except for AFFO per Share and Q3 20 Non-Financial Metrics Guidance Actual QoQ YoY (1) Revenues $1,493 - 1,513 $1,520 3% 9% Cash Gross Profit $1,026 4% 10% Cash Gross Margin % 67.5% Cash SG&A $288 7% 12% Cash SG&A % 19.0% (2) Adjusted EBITDA $696 - 716 $737 2% 9% Adjus
Slide 5: Americas Performance
Americas Performance Revenues Organic Revenues Axtel/Packet Q3 20 ($M) $662 $661 $672 Revenues Growth $645 $654 QoQ YoY $8 $13 $13 Axtel: $5M Packet: $9M As-reported 2% 4% Normalized and (1) 2% 5% Constant Currency $645 $654 $654 $648 $659 (1) Normalized MRR 1% 4% Adjusted EBITDA Q3 20 Q3 19 Q4 19 Q
Slide 6: EMEA Performance
EMEA Performance Revenues Revenues Q3 20 ($M) $518 $479 $488 Growth QoQ YoY $458 $464 As-reported 6% 13% Normalized and (1) 4% 16% Constant Currency (1) Normalized MRR 2% 16% Adjusted EBITDA Q3 20 Growth QoQ YoY Q3 19 Q4 19 Q1 20 Q2 20 Q3 20 As-reported 8% 24% Adjusted EBITDA Adjusted EBITDA Adjuste
Slide 7: Asia-Pacific Performance
Asia-Pacific Performance Revenues $304 $321 $329 Revenues Q3 20 ($M) $293 $300 Growth QoQ YoY As-reported 3% 12% Normalized and (1) 0% 11% Constant Currency (1) Normalized MRR 1% 10% Adjusted EBITDA Q3 20 Q3 19 Q4 19 Q1 20 Q2 20 Q3 20 Growth QoQ YoY Adjusted EBITDA As-reported 5% 18% Adjusted EBITDA
Slide 8: Capital Structure
Capital Structure Debt Equity • Raised $1.85B through sale of Senior Notes, including • Raised $197M in net proceeds at our inaugural green bond issuance, at a blended (1) an average net price of $777 per borrowing rate of 1.72% consisting of: Net Leverage Ratio share in Q3 under ATM program • 5Y 1.
Slide 9: Capital Expenditures
Capital Expenditures Recurring Capital Expenditures 5.7% ($M) $81 • Recurring capital expenditures have 3.4% 9% historically trended between 2% and 5% of 12% 2.5% revenues, annually $47 2.1% 13% $38 • Maintenance capital expenditures can vary by 14% 1.2% $30 12% 78% 23% 15% quarter based on maintena
Slide 10: Stabilized IBX Growth
(1) (2) Stabilized IBX Growth Stabilized, Expansion & New IBXs Stabilized IBX Profitability ($M) Last Quarter $9,430 $3,901 $2,650 $90 Reported # of IBXs Q3 20 Revenues ($M) ~28% annual Cash Gross Profit on Gross PP&E investment (5) Expansion: Stabilized: 12%(3) Growth YoY Stabilized: 209 85% Utiliz
Slide 11: 2020 Financial Guidance
(1) 2020 Financial Guidance ($M except AFFO per Share) FY 2020 Q4 2020 (2) (3) Revenues $5,983 - 6,003 $1,549 - 1,569 (4) (5) Adjusted EBITDA $2,827 - 2,847 $685 - 705 Adjusted EBITDA Margin % 47 - 48% 44 - 45% Recurring Capital Expenditures $155 - 165 $69 - 79 % of revenues ~3% 4 - 5% Non-recurring
Slide 12: FY20 Guidance
FY20 Guidance (3) Revenues Adjusted EBITDA Raise full year revenue guidance by $39M Raise full year adjusted EBITDA guidance by $21M ($M) 47.3% As-reported Margin 47.3% Normalized (1) Constant Currency ~8% 47.6% Margin excl. Integration 47.7%(4) YoY Growth Costs $5,983 - 6,003 $2,827 - 2,847 $39 $21
Slide 13: Q4 Guidance
Q4 20 Guidance Revenues Adjusted EBITDA As-reported Margin 48.5% 48.9% 45.3% 44.6% $1,549 - 1,569 -6% ($M) 1 - 2% $737 $742 $25 $5 $685 - 705 $685 - 705 $1,524 - 1,544 $0 $1,520 -$4 $1,516 (1) (2) (3) Q3 20 Normalizing Q3 20 (1) Q4 20 excl. Bell Canada Q4 20 Q3 20 Reported Normalizing Q3 20 Q4 20 (4
Slide 14: FY20 AFFO and AFFO per Share Guidance
(1) FY20 AFFO and AFFO per Share Guidance (2) Raise AFFO by $25M primarily due to FX, Bell Canada and refinancing; AFFO per share normalized growth of 10 - 11% Share Count (Diluted) ($M except AFFO per Share) Normalized AFFO per Share (Diluted) Constant Currency AFFO (3) YoY Growth 16 - 17% 1 Raise
Slide 15: Dividend Outlook
Dividend Outlook Annual Cash Dividend ($M) ~13% +14% ~$936 $826 $727 $612 $492 2020E Cash Dividend of ~$936M • Continued growth of our annual total cash dividend amount 46% 43% 44% 43% 43% Payout Payout Payout Payout Payout Ratio Ratio Ratio Ratio Ratio • Fourth quarter dividend of $2.66 to be 2016
Slide 16: Supplemental Financial and Operating Data
Supplemental Financial and Operating Data All the Right All the Right All the Right PLACES PARTNERS POSSIBILITIES Place Infrastructure Connect to Everything Seize Opportunity with Wherever You Need It You Need to Succeed Agility, Speed and Confidence Global Footprint Global Ecosystem Experience 227
Slide 17: Equinix Overview
Equinix Overview (1) • Global footprint: 227 data centers in 63 metros Unique Portfolio of Data • Network dense: 1,800+ networks; 100% of Tier 1 Network Routes Center Assets • Cloud dense: 2,900+ Cloud & IT service providers • Interconnected ecosystems: 386,000+ Total Interconnections • 2020 expecte
Slide 18: Pressing Our Advantage in All Markets
Pressing Our Advantage in All Markets Equinix global reach expanding across 63 metro areas and 26 countries (2) (2) 5 Continents 26 Countries 63 Metro areas 227 Data centers AMERICAS EMEA ASIA-PACIFIC % of Customers in Platform Equinix 27 Metros (1) 104 Data Centers 24 Metros 78 Data Centers 12 Metr
Slide 19: xScale: Amplifying Our Balance Sheet to Extend Cloud Leadership
xScale: Amplifying Our Balance Sheet to Extend Cloud Leadership Current Phase Objective Status Phase Open Cost ($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 20: GPX: Strategic acquisition to enter one of the biggest and fastest growing markets
GPX: Strategic acquisition to enter one of the biggest and fastest growing markets Extending Platform Equinix® to India with the addition of two world-class, highly interconnected data centers Expanding • India DC market is expected to exceed US$1B in 2020 and grow at 12% CAGR from 2019-2024, the th
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 16% EMEA 1 Network 2.7% 3 142 34% INT 2 Cloud & IT Services 2.5% 3 65 Network 18% Asia- Ente
Slide 22: Non-Financial Metrics
Non-Financial Metrics (1) FY 2019 FY 2020 Q3 Q4 Q1 Q2 Q3 QoQ Interconnections Americas 151,800 153,900 155,700 158,000 160,500 2,500 EMEA 122,900 124,800 127,000 128,600 131,200 2,600 Asia-Pacific 60,900 62,200 63,400 65,600 67,500 1,900 Worldwide Cross Connections 335,600 340,900 346,100 352,200 35
Slide 23: Equinix Announced Retail IBX Expansions
Equinix Announced Retail IBX Expansions Cabinet(1) Equivalent 2021 2022 Total Capex(1) Capacity In Expansion Highlights IBX Data Center Status Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 $US millions Ownership Future Phases BO2 phase 2 (Boston) Open 550 $32 Owned 500 • We have 41 major builds underway DA11 phase 1 (Dal
Slide 24: Long-Term Lease Renewals
Long-Term Lease Renewals Weighted average lease maturity of greater than 18 years including extensions (1) Global Lease Portfolio Expiration Waterfall Equinix Owned Sites (2, 3) (4) • Own 105 of 227 Data Centers % Leases Renewing by Square Footage 72% • 15.8M of 26.2M total gross square feet (4) Las
Slide 25: Same Store Operating Performance
Same Store Operating Performance (1) Revenues ($M) Cash Cost, Gross Profit and PP&E ($M) Trailing 4-Qtr Inter- Services/ Total Non- Total Cash Cost Cash Gross Cash Gross Gross Cash Return on Category Colocation connection Other Recurring recurring Revenues of Revenues Profit Margin % PP&E Gross PP&E
Slide 26: Consolidated Portfolio Operating Performance
Consolidated Portfolio Operating Performance (1) Cabinets Billed Q3 20 Revenues ($M) Total Cabinet Owned % Cabinet Cabinets Utilization Total of Total Category # of IBXs Capacity Billed % Recurring Recurring Americas Owned (2) 48 84,300 58,700 70% $425 Leased 40 33,600 27,600 82% $192 Americas Total
Slide 27: Data Center Portfolio Composition
Data Center Portfolio Composition Metro Count Stabilized Expansion New Acquisition xScale Owned Leased Atlanta 5 AT2, AT3, AT4, AT5 AT1 AT4 AT1, AT2, AT3, AT5 Change Summary (1) (2) Bogota 1 BG1 BG1 Boston 2 BO1 BO2 BO2 BO1 Calgary 3 CL1, CL2, CL3 CL3 CL1, CL2 Chicago 5 CH1, CH2, CH4, CH7 CH3 CH3, C
Slide 28: Data Center Portfolio Composition
Data Center Portfolio Composition Metro Count Stabilized Expansion New Acquisition xScale Owned Leased Abu Dhabi 1 AD1 AD1 Change Summary (1) Amsterdam 9 AM1, AM2, AM3, AM5, AM8 AM4, AM6, AM7, AM11 AM1*, AM2*, AM3*, AM4, AM5, AM6, AM7 AM8, AM11 Barcelona 1 BA1 BA1 Dubai 2 DX1, DX2 DX1, DX2 Dublin 4
Slide 29: Adjusted Corporate NOI
(1) Adjusted Corporate NOI ($M, except # of IBXs) Calculation Of Adjusted Corp NOI Q3 2020 Q2 2020 Q1 2020 Q4 2019 Q3 2019 # of IBXs (1) 212 211 208 204 203 (2) Recurring Revenues $1,420 $1,385 $1,355 $1,333 $1,316 Recurring Cash Cost of Revenues Allocation (431) (416) (423) (425) (412) Cash Net Ope
Slide 30: Adjusted NOI Composition – Organic
Adjusted NOI Composition – Organic (1) Q3 2020 Q3 2020 Total Cabinet Recurring Quarterly # of Cabinet Cabinets Utilization Revenues Adjusted NOI Category IBXs Capacity Billed % ($M) ($M) % NOI Stabilized Owned (2) 54 94,400 80,700 85% $479 $324 37% Leased 94 88,800 74,300 84% $476 $287 33% Stabilize
Slide 31: Components of Net Asset Value
Components of Net Asset Value Operating Portfolio Adjusted Q3 20 Quarterly Ownership Reference NOI Adjusted NOI ($M) Stabilized Owned Adjusted NOI Segments $324 Stabilized Leased Adjusted NOI Segments $287 Expansion Owned Adjusted NOI Segments $177 Expansion Leased Adjusted NOI Segments $86 Other Re
Slide 32: Debt Summary
Debt Summary Spread / Interest First Call First Call / Balance(1) Debt Coupon Rate Maturity Date Current Call ($M) Debt Redemption, Issuance and Revolver Term Loan A - SEK, GBP, JPY (2) L + 100 L + 120 1.221% 1.228% Dec-22 Dec-22 - - - - - 1,244 Amortization Senior Notes (3) • €1B 2025 Notes and €50
Slide 33: Shares Forecast
Shares Forecast (‘M) Fully Diluted Weighted Average Shares Common Stock Outstanding 89.1 ~89.1 0.8 88.5 -1.4 ~88.5 3.0 85.9 85.3 85.3 85.3 0.8 1.6 1.5 1.3 1.3 1.3 Shares Est. Employee Q1 - Q3 Equity (5) Est. Shares Est. Weighted Est. Weighting Est. Fully Diluted Q3 19 Q4 19 Q1 20 Q2 20 Q3 20 Outstan
Slide 34: Capital Expenditures Profile
Capital Expenditures Profile ($M) Q3 2020 Q2 2020 Q1 2020 Q4 2019 Q3 2019 Recurring IBX Maintenance 28 19 9 63 34 Sustaining IT & Network 6 5 5 10 7 Re-configuration Installation 4 7 4 8 6 Subtotal - Recurring 38 30 18 81 47 Non-Recurring IBX Expansion 417 372 310 496 412 Transform IT, Network & Off
Slide 35: FX Rates, Hedging and Currencies
FX Rates, Hedging and Currencies (4) Currency % of Revenues Revenue FX Rates Blended (4) Guidance (1) Blended % of CHF GBP Currency Hedge Rate Guidance (2) (3) Rate Hedge % Revenues 1% Rate(2) 9% HKD EUR USD 1.00 40% 21% 4% EUR to USD 1.17 1.12 1.14 61% 21% AUD 4% GBP to USD 1.29 1.28 1.28 70% 9% JP
Slide 36: Industry Analyst Reports
Industry Analyst Reports Solution Category Reports • Your Data Center May Not be Dead, but it’s Morphing - Gartner, 9/17/20 • The Future of Digital Infrastructure: Digital Services & Experiences - IDC, 9/20 • Interconnection 2020 – The Future is Programmable - 451 Research, 8/20 Interconnection • Di
Slide 37: 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 38: Appendix: Non-GAAP Financial Reconciliations & Definitions
Appendix: Non-GAAP Financial Reconciliations & Definitions © 2020 Equinix.com 38
Slide 39: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2020 Equinix.com 39
Slide 40: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2020 Equinix.com 40
Slide 41: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2020 Equinix.com 41
Slide 42: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2020 Equinix.com 42
Slide 43: Non-GAAP Reconciliations
Non-GAAP Reconciliations © 2020 Equinix.com 43
Slide 44: Non-GAAP Reconciliations
Non-GAAP Reconciliations Consolidated NOI calculation Q3 2020 Q2 2020 Q1 2020 Q4 2019 Q3 2019 (unaudited and in thousands) Revenues $ 1,519,767 $ 1,470,121 $ 1,444,542 $ 1,417,135 $ 1,396,810 Non-Recurring Revenues (NRR) (1) 82,550 68,832 77,920 75,369 77,279 Other Revenues (2) 17,510 16,208 11,990
Slide 45: Non-GAAP Reconciliations
Non-GAAP Reconciliations (unaudited and in thousands) Q3 2020 Q2 2020 Q1 2020 Q4 2019 Q3 2019 Income from Operations $ 288,350 $ 282,488 $ 253,484 $ 312,974 $ 285,368 Adjustments: Depreciation, Amortization and Accretion Expense 362,286 348,434 337,431 328,295 321,746 Stock-based Compensation Expens
Slide 46: 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 47: 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 48: © 2020 Equinix.com
ull FQUINIX WHERE OPPORTUNITY CONNECTS