Brookfield Infrastructure Partners L.P. (BIP) Earnings

Management highlights

David Krantz discussed strong first quarter results with SFO of $709 million or $0.90 per unit, 10% increase y/y. Highlighted base business results with data and midstream FFO up 46% and 12% respectively. Mentioned capital recycling initiatives with $1 billion proceeds secured, refinanced $1.5 billion of non-recourse debt. Sam Pollack discussed strategic initiatives like new frameworks for investment partnerships, equipment leasing platform with leading global investment grade OEM, progress on $5 billion strategic partnership for behind-the-meter power generation, and exploring single combined corporate structure.

Guidance

Brookfield Infrastructure expects to deliver 10% plus per unit FFO growth in 2026. Also, in the capital recycling and debt refinancing, they are positioned to fund growth while maintaining financial discipline.

Segment performance

Brookfield Infrastructure's first quarter 2026 results: Utility segment generated FFO of $201 million, up 5% year over year. Transport segment had SFO of $283 million, slightly below same period last year, but adjusted FFO ahead of prior year due to higher volumes and tariffs. Midstream segment generated FFO of $190 million, up 12% year over year. Data segment FFO was $149 million, a 46% increase compared to prior year.

Analyst Q&A

• Q: Good morning. I wanted to start on the recently launched equipment leasing business. I'm just trying to get a sense if this is part of the strategy for investing inside data centers, you know, what kind of timeframe you'd expect to deploy that $1.5 billion of capital and what you view as the main risks associated with that investment.

  A: This is Sam. The opportunity will likely be broader than just data centers. Initially, a good portion of the investment will be equipment for data centers. We think we can scale this up. Hope to deploy $1 to $2 billion of equity capital on a gross basis, BIP share 25% of that, and hope to do that within a 24-month period.

• Q: I was going to ask about that Intel JV. I didn't see any mention of it in your release, but I think Intel Disclosure suggested that payments to the JV may have started in Q1. I guess, first, was that the case? And how quickly can returns on investment ramp up in the coming quarters as both those FABs come online?

  A: It's Dave here. In the past, generally won't provide many updates specifically on the project. The project's gone well, coming in line with targets. They did make their first small wafer payment in the quarter. Final capital contributions to go in over the next six months, and expect earnings to start to ramp up, start seeing that come through our transmission and distribution segment of our data business in Q3, and full run rate in 2027.

• Q: I wanted to start with this concept of a single combined corporate structure concept. I have to assume that when the BIPC shares were first created back in 2020, something like this was contemplated. And if so, what were some of the obstacles back then and how those may or may not no longer be as big of an obstacle or even at all this time around?

  A: It's David again. We're in the early stages of considering this with the board's direction. It's probably hard to say what the obstacles are today. The two companies for the last six years have served us well, but we're always looking at ways to improve our access to capital. Following completion of our sister company, BBU's process, can now have some insights into how one simplified corporate structure will trade in the market, and early indications are positive.

• Q: I'd like to follow up on the potential corporate conversion that the board is exploring. Understanding, you know, it's quite early days. I wondered if you had any timelines for us in terms of what's reasonable to expect in terms of when a decision might be made.

  A: As I said, unfortunately, there's probably not a ton we can share on the timeline as of yet. We're just kicking off the process now.

• Q: I'd like to follow up on the data segment, and I appreciate that data centers and Intel are the major growth drivers at the moment. Just curious how you think about the balance of your data portfolio in towers, fiber, and so forth, and and what value that provides in terms of diversity, but also what you see in terms of organic and inorganic opportunities there.

  A: Maybe I'll start, but then I think you've given us a good segue to maybe talk about what's going on in the AI infrastructure sector in particular, and we have Leif Williams here. We're seeing continued strong growth across the sector. All our customers are looking to expand density across their networks. On the tower side, have built to suit opportunities. On the fiber businesses, still a lot of white space. In the AI infrastructure space, large users of AI factories and data centers are highly active, demand profile has broadened.

• Q: Hoping to dive a little bit deeper on the AI factory and Digital Hub strategy. You know, how are we progressing on those discussions with counterparties? You know, and should we be in a position in 2026 to see some, you know, notable or sizable project announcements?

  A: It's Leif again. There's tremendous demand from the large technology companies. The demand profile has broadened. We're increasingly seeing these users looking for credible partners who have placed long lead equipment orders and who have true RFS dates for when the power is available. We think the demand profile is very strong, and we'll continue to see strong demand through 2026 and 2027.

• Q: You've historically leaned into periods of uncertainty and dislocation to pursue large acquisitions. How are you thinking about your ability to deploy capital into a sizable transaction this year?

  A: Hey, Fred. I think we've been historically successful in taking advantage of dislocations. At the moment, the market remains relatively calm and constructive. We're always on the lookout for large value opportunities. The opportunity set around our AI infrastructure strategy is extremely strong, and we're optimistic about being able to do some exciting transactions there. We're also seeing an uptick in activity across Europe. We keep on monitoring the capital markets, and often some of our best acquisitions are when the public markets pull back and we can take advantage of a take private opportunity.

• Q: How are you thinking about North River and potential monetization there?

  A: What I would just say is the business has had tremendous commercial success in the past couple of years. Our debate internally is whether or not we continue to build out the business and take advantage of some of the additional growth that's there, or whether we bring it to market and seize what is probably a pretty constructive environment for midstream businesses. So we're weighing those considerations. It's performing really well. And we just don't have an answer for you at this point in time.