Equinix, Inc. Q4 FY2025 earnings call

• Adaire highlighted strong performance in 2025, especially in Q4, with high demand for solutions, accelerated bookings, and growing recurring revenue.
• Bookings accelerated dramatically, with Q4 bookings at $474,000,000, up 42% year over year. Monthly recurring revenue grew 10% in Q4.
• AI workloads drove 60% of largest deals in Q4, up from 50% earlier in the year.
• Customers like Salesforce, Alimbic, BigMate, Hudson River Trading, and Honeywell chose Equinix for their infrastructure needs.
• Initiatives like Start Better, Solve Smarter, and Build Bolder are driving growth, with strong pipeline, interconnection revenue growth, and active global development portfolio.

Monthly recurring revenue (MRR) grew 10% in Q4 2025 and 8% for the full year on a normalized and constant currency basis. Annualized gross bookings in 2025 were $1,600,000,000, up 27% year over year. Q4 bookings were $474,000,000, up 42% year over year. Revenues in Q4 2025 were $2,400,000,000, up 7% over the same quarter last year. Global Q4 adjusted EBITDA was $1,200,000,000, or approximately 49% of revenues, up 15% over the same quarter last year. Net interconnection additions increased by 7,800 in Q4, and the company surpassed 500,000 interconnections worldwide.

• 2026 revenue expected to grow 9–10%, including a modest 40 bps from xScale lease timing.
• Monthly recurring revenue expected to grow 8–10%.
• 2026 adjusted EBITDA margins expected to be approximately 51%, a 200 basis point improvement over 2025.
• 2026 AFFO expected to grow 9–11% compared to previous year, AFFO per share 8–10%.
• 2026 CapEx anticipated to range between $3,700,000,000 and $4,200,000,000.
• Quarterly cash dividend expected to increase 10% over 2025 on a per-share basis.

Q: Eric Thomas Luebchow asked about bookings momentum, AI-driven deals, and if 60% AI-driven deals would continue.

A: Adaire said 60% of largest deals were AI-driven, with nearly half from non-cloud/IT companies in various sectors, and strong diversity in interconnection ecosystem.

Q: Jonathan Atkin asked about multiyear guidance.

A: Keith D. Taylor said the business is on good trajectory, but premature to talk about 2027 and beyond.

Q: Aryeh Klein asked about accelerated momentum and characteristics of AI deals.

A: Adaire said momentum was due to robust demand across workloads, segments, and regions, and strong pipeline conversion rate. AI deals had 33% higher density.

Q: Michael Ian Rollins asked about churn reduction tools and 6% stabilized revenue growth.

A: Adaire said churn reduction was via ATR, telemetry, and customer success team; Keith explained stabilized revenue growth from 52 projects and density.

Q: Frank Garrett Louthan asked about meeting power demand.

A: Adaire and Keith said they have 3 gigawatts of developable powered land and 52 projects underway to meet power requirements.

Q: Michael J. Funk asked about pricing magnitude and contract terms.

A: Adaire said disciplined pricing with opportunity to accelerate, and most contracts auto-renew with pricing increments.

Q: David Guarino asked about cost reduction trend.

A: Keith said they aim to bend cost curve to 15% SG&A of revenue, investing in efficiency and not just adding staff.

Q: Michael Elias asked about bookings sustainability.

A: Adaire and Keith said bookings growth is strong, with 45% of Q1 target booked and large pre-sales, but some quarter-to-quarter variability.

Q: Nick Del Deo asked about cloud service providers' efforts and interconnection franchise.

A: Adaire said cloud connectivity announcements validate importance of networking, and Equinix's interconnection franchise is key with evolving Fabric.

Q: Cameron McVeigh asked about AI training to inference shift and interconnection's role in AI inference.

A: Adaire said AI inference workloads are emerging earlier, and interconnection is crucial for complex hybrid multi-cloud needs.