Financial Data and Key Metrics Changes - Fourth quarter core FFO was $1.44 per share, finishing at the top end of guidance ranges [10] - Average occupancy was 95.3% for the quarter and 95% for the full year, with period-end finishing at 95.8% [10] - Net effective rent change was 44% for the quarter, contributing approximately $60 million of annualized NOI, with a full-year net effective rent change exceeding 50% [10] - Same-store NOI growth was 4.7% on a net effective basis and 5.7% on a cash basis, each ahead of guidance midpoint [11] Business Line Data and Key Metrics Changes - The company signed 57 million sq ft of leases in the quarter, driving occupancy toward 96% [9] - Development platform, particularly in build-to-suits, continues to outperform, with $1.1 billion in new buildings started in the quarter [12] - In strategic capital, two new investment vehicles were formed in the U.S. and China [9] Market Data and Key Metrics Changes - Fourth quarter net absorption was 59 million sq ft in the U.S., with a decline in U.S. vacancy to 7.4% [13][14] - Many markets are beginning to see expansion as market rent growth starts to outpace portfolio churn [11] - International markets, particularly in Latin America and Europe, are outperforming, with strong occupancy and ongoing rent growth [16] Company Strategy and Development Direction - The company focuses on three priorities: extending leadership as a best-in-class operator, capturing value creation opportunities in logistics and data centers, and enhancing shareholder returns through growth in assets under management [6][8] - The company aims to develop critical infrastructure with a growing power pipeline and deep customer relationships [7] - Strategic capital partners are increasingly seeking fewer managers who can deliver consistent performance across geographies and strategies [8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the operational and financial results despite challenges in 2025, highlighting the strength and resilience of the platform [20] - The company anticipates positive rent growth to emerge more clearly over the course of 2026, with market vacancies expected to improve [30][31] - Management noted that e-commerce remains a significant driver of demand, representing approximately 20% of new leasing activity over the last year [15] Other Important Information - The company achieved significant milestones in strategic capital, including the IPO of the China AMC Prologis Logistics REIT [17] - The installed capacity in the energy business reached 1.1 gigawatts, surpassing the previous goal [12] Q&A Session Summary Question: Changes in strategic initiatives with new leadership - Management emphasized a focus on compounding the core logistics business while broadening the platform, with plans to grow the strategic capital area significantly [22][24] Question: Market rent growth expectations for 2026 - Management expects net absorption to approach 200 million sq ft in 2026, with vacancies declining to 7.1%-7.2% by year-end [30][31] Question: Data center project details and guidance - Approximately 40% of the development starts guidance for 2026 is expected to be in data centers, with a small number of imminent projects [35] Question: Clarification on occupancy growth and FFO growth limits - Management expressed confidence in occupancy growth despite potential downticks, with a forecast of a 25 basis points increase in average occupancy [43] Question: Capital deployment pipeline and ramp-up - Management highlighted a significant number of opportunities and the ability to make decisions based on market conditions [51][52] Question: Same-store growth guidance breakdown - The guidance reflects a mix of occupancy gains and mark-to-market improvements, with occupancy drag expected to lessen over time [64]

Financial Data and Key Metrics Changes - Fourth quarter core FFO was $1.44 per share, including net promote expense, and $1.46 per share, excluding net promote expense, finishing at the top end of guidance ranges [9] - Average occupancy was 95.3% for the quarter and 95% for the full year, with period-end finishing at 95.8% [9] - Net effective rent change was 44% for the quarter, contributing approximately $60 million of annualized NOI, driving net effective rent change for the year to more than 50% [9] - Same-store NOI growth was 4.7% on a net effective basis and 5.7% on a cash basis, each ahead of guidance midpoint [10] Business Line Data and Key Metrics Changes - The company signed 57 million sq ft of leases in the quarter, driving occupancy toward 96% [8] - The development platform, particularly in build-to-suits, continues to outperform, with 48% of new buildings started being build-to-suit [11] - In strategic capital, two new investment vehicles were formed in the U.S. and China [8] Market Data and Key Metrics Changes - Fourth quarter net absorption was 59 million sq ft in the U.S., leading to a decline in U.S. vacancy to 7.4% [12] - Many markets are beginning to see expansion as market rent growth starts to outpace portfolio churn [10] - International markets, particularly in Latin America and Europe, are showing robust consumption trends and high occupancy [14][15] Company Strategy and Development Direction - The company focuses on three priorities: extending leadership as a best-in-class operator, capturing value creation opportunities in logistics and data centers, and enhancing shareholder returns through growth in assets under management [5][6] - The company aims to develop critical infrastructure with a growing power pipeline and deep customer relationships [5] - The strategic capital area is expected to grow significantly through existing and new vehicles [22] Management Comments on Operating Environment and Future Outlook - Management expressed confidence in the operational and financial results despite challenges in 2025, highlighting the strength and resilience of the platform [19] - The company anticipates positive rent growth to emerge more clearly over the course of 2026, with net absorption expected to approach 200 million sq ft [26] - Management noted that uncertainty remains, but it is treated more as a planning assumption rather than an impediment [13] Other Important Information - The company achieved significant milestones in strategic capital, including the IPO of the China AMC Prologis Logistics REIT [15] - The installed capacity in the energy business reached 1.1 gigawatts, surpassing the previous goal [11] Q&A Session Summary Question: Changes in strategic initiatives with new leadership - The focus remains on compounding the core logistics business while broadening the platform, with an emphasis on development where supply is constrained [22] Question: Market rent growth expectations for 2026 - Market vacancies are expected to improve, with net absorption anticipated to approach 200 million sq ft in 2026 [26] Question: Data center project details and guidance - Approximately 40% of the development starts guidance is expected to be in data centers, with a mix of Powered Shell and Turnkey projects [28] Question: Clarification on occupancy growth in U.S. vs. international markets - Occupancy gains are expected to be dispersed across geographies, with more weight coming from the U.S. [50] Question: Contribution expectations for new vehicles in 2026 - The contribution guidance includes the Agility Fund, which will undertake development activities and take contributions of land from Prologis [45]

Core Insights - Prologis, Inc. (PLD) reported fourth-quarter 2025 core funds from operations (FFO) per share of $1.44, matching the Zacks Consensus Estimate but down from $1.50 in the same quarter last year [1][11] - The company generated rental revenues of $2.09 billion, which was below the Zacks Consensus Estimate of $2.17 billion, but increased from $1.94 billion year-over-year [2] - Total revenues for the quarter were $2.25 billion, slightly up from $2.20 billion in the previous year [2] Financial Performance - For the full year 2025, Prologis reported core FFO per share of $5.81, a 4.5% increase from the previous year, aligning with the Zacks Consensus Estimate [3] - Rental revenues for 2025 reached $8.16 billion, an 8.6% year-over-year increase, although it fell short of the consensus mark of $8.38 billion [3] Leasing and Occupancy - In Q4, Prologis commenced 43.8 million square feet of leases, with a retention level of 77.7% [4] - The average occupancy level in the owned and managed portfolio was 95.3%, up from 94.8% in the prior quarter but down from 95.6% year-over-year [4] Rent and Income Metrics - The company's share of net effective rent change was 43.8% in Q4, with a cash rent change of 27.3% [5] - Cash same-store net operating income (NOI) grew by 5.7%, compared to 5.2% in the previous quarter [5] Capital and Debt Management - Prologis' share of building acquisitions totaled $516.8 million, with a weighted average stabilized cap rate of 5.2% [6] - Interest expenses increased by 12.2% year-over-year to $260.5 million [7] - The company exited Q4 2025 with cash and cash equivalents of $1.15 billion and total liquidity of $7.6 billion [8] 2026 Guidance - Prologis provided guidance for 2026 core FFO per share in the range of $6.00-$6.20, with expected average occupancy between 94.75% and 95.75% [11][12] - Projected cash same-store NOI growth is estimated to be between 5.75% and 6.75% [12] - The company anticipates capital deployment for development starts of $3.00-$4.00 billion and acquisitions of $1.00 billion-$1.50 billion [13]

Prologis Park Bottrop, Bottrop, Germany FOURTH QUARTER 2025 Prologis Supplemental Information Unaudited Contents Q4 2025 Supplemental Highlights Financial Information Operations Capital Deployment Strategic Capital Capitalization Notes and Definitions 35 Notes and Definitions 1 Company Profile 2 Company Performance 4 Prologis Leading Indicators and Proprietary Metrics 5 Guidance 6 Consolidated Balance Sheets 7 Consolidated Statements of Income 8 Reconciliations of Net Earnings to FFO 9 Reconciliations of Ne ...

Logistics warehouse operator Prologis signed a record number of new leases in 2025 as more customers go long on real estate following a prolonged downturn and trade war scare. Prologis (NYSE: PLD) reported fourth-quarter consolidated revenue of $2.09 billion on Wednesday, up 8% year over year and in line with analysts’ expectations. Core funds from operations (FFO) of $1.44 per share also matched the consensus estimate. “2025 was a record year for lease signings, setting the business up with strong mome ...

Core Viewpoint - Prologis experienced an increase in fourth-quarter revenue due to a resurgence in demand for warehouses after a prolonged period of weakness [1] Group 1: Company Performance - Prologis reported higher revenue in the fourth quarter, indicating a recovery in the warehouse sector [1] Group 2: Industry Trends - The demand for warehouses is bouncing back, suggesting a positive shift in the logistics and supply chain industry following years of decline [1]

Core Insights - Prologis, Inc. has provided its financial outlook for the full-year 2026, forecasting net earnings between $3.70 and $4.00 per share [1] - The company anticipates core funds from operations (core FFO) to be in the range of $6.00 to $6.20 per share, with core FFO excluding net promote income projected between $6.05 and $6.25 per share [1] Analyst Expectations - Analysts expect Prologis to report earnings of $2.90 per share for the year, with estimates typically excluding special items [2]

Financial Performance - Prologis reported total revenues of $2.25 billion for Q4 2025, a slight increase from $2.20 billion in Q4 2024[5]. - Net earnings attributable to common stockholders for Q4 2025 were $1.40 billion, compared to $1.28 billion in Q4 2024, reflecting a year-over-year growth of 9.5%[11]. - Core FFO attributable to common stockholders for Q4 2025 was $1.38 billion, down from $1.44 billion in Q4 2024, indicating a decrease of 4.2%[5]. - The company reported a net earnings of $414,017,000 for the same period, with a core FFO of $730,309,000[33]. - Consolidated Property NOI for Q4 2025 was $1,588,885, an increase from $1,499,039 in Q4 2024, reflecting a growth of 5.9%[48]. - Rental revenues for Q4 2025 reached $2,092,107, up from $1,937,507 in Q4 2024, marking an increase of 8.0%[48]. Guidance and Projections - The company anticipates 2026 Core FFO guidance between $6.00 and $6.20 per share, with net earnings guidance of $3.70 to $4.00 per share[9]. - Prologis' development stabilizations for 2026 are projected to be between $2.25 billion and $2.75 billion, with development starts expected to range from $3.00 billion to $4.00 billion[9]. - Core FFO guidance for 2025 is projected between $6.00 and $6.20 per share, with net earnings attributable to common stockholders estimated at $3.70 to $4.00 per share[45]. Occupancy and Leasing - Prologis' average occupancy rate is projected to be between 94.75% and 95.75% for 2026[9]. - Average occupancy for the operating portfolio was 95.8% in Q4 2025, compared to 94.8% in Q4 2024[14]. - Total square feet of leases commenced in Q4 2025 was 43,764, a decrease from 65,603 in Q3 2025[15]. - The total square footage of the Operating Portfolio was 1,207,391,000 square feet, with an occupancy rate of 95.8%[20]. Assets and Liabilities - Total assets as of December 31, 2025, were $98.72 billion, with total liabilities of $40.97 billion[10]. - The company reported a gross AUM of $230 billion, with Prologis share AUM at $162 billion[4]. - The total value of assets under management reached $163,081,534,000, with G&A as a percentage of assets under management at 0.37%[45]. Development and Investment - The company owned or had investments in properties totaling approximately 1.3 billion square feet across 20 countries as of December 31, 2025[3]. - Total development stabilizations for the year reached 12,519,000 square feet, generating an annualized estimated NOI of $151,803,000[23]. - The company has signed leases totaling 67 million square feet expiring in 2026, representing 4.7% of total net effective rent[21]. - Total development starts reached 5,203 square feet with a total estimated investment (TEI) of $1,110,619, representing a 49.6% increase[24]. Debt and Financial Ratios - Debt as a percentage of gross market capitalization was 24.6%, down from 26.5% in the previous quarter, indicating improved leverage[35]. - The fixed charge coverage ratio was reported at 5.9x, reflecting the company's ability to cover fixed charges comfortably[35]. - The weighted average interest rate on debt was 3.3%, with a remaining maturity of 8.2 years, indicating a stable debt profile[35]. - The debt to Adjusted EBITDA ratio increased to 5.3x from 5.0x in the previous quarter[43]. Cash Flow and Expenses - Total current income tax expense for the twelve months ended December 31, 2025, was $204,017,000, compared to $166,943,000 in 2024, reflecting an increase of about 22.2%[46]. - Gross interest expense for the twelve months ended December 31, 2025, was $1,023,805,000, up from $892,612,000 in 2024, indicating a rise of approximately 14.7%[46]. - Capitalized G&A expenses for the twelve months ended December 31, 2025, totaled $175,068,000, compared to $188,800,000 in 2024, showing a decrease of about 7.3%[45]. Customer and Market Insights - The top customer, Amazon, occupies 169,160 square feet, contributing 11.3% to the net effective rent[21]. - The weighted average term of leases remaining based on net effective rent is 3.9 years for the top customers[21]. - The U.S. accounted for 84.6% of the total NOI, with $1,715,249,000, while total NOI outside the U.S. was $740,377,000[19].

Market Overview - The U.S. stock market experienced significant declines, with over 70.7% of U.S. issues falling on Tuesday, while only 26.4% advanced [2] - The Nasdaq Composite and S&P 500 dropped by 2.39% and 2.06% respectively, with the Dow and Russell 2000 also showing losses of 1.76% and 1.20% [3] Earnings Reports - Major earnings reports expected today include Johnson & Johnson, Charles Schwab, and Prologis, with a focus on regional banks reporting in both premarket and aftermarket sessions [5] - The S&P Regional Bank ETF ($KRE) is anticipated to be particularly responsive to these reports, having risen over 14% since its lows in November 2025 [6]

Core Insights - Prologis (PLD) is expected to report its fourth-quarter 2025 results on January 21, with analysts keen to evaluate its performance in the current economic environment [1] Company Performance - In the last reported quarter, Prologis achieved a core funds from operations (FFO) per share surprise of 3.47%, driven by increased rental revenues and strong leasing activity, although high interest expenses posed challenges [2] - Over the past four quarters, Prologis consistently exceeded the Zacks Consensus Estimate for FFO per share, with an average beat of 4.66% [2] Industry Overview - The U.S. industrial real estate market showed resilience in Q4 2025, with net absorption reaching 54.5 million square feet, a 29% increase year-over-year, and 53% of U.S. industrial markets reporting annual absorption gains [3] - The U.S. industrial vacancy rate remained stable at 7.1% for the third consecutive quarter, with 53% of markets experiencing flat or declining vacancy rates [4] - Asking rent growth in the U.S. industrial sector slowed to 1.5% year-over-year, with rents declining by 3.8% in the Northeast and 4.5% in the West [5] - The under-construction pipeline increased to 268.1 million square feet, marking a rise for the second consecutive quarter [6] Factors Influencing Prologis - Prologis benefits from its strategic portfolio locations in key distribution markets, with targeted acquisitions and developments expected to support its Q4 results [7] - The company maintains a strong financial position, characterized by a resilient balance sheet and efficient capital access, although high interest expenses remain a concern [8] Projections - For Q4 2025, FFO per share is projected at $1.44, reflecting a 4% year-over-year decrease, while revenues are estimated at $2.10 billion, indicating an 8.6% increase year-over-year [10][11] - For the full year 2025, Prologis anticipates core FFO per share between $5.78 and $5.81, with average occupancy expected to be between 94.75% and 95.25% [12]