Iron Mountain(IRM) - 2025 Q1 - Quarterly Results

Financial Performance - Total revenue for Q1 2025 was $1.6 billion, an increase of 7.8% year-over-year, and a 9.4% increase on a constant currency basis[12] - Net income for Q1 2025 was $16 million, a decrease of 79% from $77 million in Q1 2024, primarily due to foreign exchange impacts[11] - Adjusted EBITDA for the quarter was $580 million, reflecting a 12% increase compared to Q1 2024, with a margin of 36.4%[11] - AFFO for the quarter was $348 million, an increase of 7.6% year-over-year, with AFFO per share at $1.17, up 6%[20] - Adjusted EBITDA for Q1 2025 was $579,906, down 4.2% quarter-over-quarter and up 11.8% year-over-year[48] - Basic and diluted earnings per share (EPS) were both $0.05, a decrease of 85.7% from Q4 2024 and 80.0% from Q1 2024[51] - Operating income decreased to $254,294, a 10.0% decline from Q4 2024, but a 3.5% increase year-over-year[46] - Total operating expenses increased to $1,338,235, a 3.0% rise from Q4 2024 and an 8.7% rise from Q1 2024[46] Revenue Breakdown - Storage rental revenue reached $948 million, up 7% year-over-year, while service revenue increased by 9% to $644 million[11] - Total Storage Rental Revenue for Q1 2025 was $948,376, reflecting a 0.7% increase from Q4 2024 and a 7.2% increase year-over-year from Q1 2024[56] - Total Service Revenue for Q1 2025 reached $644,153, up 0.8% from Q4 2024 and 8.8% from Q1 2024[56] - Organic Storage Rental Revenue Growth was 8.8% in Q1 2025, consistent with Q4 2024[25] Guidance and Future Outlook - The company increased its full-year 2025 revenue guidance to a range of $6.74 billion to $6.89 billion, representing an approximate 11% year-over-year growth[15] - Adjusted EBITDA guidance for 2025 was raised to $2.505 billion to $2.555 billion, indicating a 13% growth at the midpoint[15] - The company continues to focus on its Matterhorn growth strategy, driving broad-based strength across its business segments[10] Capital Expenditures and Investments - Total capital expenditures for Q1 2025 amounted to $656.6 million, a decrease of 9.0% from Q4 2024, but an increase of 79.5% compared to Q1 2024[86] - Data center growth capital expenditures were $576.0 million in Q1 2025, reflecting a 6.3% increase quarter-over-quarter and a significant 108.2% increase year-over-year[86] - The total expected investment for data center expansion is $1.77 billion, with cumulative investments reaching $967.9 million[73] Debt and Financial Ratios - The company holds a net debt of $14.87 billion, resulting in a net debt to total enterprise value ratio of 36.9%[76] - The weighted average interest rate on the company's debt is 6.46%, with a credit facility fixed charge coverage ratio of 2.4x[76] Operational Metrics - The data center, digital, and asset lifecycle management (ALM) businesses collectively grew more than 20%[12] - Total Volume - Storage increased to 734,166 in Q1 2025, up from 733,571 in Q4 2024[25] - Leased % - Stabilized for Data Center reached 98.0% in Q1 2025, an increase from 97.4% in Q4 2024[25] - The churn rate for data center leases was reported at 0.3%[65] Shareholder Returns - A quarterly cash dividend of $0.785 per share was declared for Q2 2025, payable on July 3, 2025[14] - The Dividend per Share increased to $0.79 in Q1 2025, up from $0.72 in Q4 2024[25] Company Structure and Strategy - The company added 45 owned facilities and 20 leased facilities, increasing total square footage to 97,902 as of March 31, 2025[58] - The company has a total of 184.5 MW under development, with 83.3% pre-leased, indicating strong demand for data center capacity[73] - The company plans to complete several new data center phases, including 18.0 MW in Phoenix and 12.0 MW in Chicago, both expected to stabilize in 2025[73] Definitions and Metrics - Adjusted EPS is defined as reported earnings per share fully diluted from net income attributable to Iron Mountain, excluding certain items such as acquisition costs and stock-based compensation[91] - Adjusted EBITDA is calculated as net income before interest, taxes, depreciation, and amortization, excluding non-core operating results, and is used to evaluate acquisition targets[93] - Funds From Operations (FFO) is defined as net income excluding depreciation on real estate assets and is adjusted for unconsolidated joint ventures, providing a clearer view of operating performance[94] - Adjusted Funds From Operations (AFFO) is calculated by excluding non-cash rent expenses and including recurring capital expenditures, serving as a meaningful performance measure for REITs[97] - Organic revenue growth rate represents year-over-year revenue growth excluding the impact of acquisitions and foreign currency fluctuations[116]