Iron Mountain(IRM) - 2025 Q2 - Quarterly Results

Section I - Q2 Earnings Press Release Q2 2025 Earnings Press Release Iron Mountain reported record Q2 2025 revenue ($1.7B) and Adjusted EBITDA ($628M), increasing full-year guidance despite a net loss Financial Performance Summary | Financial Metric | Three Months Ended 6/30/25 (in millions) | Y/Y % Change (Reported) | Year to Date 6/30/25 (in millions) | Y/Y % Change (Reported) | | :--- | :--- | :--- | :--- | :--- | | Total Revenues | $1,712 million | 12% | $3,304 million | 10% | | Net (Loss) Income | $(43) million | n/a | $(27) million | (124)% | | Adjusted EPS | $0.48 | 14% | $0.92 | 8% | | Adjusted EBITDA | $628 million | 15% | $1,208 million | 14% | | AFFO | $370 million | 15% | $718 million | 11% | | AFFO per share | $1.24 | 15% | $2.41 | 11% | - Achieved record quarterly revenue of $1.7 billion, an increase of 11.6% on a reported basis and 11.0% on a constant currency basis[8] - Net loss for Q2 was $(43.3) million, compared to a net income of $34.6 million in Q2 2024, primarily driven by the impact of foreign exchange rate changes on intercompany balances[12] - The Board of Directors declared a quarterly cash dividend of $0.785 per share for the third quarter of 2025[14] Full-Year Financial Guidance | 2025 Guidance | New Guidance (in millions) | Previous Guidance (in millions) | Approximate Y/Y % Change (New) | | :--- | :--- | :--- | :--- | | Total Revenue | $6,790 - $6,940 M | $6,740 - $6,890 M | ~12% | | Adjusted EBITDA | $2,520 - $2,570 M | $2,505 - $2,555 M | ~14% | | AFFO | $1,505 - $1,530 M | $1,480 - $1,510 M | ~13% | | AFFO Per Share | $5.04 - $5.13 | $4.95 - $5.05 | ~12% | Section II - Financial Highlights and Organic Growth Financial and Operating Highlights Q2 2025 saw strong performance with $1.71B revenue, $628.4M Adjusted EBITDA, 9.2% organic storage rental growth, and high data center occupancy Financial Performance Summary | Financial Metric | Q2 2025 (in thousands) | Q1 2025 (in thousands) | Q2 2024 (in thousands) | | :--- | :--- | :--- | :--- | | Total Revenues | $1,711,948 | $1,592,529 | $1,534,409 | | Adjusted EBITDA | $628,388 | $579,906 | $544,361 | | Adjusted EBITDA Margin | 36.7% | 36.4% | 35.5% | | Adjusted EPS | $0.48 (per share) | $0.43 (per share) | $0.42 (per share) | | AFFO per Share | $1.24 (per share) | $1.17 (per share) | $1.08 (per share) | Operating Metrics Overview | Operating Metric | Q2 2025 | Q1 2025 | Q2 2024 | | :--- | :--- | :--- | :--- | | Organic Storage Rental Revenue Growth | 9.2% | 8.8% | 10.1% | | Total Volume - Storage (in 000s cubic feet) | 735,807 | 734,166 | 732,607 | | Records Management Retention Rate | 93.0% | 92.9% | 92.8% | | Data Center Leased % - Total | 96.3% | 96.1% | 93.5% | | Data Center Kilowatts Leased - New/Expansion | 2,325 (kW/MW) | 3,700 (kW/MW) | 66,493 (kW/MW) | Organic Revenue Growth Q2 2025 total organic revenue grew 9.4%, driven by 9.2% storage rental and 9.7% service growth, with YTD growth at 8.8% Organic Revenue Growth Rates | Revenue Growth (Y/Y) | Q2 2025 | YTD 2025 | | :--- | :--- | :--- | | Total Organic Revenue Growth | 9.4% | 8.8% | | Organic Storage Rental Growth | 9.2% | 9.0% | | Organic Service Growth | 9.7% | 8.4% | Section III - Operational Metrics Global Storage Volume Global storage volume grew to 735.8 million cubic feet in Q2 2025, up from 734.2 million in Q1 and 732.6 million in Q2 2024 Global Storage Volume Breakdown | Volume (in 000s cubic feet) | Q2 2025 (in thousands) | Q1 2025 (in thousands) | Q2 2024 (in thousands) | | :--- | :--- | :--- | :--- | | Global RIM | 728,740 | 727,496 | 726,712 | | Corporate and Other | 7,067 | 6,671 | 5,895 | | Total Volume - Storage | 735,807 | 734,166 | 732,607 | Quarterly Operating Performance Q2 2025 consolidated revenue grew 11.6% YoY, led by Global Data Center (24.0%), Global RIM (5.9%), and Corporate/Other (51.6%) Quarterly Segment Performance | Segment Performance (Q2 2025) | Total Revenues (in 000s) | Y/Y % Change (Reported) | Adjusted EBITDA (in 000s) | Adjusted EBITDA Margin | | :--- | :--- | :--- | :--- | :--- | | Global RIM Business | $1,323,798 | 5.9% | $586,303 | 44.3% | | Global Data Center Business | $189,401 | 24.0% | $96,266 | 50.8% | | Corporate and Other | $198,749 | 51.6% | $(54,181) | n/a | | Total Consolidated | $1,711,948 | 11.6% | $628,388 | 36.7% | Year to Date Operating Performance YTD 2025 consolidated revenue grew 9.7% to $3.3B, driven by Corporate/Other (42.6%) and Data Center (22.2%), with Adjusted EBITDA at $1.21B Year-to-Date Segment Performance | Segment Performance (YTD 2025) | Total Revenues (in 000s) | Y/Y % Change (Reported) | Adjusted EBITDA (in 000s) | Adjusted EBITDA Margin | | :--- | :--- | :--- | :--- | :--- | | Global RIM Business | $2,579,740 | 4.8% | $1,142,617 | 44.3% | | Global Data Center Business | $362,598 | 22.2% | $187,082 | 51.6% | | Corporate and Other | $362,139 | 42.6% | $(121,405) | n/a | | Total Consolidated | $3,304,477 | 9.7% | $1,208,294 | 36.6% | Section IV - Balance Sheets, Statements of Operations and Reconciliations Financial Statements and Reconciliations This section presents core financial statements and GAAP to non-GAAP reconciliations, showing $20.2B assets, $14.8B long-term debt, Q2 net loss of $43.3M, and $628.4M Adjusted EBITDA Condensed Consolidated Balance Sheet Highlights | Balance Sheet Item (in 000s) | 6/30/2025 (in thousands) | 12/31/2024 (in thousands) | | :--- | :--- | :--- | | Total Current Assets | $1,897,248 | $1,691,222 | | Property, Plant and Equipment, Net | $8,774,723 | $7,631,599 | | Total Assets | $20,176,789 | $18,717,115 | | Total Current Liabilities | $2,998,772 | $3,087,275 | | Long-term Debt, Net of Current Portion | $14,818,175 | $13,003,977 | | Total Liabilities | $20,745,656 | $19,021,789 | Quarterly Condensed Consolidated Statements of Operations | Income Statement Item (in 000s) | Q2 2025 (in thousands) | Q2 2024 (in thousands) | Y/Y % Change | | :--- | :--- | :--- | :--- | | Total Revenues | $1,711,948 | $1,534,409 | 11.6% | | Operating Income (Loss) | $259,896 | $230,294 | 12.9% | | Interest Expense, Net | $205,063 | $176,521 | 16.2% | | Other Expense (Income), Net | $81,877 | $5,833 | n/a | | Net (Loss) Income | $(43,340) | $34,621 | n/a | | Net (Loss) Income Attributable to Iron Mountain | $(44,921) | $35,783 | n/a | Year-to-Date Condensed Consolidated Statements of Operations | Income Statement Item (in 000s) | YTD 2025 (in thousands) | YTD 2024 (in thousands) | % Change | | :--- | :--- | :--- | :--- | | Total Revenues | $3,304,477 | $3,011,272 | 9.7% | | Operating Income (Loss) | $514,190 | $475,917 | 8.0% | | Net (Loss) Income | $(27,107) | $111,646 | (124.3)% | | Net (Loss) Income Attributable to Iron Mountain | $(28,969) | $109,844 | (126.4)% | Reconciliation of Net Income to Adjusted EBITDA | Reconciliation (in 000s) | Q2 2025 (in thousands) | Q2 2024 (in thousands) | YTD 2025 (in thousands) | YTD 2024 (in thousands) | | :--- | :--- | :--- | :--- | :--- | | Net (Loss) Income | $(43,340) | $34,621 | $(27,107) | $111,646 | | Add: Interest, Taxes, D&A | $473,925 | $414,341 | $915,652 | $805,024 | | Other Adjustments | $197,803 | $83,399 | $219,749 | $146,546 | | Adjusted EBITDA | $628,388 | $544,361 | $1,208,294 | $1,063,216 | Adjusted Earnings Per Share Reconciliation | EPS Reconciliation | Q2 2025 (per share) | Q2 2024 (per share) | YTD 2025 (per share) | YTD 2024 (per share) | | :--- | :--- | :--- | :--- | :--- | | Reported EPS - Fully Diluted | $(0.15) | $0.12 | $(0.10) | $0.37 | | Adjustments (per share) | $0.63 | $0.30 | $1.02 | $0.48 | | Adjusted EPS - Fully Diluted | $0.48 | $0.42 | $0.92 | $0.85 | Reconciliation of Net Income to FFO and AFFO | Reconciliation (in 000s) | Q2 2025 (in thousands) | Q2 2024 (in thousands) | Y/Y % Change | | :--- | :--- | :--- | :--- | | Net (Loss) Income | $(43,340) | $34,621 | n/a | | FFO (Nareit) | $62,115 | $139,654 | (55.5)% | | FFO (Normalized) | $258,005 | $231,021 | 11.7% | | AFFO | $369,744 | $320,901 | 15.2% | FFO and AFFO Per Share Data | Per Share Data | Q2 2025 (per share) | Q2 2024 (per share) | Y/Y % Change | | :--- | :--- | :--- | :--- | | FFO (Normalized) per Share | $0.87 | $0.78 | 11.5% | | AFFO Per Share | $1.24 | $1.08 | 14.8% | Section V - Storage and Service Reconciliation Quarterly Storage Rental and Service Business Detail Q2 2025 Storage Rental gross margin expanded 140 bps to 71.4%, while Service gross margin contracted 120 bps to 33.1% due to rising costs Quarterly Storage Rental and Service Business Performance | Business Detail (Q2 2025) | Storage Rental (in thousands) | Service (in thousands) | | :--- | :--- | :--- | | Total Revenue (in 000s) | $1,009,989 | $701,959 | | Gross Profit (in 000s) | $727,960 | $229,151 | | Gross Margin | 71.4% | 33.1% | | Y/Y Margin Change | +140 bps | -120 bps | Year to Date Storage and Service Business Detail YTD 2025 Storage Rental gross margin expanded 110 bps to 71.0%, while Service gross margin declined 150 bps to 32.8% YoY Year-to-Date Storage Rental and Service Business Performance | Business Detail (YTD 2025) | Storage Rental (in thousands) | Service (in thousands) | | :--- | :--- | :--- | | Total Revenue (in 000s) | $1,958,365 | $1,346,112 | | Gross Profit (in 000s) | $1,403,245 | $436,191 | | Gross Margin | 71.0% | 32.8% | | Y/Y Margin Change | +110 bps | -150 bps | Section VI - Real Estate Metrics Global Real Estate Portfolio and Lease Obligations As of June 30, 2025, Iron Mountain's global real estate portfolio included 1,325 facilities (97.8M sq ft), 24.9% owned and 75.1% leased Global Real Estate Portfolio Summary | Portfolio Metric | As of 06/30/2025 | | :--- | :--- | | Total Facilities | 1,325 | | Total Square Feet (in 000s) | 97,811 | | Owned Facilities (% of total) | 17.9% | | Owned Sq. Ft. (% of total) | 24.9% | | Leased Facilities (% of total) | 82.1% | | Leased Sq. Ft. (% of total) | 75.1% | Facility Lease Expirations The company maintains a long-term, staggered lease expiration profile with a 10.2-year WALE and 58.5% of leases expiring after 2033 - The weighted-average remaining operating lease obligation is 10.2 years[72] - The lease expiration schedule is long-dated, with 58.5% of total leased square footage expiring in 2034 and thereafter[71] Section VII - Data Center Customer and Portfolio Metrics Data Center Customer Lease Expiration and Leasing Activity Summary Data center business shows a strong 10.0-year WALE, with Q2 2025 seeing 2,325 kW new/expansion leases, 19.5% GAAP mark-to-market, and low 0.5% churn - The data center portfolio has a weighted average lease expiry (WALE) of 10.0 years, with 58.0% of total MW expiring after 2031[75] Data Center Leasing Activity Summary | Leasing Activity | Q2 2025 | YTD 2025 | | :--- | :--- | :--- | | New/expansion leases signed (kW) | 2,325 (kW/MW) | 6,025 (kW/MW) | | Churn | 0.5% | 0.8% | | Cash Mark to Market | 13.1% | 15.0% | | GAAP Mark to Market | 19.5% | 22.0% | Data Center Operating Portfolio and Total Potential Capacity Q2 2025 operating data center portfolio reached 450.2 MW (96.3% leased), with total potential capacity expanding to 1,279.9 MW, signaling robust growth Data Center Operating Portfolio Status | Portfolio Status | Leasable MW (kW/MW) | Leased % by MW | | :--- | :--- | :--- | | Stabilized | 435.8 | 97.9% | | Pre-Stabilized | 14.4 | 50.1% | | Total Data Center Properties | 450.2 | 96.3% | Total Data Center Potential Capacity | Potential Capacity (MW) | Q2 2025 (kW/MW) | Q2 2024 (kW/MW) | | :--- | :--- | :--- | | Operating Portfolio | 450.2 | 265.7 | | Under Construction | 201.5 | 305.5 | | Held for Development | 628.2 | 346.6 | | Total Data Center Portfolio | 1,279.9 | 917.8 | Data Center Expansion and Development Activity The company has a substantial data center development pipeline: 201.5 MW under construction (60.2% pre-leased) and 628.2 MW for future development Data Center Development Pipeline | Development Status | MW (kW/MW) | % Pre-Leased | | :--- | :--- | :--- | | Total Expansion | 15.5 | 8.3% | | Total New Development | 186.0 | 64.5% | | Total Under Construction | 201.5 | 60.2% | | Held for Development | 628.2 | n/a | Section VIII - Capitalization and Debt Maturity Profile Capitalization As of June 30, 2025, the company maintained a stable 5.0x Net Total Lease-Adjusted Leverage Ratio, $45.8B total enterprise value, 77% fixed-rate debt, and stable credit ratings Capitalization Details | Capitalization Metric | Value | | :--- | :--- | | Net Total Lease-Adjusted Leverage Ratio | 5.0x | | Total Enterprise Value | $45,769,848 (in thousands) | | Net Debt to Total Enterprise Value | 33.8% | | Fixed Rate Debt | 77% | | Weighted Average Interest Rate | 5.7% | | Weighted Average Maturity | 4.5 Years | - Credit ratings are stable, with S&P at BB- and Moody's at Ba3[90] Debt Maturity Profile The company maintains a well-laddered debt maturity profile with a 4.5-year weighted average maturity and no significant near-term maturities - The debt maturity schedule is staggered, with the largest maturities occurring in 2029 ($2.8B), 2030 ($3.0B), and 2031 ($1.9B)[94] - The weighted average maturity of total long-term debt is 4.5 years[90] Section IX - Capital Expenditures Quarterly and Year to Date Capital Expenditures and Investments YTD 2025 capital expenditures rose 48.2% to $1.13B, driven by a 53.1% surge in growth capex, with data center investments up 66.8% to $953M Year-to-Date Capital Expenditures | Capital Expenditures (in 000s) | YTD 2025 (in thousands) | YTD 2024 (in thousands) | % Change | | :--- | :--- | :--- | :--- | | Growth: Data Center | $952,982 | $571,388 | 66.8% | | Total Growth Capital Expenditures | $1,070,567 | $699,046 | 53.1% | | Total Recurring Capital Expenditures | $62,877 | $65,713 | (4.3)% | | Total Growth and Recurring Capital Expenditures | $1,133,444 | $764,759 | 48.2% | Quarterly Capital Expenditures | Capital Expenditures (in 000s) | Q2 2025 (in thousands) | Q2 2024 (in thousands) | Y/Y % Change | | :--- | :--- | :--- | :--- | | Total Growth Capital Expenditures | $442,050 | $361,931 | 22.1% | | Total Recurring Capital Expenditures | $34,794 | $36,976 | (5.9)% | | Total Growth and Recurring Capital Expenditures | $476,844 | $398,906 | 19.5% | Section X - Appendix and Definitions Appendix and Definitions This section defines non-GAAP financial measures and key operational terms, including Adjusted EBITDA, FFO, AFFO, organic revenue growth, and outlines the company's business segments - Adjusted EBITDA is defined as net income adjusted for interest, taxes, depreciation, amortization, and other specific items like acquisition costs, restructuring, and stock-based compensation[103] - AFFO is defined as FFO (Normalized) adjusted for non-real estate depreciation, amortization of intangibles, non-cash rent, and other items, less recurring capital expenditures[107] - The company's business is organized into three segments: Global Records and Information Management (Global RIM), Global Data Center Business, and Corporate and Other (which includes Fine Arts and asset lifecycle management)[110][112][113]