Digital Realty Reports Second Quarter 2025 Results

Core Viewpoint - Digital Realty reported strong financial results for the second quarter of 2025, showcasing significant revenue growth and improved profitability metrics compared to previous quarters and the same quarter last year [2][10]. Financial Results - Revenues reached $1.49 billion, marking a 6% increase from the previous quarter and a 10% increase year-over-year [2]. - Net income was reported at $1.05 billion, with net income available to common stockholders at $1.02 billion, translating to $2.94 per share, up from $0.27 per share in the previous quarter and $0.20 per share in the same quarter last year [2][10]. - Adjusted EBITDA was $823 million, reflecting a 4% increase from the previous quarter and a 13% increase year-over-year [3]. - Funds From Operations (FFO) totaled $600 million, or $1.75 per share, compared to $1.67 per share in the previous quarter and $1.57 per share in the same quarter last year [3][10]. Leasing Activity - The company signed total bookings expected to generate $135 million of annualized GAAP rental revenue, with significant contributions from the 0–1 megawatt category and interconnection [5]. - Renewal leases represented $177 million of annualized cash rental revenue, with rental rates increasing by 7.3% on a cash basis and 9.9% on a GAAP basis [7][10]. - The backlog of signed-but-not-commenced leases at the end of the quarter was $826 million of annualized GAAP base rent [6][10]. Investment Activity - Digital Realty acquired land parcels in three metropolitan areas, including approximately 100 acres in Atlanta for $120 million and 167 acres in Dallas for $11 million, expected to support significant IT capacity [11]. - The U.S. Hyperscale Data Center Fund received over $3 billion in equity commitments, exceeding its initial target, and Digital Realty contributed interests in five operating data centers and two development sites to the Fund [12]. Balance Sheet - As of June 30, 2025, total debt outstanding was approximately $18.5 billion, with a net debt-to-Adjusted EBITDA ratio of 5.1x [14]. - The company issued €850 million of 3.875% notes due 2034, with net proceeds of approximately $975 million, and repaid €650 million in senior notes [15]. 2025 Outlook - Digital Realty raised its 2025 Core FFO per share outlook to $7.15 - $7.25 and Constant-Currency Core FFO per share outlook to $7.10 - $7.20 [16][10].