Public Storage's Q2 FFO Beats Estimates, Occupancy Falls, View Raised

Core Insights - Public Storage (PSA) reported a second-quarter 2025 core funds from operations (FFO) per share of $4.28, exceeding the Zacks Consensus Estimate of $4.23 and reflecting a 1.2% year-over-year increase [1][11] - The company experienced top-line growth with quarterly revenues of $1.20 billion, surpassing the Zacks Consensus Estimate by 0.6% and increasing 2.4% year over year [2] - Despite the positive results, PSA's shares fell 1.1% in after-hours trading due to broader market concerns [2] Financial Performance - Same-store revenues rose 0.2% year over year to $945.2 million, driven by higher realized annual rent per occupied square foot, which increased by 0.6% to $22.50, although occupancy declined by 0.4% to 92.6% [3][5] - The cost of operations for same-store facilities increased by 2.9% year over year, influenced by higher direct property costs, repairs, maintenance, and marketing expenses [4] - Same-store net operating income (NOI) decreased by 0.6% year over year to $716.6 million, while NOI from non-same-store facilities grew by $12.0 million due to acquisitions [5] Portfolio Activity - In Q2, PSA acquired 16 self-storage facilities for $162.3 million, adding 1.1 million net rentable square feet [7] - The company has plans to acquire an additional 47 self-storage facilities with 3.1 million net rentable square feet for $481.9 million [7] - PSA is developing several facilities expected to contribute around 2.6 million net rentable square feet, with estimated costs of $487.9 million [9] Balance Sheet and Guidance - As of June 30, 2025, PSA had $1.1 billion in cash and equivalents, a significant increase from $447.4 million at the end of 2024 [12] - The company raised its 2025 core FFO per share guidance to a range of $16.45-$17.00, up from the previous range of $16.35-$17.00 [13] - Full-year assumptions include a 1.3% decline to 0.8% growth in same-store revenues and a projected $370 million in development openings [14]