BXP to Post Q3 Earnings: What to Expect From the Stock?

Core Insights - BXP, Inc. is expected to report third-quarter 2025 results on October 28, with anticipated year-over-year revenue growth but a decline in funds from operations (FFO) per share [1][10] Company Performance - In the last reported quarter, BXP's FFO per share was $1.71, exceeding the Zacks Consensus Estimate of $1.67, driven by strong leasing activity despite higher interest expenses impacting year-over-year growth [2][11] - Over the past four quarters, BXP's FFO per share has surpassed estimates once, missed once, and met expectations in the remaining periods, with an average beat of 0.45% [3] Industry Context - The U.S. office market is experiencing solid demand for high-quality spaces, with companies expanding their footprints after previous cutbacks, although net absorption for the broader market was negative in the third quarter [3][4] - Demand for Class A assets remains high, with 14 markets showing positive absorption despite overall negative trends [4] - Vacancy rates for sublease spaces have decreased by 14.5% from the first quarter of 2024, indicating a tightening market [5] Supply Dynamics - Supply pressures are easing due to reduced new construction activity, with the under-construction pipeline at 22.5 million square feet, the lowest in the 21st century, and new deliveries down 30% from the average since 2020 [6] BXP's Strategic Position - BXP is well-positioned to benefit from the increasing demand for quality office spaces, particularly as it converts office buildings to laboratory/life science spaces, which is expected to enhance leasing activity [7][8] - The Zacks Consensus Estimate for BXP's third-quarter revenues is $806.6 million, reflecting a slight increase from the previous year [9] Financial Outlook - High debt levels and rising interest expenses are anticipated to pressure BXP's quarterly FFO, with a projected 1.3% year-over-year increase in interest expenses [10][11] - The Zacks Consensus Estimate for third-quarter FFO per share is $1.72, indicating a 5% decrease from the previous year [11][12]