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DigitalBridge (DBRG) - 2024 Q4 - Earnings Call Transcript
DBRGDigitalBridge (DBRG)2025-02-20 18:35
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Financial Data and Key Metrics Changes - DigitalBridge reported record fundraising of 9billionin2024,exceedingtheannualtargetby289 billion in 2024, exceeding the annual target by 28% [6][12] - Assets under management grew from 80 billion to 96billion,representingover2096 billion, representing over 20% growth [8] - Fee revenues for Q4 2024 were 102 million, leading to a full-year total of 330million,a37330 million, a 37% increase for Q4 and 23% for the full year [39] - Fee-related earnings increased to 107 million for the full year, up from 82million,a3182 million, a 31% increase [43] Business Line Data and Key Metrics Changes - Management fees grew over 20% for the year and over 35% in Q4, while fee-related earnings grew over 30% for both periods [10][39] - The company raised 5.5 billion in co-invest capital to support new data center capacity, driven by cloud and AI demand [13] - The InfraBridge platform saw a reduction in fee-earning equity under management due to the end of an investment period in one of its funds [42] Market Data and Key Metrics Changes - The leasing pipeline across DigitalBridge's data center platforms increased by 22% year-over-year, with proposals rising from just over 5 gigawatts to over 6.2 gigawatts [102] - The demand for cloud and AI workloads is driving rapid growth, with leased capacity increasing from under 1 gigawatt to almost 4 gigawatts over four years [80] Company Strategy and Development Direction - The company aims to scale its business by focusing on fundraising, investing, and operational efficiency [36][94] - DigitalBridge plans to deploy approximately 20billionintoAIinfrastructurein2025,emphasizingtheimportanceofconnectivityandinfrastructureforgenerativeAI[92]−Thecompanyislaunchingnewinvestmentproductsandexpandingitsprivatewealthchanneltoenhancecapitalformation[56][90]Management′sCommentsonOperatingEnvironmentandFutureOutlook−ManagementhighlightedtheimportanceofdeliveringDPI(DistributionstoPaid−In)toattractnewcapital,withafocusonreturningcapitaltolimitedpartners[24][120]−Thecompanyexpectstogrowfee−earningequityundermanagementto20 billion into AI infrastructure in 2025, emphasizing the importance of connectivity and infrastructure for generative AI [92] - The company is launching new investment products and expanding its private wealth channel to enhance capital formation [56][90] Management's Comments on Operating Environment and Future Outlook - Management highlighted the importance of delivering DPI (Distributions to Paid-In) to attract new capital, with a focus on returning capital to limited partners [24][120] - The company expects to grow fee-earning equity under management to 40 billion in 2025, with a target of 10% to 20% growth in fee-related earnings [49][51] - Management noted that development yields have stabilized, with a focus on maintaining double-digit yields in the right locations [110][115] Other Important Information - DigitalBridge's strong liquidity position includes 140millionincorporatecashandtotalliquidityof140 million in corporate cash and total liquidity of 440 million [41][48] - The company has secured a significant power bank of over 16 gigawatts, positioning it well for future growth [81] Q&A Session Summary Question: How does the qualified demand pipeline compare to last year? - The leasing pipeline is up year-over-year by about 22%, with proposals increasing from just over 5 gigawatts to over 6.2 gigawatts [102] Question: What are the expectations for hyperscale data center development yields and pricing in 2025? - Development yields have stabilized, and the company has not seen a retreat in yields, maintaining double-digit yields in strategic locations [110][115]