Equinix Inc (NASDAQ:EQIX) Beats FFO Expectations

Equinix Inc (NASDAQ:EQIX) stock rose 6.67% (As on November 3, 11:42:35 AM UTC-4, Source: Google Finance) after the company posted better than expected results for the third quarter of FY 22.

EQIX in the third quarter of FY 22 has reported the adjusted funds from operations per share of $7.73, beating the analysts’ estimates for the adjusted funds from operations per share of $7.19, according to Zacks Investment Research. The company had reported the adjusted revenue growth of 10 percent to $1.84 billion in the third quarter of FY 22, beating the analysts’ estimates for revenue of $1.83 billion.

For the fourth quarter ending in December, Equinix said it expects revenue in the range of $1.85 billion to $1.87 billion. Analysts surveyed by Zacks had expected revenue of $1.89 billion. Adjusted EBITDA is expected to range between $821 and $841 million. Adjusted EBITDA includes an increase in seasonal utility costs as well as an acceleration of discretionary costs into Q4, and a negative $16 million foreign currency impact when compared to the average FX rates in Q3 2022. For the quarter, integration costs from acquisitions are expected to be $6 million. Recurring capital expenditures are expected to range between $76 and $86 million.

The company expects full-year funds from operations in the range of $29.10 to $29.32 per share, with revenue ranging from $7.24 billion to $7.26 billion. Adjusted EBITDA is expected to range between $3.352 and $3.372 billion, an adjusted EBITDA margin of 46%. This updated full-year guidance includes a raise of $46 million from better-than-expected business performance and lower integration costs, partially offset by a $22 million foreign currency impact when compared to the prior guidance rates. For the year, the Company now expects to incur $20 million in integration costs related to acquisitions. AFFO is expected to range between $2.676 and $2.696 billion, an increase of 9 – 10% over the previous year, or a normalized and constant currency increase of 10 – 11%. This updated AFFO guidance includes a raise of $52 million from better-than-expected business performance and lower integration costs, offset by a negative $17 million foreign currency impact when compared to the prior guidance rates. Total capital expenditures are expected to range between $2.138 and $2.288 billion. Non-recurring capital expenditures, including xScale-related capital expenditures, are expected to range between $1.953 and $2.093 billion, and recurring capital expenditures are expected to range between $185 and $195 million. xScale-related on-balance sheet capital expenditures are expected to range between $125 and $145 million, which we anticipate will be reimbursed to Equinix from both the current and future xScale JVs.

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