Digital Realty Reports Fourth Quarter 2024 Results

Annualized GAAP

Base Rent

Square Feet

GAAP Base Rent

GAAP Base Rent

 Americas

(in thousands)

(in thousands)

per Square Foot

Megawatts

per Kilowatt

 0-1 MW

$29,612

90

$329

8.9

$277

 > 1 MW

3,978

20

197

2.2

154

 Other ⁽¹⁾

409

7

58

—

—

Total

$33,999

117

$290

11.1

$253

 EMEA ⁽²⁾

 0-1 MW

$25,997

100

$259

9.4

$232

 > 1 MW

9,121

63

146

5.6

136

 Other ⁽¹⁾

91

1

97

—

—

Total

$35,209

164

$215

15.0

$196

 Asia Pacific ⁽²⁾

 0-1 MW

$6,139

19

$322

1.5

$352

 > 1 MW

9,474

48

196

5.8

136

 Other ⁽¹⁾

100

1

70

—

—

Total

$15,713

69

$229

7.3

$179

 All Regions ⁽²⁾

 0-1 MW

$61,748

209

$295

19.7

$261

 > 1 MW

22,573

131

172

13.6

139

 Other ⁽¹⁾

599

9

64

—

—

Total

$84,920

350

$243

33.3

$211

Interconnection

$14,587

N/A

N/A

N/A

N/A

Grand Total

$99,507

350

$243

33.3

$211

Note:  Totals may not foot due to rounding differences.

(1)

Other includes Powered Base Building® shell capacity as well as storage and office space within fully improved data center facilities.

(2)

Based on quarterly average exchange rates during the three months ended December 31, 2024.

As of

 Top-Line and Cost Structure

February 13, 2025

  Total revenue

$5.800 - $5.900 billion

  Net non-cash rent adjustments ⁽¹⁾

($45 - $50 million)

  Adjusted EBITDA

$3.100 - $3.200 billion

  G&A

$500 - $510 million

 Internal Growth

  Rental rates on renewal leases

    Cash basis

4.0% - 6.0%

    GAAP basis

6.0% - 8.0%

  Year-end portfolio occupancy

+100 - 200 bps

  "Same-Capital" cash NOI growth ⁽²⁾

3.5% - 4.5%

  Foreign Exchange Rates

    U.S. Dollar / Pound Sterling

$1.20 - $1.25

    U.S. Dollar / Euro

$1.00 - $1.05

 External Growth

  Dispositions / Joint Venture Capital

    Dollar volume

$500 - $1,000 million

    Cap rate

0.0% - 10.0%

  Development

    CapEx (Net of Partner Contributions) ⁽³⁾

$3,000 - $3,500 million

    Average stabilized yields

10.0%+

  Enhancements and other non-recurring CapEx ⁽⁴⁾

$30 - $35 million

  Recurring CapEx + capitalized leasing costs ⁽⁵⁾

$320 - $335 million

 Balance Sheet

  Long-term debt issuance

    Dollar amount

$900 - $1,500 million

    Pricing

5.0% - 5.5%

 Net income per diluted share

$2.10 - $2.20

  Real estate depreciation and (gain) / loss on sale

$4.50 - $4.50

 Funds From Operations / share (NAREIT-Defined)

$6.60 - $6.70

  Non-core expenses and revenue streams

$0.40 - $0.40

 Core Funds From Operations / share

$7.00 - $7.10

  Foreign currency translation adjustments

$0.05 - $0.05

 Constant-Currency Core Funds From Operations / share

$7.05 - $7.15

(1)

Net non-cash rent adjustments represent the sum of straight-line rental revenue and straight-line rental expense, as well as the amortization of above- and below-market leases (i.e., ASC 805 adjustments).

(2)

The "Same-Capital" pool includes properties owned as of December 31, 2023 with less than 5% of total rentable square feet under development.  It excludes properties that were undergoing, or were expected to undergo, development activities in 2024-2025, properties classified as held for sale, and properties sold or contributed to joint ventures for all periods presented. The 2025 "Same-Capital" cash NOI growth outlook is presented on a constant currency basis.

(3)

Excludes land acquisitions and includes Digital Realty's share of JV contributions. Figure is net of JV partner contributions.

(4)

Other non-recurring CapEx represents costs incurred to enhance the capacity or marketability of operating properties, such as network fiber initiatives and software development costs.

(5)

Recurring CapEx represents non-incremental improvements required to maintain current revenues, including second-generation tenant improvements and leasing commissions.

Note: The company does not provide a reconciliation for non-GAAP estimates on a forward-looking basis, where it is unable to provide a meaningful or accurate calculation or estimation of reconciling items, and the information is not available without unreasonable effort. Please see Non-GAAP Financial Measures in this document for further discussion.

Consolidated Quarterly Statements of Operations

Fourth Quarter 2024

Unaudited and in Thousands, Except Per Share Data

Three Months Ended

Twelve Months Ended

31-Dec-24

30-Sep-24

30-Jun-24

31-Mar-24

31-Dec-23

31-Dec-24

31-Dec-23

Rental revenues

$958,892

$956,351

$912,994

$894,409

$885,694

$3,722,646

$3,512,926

Tenant reimbursements - Utilities

302,664

305,097

274,505

276,357

316,634

1,158,623

1,299,676

Tenant reimbursements - Other

38,591

39,624

41,964

38,434

46,418

158,612

197,636

Interconnection & other

112,360

112,655

109,505

108,071

106,413

442,591

419,934

Fee income

23,316

12,907

15,656

13,010

14,330

64,888

44,926

Other

40

4,581

2,125

862

144

7,608

1,963

Total Operating Revenues

$1,435,862

$1,431,214

$1,356,749

$1,331,143

$1,369,633

$5,554,968

$5,477,061

Utilities

$337,534

$356,063

$315,248

$324,571

$366,083

$1,333,416

$1,471,836

Rental property operating

273,104

249,796

237,653

224,369

237,118

984,921

909,830

Property taxes

46,044

45,633

49,620

41,156

40,161

182,453

199,581

Insurance

6,007

4,869

4,755

2,694

3,794

18,325

16,823

Depreciation & amortization

455,355

459,997

425,343

431,102

420,475

1,771,797

1,694,859

General & administration

124,470

115,120

119,511

114,419

109,235

473,521

431,004

Severance, equity acceleration and legal expenses

2,346

2,481

884

791

7,565

6,502

18,054

Transaction and integration expenses

11,797

24,194

26,072

31,839

40,226

93,902

84,722

Provision for impairment

22,881

—

168,303

—

5,363

191,184

118,363

Other expenses

12,002

4,774

(529)

10,836

5,580

27,083

7,529

Total Operating Expenses

$1,291,540

$1,262,928

$1,346,860

$1,181,776

$1,235,598

$5,083,104

$4,952,600

Operating Income

$144,322

$168,286

$9,889

$149,367

$134,035

$471,864

$524,461

Equity in earnings / (loss) of unconsolidated joint ventures

(36,201)

(26,486)

(41,443)

(16,008)

(29,955)

(120,138)

(29,791)

Gain / (loss) on sale of investments

144,885

(556)

173,709

277,787

(103)

595,825

900,531

Interest and other income / (expense), net

44,517

37,756

62,261

9,709

50,269

154,243

68,431

Interest (expense)

(104,742)

(123,803)

(114,756)

(109,535)

(113,638)

(452,836)

(437,741)

Income tax benefit / (expense)

(4,928)

(12,427)

(14,992)

(22,413)

(20,724)

(54,760)

(75,579)

Loss on debt extinguishment and modifications

(2,165)

(2,636)

—

(1,070)

—

(5,871)

—

Net Income

$185,688

$40,134

$74,668

$287,837

$19,884

$588,327

$950,311

Net (income) / loss attributable to noncontrolling interests

3,881

11,059

5,552

(6,329)

8,419

14,163

(1,474)

Net Income Attributable to Digital Realty Trust, Inc.

$189,569

$51,193

$80,220

$281,508

$28,304

$602,490

$948,838

Preferred stock dividends

(10,181)

(10,181)

(10,181)

(10,181)

(10,181)

(40,725)

(40,725)

Net Income / (Loss) Available to Common Stockholders

$179,388

$41,012

$70,039

$271,327

$18,122

$561,766

$908,113

Weighted-average shares outstanding - basic

333,376

327,977

319,537

312,292

305,781

323,336

298,603

Weighted-average shares outstanding - diluted

340,690

336,249

327,946

320,798

314,995

331,547

309,065

Weighted-average fully diluted shares and units

346,756

342,374

334,186

326,975

321,173

337,697

315,113

Net income / (loss) per share - basic

$0.54

$0.13

$0.22

$0.87

$0.06

$1.74

$3.04

Net income / (loss) per share - diluted

$0.51

$0.09

$0.20

$0.82

$0.03

$1.61

$2.88

Funds From Operations and Core Funds From Operations

Fourth Quarter 2024

Unaudited and in Thousands, Except Per Share Data

Three Months Ended

Twelve Months Ended

Reconciliation of Net Income to Funds From Operations (FFO)

31-Dec-24

30-Sep-24

30-Jun-24

31-Mar-24

31-Dec-23

31-Dec-24

31-Dec-23

Net Income / (Loss) Available to Common Stockholders

$179,388

$41,012

$70,039

$271,327

$18,122

$561,766

$908,113

Adjustments:

Non-controlling interest in operating partnership

4,000

1,000

1,500

6,200

410

12,700

20,710

Real estate related depreciation & amortization ⁽¹⁾

445,462

449,086

414,920

420,591

410,167

1,730,059

1,657,239

Reconciling items related to non-controlling interests

(19,531)

(19,746)

(17,317)

(8,017)

(15,377)

(64,612)

(57,477)

Unconsolidated JV real estate related depreciation & amortization

49,463

48,474

47,117

47,877

64,833

192,931

177,153

(Gain) / loss on real estate transactions

(137,047)

556

(173,709)

(286,704)

103

(596,904)

(908,356)

Provision for impairment

22,881

—

168,303

—

5,363

191,185

118,363

Funds From Operations

$544,616

$520,382

$510,852

$451,273

$483,621

$2,027,122

$1,915,745

Weighted-average shares and units outstanding - basic

339,442

334,103

325,777

318,469

311,960

329,485

304,651

Weighted-average shares and units outstanding - diluted ^{(2) (3)}

346,756

342,374

334,186

326,975

321,173

337,697

315,113

Funds From Operations per share - basic

$1.60

$1.56

$1.57

$1.42

$1.55

$6.15

$6.29

Funds From Operations per share - diluted ^{(2) (3)}

$1.61

$1.55

$1.57

$1.41

$1.53

$6.14

$6.20

Three Months Ended

Twelve Months Ended

Reconciliation of FFO to Core FFO

31-Dec-24

30-Sep-24

30-Jun-24

31-Mar-24

31-Dec-23

31-Dec-24

31-Dec-23

Funds From Operations

$544,616

$520,382

$510,852

$451,273

$483,621

$2,027,122

$1,915,745

Other non-core revenue adjustments ⁽⁴⁾

4,537

(4,583)

(33,818)

3,525

(146)

(30,339)

26,393

Transaction and integration expenses

11,797

24,194

26,072

31,839

40,226

93,902

84,722

Loss on debt extinguishment and modifications

2,165

2,636

—

1,070

—

5,871

—

Severance, equity acceleration and legal expenses ⁽⁵⁾

2,346

2,481

884

791

7,565

6,502

18,054

(Gain) / Loss on FX and derivatives revaluation

7,127

1,513

32,222

33,602

(24,804)

74,464

(39,000)

Other non-core expense adjustments ⁽⁶⁾

14,229

11,120

2,271

10,052

1,956

37,671

3,905

Core Funds From Operations

$586,816

$557,744

$538,482

$532,153

$508,417

$2,215,194

$2,009,820

Weighted-average shares and units outstanding - diluted ^{(2) (3)}

339,982

334,476

326,181

319,138

312,356

329,899

305,138

Core Funds From Operations per share - diluted ⁽²⁾

$1.73

$1.67

$1.65

$1.67

$1.63

$6.71

$6.59

(1)  Real Estate Related Depreciation & Amortization

Three Months Ended

Twelve Months Ended

31-Dec-24

30-Sep-24

30-Jun-24

31-Mar-24

31-Dec-23

31-Dec-24

31-Dec-23

Depreciation & amortization per income statement

$455,355

$459,997

$425,343

$431,102

$420,475

$1,771,798

$1,694,859

Non-real estate depreciation

(9,894)

(10,911)

(10,424)

(10,511)

(10,308)

(41,739)

(37,619)

Real Estate Related Depreciation & Amortization

$445,462

$449,086

$414,920

$420,591

$410,167

$1,730,059

$1,657,239

(2)

Certain of Teraco's minority indirect shareholders have the right to put their shares in an upstream parent company of Teraco to Digital Realty in exchange for cash or the equivalent value of shares of Digital Realty common stock, or a combination thereof. US GAAP requires Digital Realty to assume the put right is settled in shares for purposes of calculating diluted EPS. This same approach was utilized to calculate FFO/share. The potential future dilutive impact associated with this put right will be excluded from Core FFO and AFFO until settlement occurs – causing diluted share count to be higher for FFO than for Core FFO and AFFO. When calculating diluted FFO, Teraco related minority interest is added back to the FFO numerator as the denominator assumes all shares have been put back to Digital Realty.

Three Months Ended

Twelve Months Ended

31-Dec-24

30-Sep-24

30-Jun-24

31-Mar-24

31-Dec-23

31-Dec-24

31-Dec-23

Teraco noncontrolling share of FFO

$14,905

$9,828

$12,453

$9,768

$7,135

$46,954

$39,386

Teraco related minority interest

$14,905

$9,828

$12,453

$9,768

$7,135

$46,954

$39,386

(3)

For all periods presented, we have excluded the effect of dilutive series J, series K and series L preferred stock, as applicable, that may be converted into common stock upon the occurrence of specified change in control transactions as described in the articles supplementary governing the series J, series K and series L preferred stock, as applicable, which we consider highly improbable. See above for calculations of FFO and the share count detail section that follows the reconciliation of Core FFO to AFFO for calculations of weighted average common stock and units outstanding. For definitions and discussion of FFO and Core FFO, see the Definitions section.

(4)

Includes deferred rent adjustments related to a customer bankruptcy, joint venture development fees included in gains, lease termination fees and gain on sale of equity investment included in other income.

(5)

Relates to severance and other charges related to the departure of company executives and integration-related severance.

(6)

Includes write-offs associated with bankrupt or terminated customers, non-recurring legal and insurance expenses and adjustments to reflect our proportionate share of transaction costs associated with noncontrolling interests.

Adjusted Funds From Operations (AFFO)

Fourth Quarter 2024

Unaudited and in Thousands, Except Per Share Data