Oct 29, 2026 earnings call — Record leasing and raised FFO guidance
Record quarterly leasing of $855 million and raised 2026 core FFO guidance to $8.30-$8.35 per share.
Revenue $1.9B (est $1.8B) · EPS $0.48 (est $0.52)
Key quotes
"We achieved record total bookings of approximately $855 million or $627 million at Digital Realty's share, driven by record performance in each of our leasing categories."
"In the 0-1 megawatt plus interconnection category, we generated a record $165 million of total bookings or $151.8 million at DLR share during the quarter, representing a 40% increase over last quarter's record."
"And lastly, we achieved another important milestone within our strategic private capital initiative in the last week, closing over $1.4 billion of initial cornerstone equity commitments to our new perpetual capital strategy focused on stabilized hyperscale data centers in North America."
Analyst Q&A 9
why buy land where you did
Q (Jonathan Petersen · Jefferies): They asked how Digital decides which markets to enter and who is selling the land. They also asked if sellers had planned to build data centers themselves.
A: Management said they focus on markets with robust and diverse customer demand for enterprise, cloud and AI workloads. They used Kansas City and Charlotte as examples of markets where hyperscalers are landing and where Digital can create runway for growth. They also said they worked with local real estate developers on some sites.
"So we -- I would call the playbook of where we've been growing and expanding our markets is consistent in terms of focusing on places where we see both robust and diverse customer demand." — Andrew Power (CEO)
why Indianapolis matters
Q (Gregory Wright): The analyst asked for more color on Indiana and why Indianapolis was added to the land bank.
A: Management said Indianapolis has a strong economy with major companies like Eli Lilly and Cummins and a large advanced manufacturing base. They noted Indiana is becoming a top Midwest hyperscale market with more than 70 data center facilities and attracted more than $25 billion of hyperscale investment over the last 3 years. They also highlighted low power costs at roughly $0.09 per kilowatt hour and good location latency.
edge inference and interconnection
Q (Michael Elias · TD): They asked how Digital sees the medium- to long-term opportunity for edge AI inference and what it means for interconnection demand.
A: Management said their value proposition rests on three things: global reach and scale, connectivity-rich environments, and AI-ready infrastructure. They pointed to 65 global markets, record cross-connect signings of $22 million (up 13% year-over-year), and that they are operational with liquid cooling in north of 25 locations. They also said backlog nearly doubles those customer and location counts and brings them close to 1 gigawatt of operational expertise in that category.
"I can tell you today, we're already operationalized live with liquid cooling for the AI use cases in north of 25 different locations, different customers." — Andrew Power (CEO)
cost of capital and development costs
Q (Eric Luebchow · Wells Fargo): They asked if market rent growth is rising faster than implied cost of development and what Digital is doing to mitigate development cost inflation.
A: Management said their development pipeline rose from $10 billion to $22 billion and net yields are over 11.5% with pre-leasing north of 63% (and roughly 70% when netting colo). They said they are using extended supply chains, vendor managed inventory and their scale to fare better on supply issues. They also raised capital recently, including $1.7 billion of debt at close to 4% and another $1.4 billion of equity to bolster liquidity.
"Hopefully, you saw we raised basically $1.7 billion at an average rate of close to 4%, both through the euro and Swiss market." — Matt Mercier (CFO)
buying stabilized hyperscale assets
Q (Michael Ng · Goldman Sachs): They asked about the strategy and buybox for stabilized hyperscale data center acquisitions and ways to drive additional returns.
A: Management described the evolution of their strategic private capital platform. They said the earlier closed-end fund targeted $2.5 billion and ultimately raised $3.25 billion geared to development returns in the high teens to low 20s. They added the new vehicle is a perpetual-life strategy aimed at matching long-duration institutional capital with stabilized, long-lived data center assets and will have multiple closings into early next year.
"this is focused more on a perpetual life strategy that's designed really to match, call it, long-term duration institutional capital with long-lived stabilized data center assets, quite frankly, that gets to partner with an industry leader that's got a 20-plus year track record." — Gregory Wright
0-1 megawatt business outlook
Q (Aryeh Klein · BMO): They asked whether the 0-1 megawatt business has inflected to a new baseline and how pricing is evolving there.
A: Management said Q3 was a record quarter and Q4 has started even stronger. They said the 0-1 megawatt pipeline is robust across regions and that AI is a large part of the category. They noted 44% of Q3 bookings were associated with AI and that they were already at 60% of their Q4 0-1 megawatt booking number.
"So 44% of our bookings in Q3 were associated with AI." — Colin McLean (CRO)
hyperscale pricing and pipeline
Q (Michael Rollins · Citi): They asked about the pricing yields achieved for hyperscale in the quarter and how much hyperscale capacity remains to sell for 2027–2029 vintages.
A: Management said it was a standout quarter for hyperscale with total signings of $855 million and year-to-date signings up 40% from the prior full year record. They said the total development pipeline now stands at $22 billion with ROI north of 11.5% and 63% leased, and that the '27–'28 hyperscale-oriented capacity blocks total just shy of 1.5 gigawatts under development now.
"our, call it, '27, '28 hyperscale-oriented capacity blocks roughly total just shy of the 1.5 gigawatts that we currently have under development right now." — Andrew Power (CEO)
M&A appetite and strategy
Q (Matthew Niknam · Truist): They asked whether the cleaner balance sheet and global scale give Digital special M&A opportunities and what the latest M&A activity looks like.
A: Management said M&A remains strategic and aligned to their three growth pillars: colocation enterprise, hyperscale, and strategic private capital. They listed many recent market entries and acquisitions across APAC, EMEA and the Americas as examples of ongoing activity. They said M&A has been and continues to be an important part of the business.
"I would say M&A has been and continues to be an important part of our business, and that's how we align it." — Gregory Wright
development delays and how avoided
Q (Michael Funk · BofA): They asked if Digital is seeing the industry development delays and how the company is managing or avoiding them.
A: Management said they rely on 20-plus years of focused expertise, local community engagement, and close vendor partnerships. They said building across many markets gives swing capacity for components and that planning and expertise have largely kept their track record intact, though occasional delays or customer rework can occur. They emphasized responding quickly when hiccups happen and working with customers and vendors.
"That planning ahead and that expertise has allowed us, by and large, to really, call it, to keep our track record intact." — Andrew Power (CEO)