Equinix raised long-term profit targets and committed to $5–7B annual capex spending (vs. historical ~$3–4B), citing accelerating AI datacenter demand.

Equinix delivered a standout second quarter, with recurring revenue growth accelerating to 11% year-over-year on a normalized constant currency basis, while total revenue jumped 16%, boosted by roughly $120 million in non-recurring fees from an xScale hyperscale lease in Hampton. Adjusted EBITDA margin expanded 300 basis points to 53%, and AFFO per share surged 18%. The company added a record 9,700 net interconnections and posted its second-highest annualized gross bookings of $424 million. Churn dropped to an exceptionally low 1.8%, well below the historical 2% to 2.5% range.

The company's momentum is driven by accelerating AI infrastructure demand. Equinix now hosts eight of the top 10 AI model providers and eight of the top 10 neo-clouds. CEO Adaire Fox-Martin identified four distinct AI use cases driving growth: private AI stacks to reduce token costs; sovereign deployments for data residency compliance; AI factory-style batch inference often requiring liquid cooling; and latency-sensitive metro inference. She noted that the vast majority of Equinix's largest deals in Q2 were driven by AI workloads.

Interconnection had a record quarter with 9,700 net adds, while interconnection revenue grew about 9%. The new Fabric Geo Zones sovereignty product expanded its preview to 80 enterprises, and Cloud Router bookings soared 170% year-over-year, partly from non-colocation customers. Fox-Martin announced that Chief Product Officer Chris Audie, who joined from HashiCorp, will focus on capturing more value from interconnection through pricing and new services.

Regional performance showed broad-based strength. The Americas led with low-teens growth even after stripping out the one-time Hampton lease. Asia-Pacific rebounded strongly, powered by sovereign AI projects such as SCX.ai in Australia and expansion into Southeast Asia. EMEA remained resilient despite severe capacity constraints in Frankfurt and Amsterdam, with sovereignty offerings gaining traction. Pricing discipline supported the top line, with management highlighting mark-to-market opportunities in supply-constrained metros like Ashburn, Frankfurt, and Amsterdam.

For 2026, Equinix raised full-year guidance for the second straight time, expecting total revenue growth of 11% to 12% and AFFO per share growth of 10% to 12%, with capital expenditures raised to $5 billion to $6 billion. Looking to 2027-2029, the company projects annual revenue growth of 10% to 13%, with AFFO per share growing 9% to 12% and adjusted EBITDA margin reaching 53% or higher by 2029. The long-term capital plan calls for $5 billion to $7 billion in annual capex, with CFO Olivier Leonetti stressing that 80% of capital deployment will target the company's top 25 metros—markets where demand exceeds supply. Equinix expects cash-on-cash yields of approximately 25% on new capacity at stabilization, in line with historical returns.

Leonetti addressed financing strategy, confirming that Equinix will maintain its investment-grade rating, funding growth through retained cash flow at roughly a 50% payout ratio and debt, with leverage increasing by about one turn by the end of the planning period and blended cost of capital rising approximately 150 basis points. The company has sufficient land under control, with about 2 GW of land available by 2029 after the incremental capex consumes roughly 0.3 GW of power. Fox-Martin emphasized that Equinix will not speculate as a land developer—all new projects clear internal gates on power and permitting before announcement, and the company's strong balance sheet enables pre-purchasing of electrical and mechanical equipment.

With $1.6 billion in Q2 capex, representing 90% growth, Equinix accelerated cabinet deliveries, pulling over 7,000 cabinets from 2027 into Q4 2026. Fox-Martin concluded that demand signals are clear and the company's strategy is working, with investments designed to drive sustainable long-term growth well above prior expectations.