Equinix revenue rose 16.4% to $2.63B and net income 30.2% to $479M, helped by about $124M of one-time xScale joint-venture fees; recurring revenue grew 10.9%, AFFO per share 18.9%, and 2026 and 2027-29 guidance was raised alongside a much larger capex plan.
Revenue
$2.6B
+16.4% YoY
Net income
$479M
+30.2% YoY
Diluted EPS
$4.83
+28.8% YoY
Operating margin
25.3%
Overview: a strong quarter, partly boosted by one-off hyperscale fees
Equinix runs data centers in 77 markets. Businesses rent space and power there for their servers ("colocation") and pay to connect directly to each other and to cloud providers ("interconnection"). In the quarter ended June 30, 2026, revenue rose 16.4% to $2,625 million. Income from operations rose 35% to $665 million, and net income attributable to common stockholders rose 30.2% to $479 million, or $4.83 per diluted share.
The headline growth overstates the underlying pace. The 10-Q attributes $124 million of the Americas revenue increase to "incremental revenues from non-recurring services provided to our joint ventures". These are fees from the xScale joint ventures, which build very large data centers for hyperscale cloud and AI customers, and the earnings release describes them as "one-time xScale fees". Recurring revenue, the monthly billing that makes up most of the business, grew 10.9%. Most of the rise in operating margin and AFFO also traces back to those fees.
Key metrics
Metric
Q2 2026
Q2 2025
YoY Change
Revenue
$2,625M
$2,256M
+16.4%
Income from operations
$665M
$494M
+34.6%
Operating margin
25.3%
21.9%
+3.4 pts
Net income attributable to common stockholders
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Operating margin is income from operations divided by revenue: the share of each sales dollar left after running the business, before interest and tax. The non-GAAP figures come from the company's own reconciliations in the 10-Q and the Q2 earnings release (8-K Exhibit 99.1, filed July 29, 2026).
Year to date (six months), revenue was $5,069 million (+13.1% from $4,481 million), net income attributable to common stockholders was $894 million (+25.7%), diluted EPS was $9.04 (+24.5% from $7.26), and AFFO per diluted share was $22.57 (+15.2% from $19.59).
Why AFFO matters more than net income for this REIT
Equinix is a REIT (real estate investment trust). It pays little corporate income tax, and in exchange it must pay out most of its taxable income as dividends. For a REIT, GAAP net income understates the cash the business produces, because it subtracts a large depreciation charge for the gradual wearing-out of buildings and equipment. That charge is an accounting expense, not a cash payment. In Q2, real-estate depreciation alone was $361 million and other depreciation was another $139 million, against $479 million of net income.
AFFO (adjusted funds from operations) adds back depreciation and other non-cash items such as $145 million of stock-based compensation. It then subtracts the capital spending needed just to keep existing sites running ("recurring capex", $49 million this quarter). What remains is a rough measure of the cash available to pay dividends. On that basis, Q2 AFFO was $1,168 million against net income of $479 million. The quarterly dividend of $5.16 per share is about 44% of Q2 AFFO per share ($11.78). Investors therefore watch AFFO per share, not EPS, to judge whether the dividend is covered and can keep growing.
Revenue: recurring versus one-off
Revenue type
Q2 2026
Q2 2025
Change
Colocation
$1,772M
$1,585M
+11.8%
Interconnection
$453M
$407M
+11.3%
Managed infrastructure
$112M
$117M
-4.3%
Other recurring
$40M
$34M
+17.6%
Recurring revenue
$2,377M
$2,143M
+10.9%
Non-recurring revenue
$248M
$113M
+119%
Total
$2,625M
$2,256M
+16.4%
Recurring revenue comes from customers billed every month on contracts that usually run one to five years. It was 91% of revenue, down from 95%, only because the one-off line jumped. Sequentially it grew 2.0%, from $2,331 million in Q1 2026.
Non-recurring revenue (installation fees and professional services, including services to the joint ventures) more than doubled. The 10-Q discloses that income from arrangements with equity-method investees, mostly the xScale ventures, was $161 million in Q2 against $36 million a year earlier. Without the $124 million joint-venture increase, revenue growth would have been about 11%. That is our own arithmetic, not a company figure.
Interconnection, the fees for direct cross-connections between customers inside Equinix buildings, grew 11.3%. The earnings release reports a record 9,700 net new interconnections in the quarter. This is the part of the business that competitors building plain wholesale capacity find hardest to copy.
Managed infrastructure fell 4.3%, a small drag.
By region: Americas carries the quarter
Region
Q2 2026 revenue
Q2 2025 revenue
Reported growth
Constant-currency growth
Americas
$1,251M
$1,004M
+25%
+24%
EMEA
$845M
$767M
+10%
+7%
Asia-Pacific
$529M
$485M
+9%
+9%
Constant currency restates this year's results at last year's exchange rates, which removes the effect of a weaker or stronger dollar.
Americas growth was mainly the $124 million of joint-venture services. The rest came from about $54 million of revenue from expansion projects completed in the past 12 months, plus new orders. Americas recurring revenue grew 12% (11% in constant currency). Americas adjusted EBITDA rose 38%.
EMEA looks better in dollars than it is. Currency added about three points: reported growth was 10% and constant-currency growth was 7%. About $28 million came from new capacity.
Asia-Pacific grew 9% with no currency effect. New capacity contributed about $9 million.
Company-wide, the 10-Q gives constant-currency revenue growth of 15%. The earnings release gives 16% on a "normalized and constant currency" basis, which also strips out power costs passed through to customers and a few other items. The one-off joint-venture fees are included in both figures.
Costs, power and interest
Cost of revenues rose 13% to $1,230 million, more slowly than revenue. Higher power prices are one driver. Americas utilities expense rose $14 million, "primarily due to increases in power costs". EMEA utilities rose $11 million, "primarily due to increases in renewable energy costs". Power contracts also make up part of the $2.1 billion of non-capital purchase commitments the 10-Q discloses. The company expects power costs to stay volatile.
Customers are using more power per cabinet (the racks that hold servers), and the 10-Q expects AI to speed this up. New Equinix buildings are designed for twice the power and cooling of earlier ones. Older sites could run short of power before they run short of floor space. Cabinet utilization held at about 78%.
Below operating income, interest expense rose to $151 million from $135 million after new bond issues. Interest income fell to $36 million from $52 million because the company held less cash. Other expense of $28 million was mainly Equinix's share of joint-venture losses ($24 million). A $17 million impairment charge (a write-down of spending on a previously impaired asset) also weighed on the quarter. The effective tax rate was 8.8%, low because of REIT status.
xScale, AI demand and the build-out
xScale data centers sit in joint ventures in which Equinix typically owns 20%. The one exception is the Americas AMER 3 venture, where its effective interest is 25%. In January 2026, Equinix sold its Hampton data center campus to AMER 3 for $459 million: $129 million in net cash, $184 million in receivables and equity worth $146 million. That sale produced a $19 million gain in Q1. Equinix's equity-method investments in xScale rose to $735 million from $536 million at year-end.
Annualized gross bookings (the yearly value of new contracts signed) were $424 million, up 23%. The earnings release calls the backlog a record and says 52 expansion projects are underway across 33 markets.
Capital expenditures were $1,578 million in Q2, up 60% from $989 million, and $2,834 million year to date. Equinix also has about $6.1 billion of contracted but not yet recorded capex commitments. Free cash flow was negative $560 million for the half, as defined by the company in the earnings release. Construction is currently funded partly by borrowing: $2.4 billion of senior notes were issued in the first half, and senior note principal outstanding stands at about $19.9 billion. $38 million of interest was capitalized into construction in the quarter, up from $14 million. That capitalized interest does not appear as interest expense in the income statement.
Dividend
Equinix paid $5.16 per share on June 17, 2026, up 10.0% from $4.69 a year earlier, and declared another $5.16 payable September 16, 2026. The company expects about $2,039 million of cash dividends in 2026, against AFFO guidance of $4,240 to $4,300 million. That leaves roughly half of AFFO to help fund construction.
Guidance (from the earnings release)
Q3 2026: revenue of $2,525 to $2,575 million (+9% to 11% reported) and an adjusted EBITDA margin of about 51%. The midpoint is below Q2's $2,625 million. That fits with the one-time xScale fees not repeating, although the release does not break out the step-down.
Full-year 2026 (raised): revenue of $10,205 to $10,285 million (+11% to 12%), adjusted EBITDA of $5,210 to $5,270 million, and AFFO per diluted share of $42.69 to $43.29 (+11% to 13%). Non-recurring capex (spending on new capacity) rises to $4,710 to $5,690 million from about $3,800 million previously. Total capex is guided at $5.0 to $6.0 billion.
2027-2029 outlook (raised): annual revenue growth of 10% to 13% (previously 7% to 10%), adjusted EBITDA margin of 53% or more by 2029, annual capex of $5 to $7 billion (previously $3 to $4 billion), and AFFO per share growth of 9% to 12% a year (previously 5% to 9%). Dividend-per-share growth is expected to roughly match AFFO-per-share growth.
Takeaway: Two things in this quarter need separating. The durable business, meaning recurring revenue and interconnection, grew about 11%. That is a genuine step up and supports the higher long-term outlook. The eye-catching 16% revenue and 30% profit growth, however, leaned on roughly $124 million of xScale fees that the company itself calls one-time. Q3 guidance of $2,525 to $2,575 million sits below Q2 revenue. The bigger change is the capex plan: spending of $5 to $7 billion a year, funded partly with debt, means future AFFO growth depends on new capacity filling up at the returns management is promising.
Our view
The recurring numbers point in the right direction. Bookings rose 23%, interconnections hit a record, and costs grew more slowly than revenue. The raised full-year guide implies 11% to 12% growth even after Q3 steps down. The main risks are execution and financing, not demand. Free cash flow is already negative before the larger capex budget takes effect. Interest expense is rising even with more of it being capitalized into construction. Power costs and power availability constrain growth in a way floor space does not. The 2026 test is whether AFFO per share lands inside the $42.69 to $43.29 range once the one-off fees drop out of the comparison.
Note: the full Q2 10-Q (filed July 29, 2026) is the primary source. Figures for AFFO per share, adjusted EBITDA, bookings, net interconnection additions, free cash flow and all guidance come from the Q2 earnings release (8-K Exhibit 99.1).