Management's Discussion and Analysis of Financial Condition and Results of Operations
Quantitative and Qualitative Disclosures About Market Risk
Financial Statements and Supplementary Data
Changes in and Disagreements with Accountants on Accounting and Financial Disclosure
Controls and Procedures
Other Information
Disclosure Regarding Foreign Jurisdictions that Prevent Inspections
PART III
Directors, Executive Officers and Corporate Governance
Executive Compensation
Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters
Certain Relationships and Related Transactions, and Director Independence
Principal Accounting Fees and Services
PART IV
Exhibits and Financial Statement Schedules
Form 10-K Summary
Signatures
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PART I
Forward-Looking Statements
The words "Equinix", "we", "our", "ours", "us" and the "Company" refer to Equinix, Inc. All statements in this discussion that are not historical are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding Equinix's "expectations", "beliefs", "intentions", "strategies", "forecasts", "predictions", "plans" or the like. Such statements are based on management's current expectations and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Equinix cautions investors that there can be no assurance that actual results or business conditions will not differ materially from those projected or suggested in such forward-looking statements as a result of various factors, including, but not limited to, the risk factors discussed in this Annual Report on Form 10-K. Equinix expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in Equinix's expectations with regard thereto or any change in events, conditions, or circumstances on which any such statements are based.
Summary of Risk Factors
Our business is subject to numerous risks and uncertainties that make an investment in our securities speculative or risky, any one of which could materially adversely affect our results of operations, financial condition or business. These risks include, but are not limited to, those listed below. This list is not complete, and should be read together with the section titled “Risk Factors” in this Annual Report on Form 10-K, as well as the other information in this Annual Report on Form 10-K and the other filings that we make with the U.S. Securities and Exchange Commission (the “SEC”).
Risks Related to the Macro Environment
• Geopolitical events and political tensions contribute to an already complex landscape, and could have a negative effect on our global business operations.
• The current uncertain economic environment, including challenges related to power and supply chains, could impact our business and the businesses of our customers.
• Our business could be harmed by increased costs to procure power, prolonged power outages, shortages or capacity constraints.
Risks Related to our Operations
• Any failure of our physical infrastructure or negative impact on our ability to meet our obligations to our customers, or damage to customer infrastructure within our IBX data centers, could lead to significant costs and disruptions that could reduce our revenue and harm our business reputation and financial condition.
• We experienced cybersecurity incidents in the past and may be vulnerable to future security breaches, which could disrupt our operations and have a material adverse effect on our business, results of operation and financial condition.
• We are currently making significant investments in our back-office information technology systems and processes. Difficulties from or disruptions to these efforts may interrupt our normal operations and adversely affect our business and results of operations.
• The level of insurance coverage that we purchase may prove to be inadequate.
• If we are unable to recruit or retain key qualified personnel, our business could be harmed.
• The failure to obtain favorable terms when we renew our IBX data center leases, or the failure to renew such leases, could harm our business and results of operations.
• We depend on a number of third parties to provide internet connectivity to our IBX data centers; if connectivity is interrupted or terminated, our results of operations and cash flow could be materially and adversely affected.
• The use of high-power density equipment may limit our ability to fully utilize the space in our older IBX data centers.
• The development and use of artificial intelligence in the workplace presents risks and challenges that may adversely impact our business and operating results.
Risks Related to our Offerings and Customers
• Our offerings have a long sales cycle that may harm our revenue and results of operations.
• We may not be able to compete successfully against current and future competitors.
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• If we cannot continue to develop, acquire, market and provide new offerings or enhancements to existing offerings that meet customer requirements and differentiate us from our competitors, our results of operations could suffer.
• We have government contracts, which subject us to revenue risk and certain other risks including early termination, audits, investigations, sanctions and penalties, any of which could have a material adverse effect on our results of operations.
• Because we depend on the development and growth of a balanced customer base, including key magnet customers, failure to attract, grow and retain this base of customers could harm our business and results of operations.
Risks Related to our Financial Results and Stock Price
• The market price of our stock may continue to be highly volatile, and the value of an investment in our common stock may decline.
• We have been, and in the future may be, subject to securities class action and other litigation, which may harm our business and results of operations.
• Our results of operations may fluctuate.
• We have incurred substantial losses in the past and may incur additional losses in the future.
• We may incur goodwill and other intangible asset impairment charges, or impairment charges to our property, plant and equipment, which could result in a significant reduction to our earnings.
Risks Related to Our Expansion Plans
• Our construction of new IBX data centers, IBX data center expansions or IBX data center redevelopment could involve significant risks to our business.
• Acquisitions present many risks, and we may not realize the financial or strategic goals that were contemplated at the time of any transaction.
• The anticipated benefits of our joint ventures may not be fully realized, or take longer to realize than expected.
• Joint venture investments could expose us to risks and liabilities in connection with the formation of the new joint ventures, the operation of such joint ventures without sole decision-making authority, and our reliance on joint venture partners who may have economic and business interests that are inconsistent with our business interests.
• If we cannot effectively manage our international operations and successfully implement our international expansion plans, our business and results of operations would be adversely impacted.
• We continue to invest in our expansion efforts, but may not have sufficient customer demand in the future to realize expected returns on these investments.
Risks Related to Our Capital Needs and Capital Strategy
• Our substantial debt could adversely affect our cash flows and limit our flexibility to raise additional capital.
• Sales or issuances of shares of our common stock may adversely affect the market price of our common stock.
• If we are not able to generate sufficient operating cash flows or obtain external financing, our ability to fund incremental expansion plans may be limited.
Risks Related to Sustainability, Environmental Laws and Climate Change
• Environmental and sustainability laws and regulations may impose upon us new or unexpected costs.
• Our business may be adversely affected by physical risks related to climate change and our response to it.
• We may fail to achieve our sustainability initiatives, including reaching our climate targets, or may encounter objections to them, which may adversely affect public perception of our business and affect our relationship with our customers, regulators, our stockholders and/or other stakeholders.
Risks Related to Certain Regulations and Laws, Including Tax Laws
• Government regulation related to our business or failure to comply with laws and regulations may adversely affect our business.
• Changes in U.S. or foreign tax laws, regulations, or interpretations thereof, including changes to tax rates, may adversely affect our financial statements and cash taxes.
• Our business could be adversely affected if we are unable to maintain our complex global legal entity structure.
Risks Related to Our REIT Status in the U.S.
• We have a number of risks related to our qualification as a real estate investment trust for federal income tax purposes ("REIT"), including the risk that we may not be able to maintain our qualification for taxation as a REIT which could expose us to substantial corporate income tax and have a materially adverse effect on our business, financial condition, and results of operations.
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ITEM 1. Business
Overview: Enabling Innovation for the Digital World
Equinix (Nasdaq: EQIX) is the world's digital infrastructure company, shortening the path to boundless connectivity anywhere in the world to enable the innovations that enrich our work, life and planet. Equinix combines a global footprint of International Business Exchange TM (IBX ® ) and xScale TM data centers in the Americas, Asia-Pacific, and Europe, the Middle East and Africa ("EMEA") regions, infrastructure and interconnection offerings, and digital ecosystems required to serve a large and diverse set of customers around the world.
Equinix was incorporated on June 22, 1998 as a Delaware corporation and operates as a REIT for federal income tax purposes. Since our inception, Equinix has been a network-neutral, multi-tenant data center ("MTDC") provider, where competing networks could connect and share data traffic to help scale the rapid growth of the early internet. The company’s name, Equinix (composed from the words "equality," "neutrality" and "internet exchange"), reflects that vision. The founders believed they not only had the opportunity, but also the responsibility, to create a company that would be the steward of some of the most important digital infrastructure assets in the world. Twenty-seven years later, we have expanded upon that vision by connecting economies, countries, enterprises and communities with seamless digital experiences, including cutting-edge artificial intelligence ("AI").
Our data centers around the world allow our customers to bring together and interconnect the infrastructure they need to seamlessly operate their business. With Equinix, they can scale with speed and agility, accelerate the launch of new digital offerings while safeguarding data, and implement AI applications at scale to achieve business success. We enable customers to simplify their digital infrastructure, ensure interoperability across platforms, and maximize speed, efficiency and security to deliver superior customer, partner and employee experiences. As more customers choose Equinix for high connectivity and performance reliability at the metro edge, it benefits their suppliers and business partners to colocate in the same data centers and connect directly with each other. This adjacency creates a network effect that attracts new customers while continuously enhancing our value proposition to existing customers and enabling them to capture further economic and performance benefits from our offerings.
Our Competitive Advantage
The digital economy continues to accelerate as AI, data-intensive workloads, and ecosystem-based business models reshape how industries operate. Organizations continue to shift from siloed digital adoption toward interconnected systems where data, digital services, and workflows flow smoothly across partners and platforms. Equinix is uniquely positioned to capture the increasing demand for these infrastructure solutions. Trends reinforcing our leading market position include:
• Scaled global presence: As the world becomes increasingly digital across geographies, organizations will need to partner and collaborate with an infrastructure provider that can satisfy their requirements in a globally consistent manner. Our extensive global footprint spans 280 data centers, in 77 markets in 36 countries. Data sovereignty, security and latency requirements are increasing, requiring a distributed and local metro footprint. This further positions us as a global trusted vendor to our current and prospective customers.
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• The requirement of hybrid architectures: Industries are moving from linear value chains to hybrid digital ecosystems. Service providers supply cloud and AI infrastructure, services across payments, cybersecurity and other domains, and industry-specific platforms and applications, while enterprise consumers assemble these capabilities into operational stacks that drive innovation and scale. These comprehensive solutions require a hybrid of enterprise-owned infrastructure combined with networking to a diverse set of service providers. With over 10,500 customers, including 2,000+ network service providers and a leading market share of cloud-on ramps, our position is unmatched in the industry.
• The interconnection imperative: Growing digital complexity and real-time operational demands require secure, low-latency private interconnection across clouds, networks, partners, and data sources. Critical workflows—including digital payments, supply chain telemetry, smart manufacturing, telemedicine, and AI inference—depend on high-performance connectivity. Interconnection has become essential for resiliency, regulatory compliance, and collaboration across increasingly distributed digital ecosystems. Over our 27-year history, we have curated a diverse, industry-leading ecosystem of more than 500,000 interconnections.
• AI as a catalyst for ecosystem acceleration: AI adoption is increasing the need for distributed, interconnected digital infrastructure. Training, inference, and model coordination require dense data exchange across cloud and edge environments. AI-driven use cases—spanning fraud detection, predictive maintenance, connected mobility, personalized retail, energy optimization and agentic connectivity—depend on secure, low-latency pathways. As AI integrates into mission-critical workflows, multi-directional, low-latency connectivity becomes essential. Equinix has curated a leading AI ecosystem of model providers, data platforms, neoclouds and gateways to serve the AI requirements of enterprises.
• Sustainability, resource efficiency and intelligent infrastructure management: Rising digital demand—driven by AI, cloud growth, and global data proliferation—is heightening expectations for environmental accountability. Digital value networks support more efficient operations through innovations in high-density compute, AI-optimized cooling, grid-interactive systems, renewable integration, and telemetry-driven management. Intelligent infrastructure is becoming critical to meeting sustainability goals while supporting expanding digital workloads.
Equinix Business Proposition
In 2025, we continued to build new offerings to further our mission to make digital infrastructure more powerful, accessible and sustainable. At Equinix, businesses can reach strategic markets with scalable, manageable infrastructure that blends physical and virtual options on our one-of-a-kind global ecosystem. We enable competitive advantage for our customers and partners by creating the foundational infrastructure capabilities that harness innovation and create value. We offer a comprehensive, integrated suite of infrastructure and interconnection solutions, with global, state-of-the-art data centers which meet strict standards of security, reliability, certification and sustainability. Our footprint consists of 280 data centers worldwide, including:
• IBX Data Centers are our carrier-neutral colocation data centers, providing our customers with the secure, reliable and robust environments (including space and power) necessary to aggregate and distribute information and connect digital and business ecosystems globally. IBX data centers provide access to vital ecosystems where enterprises, network, cloud and SaaS providers, and business partners, can directly and securely interconnect to each other.
• xScale Data Centers are designed to serve the unique core workload deployment needs of a targeted group of hyperscale companies, which include the world's largest cloud service providers. Hyperscalers require infrastructure to support demanding workload requirements for cloud and AI initiatives. With xScale data centers, which are developed and operated through our joint venture partnership arrangements, hyperscale customers add to their core hyperscale data center deployments and existing customer access points at Equinix, allowing streamlined expansion with a single global vendor.
The following are Equinix's primary revenue-generating products and other offerings:
Infrastructure Offerings
Equinix infrastructure offerings include a suite of comprehensive solutions that provide all the components required by a customer to house its IT infrastructure or equipment. These offerings are designed to speed and streamline data center deployments for our customers. These offerings are typically billed based on the space and power a customer consumes in our IBX data centers, are delivered under a fixed duration contract and generate monthly recurring revenue ("MRR").
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• Private Cages are typically designed and built to order for a single customer, with space assigned based on purchased power allocations and planned cabinet quantity. A cage typically includes steel mesh walls with a locking door, interconnection provision such as a demarcation rack with patch panels, and cabling systems such as a ladder rack and fiber raceway. Available security accessories include dedicated cameras, biometric hand scanners and more.
• Secure Cabinets are steel-framed cabinets sized to industry standards and typically configured to order, with lockable, fully ventilated doors. Secure cabinets provide a private, secure, smaller-footprint alternative to a Private Cage. Each cabinet includes an integrated, interconnection-ready demarcation panel and power circuitry sufficient to support planned utilization requirements. Secure cabinets are typically housed in a shared, secured cage within the data center facility.
• Secure Cabinet Express are ready for service secure cabinets that are preconfigured to fit Equinix recommendations and most modern IT deployment requirements, providing a simplified and globally consistent colocation module for cabinet-sized deployments.
Equinix offers a variety of enabling solutions that support a customer's need to implement, operate and maintain its colocated deployments. These solutions include both on-consumption and subscription services that may generate MRR as well as non-recurring revenue ("NRR").
• Equinix Smart View ® is a fully integrated monitoring software that provides customers visibility into the operating data relevant to their specific Equinix footprint as if they were in-house. The software provides online access to real-time environmental and operating data through the Equinix Customer Portal or via either REST (application programming interfaces ("APIs") that provide customers the ability to retrieve information about their assets from every IBX location) or streaming API integrations. With real-time alerts and configurable reporting, Equinix SmartView allows customers to maintain their IBX operations and plan for future growth.
• Equinix Smart Hands ® provides around-the-clock, on-site operational support service for remote management, installation and troubleshooting of customer data center equipment. Using Equinix IBX data center technicians, Smart Hands allows customers to manage their data center operations from anywhere in the world.
• Equinix Smart Build ("ESB") provides customers with an easy way to accelerate and simplify world-class data center deployments with expert support. ESBs are repeatable, proven processes that address larger, more complex data center jobs, including installation and implementation of new builds and planned migrations. ESB practices deliver Equinix expertise in colocation design to optimize our customers’ data center needs, including structured cabling, labeling and documentation, procurement recommendations and coordination, and secure de-installation.
• Equinix Managed Solutions and Enablement Services offer flexible and easy-to-consume managed platforms for cloud, storage, backup and firewall, built on top of neutral, leading technology. Combined with simplified implementation of Equinix Fabric and Network Edge, these managed services leverage customer hybrid and multicloud experiences, allowing organizations to prioritize their core business functions.
Interconnection Offerings
Our interconnection solutions connect businesses directly, securely and dynamically within and between our data centers across our global platform. These solutions are typically billed based on the outbound connections from a customer and generate MRR.
• Equinix Fabric ® provides secure, on-demand, software-defined interconnection. Built specifically for digital infrastructure, Equinix Fabric enables businesses to connect globally to their choice of thousands of networking, storage, compute and application service providers in the industry’s largest infrastructure ecosystem. As the foundation of Equinix’s interconnection capability, Equinix Fabric also enables customers to quickly and easily connect between the physical and virtual digital infrastructures they have deployed in Equinix data centers globally.
• Equinix Fabric Cloud Router makes it easy to connect applications and data across different clouds. With high-performance and secure private connections, protecting data from exposure to the public internet, these enterprise-grade connections offer virtually unlimited bandwidth and built-in resiliency. Fabric Cloud Router also reduces networking costs, lowers cloud egress charges and enables elastic bandwidth consumption so customers pay for only what they need.
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• Equinix Cross Connects provide a point-to-point cable link between two Equinix customers in the same data center. Cross connects deliver fast, convenient, affordable and highly reliable connectivity and data exchange with business partners and service providers within the Equinix ecosystem.
• Equinix Internet Exchange enables networks, content providers and large enterprises to exchange internet traffic through the largest global peering solution. Service providers can aggregate traffic to multiple counterparties, called peers, on one physical port and handle multiple small peers while moving high-traffic peers to private interconnections. This reduces latency for end users when accessing content and applications.
• Equinix Internet Access is an agile, scalable, resilient and high-performing managed internet access solution. Offering multiple upstream Tier 1 providers per metro and connections to all Equinix and major third-party internet exchanges, with over 300 private peering relationships, it delivers superior availability and performance. Internet Access serves as a one-stop shop for businesses, offering both physical and virtual connection options with Equinix Fabric and Network Edge to deliver primary and secondary internet access solutions. Available in 60+ markets, Internet Access allows scalable bandwidth to meet growing usage needs, empowering businesses to innovate in the digital age.
• Fiber Connect provides dark fiber links between customers and partners between multiple Equinix data centers. Fiber Connect enables fast, convenient and affordable integration with partners, customers and service providers across the global Equinix digital ecosystem. It supports highly reliable, extremely low-latency communication, system integration and data exchange.
• Metro Connect ® provides direct, dedicated, carrier-grade network links between customers in one IBX and partners in another IBX within the same metro. Metro Connect provides integration with customers, partners and service providers within the Equinix digital ecosystem, supplying highly reliable, extremely low-latency communication, system integration and data exchange.
• Equinix Network Edge allows customers to modernize networks within minutes, by deploying network functions virtualization ("NFV") from multiple vendors across Equinix metros. Companies can select, deploy and connect virtual network solutions at the edge quickly, with no additional hardware requirements.
Competitive Landscape
While a large number of enterprises and service providers, such as hyperscale cloud service providers, own their own data centers, we believe enterprises are shifting away from single-tenant solutions toward those that enable customers to outsource some or all of their IT infrastructure and interconnection requirements to third-party facilities, such as those operated by Equinix. This shift is being accelerated by the proliferation of hybrid multi-cloud architectures and the adoption of AI.
Historically, the outsourcing market was served by large telecommunications carriers that bundled their products and services with their colocation offerings. The data center market landscape has since evolved to include private and carrier-neutral multi-tenant data centers, public and private cloud providers, managed infrastructure and application hosting providers, large hyperscale cloud providers and systems integrators. As a result, the global MTDC market is large and remains highly fragmented—with significant long-term growth opportunities for providers that can bundle various colocation, interconnection and network offerings, outsourced IT infrastructure solutions and managed services.
Equinix has a highly differentiated offering in this large and growing market. Our global platform reaches 36 countries and connects the industry’s largest and most active ecosystem of partners across our sites, including access to a leading share of cloud on-ramps and an increasingly diverse ecosystem of networks and cloud and IT service providers. This ecosystem creates a network effect that improves performance and lowers the cost for our customers, enabling them to innovate and fast-track digital transformation. This is a significant source of competitive advantage for Equinix—particularly as AI and cloud innovations fuel workload demands for hyperscale infrastructure and optimization across enterprises. Our scalable, neutral, global platform offers one-of-a-kind solutions to the most pressing digital challenges customers face. Our platform enables customers to bring together physical and programmable technologies like compute, storage, network, AI and applications to build the foundation for their company's digital success.
Customers
Our customers include telecommunications carriers, mobile and other network services providers, cloud and IT services providers, digital media and content providers, financial services companies, and global enterprise
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ecosystems in various industries. We provide each company with access to a choice of business partners and solutions based on their colocation, interconnection and managed IT service needs, and we delivered 99.9999%+ operational uptime across our global data centers during the year ended December 31, 2025. As of December 31, 2025, we had over 10,500 customers worldwide. No one customer made up 10% or more of our total business revenues for the year ended December 31, 2025.
The following companies represent some of our leading customers and partners:
We serve our customers with a direct sales force and channel marketing program. We organize our sales force by customer type, as well as by establishing a sales presence in diverse geographic regions, which enables efficient servicing of the customer base from a network of regional offices. We also support our customers with a global customer care organization.
Human Capital
As of December 31, 2025, we had 13,716 employees worldwide with 5,917 based in the Americas, 4,706 based in EMEA and 3,093 based in Asia-Pacific. Of those employees, 44% of employees were in engineering and operations, 14% of employees were in sales and marketing and 42% of employees were in management, finance and administration. As of December 31, 2025, approximately 71% of our workforce identified as men, 28% identified as women and less than 1% declined to identify.
Equinix remains steadfast in its commitment to create a thriving workplace where we foster belonging for all— where every one of our colleagues is valued and respected for who they are and what they contribute. Our objective is to continue to make our culture a critical competitive advantage, engaging every leader and every employee in the process.
Our talent strategies focus on attracting, developing and retaining a diverse, global workforce; building leadership capability and accountability; and empowering employees to do the best work of their lives. We continue to leverage and expand our recruiting pathways to attract qualified talent from adjacent industries and reach emerging talent pools. In 2025, our internship and apprenticeship programs provided pathways for early-career talent to gain hands-on experience, mentorship, and development opportunities in both technical and professional settings, setting them up for success to thrive at Equinix. Also, through employee-led collaborations, Equinix is building long-term relationships with local schools to raise awareness of data center careers and provide ongoing opportunities for student engagement, learning and mentorship. Lastly, we continue to focus on leadership development by offering programs that feature external experts to speak on topics ranging from strategic alignment, team management, and industry relevant topics. We also evolved our performance management approach, increasing simplicity and clarity through consistent feedback between employees and their managers.
We believe in equal pay and equal opportunity for everyone. Equinix remains committed to ensuring we have consistent practices in place to recognize, reward and promote all employees, regardless of gender, ethnicity, sexual orientation, or other protected class. Equinix operates a rigorous governance framework to manage pay and other compensation elements to ensure that all reward decisions are fair and without discrimination or bias. All roles are mapped and graded to one consistent global organizational framework. Each grade has a specific pay range informed by benchmarking against the external market in the country in which the role is located. This global
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framework is also used to determine target levels for annual bonuses and long-term incentives. We strive to update annually our global market data where information is available.
We believe our employee engagement efforts differentiate Equinix's culture and accelerate our competitive advantage as they lead to more inclusive and high performing teams, higher employee satisfaction and overall organizational innovation and success. In 2025, employee satisfaction scores resulted in an average score of 78 for Equinix, followed by our average belonging score of 81 and average well-being score of 82. Our Equinix Employee Connection Networks ("EECNs") are a strategic cornerstone of our inclusive culture, fostering a sense of belonging that drives engagement and business impact. Open to all employees, our nine EECNs are designed to provide meaningful learning opportunities, raise awareness of diverse perspectives, and strengthen connections across the organization.
We recognize that creating the best workplace and culture requires a global effort with localized approaches. As of 2025, we have 44 global WeAreEquinix teams, led by employee volunteers, who are empowered to create and promote belonging in locations across the world. Through both virtual and in-person connection, and in collaboration with the business and their local communities, these volunteer leaders create opportunities to support Wellbeing, Sustainability, and Community engagement. Across our EECNs and WeAreEquinix teams, we currently have 800+ volunteer leaders who are working on strengthening community and belonging for our workforce.
The Equinix Foundation and Equinix Community Impact program promote connection and belonging by enabling employees to give back through volunteer services, donations and more, to the communities in which we work and live. In 2025, our employees volunteered over 54,400 hours, representing an increase of approximately 45% year-over-year. Since the launch of the Equinix Foundation in 2022, we have continued to focus on the advancement of digital inclusion—from access to technology and connectivity to the skills needed to thrive in today's digitally-driven world.
We believe our commitment to the highest standards of honesty, integrity and ethical behavior differentiates our business as much as our technology. We promote these high standards through a number of policies including the Equinix Code of Business Conduct. All employees are required to complete training in ethics and the company’s anti-bribery and corruption policies. In addition, we maintain a confidential ethics helpline where employees are encouraged to speak up if they have any questions or concerns that our Code of Business Conduct is being violated. We have a zero-tolerance, non-retaliation policy that protects our employees when they speak up.
Our comprehensive approach to health and safety combines global policies, rigorous inspections and targeted training to foster a safe and supportive work environment. This approach upholds our commitment to employee well-being across all our operations and limits service disruptions, ensuring we meet customer needs. Well-being is weaved into our employee experience and benefit offerings, driven globally through health programs, ergonomic support, technology reimbursements, and a company-wide wellness day.
Our investment in furthering our human capital efforts aligns with our business strategy and enables Equinix's impact and success. We are committed to creating a workplace that allows individuals to contribute their unique strengths, share their varied perspectives, and grow their skills leading to meaningful and fulfilling careers.
Sustainability
We believe in a future where technology drives sustainable growth and transformative social impact. Our Future First strategy is our commitment to sustainability as we deliver digital infrastructure that fosters positive change through secure, efficient and responsible solutions—bringing the world together to create innovations that will enrich our work, life and planet. We bring this vision to life by growing our digital infrastructure sustainably through our commitment to minimize environmental impact while enabling our customers to leverage the full potential of the digital economy. In addition, we drive social progress by championing belonging for all, fostering a people-centered culture and working to close the digital divide in the communities where we build, work and live. At the core of it all, we lead with integrity by building our business on a foundation of ethical conduct for accessible, resilient and responsibly managed digital infrastructure.
We continue to progress on our sustainability strategy and look to build a business and world that reflects our vision to enable innovations that enrich our work, life and planet. Our sustainability program earned notable recognition in 2025, including achieving the EcoVadis Gold Medal for the first time. EcoVadis provides trusted, independent evaluations of company sustainability performance, and is frequently requested by our customers.
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Environmental Performance
Climate change presents systemic risks to the global economy, infrastructure, and supply chains, making it critical to our long-term business resilience. Reducing greenhouse gas emissions helps us manage regulatory exposure, energy price volatility and climate related disruptions, while also enabling us to meet rising customer expectations, access sustainable capital and drive operational efficiency across our global portfolio. Equinix began its sustainability journey prior to 2014. We were the first in the industry to set approved near-term science-based targets ("SBTs") for our emissions reduction roadmap. In 2024, our 2040 long-term science-based target was approved by the Science Based Targets initiative ("SBTi").
We track our progress towards our goals by measuring and reporting our global Greenhouse Gas ("GHG") footprint across direct ("Scope 1"), indirect energy ("Scope 2") and indirect value chain ("Scope 3") emissions. As of 2024, we have achieved a 10% absolute reduction in operational GHG emissions from a 2019 baseline year (Scope 1 and Scope 2 market-based metric tons of carbon dioxide-equivalent ("mtCO2e")), despite significant business growth. To identify and assess climate-related physical and transition risks, we conduct climate risk assessments and disclose key findings through our Task Force on Climate-related Financial Disclosures ("TCFD")-aligned Climate Risk report. In 2025, we strengthened our climate risk assessment by introducing a quantitative model and expanding the scope of risks analyzed. This approach provides deeper, data-driven insights into both physical and transition risks, helping us better understand their relevance to Equinix and prioritize actions that enhance business resilience. These efforts help inform strategic planning, enhance risk management, and provide insights into how climate change may impact our operations and long-term financial performance.
We invest in energy efficiency and procure renewable energy to reduce our GHG emissions and maintain a competitive edge in our industry. Our operational efficiency is measured through power usage effectiveness ("PUE"), our primary performance indicator. In 2024, we achieved an annual average operational PUE of 1.39, a 6% improvement from 2023, despite an expanded portfolio. In parallel, we continue to expand renewable energy coverage across our portfolio.
Equinix was the first data center company to set a goal of 100% clean and renewable energy coverage across our portfolio. In 2024, 96% of our global electricity consumption, and 100% of U.S. and European electricity consumption, was covered by renewable energy sources. We procure Energy Attributable Certificates ("EACs") through various mechanisms, favoring Power Purchase Agreements ("PPAs") that add new clean energy to the grid. As of December 31, 2025, we have executed 29 PPAs in 12 countries, which brings our total portfolio to 1,472 MW of new wind and solar capacity in Australia, Brazil, Finland, France, India, Italy, Japan, Portugal, Singapore, Spain, Sweden, and the United States.
Our green finance program exemplifies our commitment to sustainability, enabling targeted investments in infrastructure and innovation that deliver measurable environmental benefits while generating resilient value for our stakeholders. In 2024, we updated our Green Finance Framework to broaden our focus, incorporating projects that advance decarbonization, resource efficiency and climate resilience, while also tightening eligibility criteria with more rigorous qualification requirements. These investments, ranging from renewable energy procurement to low- carbon construction materials, help us reduce emissions, conserve resources, and reduce our environmental impact. As of December 31, 2025, Equinix has issued a total of approximately $9.5 billion in green bonds, with $7 billion in net proceeds allocated to eligible green projects.
Customer Impact
As part of our commitment to better serve our customers, Equinix provides customers with Green Power Reports ("GPRs") that detail customer’s electricity consumption, renewable energy coverage and carbon footprint related to their Equinix deployments. In 2025, to enhance accessibility and ease of use, we launched a self-service tool that allows customers to directly download their GPRs. We also introduced Customer Water Reports ("CWRs") that provide allocated water withdrawal and Water Usage Effectiveness ("WUE") metrics for every Equinix site that uses water for cooling.
Sustainability Accounting Standards Board ("SASB") Disclosures
The following metrics are aligned with SASB Real Estate Standard version 2023-06 and represent the performance of our facilities in the calendar years specified. Energy, renewable energy, and GHG emissions are independently assured to ISO 14064-3:2019 Standards for the quantification and reporting of GHG emissions
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(Scope 1, 2 and 3). Calendar year data for 2025 will become available in Q2 2026 and will be published in our annual Sustainability Report located on our corporate website.
Energy Management: Energy Consumption
Year
Energy Consumption Data as a % of Floor Area
Total Energy Consumed by Portfolio Area with Data Coverage (MWh) (1)
Like-for-Like Change in Energy Consumption of Portfolio Area with Data Coverage (MWh) (2)
Grid Electricity Consumption as a % of Energy Consumption
Energy Consumption from Renewable Sources (MWh) (3)
Renewable Energy as a % of Energy Consumption
Like-for-Like Change in Energy Consumption from Renewable Sources as a % of Portfolio Area with Data Coverage (2) (3)
Renewable Energy as a % of Electricity Consumption
(1) The scope of energy includes energy used onsite and energy procured.
(2) Like-for-like computed for stabilized asset list for the overlapping list of sites designated as stabilized in 2023 and 2024.
(3) Equinix procures renewable energy to cover for the entire electricity consumption of sites.
(4) Recently constructed or acquired sites for which no utility data is available are excluded. These include BG2, DC16, FR13, IL4, JH1, JN1, KL1, MB4, MD6, NY3, SL4 and TY15. Reseller sites are also excluded in both the gross floor area and the energy metrics (DA99, OS99, SH1).
(5) 2023 portfolio coverage excludes xScale sites: DB6x, FR9x, OS4x, SL2x, SV12x.
(6) Recently constructed or acquired sites for which no utility data is available are excluded. These include JN1, MB4 and SA1. Reseller sites are also excluded in both the gross floor area and the energy metrics (DA99, OS99, SH1).
(7) 2024 portfolio coverage excludes xScale sites: FR9x.
Energy Management: Green Building Ratings
Our data centers are designed with high operational excellence standards and energy efficiency in mind and are planned holistically to incorporate the needs of our customers and communities, while minimizing the use of natural resources in our operations.
Our Energy Efficiency Center of Excellence is driving a global approach to improving operational efficiency across our global portfolio from lighting and airflow management to efficient cooling innovations. The program also engages customers to manage their implementations more sustainably at our facilities, leading to overall improved site efficiencies.
We aim to have our data centers certified to green buildings and energy management certifications and schemes. These include USGBC LEED green buildings certifications, ISO 14001:2015 Environmental Management Standard, ISO 50001:2011 Energy Management Standard, BCA Green Mark, U.S. EPA Energy Star for Data Centers and others. Data centers receiving green building ratings in 2025 covered 1,278,460 gross sq. ft across Barcelona, Dublin, Istanbul, Johor Bahru, London, Silicon Valley, Tokyo, and Washington, D.C.
In 2025, we had 32.4 million gross sq. ft., or 98.7% of our global footprint, in operation with green buildings and energy management certifications. Within the U.S., we had 10.8 million gross sq. ft., or 100% of our footprint, under certification, including 1.8 million gross sq. ft., or 16.6% of U.S. footprint, having achieved U.S. EPA Energy Star for Data Centers. We disclose these and other site-level details about our data centers on our sustainability website.
Year
Total Gross sq. ft. (million) (1)
Area of Eligible Portfolio with Green Building Rating (million sq. ft.) (2)
Eligible Portfolio with Green Building Rating (%)
Global Total through 2025
U.S. Total through 2025
1.8 (Energy Star)
16.6% (Energy Star)
(1) Ratings included in our totals: ISO 50001 Energy Management, ISO 14001 Environmental Management, LEED green buildings certifications, U.S. Environmental Protection Agency Energy Star for Data Centers, BCA Green Mark, NABERS and Green Globes.
(2) As of December 2025, ten sites received Energy Star for Data Centers recognition, representing 16.6% of our U.S. portfolio. In contrast, our U.S. portfolio has 24 LEED-certified data centers or 48.2% of the U.S. portfolio by gross square footage.
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Our Business Segment Financial Information
We currently operate in three reportable segments comprised of our Americas, EMEA and Asia-Pacific geographic regions. Information attributable to each of our reportable segments is set forth in Note 18 within the Consolidated Financial Statements.
Available Information
Equinix owns and maintains intellectual property in the form of trademarks, patents, application programming interfaces, customer portals and a variety of products and other offerings.
We were incorporated in Delaware in June 1998. We are required to file reports under the Securities Exchange Act of 1934, as amended, with the Securities and Exchange Commission ("SEC"). The SEC maintains an internet website at www.sec.gov that contains reports, proxy and information statements and other information.
You may also obtain copies of our annual reports on Form 10-K, our quarterly reports on Form 10-Q and our current reports on Form 8-K, including exhibits, and any amendments to such reports, free of charge by visiting the Investor Relations page on our website, www.equinix.com. These reports are available as soon as reasonably practical after we file them with the SEC. Information contained on or accessible through our website is not part of this Annual Report on Form 10-K.
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ITEM 1A. Risk Factors
In addition to the other information contained in this report, the following risk factors should be considered carefully in evaluating our business. Additional risks which we do not presently consider material, or of which we are not currently aware, may also have an adverse impact on us. The information discussed below is at the time of this filing. This section contains forward-looking statements.
Risk Factors
Risks Related to the Macro Environment
Geopolitical events and political tensions contribute to an already complex landscape, and could have a negative effect on our global business operations.
Geopolitical events, including trade tensions between the U.S. and other countries, the war between Russia and Ukraine, and ongoing conflicts in the Middle East, could negatively affect our global operations, and their future impact remains unpredictable. In addition, uncertainty surrounding the legality, enforceability, and interpretation of U.S. and international laws, executive actions, regulatory frameworks, and enforcement priorities could result in compliance challenges, significant penalties, operational restrictions, reputational harm, or adverse effects on our business and results of operations. Periodic risks of a U.S. government shutdown could further disrupt economic conditions. Moreover, actual or proposed U.S. tariffs and potential counter tariffs may increase costs and disrupt our supply chain, with their scope and duration dependent on evolving negotiations and exemptions, making their impact difficult to predict. Our inability to effectively manage these developments could have a material adverse effect on our business, financial condition, results of operations, and the price of our common stock.
The current uncertain economic environment, including challenges related to power and supply chains, could impact our business and the businesses of our customers.
We are experiencing an increase in our costs to procure power and supply chain issues globally. Rising prices for materials related to our IBX data center construction and our data center offerings, energy and gas prices, as well as rising wages and benefits costs negatively impact our business by increasing our operating costs. Further, as a result of the increase in demand for AI infrastructure, we are anticipating chip shortages relative to those experienced in the market in prior years. This shortage could impact our customers and delay or deter customer server deployments within our IBX data centers. These shortages could also impact our own network rooms and certain products which rely on integration with these chips. Price increases for the chips could be significant and could have a material impact on our business or the business of our customers. The adverse economic conditions we are currently experiencing, including the impact of increased tariffs and inflation, may also impact our customers and cause a decrease in sales as some customers may initiate cost cutting measures or scale back their operations. This could result in churn in our customer base, reductions in revenues from our offerings, adverse effects to our days of sales outstanding in accounts receivable ("DSO"), longer sales cycles, slower adoption of new technologies and increased price competition, which could adversely affect our liquidity. Customers, vendors and/or partners filing for bankruptcy could also lead to costly and time-intensive actions with adverse effects, including greater difficulty or delay in accounts receivable collection. The uncertain economic environment could also have an impact on our foreign exchange forward contracts if our counterparties' credit deteriorates or if they are otherwise unable to perform their obligations.
Our efforts to mitigate the risks associated with these adverse conditions may not be successful and our business and growth could be adversely affected.
Our business could be harmed by increased costs to procure power, prolonged power outages, shortages or capacity constraints.
Any power outages, shortages, capacity constraints, limits on access or significant increases in the cost of power may have an adverse effect on our business and our results of operations.
In each of our markets, we contract with and rely on third parties, third party infrastructure, governments, and global suppliers to provide a sufficient amount of power to maintain our IBX data centers and meet the needs of our current and future customers. In certain instances, we have experienced difficulties in securing the energy supply we have contracted for or that we need for our expansion plans. In certain markets, there are specific requirements to cover our operations with power procured from renewable energy resources and the availability of such alternative energy resources may be limited. Any such limitations may have a negative impact on a given IBX data
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center and may limit our ability to grow our business which could negatively affect our financial performance and results of operations. Furthermore, the inability to supply customers with their contracted power for any reason could harm customer and/or joint venture relationships as well as cause reputational harm.
Each new facility requires access to significant quantities of electricity. Limitations on generation, transmission and distribution may limit our ability to obtain sufficient power capacity for potential expansion sites in new or existing markets. Utility companies and other third-party power providers may impose onerous operating conditions to any agreement to provision power or we may experience significant delays, unfavorable contractual terms, new industry regulations and substantial increased costs to obtain the level of electrical service required by our current or future IBX data center designs. In certain cases, we must commit to power purchases before an IBX center is fully operational, increasing fixed costs and the risk that these costs cannot be passed on to customers. Our ability to find reliable partners and appropriate sites for expansion may also be limited by access to power, especially as we design our data centers to the specifications of new and evolving technologies, such as AI, which are more power-intensive, and further prepare to serve the power demands we expect in the future.
Our IBX data centers are affected by problems accessing electricity sources, such as planned or unplanned power outages and limitations on transmission or distribution of power. Unplanned power outages, including, but not limited to those relating to large storms, earthquakes, fires, tsunamis, cyber-attacks, physical attacks on utility infrastructure, war, and any failures of electrical power grids or internal systems more generally, and planned power outages by public utilities, could harm our customers and our business. Employees working from home could be subjected to power outages at home which could be difficult to track and could affect the day-to-day operations of our non-IBX data center employees. Our international operations are sometimes located outside of developed, reliable electricity markets, where we are exposed to some insecurity in supply associated with technical, regulatory and reliability problems, as well as transmission constraints. Some of our IBX data centers are located in leased buildings where, depending upon the lease requirements and number of tenants involved, we may or may not control some or all of the infrastructure including generators and fuel tanks. As a result, in the event of a power outage, we could be dependent upon the landlord, as well as the utility company, to restore the power. We attempt to limit our exposure to system downtime by using backup generators, which are in turn supported by onsite fuel storage and through contracts with fuel suppliers, but these measures may not always prevent downtime or solve for long-term or large-scale outages. We have experienced outages in the past for various reasons and could experience outages in the future. Any outage or supply disruption could adversely affect our business, customer experience and revenues.
We are currently experiencing inflation and volatility pressures in the energy market globally. Various macroeconomic factors are contributing to the instability and global power shortage including inadequate power generation and transmission to meet market demand in certain locations, severe weather events, governmental regulations, government relations and inflation. While we have aimed to minimize our risk, via hedging, conservation, and other efficiencies, we expect the cost for power to continue to be volatile and unpredictable and subject to inflationary pressures. We believe we have made appropriate estimates for these costs in our forecasting, but the current unpredictable energy market could materially affect our ability to expand our business, our financial forecasting, results of operations and financial condition.
Risks Related to our Operations
Any failure of our physical infrastructure or negative impact on our ability to meet our obligations to our customers, or damage to customer infrastructure within our IBX data centers, could lead to significant costs and disruptions that could reduce our revenue and harm our business reputation and financial condition.
Our business depends on providing customers with highly reliable solutions. We must safeguard our customers' infrastructure and equipment located in our IBX data centers and ensure our IBX data centers and non-IBX business operations remain operational at all times. We own certain of our IBX data centers, but others are leased by us, and we rely on the landlord for basic maintenance of our leased IBX data centers and office buildings and, in some cases, the landlord is responsible for the infrastructure that runs the building such as power connections, UPSs and backup power generators. If such landlord has not maintained a leased property sufficiently, we may be forced into an early exit from the center which could be disruptive to our business. Furthermore, we continue to acquire IBX data centers not built by us and we may be required to incur substantial additional costs to repair or upgrade the IBX data centers. Newly acquired data centers also may not have the same power infrastructure and design in place as our own IBX data centers. These legacy designs could require upgrades in order to meet our standards and our customers’ expectations. Until the legacy systems are brought up to our standards, customers in
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these IBX data centers could be exposed to higher risks of unexpected power outages. We have experienced power outages because of these legacy design issues in the past and we could experience them in the future.
Problems at one or more of our IBX data centers or corporate offices, whether or not within our control, could result in service interruptions or significant infrastructure or equipment damage. These could result from numerous factors, including but not limited to:
• human error;
• equipment failure;
• physical, electronic and cybersecurity breaches;
• fire, earthquake, hurricane, flood, tornado and other natural disasters;
• extreme temperatures;
• water damage;
• fiber failures, subsea cable damage and other network damage/interruptions;
• software updates;
• power loss;
• terrorist acts;
• sabotage and vandalism;
• insider threat;
• global pandemics;
• inability of our operations employees to access our IBX data centers for any reason; and
• failure of business partners who provide our resale products.
We have service level commitment obligations to most customers. As a result, service interruptions or significant equipment damage in our IBX data centers could result in difficulty maintaining service level commitments to these customers and potential claims related to such failures. Because our IBX data centers are critical to many of our customers' businesses, service interruptions or significant equipment damage in our IBX data centers could also result in lost profits or other indirect or consequential damages to our customers. We cannot guarantee that a court would enforce any contractual limitations on our liability in the event that one of our customers brings a lawsuit against us as a result of a problem at one of our IBX data centers and we have in the past and may decide in the future to reach settlements with affected customers irrespective of any such contractual limitations. Any such settlement may result in a reduction of revenue under U.S. generally accepted accounting principles ("GAAP"). In addition, any loss of service, equipment damage or inability to meet our service level commitment obligations could reduce the confidence of our customers and could consequently impair our ability to obtain and retain customers, which would adversely affect both our ability to generate revenues and our results of operations.
Furthermore, we are dependent upon internet service providers, telecommunications carriers and other website operators in the Americas, Asia-Pacific and EMEA regions and elsewhere, some of which have experienced significant system failures and electrical outages in the past. We also rely on a number of third-party software providers in order to deliver our offerings and operate our business. Our customers may in the future experience difficulties due to system failures unrelated to our systems and offerings. If, for any reason, these suppliers fail to provide the required services, our business, financial condition and results of operations could be materially and adversely impacted.
Our IBX data center employees are critical to our ability to maintain our business operations and reach our service level commitments. Although we have redundancies built into our workforce, if our IBX employees are unable to access our IBX data centers for any reason, we could experience operational issues at the affected site. Pandemics, weather and climate related crises or any other social, political, or economic disruption in the U.S. or abroad could prevent sufficient staffing at our IBX data centers, or at our corporate offices, and have a material adverse impact on our operations.
We experienced cybersecurity incidents in the past and may be vulnerable to future security breaches, which could disrupt our operations and have a material adverse effect on our business, results of operation and financial condition.
Despite our efforts to protect against cyber-attacks, we are not fully insulated from such threats. We have experienced cybersecurity attacks and security incidents to varying degrees, and in some cases threat actors have gained unauthorized access to our systems and data. While previous incidents have been resolved, and their impacts have been immaterial, we expect we will continue to face risks associated with unauthorized access to our
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computer systems, loss or destruction of data, computer viruses, ransomware, malware, distributed denial-of-service attacks or other malicious activities, and the impact of such events in the future may be material. A cyber attack may originate from either an external actor or an insider threat within the organization. In the course of our business, we utilize vendors and other partners who are also sources of cyber risks to us. In addition, our hybrid working model, that includes both work from home and in office working environments, could expose us to additional security risks.
We offer professional solutions to our customers where we consult on data center solutions and assist with implementations. We also offer managed services in certain locations where we manage the data center infrastructure for our customers. The access to our clients' networks and data, which is gained from these solutions, creates some risk that our clients' networks or data could be improperly accessed. We may also design our clients' cloud storage systems in such a way that exposes our clients to increased risk of data breach. If we were held responsible for any such breach, it could result in a significant loss to us, including damage to our client relationships, harm to our brand and reputation, and legal liability.
As techniques used to breach security change frequently and are generally not recognized until launched against a target, we may not be able to promptly detect that a cyber breach has occurred, or implement security measures in a timely manner or, if and when implemented, we may not be able to determine the extent to which these measures could be circumvented. Recent developments in the cyber threat landscape include use of AI and machine learning, as well as an increased number of cyber extortion and ransomware attacks, with the potential for higher financial ransom demand amounts and increasing sophistication and variety of ransomware techniques and methodology. Further, any adoption of AI by us or by third parties may pose new security challenges. A party who is able to compromise the security measures on our networks or the security of our infrastructure could misappropriate the proprietary or sensitive information of Equinix, our customers, including government customers, or the personal information of our employees, or cause interruptions or malfunctions in our operations or our customers' operations. As we provide assurances to our customers that we provide a high level of security, such a compromise could be particularly harmful to our brand and reputation. We also may be required to expend significant capital and resources to protect against such threats or to alleviate problems caused by cyber breaches in our physical or virtual security systems. Any breaches that may occur in the future could expose us to increased risk of lawsuits, regulatory penalties, loss of existing or potential customers, damage relating to loss of proprietary information, harm to our reputation and increases in our security costs, which could have a material adverse effect on our financial performance and results of operations. The international cybersecurity regulatory landscape continues to evolve and compliance with the proposed reporting requirements could further complicate our ability to resolve cyber-attacks. We maintain insurance coverage for cyber risks, but such coverage may be unavailable or insufficient to cover our losses.
We are currently making significant investments in our back-office information technology systems and processes. Difficulties from or disruptions to these efforts may interrupt our normal operations and adversely affect our business and results of operations.
We have been investing heavily in our back-office information technology systems and processes for a number of years and expect such investment to continue for the foreseeable future in support of our pursuit of global, scalable solutions across all geographies and functions that we operate in. These continuing investments include ongoing improvements to the customer experience from initial quote to customer billing and our revenue recognition process; integration of recently acquired operations onto our various information technology systems; and implementation of new tools and technologies to either further streamline and automate processes, or to support our compliance with evolving U.S. GAAP and international accounting standards. As a result of our continued work on these projects, we may experience difficulties with our systems, management distraction and significant business disruptions. For example, difficulties with our systems may interrupt our ability to accept and deliver customer orders and may adversely impact our overall financial operations, including our accounts payable, accounts receivables, general ledger, fixed assets, revenue recognition, close processes, internal financial controls and our ability to otherwise run and track our business. We may need to expend significant attention, time and resources to correct problems or find alternative sources for performing these functions. Changes to our financial systems also create an increased risk of deficiencies in our internal controls over financial reporting until such systems are stabilized. Such significant investments in our back-office systems may take longer to complete and cost more than originally planned. In addition, we may not realize the full benefits we hoped to achieve and there is a risk of an impairment charge if we decide that portions of these projects will not ultimately benefit us or are de-scoped. Finally, the collective impact of these changes to our business has placed significant demands on impacted employees across multiple functions, increasing the risk of errors and control deficiencies in our financial statements, distraction from
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the effective operation of our business and difficulty in attracting and retaining employees. Any such difficulties or disruptions may adversely affect our business, our culture and our results of operations.
The level of insurance coverage that we purchase may prove to be inadequate.
We carry liability, property, business interruption and other insurance policies to cover insurable risks to our company. We select the types of insurance, the limits and the deductibles based on our specific risk profile, the cost of the insurance coverage versus its perceived benefit and general industry standards. Our insurance policies contain industry standard exclusions for events such as war and nuclear reaction. We purchase earthquake insurance for certain of our IBX data centers, but for our IBX data centers in high-risk zones, including those in California and Japan, we have elected to self-insure. The earthquake and flood insurance that we do purchase would be subject to high deductibles. Any of the limits of insurance that we purchase, including those for flood or cyber risks, could prove to be inadequate, which could materially and adversely impact our business, financial condition and results of operations.
If we are unable to recruit or retain key qualified personnel, our business could be harmed.
In December 2025, we announced the retirement of and succession plan for our Chief Financial Officer. Any significant leadership change involves risk, and any failure to transition effectively could hinder our strategic planning, business execution and future performance. A transition in our Chief Financial Officer role may create uncertainty and operational challenges, including disruption to employee workflows, increased distraction, potential adverse impacts on employee retention and satisfaction, and an increased risk of delays or errors in financial reporting and internal controls during the transition period. Any such impacts could impair our ability to execute our financial strategy effectively and could adversely affect our results of operations and financial condition. Our future performance depends on the continued success of our executive team and our ability to attract and retain skilled employees, including management. In addition, our talent strategy could continue to evolve with the future direction of the business. We must continue to identify, hire, train and retain key personnel who maintain relationships with our customers and who can provide the technical, strategic and marketing skills required for our company's growth. There is a shortage of qualified personnel in these fields, and we compete with other companies for the limited pool of talent. We cannot provide assurance that we will be able to retain our existing personnel or attract additional qualified employees in the future. The failure to recruit and retain necessary key personnel could cause disruption, harm our business and hamper our ability to grow our company.
The failure to obtain favorable terms when we renew our IBX data center leases, or the failure to renew such leases, could harm our business and results of operations.
While we own certain of our IBX data centers, others are leased under long-term arrangements. These leased IBX data centers have all been subject to significant development by us in order to convert them from, in most cases, vacant buildings or warehouses into IBX data centers. Most of our IBX data center leases have renewal options available to us. However, many of these renewal options provide for the rent to be set at then-prevailing market rates. To the extent that then-prevailing market rates or negotiated rates are higher than present rates, these higher costs may adversely impact our business and results of operations, or we may decide against renewing the lease. There may also be changes in shared operating costs in connection with our leases, which are commonly referred to as common area maintenance expenses. In the event that an IBX data center lease does not have a renewal option, or we fail to exercise a renewal option in a timely fashion and lose our right to renew the lease, we may not be successful in negotiating a renewal of the lease with the landlord. Further, for various reasons, a landlord may not want to renew the lease with us, or he may transfer his interests to third parties which could affect our ability to renew the lease. A failure to renew a lease or termination by a landlord of any lease could force us to exit a building prematurely, which could disrupt our business, harm our customer relationships, impact and harm our joint venture relationships, expose us to liability under our customer contracts or joint venture agreements, cause us to take impairment charges and affect our results of operations negatively.
We depend on a number of third parties to provide internet connectivity to our IBX data centers; if connectivity is interrupted or terminated, our results of operations and cash flow could be materially and adversely affected.
The presence of diverse telecommunications carriers' fiber networks in our IBX data centers is critical to our ability to retain and attract new customers. We are not a telecommunications carrier, and as such, we rely on third parties to provide our customers with carrier services. We believe that the availability of carrier capacity will directly affect our ability to achieve our projected results. We rely primarily on revenue opportunities from the
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telecommunications carriers' customers to encourage them to invest the capital and operating resources required to connect from their data centers to our IBX data centers. Carriers will likely evaluate the revenue opportunity of an IBX data center based on the assumption that the environment will be highly competitive. We cannot provide assurance that each and every carrier will elect to offer its services within our IBX data centers or that once a carrier has decided to provide internet connectivity to our IBX data centers that it will continue to do so for any period of time.
Our new IBX data centers require construction and operation of a sophisticated redundant fiber network. The construction required to connect multiple carrier facilities to our IBX data centers is complex and involves factors outside of our control, including regulatory processes and the availability of construction resources.
Any hardware or fiber failures on these networks, either on land or subsea, may result in significant loss of connectivity to our new IBX data center expansions. This could affect our ability to attract new customers to these IBX data centers or retain existing customers.
To date, the network neutrality of our IBX data centers and the variety of networks available to our customers has often been a competitive advantage for us. In certain of our markets, the limited number of carriers available reduces that advantage. As a result, we may need to adapt our key revenue-generating offerings and pricing to be competitive in those markets.
If the establishment of highly diverse internet connectivity to our IBX data centers does not occur, is materially delayed, disrupted or is discontinued, or is subject to failure, our results of operations and financial condition will be adversely affected.
The use of high-power density equipment may limit our ability to fully utilize the space in our older IBX data centers.
Server technologies continue to evolve and in some instances these changes can result in customers increasing their use of high-power density equipment in our IBX data centers which can increase the demand for power on a per cabinet basis. Additionally, the workloads related to new and evolving technologies such as AI are increasing the demand for high density computing power. Because many of our IBX data centers were built a number of years ago, the current demand for power may exceed the designed electrical capacity in these IBX data centers. As power, not space, is a limiting factor in many of our IBX data centers, our ability to fully utilize the space in those IBX data centers may be impacted. The ability to increase the power capacity of an IBX data center, should we decide to, is dependent on several factors including, but not limited to, the local utility's ability to provide additional power; the length of time required to provide such power; and/or whether it is feasible to upgrade the electrical and mechanical infrastructure of an IBX data center to deliver additional power and cooling to customers. Although we are currently designing and building to a higher power specification than that of many of our older IBX data centers, and are considering redevelopment of certain sites where appropriate, there is a risk that demand could continue to increase, or our redevelopment may not be successful, and the space inside our IBX data centers could become underutilized sooner than expected.
The development and use of artificial intelligence in the workplace presents risks and challenges that may adversely impact our business and operating results.
We have begun leveraging AI and machine learning capabilities for our employees to use in their day-to-day operations. Failure to invest adequately in such capabilities may result in us lagging behind our competitors in terms of improving operational efficiency and achieving superior outcomes for our business and our customers. As we embark on these initiatives, we may encounter challenges such as a shortage of appropriate data to train internal AI models, a lack of skilled talent to effectively execute our strategy of leveraging AI internally, or the possibility that the tools we utilize may not deliver the intended value. Use of third-party AI tools can also bring information security, data privacy and legal risks. Failure to successfully harness these AI tools and manage associated risks could negatively impact our business and operating results.
Risks Related to our Offerings and Customers
Our offerings have a long sales cycle that may harm our revenue and results of operations.
A customer's decision to purchase our offerings typically involves a significant commitment of resources. In addition, some customers will be reluctant to commit to locating in our IBX data centers until they are confident that
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the IBX data center has adequate carrier connections. As a result, we have a long sales cycle. Furthermore, we may devote significant time and resources to pursuing a particular sale or customer that does not result in revenues.
Delays due to the length of our sales cycle may materially and adversely affect our revenues and results of operations, which could harm our ability to meet our forecasts and cause volatility in our stock price.
We may not be able to compete successfully against current and future competitors.
The global multi-tenant data center market is highly fragmented. It is estimated that we are one of more than 2,400 companies that provide these offerings around the world. We compete with these firms which vary in terms of their data center offerings and the geographies in which they operate. We must continue to evolve our product strategy and be able to differentiate our IBX data centers and product offerings from those of our competitors.
Some of our competitors may adopt aggressive pricing policies, especially if they are not highly leveraged or have lower return thresholds than we do. As a result, we may suffer from pricing pressure that would adversely affect our ability to generate revenues. Some of these competitors may also provide our target customers with additional benefits, including bundled communication services or cloud services, and may do so in a manner that is more attractive to our potential customers than obtaining space in our IBX data centers. Similarly, with growing acceptance of cloud-based technologies, we are at risk of losing customers that may decide to fully leverage cloud infrastructure offerings instead of managing their own. Competitors could also operate more successfully or form alliances to acquire significant market share. Regional competitors may also consolidate to become a global competitor. Consolidation of our customers and/or our competitors may present a risk to our business model and have a negative impact on our revenues.
Further, because of the expected growth and opportunity related to AI, we anticipate significant investments in the data center industry by both current competitors and new investors and companies looking to capture this opportunity. If Equinix is unable to compete against these new market entrants, or capture a proportionate share of these investments, we could lose market share during this expected period of growth. We also must compete against certain of these competitors to secure the land and power needed for our expansion plans.
Failure to compete successfully may materially adversely affect our financial condition, cash flows and results of operations.
If we cannot continue to develop, acquire, market and provide new offerings or enhancements to existing offerings that meet customer requirements and differentiate us from our competitors, our results of operations could suffer.
As our customers evolve their IT strategies, we must remain flexible and evolve along with new technologies and industry and market shifts. The process of developing and acquiring new offerings and enhancing existing offerings is complex. If we fail to anticipate customers’ evolving needs and expectations or do not adapt to technological and IT trends, our results of operations could suffer. Ineffective planning and execution in our cloud, AI and product development strategies may cause difficulty in sustaining our competitive advantages. Additionally, any delay in the development, acquisition, marketing or launch of a new offering could result in customer dissatisfaction or attrition. If we cannot continue adapting our products and strategies, or if our competitors can adapt their products more quickly than us, our business could be harmed.
In order to adapt effectively, we sometimes must make long-term investments and commit significant resources before knowing whether our predictions will accurately reflect customer demand for the new offerings. This kind of investment may include real estate expansion or developing, acquiring and obtaining power and intellectual property investments. If we fail to invest before or contemporaneously with our competitors, our results of operations could suffer. We also must remain flexible and change strategies quickly if our predictions are not accurate. We are currently investing in our AI strategy to serve the large footprint we foresee for customers’ AI workloads. The future of AI is still uncertain and as it continues to evolve, our predictions about the market may prove inaccurate. Market news and speculation about the future of AI and/or its impact on the data center industry have caused volatility in our stock price in the past. We cannot guarantee our investments and predictions will be accurate around AI or any other customer demand.
We have also been making investments of resources in expanding our product portfolio in recent years. New offerings may come with additional risks and may not always be successful, and certain past offerings have been or are being discontinued, including the Equinix Metal product. New offerings may also require additional capital, have lower margins and higher customer churn as compared to our data center offerings, thus adversely impacting our
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results. These offerings may also introduce us to different competition and faster development cycles as compared to our data center business. If we cannot develop or partner to quickly and efficiently meet market demands, we may also see adverse results. While we believe these product offerings and others we may implement in the future will be desirable to our customers and will complement our other offerings, we cannot guarantee the success of any product or any other new product offering.
We have also invested in joint ventures in order to develop capacity to serve the large footprint needs of a targeted set of hyperscale customers by leveraging existing capacity and dedicated hyperscale builds. We believe these hyperscale customers will also play a large role in the growth of the market for AI. We have announced our intention to seek additional joint ventures for certain of our hyperscale builds. There can be no assurances that our joint ventures will be successful or that we find appropriate partners, or that we will be able to successfully meet the needs of these customers through our hyperscale offerings.
Failure to successfully execute on our product, AI or hyperscale strategies could materially adversely affect our financial condition, cash flows and results of operations.
We have government contracts, which subject us to revenue risk and certain other risks including early termination, audits, investigations, sanctions and penalties, any of which could have a material adverse effect on our results of operations.
We derive revenues from contracts with the U.S. government, state and local governments and foreign governments. Some of these customers may terminate all or part of their contracts at any time, without cause. There is increased pressure for governments and their agencies, both domestically and internationally, to reduce spending. Some of our federal government contracts are subject to the approval of appropriations being made by the U.S. Congress to fund the expenditures under these contracts. Similarly, some of our contracts at the state and local levels are subject to government funding authorizations.
Government contracts often have unique terms and conditions to address public sector acquisition requirements, such as most favored customer obligations, and are generally subject to audits and investigations. On occasion, we have been out of compliance with contractual terms of certain government contracts and have remedied as necessary. Being out of compliance with the terms of such contracts could result in various civil and criminal penalties and administrative sanctions, including termination of contracts, refund of a portion of fees received, forfeiture of profits, suspension of payments, fines and suspensions, or debarment from future government business.
Because we depend on the development and growth of a balanced customer base, including key magnet customers, failure to attract, grow and retain this base of customers could harm our business and results of operations.
Our ability to maximize revenues depends on our ability to develop and grow a balanced customer base, consisting of a variety of companies, including enterprises, cloud, digital content and financial companies, and network service providers. We consider certain of these customers to be key magnets in that they draw in other customers. In many instances, the more balanced the customer base within each IBX data center, the better we will be able to generate significant interconnection revenues, which in turn increases our overall revenues. Our ability to attract customers to our IBX data centers will depend on a variety of factors, including the presence of multiple carriers, the mix of our offerings, the overall mix of customers, the presence of key customers attracting business through vertical market ecosystems, the IBX data center's operating reliability and security and our ability to effectively market our offerings. However, some of our customers may face competitive pressures and may ultimately not be successful or may be consolidated through merger or acquisition. If these customers do not continue to use our IBX data centers it may be disruptive to our business. If customers combine businesses, they may require less colocation space, which could lead to churn in our customer base. Finally, any uncertain global economic climate, including the one we are currently experiencing, could harm our ability to attract and retain customers if customers slow spending, or delay decision-making on our offerings, or if customers begin to have difficulty paying us or seek bankruptcy protection and we experience increased churn in our customer base. Any of these factors may hinder the development, growth and retention of a balanced customer base and adversely affect our business, financial condition and results of operations.
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Risks Related to our Financial Results and Stock Price
The market price of our stock may continue to be highly volatile, and the value of an investment in our common stock may decline.
The market price of the shares of our common stock has recently been and may continue to be highly volatile. General economic and market conditions, like the ones we are currently experiencing, and market conditions for technology, data center and REIT stocks in general, may affect the market price of our common stock.
Announcements by us or others, or speculations about our future plans, may also have a significant impact on the market price of our common stock. These may relate to:
• our results of operations or forecasts;
• new issuances of equity, debt or convertible debt by us, including issuances through any existing ATM Program;
• increases in market interest rates and changes in other general market and economic conditions, including inflationary concerns;
• changes to our capital allocation, tax planning or business strategy;
• our qualification for taxation as a REIT and our declaration of distributions to our stockholders;
• changes in U.S. or foreign tax laws;
• changes in management or key personnel;
• developments in our relationships with customers;
• announcements by our customers or competitors;
• changes in the perceived demand for goods and services supporting AI;
• changes in regulatory policy or interpretation;
• market speculation involving us or other companies in our industry, which may include short seller reports;
• litigation and governmental investigations;
• changes in the ratings of our debt or stock by rating agencies or securities analysts;
• our purchase or development of real estate and/or additional IBX data centers;
• our acquisitions of complementary businesses; or
• the operational performance of our IBX data centers.
The stock market has from time-to-time experienced extreme price and volume fluctuations, which have particularly affected the market prices for technology, data center and REIT stocks, and which have often been unrelated to their operating performance. These broad market fluctuations may adversely affect the market price of our common stock. One of the factors that investors may consider in deciding whether to buy or sell our common stock is our distribution rate as a percentage of our stock price relative to market interest rates. If market interest rates increase, prospective investors may demand a higher distribution rate or seek alternative investments paying higher dividends or interest. As a result, interest rate fluctuations and conditions in the capital markets may affect the market value of our common stock. Furthermore, companies that have experienced volatility in the market price of their stock have been subject to securities class action litigation. We have been the target of this type of litigation and we may be the target of this type of litigation in the future. Securities litigation against us could result in substantial costs and/or damages, and divert management's attention from other business concerns, which could seriously harm our business.
Furthermore, short sellers may engage in activity intended to drive down the market price of our common stock, which could also result in related regulatory and governmental scrutiny, among other effects. Short selling is the practice of selling securities that the seller does not own but rather has borrowed or intends to borrow from a third party with the intention of later buying lower priced identical securities to return to the lender. Accordingly, it is in the interest of a short seller of our common stock for the price to decline. At any time, short sellers may also publish, or arrange for the publication of, opinions or characterizations that are intended to create negative market momentum in our common stock. Short selling reports can cause downward pressure and increased volatility in an issuer’s stock price. On March 20, 2024, a short seller report was published about us, which contained certain allegations related to components of our operating results and other strategic matters. As a result, the Audit Committee of our Board of Directors commenced an independent investigation to review the matters referenced in the report. Shortly after the release of the report, we received a subpoena from the U.S. Attorney’s Office for the Northern District of California (the "NDCA") and on April 30, 2024, we also received a subpoena from the SEC. On November 19, 2025, we received correspondence from the SEC indicating that the agency had concluded its investigation and does not intend to recommend an enforcement action. The Company also does not expect any further related action from the NDCA. Although these investigations are resolved, any future subpoenas, inquiries or investigations conducted by a
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governmental organization or other regulatory body or internal investigation, could result in a material diversion of our management’s time and result in substantial cost and, in the event of an adverse finding, could have a material adverse effect on our business and results of operations.
We have been, and in the future may be, subject to securities class action and other litigation, which may harm our business and results of operations.
We have been, and in the future may be, subject to securities class action or other litigation. For example, we recently resolved a stockholder class action lawsuit and continue to face multiple stockholder derivative claims as described in "Legal Proceedings" included in Part I, Item 3 of this Annual Report on Form 10-K. Litigation can be lengthy, expensive, and divert management's attention and resources. Results cannot be predicted with certainty and an adverse outcome in litigation could result in monetary damages or injunctive relief. Further, any payments made in settlement may directly reduce our revenue under U.S. GAAP and could negatively impact our results of operations for the period. While we maintain insurance coverage, we cannot be certain that such coverage will continue to be available on acceptable terms or in sufficient amounts to cover potential losses. For all of these reasons, litigation could seriously harm our business, results of operations, financial condition or cash flows.
Our results of operations may fluctuate.
We have experienced fluctuations in our results of operations on a quarterly and annual basis. The fluctuations in our results of operations may cause the market price of our common stock to be volatile. We may experience significant fluctuations in our results of operations in the foreseeable future due to a variety of factors, many of which are listed in this Risk Factors section. Additional factors could include, but are not limited to:
• the timing of investment commitment versus the subsequent resulting revenue as development can take multiple years;
• the timing and magnitude of depreciation and interest expense or other expenses related to the acquisition, purchase or construction of additional IBX data centers or the upgrade of existing IBX data centers;
• demand for space, power and solutions at our IBX data centers;
• the availability of power and the associated cost of procuring the power;
• changes in general economic conditions, such as those stemming from pandemics or other economic downturns, or specific market conditions in the telecommunications and internet industries, any of which could have a material impact on us or on our customer base;
• additions and changes in product offerings and our ability to ramp up and integrate new products within the time period we have forecasted;
• restructuring and other exit charges incurred in the event of a realignment of our management structure, operations or products or other exit activities;
• the financial condition and credit risk of our customers;
• the provision of customer discounts and credits;
• the mix of current and proposed products and offerings and the gross margins associated with our products and offerings;
• increasing repair and maintenance expenses in connection with aging IBX data centers;
• lack of available capacity in our existing IBX data centers to generate new revenue or delays in opening new or acquired IBX data centers that delay our ability to generate new revenue in markets which have otherwise reached capacity;
• changes in employee stock-based compensation;
• changes in our tax planning strategies or failure to realize anticipated benefits from such strategies;
• changes in income tax benefit or expense; and
• changes in or new GAAP as periodically released by the Financial Accounting Standards Board ("FASB").
Any of the foregoing factors, or other factors discussed elsewhere in this report, could have a material adverse effect on our business, results of operations and financial condition. Although we have experienced growth in revenues in recent quarters, this growth rate is not necessarily indicative of future results of operations. It is possible that we may not be able to generate net income on a quarterly or annual basis in the future. In addition, a relatively large portion of our expenses are fixed in the short-term, particularly with respect to lease and personnel expenses, depreciation and amortization and interest expenses. Therefore, our results of operations are particularly sensitive to fluctuations in revenues. As such, comparisons to prior reporting periods should not be relied upon as indications of our future performance. In addition, our results of operations in one or more future quarters may fail to meet the expectations of securities analysts or investors.
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We have incurred substantial losses in the past and may incur additional losses in the future.
As of December 31, 2025, our retained earnings were $6.1 billion. We are currently investing heavily in our future growth through the build out of multiple additional IBX data centers, expansions of IBX data centers and acquisitions of complementary businesses. As a result, we will incur higher depreciation and other operating expenses, as well as transaction costs and interest expense, that may negatively impact our ability to sustain profitability in future periods unless and until these new IBX data centers generate enough revenue to exceed their operating costs and cover the additional overhead needed to scale our business for this anticipated growth. The current global financial uncertainty may also impact our ability to sustain profitability if we cannot generate sufficient revenue to offset the increased costs of our recently opened IBX data centers or IBX data centers currently under construction. In addition, costs associated with the acquisition and integration of any acquired companies, as well as the additional interest expense associated with debt financing, we have undertaken to fund our growth initiatives, may also negatively impact our ability to sustain profitability. Finally, given the competitive and evolving nature of the industry in which we operate, we may not be able to sustain or increase profitability on a quarterly or annual basis.
We may incur goodwill and other intangible asset impairment charges, or impairment charges to our property, plant and equipment, which could result in a significant reduction to our earnings.
In accordance with U.S. GAAP, we are required to assess our goodwill and other intangible assets annually, or more frequently whenever events or changes in circumstances indicate potential impairment, such as changing market conditions or any changes in key assumptions. If the testing performed indicates that an asset may not be recoverable, we are required to record a non-cash impairment charge for the difference between the carrying value of the goodwill or other intangible assets and the implied fair value of the goodwill or other intangible assets in the period the determination is made.
We also periodically monitor the remaining net book values of our property, plant and equipment, generally at the individual IBX data center level. Although our individual IBX data centers are generally performing in accordance with our expectations, our IBX data centers could under-perform relative to our expectations which may result in additional non-cash impairment charges.
These charges could be significant, which could have a material adverse effect on our business, results of operations or financial condition.
Risks Related to Our Expansion Plans
Our construction of new IBX data centers, IBX data center expansions or IBX data center redevelopment could involve significant risks to our business.
In order to sustain our growth in certain of our existing and new markets, we may have to expand an existing data center, lease a new facility or acquire suitable land, with or without structures, to build new IBX data centers from the ground up. Expansions or new builds are currently underway, or being contemplated, in new and existing markets. Construction projects expose us to many risks which could have an adverse effect on our results of operations, financial condition and/or on customer demand and satisfaction. As part of our current strategy, we are also building larger campuses than we have in the past which may exacerbate many of the risks associated with construction projects. Current global supply chain, tariffs and inflation issues have also increased many of these construction risks and created additional risks for our business. Some of the risks associated with construction projects include:
• construction delays and/or quality issues;
• power and power grid constraints;
• unexpected lack or reduction of power access;
• increased prices and lack of availability and delays for data center equipment, including items such as generators and switchgear;
• water constraints;
• unexpected budget changes;
• increased prices for and delays in obtaining building supplies and raw materials;
• labor availability, labor disputes and work stoppages with contractors, subcontractors and other third parties;
• unanticipated environmental issues and geological problems;
• delays related to permitting and approvals to open from public agencies and utility companies;
• community protest and/or disruption;
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• adverse impacts on existing customers in the IBX data center;
• delays in site readiness leading to our failure to meet commitments made to customers planning to expand into a new build; and
• unanticipated customer requirements that would necessitate alternative data center design, making our sites less desirable or leading to increased costs in order to make necessary modifications or retrofits.
We are currently experiencing rising construction costs which reflect the increase in cost of labor and raw materials, supply chain and logistic challenges, and high demand in our sector. While we have invested in creating a reserve of materials to mitigate supply chain issues and inflation, it may not be sufficient and ongoing delays, difficulty finding replacement products and continued high inflation could affect our business and growth and could have a material effect on our business. In certain instances, we have elected to pre-buy certain equipment and materials to mitigate supply chain issues before our construction plans are finalized. If our estimates are wrong, we may be liable to pay for goods we no longer need.
Current relations between the U.S. and China have created increased supply chain risk due to successive U.S. legislation promoting decoupling from China on semiconductors and specific telecommunications equipment makers as well as the threat of increased tariffs and having to source from alternative suppliers for key components outside of China. We are currently using our global supply chain to manage the evolving tariff environment and reduce impacts on our business and customers. At this time, we believe the largest potential tariff impact for us is related to steel and steel derivatives. Tariffs on steel and steel derivatives could lead to significant building cost increases for us if we are unable to source alternative options. Any additional tariffs to be imposed by the U.S. on imports from certain countries and potential counter-tariffs in response, could lead to increased costs and supply chain disruptions.
Attacks on merchant vessels remain high in the Red Sea which is causing disruptions in shipping routes. Although alternative routes are available, including routes via the Cape of Good Hope, these routes can add additional transit time and lead to delayed deliveries and increased fuel costs. We anticipate the disruptions in the Red Sea could continue to escalate. Any additional or unexpected disruptions to our supply chain, including in the event of any sustained regional escalation of the current conflict in the Middle East in the area around the Red Sea or more broadly, or inflationary pressures could significantly affect the cost and delivery timing of our planned expansion projects and interfere with our ability to meet commitments to customers who have contracted for space in new IBX data centers under construction.
Construction projects are dependent on permitting from public agencies and utility companies. Any delay in permitting, including due to community opposition, could affect our growth. We are currently experiencing permitting delays in most metros. While we don't currently anticipate any material long-term negative impact to our business because of these construction delays, these types of delays and stoppages related to permitting from public agencies and utility companies could worsen and have an adverse effect on our bookings, revenue or growth. Additionally, increased community scrutiny of data center resource use including land, water and power, may lead permitting authorities to impose stricter requirements, resulting in longer approval processes, higher costs, or project cancellations. These challenges could hinder our ability to execute growth plans and meet strategic objectives.
All construction related projects require us to carefully select and rely on the experience of one or more designers, general contractors, and associated subcontractors during the design and construction process. Additionally, we specify performance and quality requirements for our products. Constraints to component availability, restrictions on permitted suppliers, import and export controls and supplier backlogs could lead suppliers to source from alternative providers. This could lead to increased quality defects and a failure of Equinix to meet our performance and quality requirements. Further, should a designer, general contractor, significant subcontractor or key supplier experience financial problems or other problems during or leading up to the design or construction process, we could experience significant delays, increased costs to complete the project and/or other negative impacts to our expected returns.
Site selection is also a critical factor in our expansion plans. There may not be suitable properties available in our markets with the necessary combination of high-power capacity, sufficient water supply and fiber connectivity, or selection may be limited. We expect that we will continue to experience limited availability of water and power and grid constraints in many markets as well as shortages of associated equipment because of the current high demands and finite nature of these resources. These shortages could result in site selection challenges, construction delays or increased costs. Government limitations or moratoriums placed on data center construction in a given market may also negatively impact our ability to expand according to our plans or prevent us from
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completing our data center construction projects leading to stranded capital. Thus, while we may prefer to locate new IBX data centers adjacent to our existing locations, it may not always be possible. In the event we decide to build new IBX data centers separate from our existing IBX data centers, we may provide metro connect solutions to connect these two IBX data centers. Should these solutions not provide the necessary reliability to sustain connection, or if they do not meet the needs of our customers, this could result in lower interconnection revenue and lower margins and could have a negative impact on customer retention over time.
Acquisitions present many risks, and we may not realize the financial or strategic goals that were contemplated at the time of any transaction.
We have completed numerous acquisitions and we expect to make additional acquisitions in the future, which may include (i) acquisitions of businesses, products, solutions or technologies that we believe to be complementary, (ii) acquisitions of new IBX data centers or real estate for development of new IBX data centers; (iii) acquisitions through investments in local data center operators; or (iv) acquisitions in new markets with higher risk profiles. We may pay for future acquisitions by using our existing cash resources (which may limit other potential uses of our cash), incurring additional debt (which may increase our interest expense, leverage and debt service requirements) and/or issuing shares (which may dilute our existing stockholders and have a negative effect on our earnings per share). Acquisitions expose us to potential risks, including but not limited to:
• the possible disruption of our ongoing business and diversion of management's attention by acquisition, transition and integration activities, particularly when multiple acquisitions and integrations are occurring at the same time or when we are entering an emerging market with a higher risk profile;
• our potential inability to successfully pursue or realize some or all of the anticipated revenue opportunities associated with an acquisition or investment;
• the possibility that we may not be able to successfully integrate acquired businesses, or businesses in which we invest, or achieve anticipated operating efficiencies or cost savings;
• the possibility that announced acquisitions may not be completed, due to failure to satisfy the conditions to closing as a result of:
• an injunction, law or order that makes unlawful the consummation of the acquisition;
• inaccuracy or breach of the representations and warranties of, or the non-compliance with covenants by, either party;
• the nonreceipt of closing documents; or
• for other reasons;
• the possibility that there could be a delay in the completion of an acquisition, which could, among other things, result in additional transaction costs, loss of revenue or other adverse effects resulting from such uncertainty;
• the possibility that our projections about the success of an acquisition could be inaccurate and any such inaccuracies could have a material adverse effect on our financial projections;
• the dilution of our existing stockholders as a result of our issuing stock as consideration in a transaction or selling stock in order to fund the transaction;
• the possibility of customer dissatisfaction if we are unable to achieve levels of quality and stability on par with past practices;
• the possibility that we will be unable to retain relationships with key customers, landlords and/or suppliers of the acquired businesses, some of which may terminate their contracts with the acquired business as a result of the acquisition or which may attempt to negotiate changes in their current or future business relationships with us;
• the possibility that we could lose key employees from the acquired businesses;
• the possibility that we may be unable to integrate certain IT systems for any reason including because they do not meet Equinix's standard requirements with respect to security, privacy or any other standard;
• the potential deterioration in our ability to access credit markets due to increased leverage;
• the possibility that our customers may not accept either the existing equipment infrastructure or the "look-and-feel" of a new or different IBX data center;
• the possibility that additional capital expenditures may be required or that transaction expenses associated with acquisitions may be higher than anticipated;
• the possibility that required financing to fund an acquisition may not be available on acceptable terms or at all;
• the possibility that we may be unable to obtain required approvals from governmental authorities under antitrust and competition laws on a timely basis or at all, which could, among other things, delay or prevent
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us from completing an acquisition, limit our ability to realize the expected financial or strategic benefits of an acquisition or have other adverse effects on our current business and operations;
• the possible loss or reduction in value of acquired businesses;
• the possibility that future acquisitions may present new complexities in deal structure, related complex accounting and coordination with new partners, particularly in light of our desire to maintain our qualification for taxation as a REIT;
• the possibility that we may not be able to prepare and issue our financial statements and other public filings in a timely and accurate manner, and/or maintain an effective control environment, due to the strain on the finance organization when multiple acquisitions and integrations are occurring at the same time;
• the possibility that future acquisitions may trigger property tax reassessments resulting in a substantial increase to our property taxes beyond that which we anticipated;
• the possibility that future acquisitions may be in geographies and regulatory environments to which we are unaccustomed and we may become subject to complex requirements and expose us to risks with which we have limited experience;
• the possibility that future acquisitions may appear less attractive due to fluctuations in foreign currency rates;
• the possibility that carriers may find it cost-prohibitive or impractical to bring fiber and networks into a new IBX data center;
• the possibility of litigation or other claims in connection with, or as a result of, an acquisition, or inherited from the acquired company, including claims from terminated employees, customers, former stockholders or other third parties;
• the possibility that asset divestments may be required in order to obtain regulatory clearance for a transaction;
• the possibility of pre-existing undisclosed liabilities, including, but not limited to, lease or landlord related liability, tax liability, environmental liability or asbestos liability, for which insurance coverage may be insufficient or unavailable, or other issues not discovered in the diligence process;
• the possibility that we receive limited or incorrect information about the acquired business in the diligence process; and
• the possibility that we do not have full visibility into customer agreements and customer termination rights during the diligence process which could expose us to additional liabilities after completing the acquisition.
The occurrence of any of these risks could have a material adverse effect on our business, results of operations, financial condition or cash flows. If an acquisition does not proceed or is materially delayed for any reason, the price of our common stock may be adversely impacted, and we will not recognize the anticipated benefits of the acquisition.
We cannot assure that the price of any future acquisitions of IBX data centers or businesses will be similar to prior IBX data center acquisitions and businesses. In fact, we expect costs required to build or render new IBX data centers operational to increase in the future. If our revenue does not keep pace with these potential acquisition and expansion costs, we may not be able to maintain our current or expected margins as we absorb these additional expenses. There is no assurance we would successfully overcome these risks, or any other problems encountered with these acquisitions.
The anticipated benefits of our joint ventures may not be fully realized, or take longer to realize than expected.
We have entered into joint ventures to develop and operate data centers. Certain sites that are intended to be utilized in joint ventures require investment for development. The success of these joint ventures will depend, in part, on our ability to find suitable land and power. From time to time, Equinix may incur costs or make commitments to acquire land and/or power prior to the consummation of the joint venture or in advance of their transfer to the joint venture. These commitments could result in increased costs and risks for Equinix. The success of these joint ventures will also depend on the development of the data center sites. Such development may be more difficult, time-consuming or costly than expected and could result in increased costs, decreases in the amount of expected revenues and diversion of management's time and energy, which could materially impact our business, financial condition and results of operations. Additionally, if it is determined these sites are no longer desirable for the joint ventures, we would need to adapt such sites for other purposes and incur additional expenses as a result.
We may not realize all of the anticipated benefits from our joint ventures. The success of these joint ventures will depend, in part, on the successful partnership between Equinix and our joint venture partners. Such a
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partnership is subject to risks as outlined below, and more generally, to the same types of business risks as would impact our IBX data center business. A failure to successfully partner, or a failure to realize our expectations for the joint ventures, including any contemplated exit strategy from a joint venture, could materially impact our business, financial condition and results of operations. These joint ventures could also be negatively impacted by inflation, supply chain issues, an inability to obtain financing on favorable terms or at all, an inability to fill the data center sites with customers as planned, unexpected power constraints, and development and construction delays, including those we are currently experiencing in many markets globally.
Joint venture investments could expose us to risks and liabilities in connection with the formation of the new joint ventures, the operation of such joint ventures without sole decision-making authority, and our reliance on joint venture partners who may have economic and business interests that are inconsistent with our business interests.
In addition to our current and proposed joint ventures, we may co-invest with other third parties through partnerships, joint ventures or other entities in the future. These joint ventures could result in our acquisition of non-controlling interests in, or shared responsibility for, managing the affairs of a property or portfolio of properties, partnership, joint venture or other entity. We may be subject to additional risks, including:
• we may not have the right to exercise sole decision-making authority regarding the properties, partnership, joint venture or other entity;
• our joint venture structures may come with complex governance obligations that may be challenging to meet;
• if our partners become bankrupt or fail to fund their share of required capital contributions, we may choose to or be required to contribute such capital or be otherwise adversely impacted;
• our partners may have economic, tax or other business interests or goals which are inconsistent with our business interests or goals, and may be in a position to take actions contrary to our policies or objectives;
• our joint venture partners may take actions that are not within our control, which could require us to dispose of the joint venture asset, transfer it to a taxable REIT subsidiary ("TRS") in order to maintain our qualification for taxation as a REIT, or purchase the partner's interests or assets at an above-market price;
• our joint venture partners may take actions unrelated to our business agreement but which reflect poorly on us because of our joint venture relationship;
• disputes between us and our partners may result in litigation or arbitration that would increase our expenses and prevent our management from focusing their time and effort on our day-to-day business;
• we may in certain circumstances be liable for the actions of our third-party partners or guarantee all or a portion of the joint venture's liabilities, which may require us to pay an amount greater than its investment in the joint venture;
• we may fail to maintain the complex tax structure of the joint ventures and, as a result, become liable for additional tax liabilities of the joint ventures;
• our joint venture partner may have contractual exit rights under certain circumstances, and may force us to buy them out on terms and timing unfavorable to us;
• we may need to change the structure of an established joint venture or create new complex structures to meet our business needs or the needs of our partners which could prove challenging; and
• a joint venture partner's decision to exit the joint venture may not be at an opportune time for us or in our business interests.
Each of these factors may result in returns on these investments being less than we expect or in losses, and our financial and results of operations may be adversely affected.
If we cannot effectively manage our international operations and successfully implement our international expansion plans, our business and results of operations would be adversely impacted.
For the years ended December 31, 2025, 2024 and 2023, we recognized approximately 61%, 62% and 63%, respectively, of our revenues outside the U.S. We currently operate outside of the U.S. in Canada, Mexico, South America, the Asia-Pacific region and the EMEA region.
In addition, we are currently undergoing expansions or evaluating expansion opportunities outside of the U.S., which could include entering into emerging and higher-risk markets which may expose us to new risks. Undertaking and managing expansions in foreign jurisdictions may present unanticipated challenges to us.
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Our international operations are generally subject to a number of additional risks, including:
• the costs of customizing IBX data centers for foreign countries;
• protectionist laws and business practices favoring local competition;
• greater difficulty or delay in accounts receivable collection;
• difficulties in staffing and managing foreign operations, including negotiating with foreign labor unions or workers' councils;
• difficulties in managing across cultures and in foreign languages;
• political and economic instability;
• difficulties in managing varying business standards and construction speeds across markets;
• fluctuations in currency exchange rates;
• exposure to hyperinflation related to expansion into developing countries;
• difficulties in repatriating funds from certain countries;
• our ability to obtain, transfer or maintain licenses required by governmental entities with respect to our business;
• difficulties in procuring power and/or in obtaining stable sources of power;
• our ability to secure and maintain the necessary physical and telecommunications infrastructure;
• unexpected changes in political environments and government relations including trade wars;
• changes in the government and public administration in emerging markets that may impact the stability of foreign investment policies;
• compliance with anti-bribery and corruption laws;
• compliance with economic and trade sanctions enforced by the Office of Foreign Assets Control of the U.S. Department of Treasury, the Bureau of Industry and Security of the US Department of Commerce and other enforcement agencies in other jurisdictions around the world including those related to the Russian and Ukrainian war;
• compliance with changing and conflicting laws, policies and requirements related to sustainability;
• increasing scrutiny on the operational resilience of data centers, especially in countries where data centers are designated as critical national infrastructure and/or essential ICT service providers;
• increasing resistance to data center presence and expansion by local communities;
• compliance with evolving cybersecurity laws including reporting requirements;
• unexpected changes and compliance with tax laws; and
• compliance with evolving governmental regulation.
If we cannot effectively manage the challenges associated with our international operations and expansion plans, we could experience a delay in our expansion projects or a failure to grow. Expansion challenges and international operations failures could also materially damage our reputation, our brand, our business and results of operations. Our success depends, in part, on our ability to anticipate and address these risks and manage these difficulties.
We continue to invest in our expansion efforts, but may not have sufficient customer demand in the future to realize expected returns on these investments.
We are considering the acquisition or lease of additional properties and the construction of new IBX data centers beyond those expansion projects already announced. We will be required to commit substantial operational and financial resources to these IBX data centers in advance of securing customer contracts and we may not have sufficient customer demand in those markets to support these IBX data centers once they are built. In addition, unanticipated technological changes could affect customer requirements for data centers, and we may not have built such requirements into our new IBX data centers. Either of these contingencies, if they were to occur, could make it difficult for us to realize expected or reasonable returns on these investments.
Risks Related to Our Capital Needs and Capital Strategy
Our substantial debt could adversely affect our cash flows and limit our flexibility to raise additional capital.
We have a significant amount of debt and have announced our need to incur additional debt to support our planned growth. Additional debt may also be incurred to fund future acquisitions, any future special distributions, regular distributions or the other cash outlays associated with maintaining our qualification for taxation as a REIT. As of December 31, 2025, our total indebtedness (inclusive of finance lease liabilities and gross of debt issuance costs and debt discounts) was approximately $21.4 billion, our stockholders' equity was $14.2 billion and our cash, cash equivalents and short-term investments totaled $3.2 billion. In addition, as of December 31, 2025, we had
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approximately $4.0 billion of additional liquidity available to us from our $4.0 billion revolving credit facility. In addition to our substantial debt, we lease many of our IBX data centers and certain equipment under lease agreements, some of which are accounted for as operating leases. As of December 31, 2025, we recorded operating lease liabilities of $1.5 billion, which represents our obligation to make lease payments under those lease arrangements.
Our substantial amount of debt and related covenants, our off-balance sheet commitments, and our intent to raise additional debt could have important consequences. For example, they could:
• require us to dedicate a substantial portion of our cash flow from operations to make interest and principal payments on our debt and in respect of other off-balance sheet arrangements, reducing the availability of our cash flow to fund future capital expenditures, working capital, execution of our expansion strategy and other general corporate requirements;
• increase the likelihood of negative outlook from our credit rating agencies, or of a downgrade to our current rating;
• make it more difficult for us to satisfy our obligations under our various debt instruments;
• increase our cost of borrowing and even limit our ability to access additional debt to fund future growth;
• increase our vulnerability to general adverse economic and industry conditions and adverse changes in governmental regulations;
• limit our flexibility in planning for, or reacting to, changes in our business and industry, which may place us at a competitive disadvantage compared with our competitors;
• limit our operating flexibility through covenants with which we must comply;
• limit our ability to borrow additional funds, even when necessary to maintain adequate liquidity, which would also limit our ability to further expand our business; and
• make us more vulnerable to increases in interest rates because of the variable interest rates on some of our borrowings to the extent we have not entirely hedged such variable-rate debt.
The occurrence of any of the foregoing factors could have a material adverse effect on our business, results of operations and financial condition.
We also plan to refinance a portion of our outstanding debt as it matures. Given current market conditions, there is a risk that we may not be able to refinance existing debt or the terms of any refinancing may not be as favorable as the terms of our existing debt. Furthermore, if prevailing interest rates or other factors at the time of refinancing result in even higher interest rates upon refinancing than we anticipate, the interest expense relating to that refinanced indebtedness would increase. Volatility in the financial markets and rising interest rates could affect our ability to access the capital markets at a time when we desire, or need, to do so which could have an impact on our flexibility to pursue additional expansion opportunities and maintain our desired level of revenue growth in the future.
These risks could materially adversely affect our financial condition, cash flows and results of operations.
Sales or issuances of shares of our common stock may adversely affect the market price of our common stock.
Future sales or issuances of common stock or other equity related securities may adversely affect the market price of our common stock, including any shares of our common stock issued to finance capital expenditures, finance acquisitions or repay debt. In October 2024, we established an "at the market" equity offering program (the "2024 ATM Program") to replace a previous program from 2022 which had been exhausted (the "2022 ATM Program”). Under the $2.0 billion 2024 ATM Program, we may, from time to time, issue and sell shares of our common stock to or through sales agents up to established limits. As of December 31, 2025, we had approximately $1.2 billion available for sale under the 2024 ATM Program. We have refreshed our ATM program in the past and may refresh our ATM program in the future, which may lead to additional dilution for our stockholders. We may also seek authorization to sell additional shares of common stock through other means which could lead to additional dilution for our stockholders. Please see Note 11 within the Consolidated Financial Statements of this Annual Report on Form 10-K for sales of our common stock under our ATM programs.
If we are not able to generate sufficient operating cash flows or obtain external financing, our ability to fund incremental expansion plans may be limited.
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Our capital expenditures, together with ongoing operating expenses, obligations to service our debt and the cash outlays associated with our REIT distribution requirements, are, and will continue to be, a substantial burden on our cash flow and may decrease our cash balances. Additional debt or equity financing may not be available when needed or, if available, may not be available on satisfactory terms. Our inability to obtain additional debt and/or equity financing or to generate sufficient cash from operations may require us to prioritize projects or curtail capital expenditures which could adversely affect our results of operations.
Risks Related to Sustainability, Environmental Laws and Climate Change
Environmental and sustainability laws and regulations may impose upon us new or unexpected costs.
Many countries and states have increasingly taken a more proactive approach relating to sustainability through the adoption of laws, regulations and directives that require corporations to disclose their corporate sustainability efforts, including through mandatory reporting and preparation of carbon reduction plans. Despite there being some developments in the U.S. and the EU to deregulate, scale back or simplify the requirements on corporate sustainability efforts, the global regulatory landscape on corporate sustainability reporting has continued to expand in both size and complexity across other parts of the world in which we operate. It is possible that compliance with sustainability-related laws, regulations and directives will require us to re-evaluate and make changes to our business, including changes in operations and in our supply chain and thus increase our cost of doing business in the relevant affected regions or countries. We also may incur incremental costs to enhance our internal systems to collect the data needed to meet these regulatory requirements, including attestation standards.
We are subject to various federal, state and local environmental and health and safety laws and regulations in the United States and at our non-U.S. locations, including those relating to the generation, storage, handling and disposal of hazardous substances, regulated materials and wastes. Certain of these laws and regulations also impose joint and several liability, without regard to fault, for investigation and cleanup costs on current and former owners and operators of real property and persons who have arranged for, disposed of or released hazardous substances into the environment. Our operations involve the use of hazardous substances and other regulated materials such as petroleum fuel for emergency generators, as well as batteries, cleaning solutions, refrigerants and other materials. At some of our locations, hazardous substances or regulated materials are known to be present in soil or groundwater, and there may be additional unknown hazardous substances, or regulated materials present at sites that we own, operate or lease. At some of our locations, there are land use restrictions in place relating to earlier environmental cleanups that currently do not materially limit our use of the sites. To the extent any hazardous substances or any other substance or material must be investigated, cleaned up or removed from any property that we own, operate or lease, we may be responsible under applicable laws, regulations, permits or leases for the investigation, removal or cleanup of such substances or materials, the cost of which could be substantial.
Regulations or other governmental actions taken or implemented by federal executive branch officials (including U.S. Presidents) and agencies (such as the U.S. EPA), state environmental and health and safety agencies, regulators in other countries or judicial opinions or orders could limit or impact standards for air emissions from fossil fuel-fired power plants. Similarly, they could limit discharges of cooling water, the availability of potable water and otherwise impose new or different operational restraints or requirements on power plants that could increase costs and reliability of electricity. Regulatory programs intended to promote increased generation of electricity from renewable or carbon-free sources may also increase our costs of procuring electricity. In addition, we are directly subject to environmental, health and safety laws regulating air emissions, storm water management and other environmental matters arising in our business. For example, our emergency generators are subject to federal, state and country-specific regulations governing air pollutants, which could limit the operation of those generators or require the installation of new pollution control technologies. While environmental regulations do not normally impose material costs upon our operations, unexpected events, equipment malfunctions, human error and changes in law or regulations, among other factors, can lead to additional capital requirements, limitations upon our operations and unexpected increased costs.
Further, greenhouse gas ("GHG") emissions regulations, carbon taxes, carbon pricing mechanisms and removal of incentives for renewable energy development and GHG reductions could also increase expenses, create unexpected costs and require investments in new technologies. Non-U.S. regulations related to the environment and sustainability are expected to continue to increase and evolve and may impose upon us new or unexpected costs. The course of future and existing legislation and regulation in the U.S. and abroad remains difficult to predict, and the potential increased costs associated with national or supra-national GHG regulation and other government policies cannot be estimated at this time.
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We also purchase significant amounts of electricity from generating facilities and utility companies. These facilities and utility companies are subject to executive actions, environmental laws, regulations, permit requirements and policy decisions that could be subject to material change, which could result in increases in our electricity suppliers' compliance costs that may be passed through to us in the form of higher electricity costs.
Our business may be adversely affected by physical risks related to climate change and our response to it.
Acute physical risks and severe weather events, such as heatwaves, droughts, flooding, wildfires and storms, pose threats to our data centers by causing physical damages, power disruptions, and rising electricity costs, which may impact our ability to operate, maintain service and attract and retain customers, thereby affecting our costs and revenues. The frequency and intensity of severe weather events are reportedly increasing as part of broader climate changes. Changes in global weather patterns may also pose long-term risks of physical impacts to our business.
Interruptions in power transmission and grid constraints due to severe weather events can disrupt operations and increase costs, potentially resulting in adverse effects on our reputation or demand for our services and products. While we maintain disaster recovery and business continuity plans to allow us to recover from natural disasters or other events that can interrupt our business, we cannot be certain that our plans will work as intended to mitigate the impacts of such disasters or events. Failure to prevent impact to customers from such events could adversely affect our business.
We may fail to achieve our sustainability initiatives, including reaching our climate targets, or may encounter objections to them, which may adversely affect public perception of our business and affect our relationship with our customers, regulators, our stockholders and/or other stakeholders.
We face pressure from our customers, stockholders and other stakeholders, such as the communities in which we operate, who are increasingly focused on sustainability, to prioritize clean and renewable energy procurement, reduce our carbon footprint, promote resource efficiency practices and demonstrate economic benefits to society. We have established science-based climate targets, including goals of achieving 100% clean and renewable energy coverage across our global portfolio by 2030 and reaching net-zero GHG emissions across the value chain by 2040. We also plan to continue to scale our clean and renewable energy strategy and pursue opportunities to improve energy and water efficiency. As a result of these and other initiatives, we intend to make progress towards reducing our environmental impact, meeting our climate targets and ensuring that our business remains viable in a low-carbon economy.
While we believe these initiatives are beneficial to our business, they may involve additional costs for conducting our business, including costs related to collecting, measuring and reporting sustainability data and information. Further, we have undertaken efforts to support availability of new clean and renewable energy development. These efforts may increase our costs of electricity above those that would be incurred through procurement of conventional electricity from existing sources or through conventional grids. Reducing our environmental footprint may also require physical or operational modifications that may be costly. These initiatives could adversely affect our financial position and results of operations.
There is also a risk that our climate targets will not be met. It is possible that we may fail to reach our climate targets in a timely manner or that our customers, stockholders, or other stakeholders might not be satisfied with our progress. Our customers, stockholders or other stakeholders may object to our climate targets or the way we seek to achieve them. A failure to meet climate targets, or significant controversy regarding these targets and how we achieve them, could adversely affect public perception of our business, employee morale or customer, stockholder or public support. If we do not meet our customers', stockholders' or other stakeholders' expectations regarding sustainability initiatives, or lose support in our communities, our business and/or our share price could be harmed.
Some governmental and non-governmental entities in the U.S. and certain investor constituencies have questioned the appropriateness of or objected to sustainability initiatives. Some investors may use sustainability-related factors to guide their investment strategies and may choose not to invest in us, a factor that could tend to reduce demand for our shares and possibly affect our share price adversely. We may face increased governmental scrutiny, potential enforcement actions or private litigation challenging our sustainability goals, or our disclosure of those goals. This could also impact our ability to achieve our sustainability goals. New or changing regulation or public opinion regarding our sustainability goals or our actions to achieve them may result in adverse effects on our financial performance, reputation or demand for our services and products, or may otherwise result in obligations and liabilities that cannot be predicted or estimated at this time.
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Risks Related to Certain Regulations and Laws, Including Tax Laws
Government regulation related to our business or failure to comply with laws and regulations may adversely affect our business.
Various laws and governmental regulations, both in the U.S. and abroad, governing internet-related services, related communications services and information technologies are evolving rapidly to address technological advancements, shifting consumer behaviors and the rise of new services. Changes to these laws and regulations could have a material adverse effect on us and our customers. We expect there may also be forthcoming regulation in areas of regulating the responsible use of AI, such as the proposed EU Artificial Intelligence Act and the introduction of heightened measures to be adopted with respect to cybersecurity, operational resilience, data privacy, sustainability, taxation and data security, any of which could impact us and our customers.
We remain focused on whether and how existing and changing laws, such as those governing intellectual property, privacy, libel, telecommunications services, data flows/data localization, carbon emissions impact, competition and antitrust, and taxation apply to our business and those which might have a material effect on our customers’ decisions to purchase our solutions. Substantial resources may be required to comply with regulations or bring any non-compliant business practices into compliance with such regulations. In addition, the continuing development of the market for online commerce and the displacement of traditional telephony service by the internet and related communications services may prompt an increased call for more stringent consumer protection laws or other regulation both in the U.S. and abroad that may impose additional burdens on companies conducting business online and their service providers.
In countries where there are shortages of power, land and water resources, local governments have and/or will be imposing more stringent regulations and requirements to control the growth and development of data centers in their countries. New builds and further expansion of data center operations in such markets are increasingly being evaluated and approvals (where required) may only be granted where a data center operator is not only able to demonstrate that it is efficient in its use of energy and water but also that its operations have and/or will bring positive and significant environmental, economic and social impact to the country and the local community. Our data center operations increasingly have to accommodate thermal demands of high-performance computing infrastructure at scale. Using evaporative cooling to meet these demands introduces water-related risks that could impact our operations, costs, and reputation. For example, certain facilities are located in regions experiencing water stress or recurring droughts, and evaporative cooling systems can consume millions of gallons annually. In water-scarce areas, this can lead to regulatory restrictions, community opposition, or operational limitations.
Regulators are increasingly aware and recognizing the importance of data centers in ensuring the availability, resiliency, security and stability of digitalized critical services such as national security, healthcare and financial and banking services. Our business was designated "critical infrastructure" or "essential services" which allowed our data centers to remain open in many jurisdictions during the COVID-19 pandemic. Regulations such as the US Cyber Incident Reporting for Critical Infrastructure Act of 2022 (“CIRCIA 2022”), the SEC Cybersecurity Disclosure Rule, the EU Network and Information Security Directive No.2 (“NIS 2”), the EU Digital Operational Resilience Act (“DORA”), and Australia’s Security of Critical Infrastructure Act 2018 make it mandatory for Equinix to comply with more stringent requirements related to cybersecurity, data privacy, controls on data storage and cross border data transfer and operational resilience, more so, in countries where our entities and/or IBXs are designated as critical information or critical national infrastructure. For example, we have recently been designated as a “Critical ICT Third-Party Information and Communications Technology ("ICT") Service Provider" under DORA. Any regulations restricting our ability to operate our business for any reason could have a material adverse effect on our business.
Laws and regulations related to economic sanctions, export controls, anti-bribery and anti-corruption, and other international activities may restrict or limit our ability to engage in transactions or dealings with certain counterparties, in or with certain countries or territories, or in certain activities. We screen third parties against applicable sanctions lists per our standard process, and use of software solutions when possible. However, sanctions lists continue to evolve and vary by country. We continue to address necessary changes in global sanctions laws including by running manual sanctions checks in certain instances and we modify our processes as necessary in light of evolving laws. A material failure to comply with global sanctions laws could have a negative effect on our reputation, business and financial condition. In addition, we have several Chinese customers who are named in restrictive executive orders ("EOs") in the United States, and while a majority of these EOs do not apply to the type of services that we currently provide to these Chinese customers, the landscape continues to evolve, and new rules have been broader than what we have historically experienced. If we are required to cease business with these companies, or additional companies in the future, our revenues could be adversely affected. The U.S. has
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also been adopting a restrictive posture toward Chinese technology, data flows, and cross-border digital infrastructure, which could materially impact our business.
We strive to comply with all laws and regulations that apply to our business. However, as these laws evolve, they can be subject to varying interpretations and regulatory discretion. To the extent a regulator or court disagrees with our interpretation of these laws and determines that our practices are not in compliance with applicable laws and regulations, we could be subject to civil and criminal penalties that could adversely affect our business operations. The adoption, or modification of laws or regulations relating to the internet and our business, or interpretations of existing laws, could have a material adverse effect on our business, financial condition and results of operations.
Changes in U.S. or foreign tax laws, regulations, or interpretations thereof, including changes to tax rates, may adversely affect our financial statements and cash taxes.
We are a U.S. company with global subsidiaries and are subject to income and other taxes in the U.S. (although currently limited due to our taxation as a REIT) and many foreign jurisdictions. Significant judgment is required in determining our worldwide provision for income and other taxes. Although we believe that we have adequately assessed and accounted for our potential tax liabilities, and that our tax estimates are reasonable, there can be no certainty that additional taxes will not be due upon audit of our tax returns or as a result of changes to the tax laws and interpretations thereof. For example, we are currently undergoing audits in a number of jurisdictions where we operate. The final results of these audits are uncertain and may not be resolved in our favor.
The Organization for Economic Co-operation and Development ("OECD") is an international association made up of over 30 countries including the U.S. The OECD has proposed and made numerous changes to long-standing tax principles, which, if adopted by the member countries, could have a materially adverse effect on our tax liabilities. For example, it has proposed a framework to implement a global minimum tax of 15% for businesses with global revenues and profits above certain thresholds (referred to as Pillar Two). The framework includes a mechanism empowering foreign jurisdictions to levy a top-up tax on our profits in the U.S. Certain aspects of Pillar Two became effective January 1, 2024, and the rest of the new tax regime became generally effective January 1, 2025, to the extent the rules have been adopted and ratified by the legislatures in the OECD countries. On January 5, 2026, the OECD/G20 Inclusive framework on Base Erosion and Profit Shifting (the Inclusive Framework) published the “side-by-side package” of administrative guidance which significantly modifies key aspects of the Pillar Two Global Minimum Tax (GMT) framework. The side-by-side package includes safe harbors designed to largely exempt U.S.-headquartered multinational enterprises from certain income inclusion rules. As such, the risk of Pillar Two framework to our financial statements has diminished.
Our business could be adversely affected if we are unable to maintain our complex global legal entity structure.
We maintain a complex global organizational structure, containing numerous legal entities of varied types and serving various purposes, in each country in which we operate. For example, to maintain our qualification for taxation as a REIT for U.S. federal income tax purposes, we use TRSs and qualified REIT subsidiaries ("QRSs") in order to segregate our income between net income from real estate and net income from other non-real estate activities. This results in significantly more entities than we might otherwise utilize if we were not having to maintain our qualification for taxation as a REIT in the U.S.
Additionally, we maintain certain other regional and/or business specific organizational structures for various tax, legal and other business purposes. The organization, maintenance and reporting requirements for our entity structure are complex and require coordination amongst many teams within Equinix and the use of outside service providers. While we use automation tools and software where possible to manage this process, a meaningful amount of work continues to be manual. We believe we have adequate controls in place to manage these complex structures, but if our controls fail, there could be significant legal and tax implications to our business and our operations including but not limited to material tax and legal liabilities.
Risks Related to Our REIT Status in the U.S.
We may not remain qualified for taxation as a REIT.
We elected to be taxed as a REIT for U.S. federal income tax purposes beginning with our 2015 taxable year. We believe that our organization and method of operation comply with the rules and regulations promulgated under
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the Internal Revenue Code of 1986, as amended (the "Code"), such that we will continue to qualify for taxation as a REIT. However, we cannot assure you that we have qualified for taxation as a REIT or that we will remain so qualified. Qualification for taxation as a REIT involves the application of highly technical and complex provisions of the Code to our operations as well as various factual determinations concerning matters and circumstances not entirely within our control. There are limited judicial or administrative interpretations of applicable REIT provisions of the Code.
If, in any taxable year, we fail to remain qualified for taxation as a REIT and are not entitled to relief under the Code:
• we will not be allowed a deduction for distributions to stockholders in computing our taxable income;
• we will be subject to U.S. federal and state income tax on our taxable income at regular corporate income tax rates; and
• we would not be eligible to elect REIT status again until the fifth taxable year that begins after the first year for which we failed to qualify for taxation as a REIT.
Any such corporate tax liability could be substantial and would reduce the amount of cash available for other purposes. If we fail to remain qualified for taxation as a REIT, we may need to borrow additional funds or liquidate some investments to pay any additional tax liability. Accordingly, funds available for investment and distributions to stockholders could be reduced.
As a REIT, failure to make required distributions would subject us to federal corporate income tax.
We paid a quarterly distribution on December 17, 2025 and have declared a quarterly distribution for the first quarter of 2026 to be paid on March 18, 2026. The amount, timing and form of any future distributions will be determined, and will be subject to adjustment, by our Board of Directors. To remain qualified for taxation as a REIT, we are generally required to distribute at least 90% of our REIT taxable income (determined without regard to the dividends paid deduction and excluding net capital gain) each year, or in limited circumstances, the following year, to our stockholders. Generally, we expect to distribute all or substantially all of our REIT taxable income. If our cash available for distribution falls short of our estimates, we may be unable to maintain distributions that approximate our REIT taxable income and may fail to remain qualified for taxation as a REIT. In addition, our cash flows from operations may be insufficient to fund required distributions as a result of differences in timing between the actual receipt of income and the payment of expenses and the recognition of income and expenses for federal income tax purposes, or the effect of nondeductible expenditures, such as capital expenditures, payments of compensation for which Section 162(m) of the Code denies a deduction, interest expense deductions limited by Section 163(j) of the Code, the settlement of reserves or required debt service or amortization payments.
To the extent that we satisfy the 90% distribution requirement but distribute less than 100% of our REIT taxable income, we will be subject to federal corporate income tax on our undistributed taxable income. In addition, we will be subject to a 4% nondeductible excise tax on our undistributed taxable income if the actual amount that we distribute to our stockholders for a calendar year is less than the minimum amount specified under the Code.
Complying with REIT requirements may limit our flexibility or cause us to forgo otherwise attractive opportunities.
To remain qualified for taxation as a REIT for U.S. federal income tax purposes, we must satisfy tests concerning, among other things, the sources of our income, the nature and diversification of our assets and the amounts we distribute to our stockholders. For example, under the Code, no more than 25% (20% for our tax years beginning after December 31, 2017 and before January 1, 2026) of the value of the assets of a REIT may be represented by securities of one or more TRSs. Similar rules apply to other nonqualifying assets. These limitations may affect our ability to make large investments in other non-REIT qualifying operations or assets. In addition, in order to maintain our qualification for taxation as a REIT, we must distribute at least 90% of our REIT taxable income, determined without regard to the dividends paid deduction and excluding any net capital gains. Even if we maintain our qualification for taxation as a REIT, we will be subject to U.S. federal income tax at regular corporate income tax rates for our undistributed REIT taxable income, as well as U.S. federal income tax at regular corporate income tax rates for income recognized by our TRSs; we also pay taxes in the foreign jurisdictions in which our international assets and operations are held and conducted regardless of our qualification for taxation as a REIT. Because of these distribution requirements, we will likely not be able to fund future capital needs and investments from operating cash flow. As such, compliance with REIT tests may hinder our ability to make certain attractive
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investments, including the purchase of significant nonqualifying assets and the material expansion of non-real estate activities.
Our use of TRSs, including for certain of our international operations, may cause us to fail to remain qualified for taxation as a REIT in the U.S.
Our operations utilize TRSs to facilitate our qualification for taxation as a REIT. The net income of our TRSs is not included in our REIT taxable income unless it is distributed by an applicable TRS, and income that is not included in our REIT taxable income generally is not subject to the REIT income distribution requirement. Our ability to receive distributions from our TRSs is limited by the rules with which we must comply to maintain our qualification for taxation as a REIT. In particular, at least 75% of our gross income for each taxable year as a REIT must be derived from real estate. Consequently, no more than 25% of our gross income may consist of dividend income from our TRSs and other nonqualifying types of income. Thus, our ability to receive distributions from our TRSs may be limited and may impact our ability to fund distributions to our stockholders using cash flows from our TRSs.
Further, there may be limitations on our ability to accumulate earnings in our TRSs and the accumulation or reinvestment of significant earnings in our TRSs could result in adverse tax treatment. In particular, if the accumulation of cash in our TRSs causes (1) the fair market value of our securities in our TRSs to exceed 25% (20% for our tax years beginning after December 31, 2017 and before January 1, 2026) of the fair market value of our assets or (2) the fair market value of our securities in our TRSs and other nonqualifying assets to exceed 25% of the fair market value of our assets, then we will fail to remain qualified for taxation as a REIT. Further, a substantial portion of our TRSs are overseas, and a material change in foreign currency rates could also negatively impact our ability to remain qualified for taxation as a REIT.
The Code imposes limitations on the ability of our TRSs to utilize specified income tax deductions, including limits on the use of net operating losses and limits on the deductibility of interest expense.
Even if we remain qualified for taxation as a REIT, some of our business activities are subject to corporate level income tax and foreign taxes, which will continue to reduce our cash flows, and we will have potential deferred and contingent tax liabilities.
Even if we remain qualified for taxation as a REIT, we may be subject to some federal, state, local and foreign taxes, including taxes on any undistributed income, and state, local or foreign income, franchise, property and transfer taxes. In addition, we could in certain circumstances be required to pay an excise or penalty tax, which could be significant in amount, in respect of dealer property income or in order to utilize one or more relief provisions under the Code to maintain our qualification for taxation as a REIT.
A portion of our business is conducted through wholly owned TRSs because certain of our business activities could generate nonqualifying REIT income as currently structured and operated. The income of our U.S. TRSs will continue to be subject to federal and state corporate income taxes. In addition, our international assets and operations continue to be subject to taxation in the foreign jurisdictions where those assets are held or those operations are conducted. Any of these taxes would decrease our earnings and our available cash.
We are also subject to a U.S. federal corporate level income tax at the highest regular corporate income tax rate on any gains recognized from the sale of a REIT asset where our basis in the asset is determined by reference to the basis of the asset in the hands of a C corporation (such as an asset that we or our QRSs hold following the liquidation or other conversion of a former TRS). This tax is generally applicable to any disposition of such an asset during the five-year period after the date we first owned the asset as a REIT asset, to the extent of the built-in-gain based on the fair market value of such asset on the date we first held the asset as a REIT asset.
Our certificate of incorporation contains restrictions on the ownership and transfer of our stock, though they may not be successful in preserving our qualification for taxation as a REIT.
In order for us to remain qualified for taxation as a REIT, no more than 50% of the value of outstanding shares of our stock may be owned, beneficially or constructively, by five or fewer individuals at any time during the last half of each taxable year. In addition, rents from "affiliated tenants" will not qualify as qualifying REIT income if we own 10% or more by vote or value of the customer, whether directly or after application of attribution rules under the Code. Subject to certain exceptions, our certificate of incorporation prohibits any stockholder from owning, beneficially or constructively, more than (i) 9.8% in value of the outstanding shares of all classes or series of our capital stock or (ii) 9.8% in value or number, whichever is more restrictive, of the outstanding shares of any class or series of our capital stock. We refer to these restrictions collectively as the "ownership limits" and we included them
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in our certificate of incorporation to facilitate our compliance with REIT tax rules. The constructive ownership rules under the Code are complex and may cause the outstanding stock owned by a group of related individuals or entities to be deemed to be constructively owned by one individual or entity. As a result, the acquisition of less than 9.8% of our outstanding common stock (or the outstanding shares of any class or series of our stock) by an individual or entity could cause that individual or entity or another individual or entity to own constructively in excess of the relevant ownership limits. Any attempt to own or transfer shares of our common stock or of any of our other capital stock in violation of these restrictions may result in the shares being automatically transferred to a charitable trust or may be void. Even though our certificate of incorporation contains the ownership limits, there can be no assurance that these provisions will be effective to prevent our qualification for taxation as a REIT from being jeopardized, including under the affiliated tenant rule. Furthermore, there can be no assurance that we will be able to monitor and enforce the ownership limits. If the restrictions in our certificate of incorporation are not effective and, as a result, we fail to satisfy the REIT tax rules described above, then absent an applicable relief provision, we will fail to remain qualified for taxation as a REIT.
In addition, the ownership and transfer restrictions could delay, defer or prevent a transaction or a change in control that might involve a premium price for our stock or otherwise be in the best interest of our stockholders. As a result, the overall effect of the ownership and transfer restrictions may be to render more difficult or discourage any attempt to acquire us, even if such acquisition may be favorable to the interests of our stockholders.
General Risk Factors
Our derivative transactions expose us to counterparty credit risk.
Our derivative transactions expose us to risk of financial loss if a counterparty fails to perform under a derivative contract. Disruptions in the financial markets could lead to sudden decreases in a counterparty's liquidity, which could make them unable to perform under the terms of their derivative contract and we may not be able to realize the benefit of the derivative contract.
Inadequate or inaccurate external and internal information, including budget and planning data, could lead to inaccurate financial forecasts and inappropriate financial decisions.
Our financial forecasts are dependent on estimates and assumptions regarding budget and planning data, market growth, foreign exchange rates, our ability to remain qualified for taxation as a REIT, and our ability to generate sufficient cash flow to reinvest in the business, fund internal growth, make acquisitions, pay dividends and meet our debt obligations. Our financial projections are based on historical experience and on various other assumptions that our management believes to be reasonable under the circumstances and at the time they are made.
We continue to evolve our forecasting models as necessary and appropriate but if our predictions are inaccurate and our results differ materially from our forecasts, we could make inappropriate financial decisions. Additionally, inaccuracies in our models could adversely impact our compliance with REIT asset tests, future profitability, stock price and/or stockholder confidence.
Fluctuations in foreign currency exchange rates, especially the strength of the U.S. dollar, in the markets in which we operate internationally could harm our results of operations.
We have experienced and may continue to experience gains and losses resulting from fluctuations in foreign currency exchange rates. To date, the majority of revenues and costs in our international operations are denominated in foreign currencies. Where our prices are denominated in U.S. dollars, our sales and revenues could be adversely affected by declines in foreign currencies relative to the U.S. dollar, thereby making our offerings more expensive in local currencies. We are also exposed to risks resulting from fluctuations in foreign currency exchange rates in connection with our international operations. To the extent we are paying contractors in foreign currencies, our operations could cost more than anticipated as a result of declines in the U.S. dollar relative to foreign currencies. In addition, fluctuating foreign currency exchange rates have a direct impact on how our international results of operations translate into U.S. dollars.
Although we currently undertake, and may decide in the future to further undertake, foreign exchange hedging transactions to reduce foreign currency transaction exposure, not every market is appropriate for a hedging strategy and we do not currently intend to eliminate all foreign currency transaction exposure. In addition, REIT compliance rules may restrict our ability to enter into hedging transactions. Therefore, any weakness of the U.S. dollar may have a positive impact on our consolidated results of operations because the currencies in the foreign countries in
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which we operate may translate into more U.S. dollars. However, if the U.S. dollar strengthens relative to the currencies of the foreign countries in which we operate, our consolidated financial position and results of operations may be negatively impacted as amounts in foreign currencies will generally translate into fewer U.S. dollars. For additional information on foreign currency risks, refer to our discussion of foreign currency risk in "Quantitative and Qualitative Disclosures about Market Risk" included in Item 7A of this Annual Report on Form 10-K.
If our internal controls are found to be ineffective, our financial results or our stock price may be adversely affected.
Our most recent evaluation of our controls resulted in our conclusion that, as of December 31, 2025, in compliance with Section 404 of the Sarbanes-Oxley Act of 2002, our internal controls over financial reporting were effective. Our ability to manage our operations and growth through, for example, the integration of recently acquired businesses, the entry into new joint venture structures, the adoption of new accounting principles and tax laws, and our overhaul of our back-office systems that, for example, support the customer experience from initial quote to customer billing and our revenue recognition process, will require us to further develop our controls and reporting systems and implement or amend new or existing controls and reporting systems in those areas where the implementation and integration is still ongoing. All of these changes to our financial systems and the implementation and integration of acquisitions create an increased risk of deficiencies in our internal controls over financial reporting. If, in the future, our internal control over financial reporting is found to be ineffective, or if a material weakness is identified in our controls over financial reporting, our financial results may be adversely affected. Investors may also lose confidence in the reliability of our financial statements which could adversely affect our stock price.
Terrorist activity, or other acts of violence, including violence stemming from the current climate of political and economic uncertainty, could adversely impact our business.
The continued threat of terrorist activity and other acts of war or hostility both domestically and abroad by terrorist organizations, organized crime organizations, or other criminals along with violence stemming from political unrest, contribute to a climate of political and economic uncertainty in many of the regions in which we operate. Due to existing or developing circumstances, we may need to incur additional costs in the future to provide enhanced security, including cybersecurity and physical security, which could have a material adverse effect on our business and results of operations. These circumstances may also adversely affect our ability to attract and retain customers and employees, our ability to raise capital and the operation and maintenance of our IBX data centers.
We may not be able to protect our intellectual property rights.
We cannot make assurances that the steps taken by us to protect our intellectual property rights will be adequate to deter misappropriation of proprietary information or that we will be able to detect unauthorized use and take appropriate steps to enforce our intellectual property rights. We also are subject to the risk of litigation alleging infringement of third-party intellectual property rights. Any such claims could require us to spend significant sums in litigation, pay damages, develop non-infringing intellectual property or acquire licenses to the intellectual property that is the subject of the alleged infringement.
We have various mechanisms in place that may discourage takeover attempts.
Certain provisions of our certificate of incorporation and bylaws may discourage, delay or prevent a third party from acquiring control of us in a merger, acquisition or similar transaction that a stockholder may consider favorable. Such provisions include:
• ownership limitations and transfer restrictions relating to our stock that are intended to facilitate our compliance with certain REIT rules relating to share ownership;
• authorization for the issuance of "blank check" preferred stock;
• the prohibition of cumulative voting in the election of directors;
• limits on the persons who may call special meetings of stockholders;
• limits on stockholder action by written consent; and
• advance notice requirements for nominations to the Board of Directors or for proposing matters that can be acted on by stockholders at stockholder meetings.
In addition, Section 203 of the Delaware General Corporation Law, which restricts certain business combinations with interested stockholders in certain situations, may also discourage, delay or prevent someone from acquiring or merging with us.
ITEM 1B. Unresolved Staff Comments
There is no disclosure to report pursuant to Item 1B.
ITEM 1C. Cybersecurity
Equinix Risk Management and Strategy
Equinix has processes for assessing, identifying, and managing material risks from cybersecurity threats within our Information Security function (“InfoSec”) led by our Chief Information Security Officer (“CISO”).
The foundation of risk oversight at Equinix is our Enterprise Risk Management program ("ERM”), overseen by the Nominating and Governance Committee of our Board. The process is governed by the ERM Policy and includes the ERM team, the Emerging Risk team and the Governance, Risk and Compliance Committee. The ERM program focuses on identification, assessment, management, monitoring and reporting of key business risks. Risk identification involves periodic risk surveys and/or risk interviews with key business process owners and executives to identify key strategic, operational, financial, regulatory, compliance and external risks at the enterprise level. The Emerging Risk team, comprised of business leaders representing a majority of business functions at Equinix, meets monthly to identify fast-moving, potentially impactful risks.
The ERM program works with risk owners to gather, evaluate, and prioritize risk information through the completion of a risk assessment and creation of a risk profile document. Top risks, including those related to cybersecurity, are evaluated through a detailed risk assessment, and the risks are reexamined periodically as needed. InfoSec performs an annual refresh of an information security risk profile document as required by this process, and the results of such assessment are reported out for escalation, prioritization and reporting on an annual basis.
Cybersecurity Risk Management and Strategy
Equinix cybersecurity risk management activities and outcomes are guided by the National Institute of Standards and Technology (“NIST”) Cybersecurity Framework (“CSF”). In addition, our cybersecurity program is certified globally against the International Organization for Standardization (“ISO”) 27001 standards. Currently, our cybersecurity program includes the following key categories of security controls with many security capabilities serving under each category: Governance, Access Control, Awareness and Training, Audit and Accountability, Configuration Management, Contingency Planning, Incident Response, Data Security, Continuous Monitoring, Maintenance Controls, Media Protection, Physical Protections, Risk Assessment, Third-Party Risk Management, System and Communications Protection, and System and Information Integrity.
Equinix has also implemented our Security Engagement and Third-Party Risk programs which are designed to identify and mitigate cybersecurity risk associated with our use of third-party service providers. We use a variety of inputs in such assessments, including information supplied by the third parties and regular monitoring.
Equinix conducts annual, mandatory employee training on how to spot suspicious activity, educates employees on potential security risks, and periodically conducts cybersecurity tests across various functions to assess and refine response capabilities.
Equinix’s cybersecurity risk management processes are carried out in the context of broader business objectives and are integrated into Equinix’s broader risk management processes as described above in “Equinix Risk Management and Strategy”.
Equinix's networks, products and services are reviewed by our internal audit teams as well as independent third-party assessors in support of security-related industry certifications and attestations (including SOC2, ISO27001 and PCI DSS). When appropriate, external service providers are also used to assess, test, or otherwise assist our program.
Board of Directors’ Oversight of Risks from Cybersecurity Threat
The Nominating and Governance Committee oversees InfoSec per its charter, reviewing and considering developments related to the program and reporting on the InfoSec activities and recommendations to the full Board.
Information security risks have been deemed by our Board to be of critical importance to Equinix, and thus the Nominating and Governance Committee receives quarterly updates on cybersecurity and the full Board receives a report on cybersecurity at least annually. These briefings are conducted by our CISO and members of the InfoSec leadership team and cover topics such as key risk indicators, the status of strategic programs, operational updates and key initiatives, past and future action plans, and InfoSec functional updates.
In the event of a material cybersecurity incident, the full Board would be convened to receive updates and provide oversight.
Management’s Role in Assessing and Managing Material Risks from Cybersecurity Threats
Equinix's Information Security governance is supported by the Equinix Security Council, a cross-functional body of senior leaders chaired by our CISO. The Security Council is responsible for shaping Equinix's security operating model and culture, aligning Equinix-wide security standards, and providing oversight of the security program and strategic security initiatives. Its mission includes strengthening Equinix's overall security posture, fostering a secure-by-design culture, and ensuring that cybersecurity priorities are aligned with business objectives and regulatory expectations. The Security Council meets quarterly to review risk-based priorities, assess security outcomes and performance indicators, and evaluate progress on key initiatives. The Security Council serves as a central mechanism for enterprise-level alignment, decision-making, and communication on cybersecurity matters.
Our current CISO brings over 30 years of experience in information technology and cybersecurity, which enables him to ensure alignment of our cybersecurity program with our critical infrastructure strategies. He has experience in implementing and operating a governance framework and core controls in information technology. Additionally, team members supporting our program have relevant education and information security experience.
Risks From Cybersecurity Threats
Although we believe we have a robust program to protect against cybersecurity risks, we may not be able to prevent a cybersecurity incident that could have a material adverse effect on us. While we maintain cybersecurity insurance, the costs related to cybersecurity threats or disruptions may not be fully insured. See Item 1A. “Risk Factors” for further discussion of cybersecurity risks.
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ITEM 2. Properties
Our executive offices are located in Redwood City, California, with additional offices in several cities throughout the Americas, EMEA and Asia-Pacific regions.
The following tables present the locations of our leased and owned IBX data centers and xScale TM data centers as of December 31, 2025.
AMERICAS
Metro
Leased (1)
Owned (1) (2)
Atlanta
Bogotá
Boston
Calgary
Chicago
Culpeper
Dallas
Washington, D.C./Ashburn
Denver
Houston
Kamloops
Lima
Los Angeles
Mexico City
Miami
Monterrey
Montreal
New York
Ottawa
Philadelphia
Rio de Janeiro
Saint John
Santiago
São Paulo
Seattle
Silicon Valley
Toronto
Vancouver
Winnipeg
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EMEA
Metro
Leased (1)
Owned (1) (2)
Abidjan
Abu Dhabi
Accra
Amsterdam
Barcelona
Bordeaux
Dubai
Dublin
Düsseldorf
East Netherlands
Frankfurt
Geneva
Genoa
Hamburg
Helsinki
Istanbul
Johannesburg
Lagos
Lisbon
London
Madrid
Manchester
Milan
Munich
Muscat
Paris
Salalah
Sofia
Stockholm
Warsaw
Zurich
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Asia-Pacific
Metro
Leased (1)
Owned (1) (2)
Adelaide
Brisbane
Canberra
Chennai
Hong Kong
Jakarta
Johor
Kuala Lumpur
Manila
Melbourne
Mumbai
Osaka
Perth
Seoul
Shanghai
Singapore
Sydney
Tokyo
(1) " ● " denotes locations with one or more data centers.
(2) Owned sites include IBX data centers and xScale data centers subject to long-term ground leases.
The following table presents an overview of our portfolio of IBX data centers as of December 31, 2025:
# of IBXs (1)
Total Cabinet Capacity (1)(2)
Cabinets
Billed (1)
Cabinet Utilization % (1)(3)
MRR per Cabinet (1)(4)
Americas
EMEA
Asia-Pacific
Total
(1) Excludes 25 unconsolidated data centers (23 xScale data centers and the MC1 and SN1 IBX data centers).
(2) Cabinets represent a specific amount of space within an IBX data center. Customers can combine and use multiple adjacent cabinets within an IBX data center, depending on their space requirements.
(3) The cabinet utilization rate represents the percentage of cabinet space billed versus total cabinet capacity, taking into consideration power limitations.
(4) MRR per cabinet represents average monthly recurring revenue recognized divided by the average number of cabinets billed during the fourth quarter of the year. Americas MRR per cabinet excludes Infomart non-IBX tenant income.
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The following table presents a summary of our significant IBX data center projects under construction as of December 31, 2025:
Property
Property Location
Target Open Date
Sellable Cabinets
Total Capex
(in millions) (1)
Americas:
NY11 phase 5
New York
BG2 phase 2
Bogotá
SV18 phase 1
Silicon Valley
MI1 redevelopment
Miami
MT1 phase 3
Montreal
RJ3 phase 2
Rio de Janeiro
SP7 phase 1
São Paulo
SP4 phase 5
São Paulo
DC17 phases 1 and 2
Washington, D.C.
DC22 phase 2
Washington, D.C.
SV18 phase 2
Silicon Valley
TR6 phase 3
Toronto
CH5 phase 2
Chicago
DA12 phase 1
Dallas
EMEA:
LG3 phase 1
Lagos
DX3 phase 2
Dubai
MD5 phase 1
Madrid
IL3 phase 1
Istanbul
FR8 phase 3
Frankfurt
LD14 phase 1
London
PA14 phase 1
Paris
LS2 phase 2
Lisbon
ZH4 phase 6
Zurich
LG4 phase 1
Lagos
DB10 phase 1
Dublin
LD14 phase 2
London
FR12 phase 1
Frankfurt
MU4 phase 3
Munich
PA14 phase 2
Paris
FR15 phase 1
Frankfurt
Asia-Pacific:
HK6 phase 1
Hong Kong
OS3 phase 4
Osaka
JK1 phase 2
Jakarta
SG6 phase 1
Singapore
SY5 phase 4
Sydney
KL2 phases 1 and 2
Kuala Lumpur
MB3 phase 2
Mumbai
BK1 phase 1
Bangkok
JH2 phases 1 and 2
Johor
CN1 phase 2
Chennai
OS6 phase 1
Osaka
Total
(1) Capital expenditures are approximate and may change based on final construction details.
ITEM 3. Legal Proceedings
On March 20, 2024, the Company received a subpoena from the U.S. Attorney’s Office for the Northern District of California (“NDCA”). On April 30, 2024, the Company received a subpoena from the SEC. Thereafter, the Company responded to additional information requests by the SEC on the same or related issues. On November 19, 2025, the Company received correspondence from the SEC indicating that the agency had concluded its investigation and does not intend to recommend an enforcement action. The Company also does not expect any further related action from the NDCA.
On May 2, 2024, a putative stockholder class action was filed against the Company and certain of our officers in the United States District Court for the NDCA. The named plaintiff alleges violations of Section 10(b) of the Exchange Act and SEC Rule 10b-5, and Section 20(a) of the Exchange Act, on the basis that the defendants allegedly made false and misleading statements about our business, results, internal controls, and accounting practices between May 3, 2019 and March 24, 2024. The lawsuit sought, among other relief, a determination that the alleged claims may be asserted on a class-wide basis, unspecified damages, attorneys' fees, other expenses and costs. We filed a motion to dismiss the lawsuit on October 10, 2024. The motion was granted in part on January 6, 2025. On July 15, 2025, the parties entered a Stipulation of Settlement to resolve the action. The Court granted preliminary approval of the settlement on September 4, 2025, and final approval of the settlement on December 19, 2025. The case was dismissed with prejudice on December 19, 2025, and the settlement was covered entirely by our insurance.
On February 14, 2025, and February 26, 2025, respectively, certain of the Company’s current and former directors and officers were named as defendants in two shareholder derivative lawsuits (in which the Company is a nominal defendant) filed in the United States District Court for the NDCA. The lawsuits alleged, among other things, violations of Section 14(a) of the Exchange Act, breach of fiduciary duty, unjust enrichment, and waste of corporate assets and generally alleged the same purported misconduct as alleged in the putative stockholder class action described above. The lawsuits sought, among other relief, unspecified damages, restitution, attorneys’ fees, and other expenses and costs. On April 17, 2025, and April 18, 2025, respectively, the plaintiffs filed notices of voluntary dismissal without prejudice, subject to court approval, to pursue remedies under Delaware law. The cases were dismissed on April 28, 2025 and August 19, 2025, respectively.
On August 6, 2025, certain of the Company's current and former directors and officers were named as defendants in an additional shareholder derivative lawsuit (in which the Company is a nominal defendant) filed in the United States District Court for the District of Delaware. The lawsuit makes generally the same types of allegations and seeks the same types of relief as the derivative lawsuits above and makes additional allegations that certain directors' and officers' alleged knowledge of the purported misconduct constituted insider trading. We filed a motion to dismiss the lawsuit on October 20, 2025, which remains pending with the Court.
These matters are subject to uncertainties and we cannot predict the outcome, nor reasonably estimate a range of loss or penalties, if any, relating to these matters prior to resolution.
ITEM 4. Mine Safety Disclosures
Not applicable.
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PART II
ITEM 5. Market for Registrant's Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities
Our common stock is quoted on the NASDAQ Global Select Market under the symbol of "EQIX." Our common stock began trading in August 2000. As of January 31, 2026, we had 98,254,928 shares of our common stock outstanding held by approximately 233 registered holders. During the years ended December 31, 2025 and 2024, we did not issue or sell any securities on an unregistered basis.
Stock Performance Graph
The graph set forth below compares the cumulative total stockholder return on Equinix's common stock between December 31, 2020 and December 31, 2025 with the cumulative total return of:
• the S&P 500 Index;
• the NASDAQ Composite Index; and
• the FTSE NAREIT All REITs Index.
The graph assumes the investment of $100.00 on December 31, 2020 in Equinix's common stock and in each index, and assumes the reinvestment of dividends, if any.
Equinix cautions that the stock price performance shown in the graph below is not indicative of, nor intended to forecast, the potential future performance of Equinix's common stock.
Notwithstanding anything to the contrary set forth in any of Equinix's previous or future filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, that might incorporate this Annual Report on Form 10-K or future filings made by Equinix under those statutes, the stock performance graph shall not be deemed filed with the Securities and Exchange Commission and shall not be deemed incorporated by reference into any of those prior filings or into any future filings made by Equinix under those statutes.
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COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
*$100 invested on 12/31/20 in stock or index, including reinvestment of dividends.
Fiscal year ending December 31.
ITEM 6. [Reserved]
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ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations
The following commentary should be read in conjunction with the financial statements and related notes contained elsewhere in this Annual Report on Form 10-K. The information in this discussion contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are based upon current expectations that involve risks and uncertainties. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. For example, the words "believes," "anticipates," "plans," "expects," "intends" and similar expressions are intended to identify forward-looking statements. Our actual results and the timing of certain events may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such a discrepancy include, but are not limited to, those discussed in "Liquidity and Capital Resources" and "Risk Factors" elsewhere in this Annual Report on Form 10-K. All forward-looking statements in this document are based on information available to us as of the date hereof and we assume no obligation to update any such forward-looking statements.
Item 7 of this Form 10-K focuses on discussion of 2025 and 2024 items as well as 2025 results as compared to 2024 results. For the discussion of 2023 items and 2024 results as compared to 2023 results, please refer to Item 7 of our 2024 Form 10-K as filed with the SEC on February 12, 2025.
Our management's discussion and analysis of financial condition and results of operations is intended to assist readers in understanding our financial information from our management's perspective and is presented as follows:
• Overview
• Results of Operations
• Non-GAAP Financial Measures
• Liquidity and Capital Resources
• Critical Accounting Estimates
• Recent Accounting Pronouncements
Overview
We provide a global, vendor-neutral data center, interconnection and edge solutions platform with offerings that enable our customers to reach everywhere, interconnect everyone and integrate everything. We connect economies, countries, enterprises and communities, delivering seamless digital experiences and cutting-edge AI— quickly, efficiently and with high service reliability.
Global enterprises, service providers and business ecosystems of industry partners rely on our IBX data centers and expertise around the world for the safe housing of their critical IT equipment and to protect and connect the
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world's most valued information assets. They also look to Equinix for the ability to directly and securely interconnect to the networks, clouds and content that enable today's information-driven global digital economy. Our recent IBX data center openings and acquisitions, as well as xScale TM data center investments, have expanded our total global footprint to 280 data centers, including 23 xScale data centers and the MC1 and SN1 data centers that are held in unconsolidated joint ventures, across 77 markets around the world. We offer the following solutions:
• premium data center colocation;
• physical and virtual interconnection and data exchange solutions;
• edge solutions for deploying networking, security and hardware; and
• remote expert support and professional services.
Our data centers around the world allow our customers to bring together and interconnect the infrastructure they need to seamlessly operate their business. With Equinix, they can scale with speed and agility, accelerate the launch of new digital offerings while safeguarding data, and implement AI applications at scale to achieve business success. We enable customers to simplify their digital infrastructure, ensure interoperability across platforms, and maximize speed, efficiency and security to deliver superior customer, partner and employee experiences. The Equinix global platform, and the quality of our offerings, have enabled us to establish a critical mass of customers. As more customers choose Equinix for high connectivity and performance reliability at the metro edge, it benefits their suppliers and business partners to colocate in the same data centers and connect directly with each other. This adjacency creates a network effect that attracts new customers while continuously enhancing our value proposition to existing customers and enabling them to capture further economic and performance benefits from our offerings.
In 2025, we opened 16 new data centers, including new sites added via our joint ventures and acquisitions. These openings included sites in the following metros: Chennai, Chicago, Dublin, Frankfurt, Jakarta, Lisbon, Madrid, Manila, Monterrey, Mumbai, Salalah, São Paulo and Washington, D.C. This resulted in an increase in our total number of data center facilities to 280. Additional 2025 highlights include:
• We had 52 active major development projects underway as of January 2026 across 35 metros around the world. We anticipate these development projects will deliver 55,000+ cabinets of retail capacity and 100+ MW of xScale capacity through 2028.
• We surpassed 500,000 interconnections, further demonstrating our market-leading position as we enable our customers to meet their real-time operational demands and networking requirements.
• We closed strategic land acquisitions in several locations, including the greater Amsterdam, Chicago, London, Milan, Mumbai and Toronto metros, which will support approximately 1 GW of retail and xScale capacity.
• We completed our acquisition of all outstanding shares of TIM NextGen DC Corporation, consisting of three data centers in the Philippines, for total purchase consideration of $183 million. This marked our entry into the Philippines market. See Note 3 within the Consolidated Financial Statements.
• We raised $4.4 billion of capital to support organic growth, land and building acquisitions and required debt refinancings. This included the following:
◦ Throughout 2025, we issued $4.3 billion of senior notes due between 2029 and 2034. The issuances were denominated in euros, U.S. dollars, Singapore dollars and Canadian dollars and were translated at the exchange rates in effect on issuance. See Note 10 within the Consolidated Financial Statements.
◦ In February and March, we sold 107,493 shares on a spot basis under the 2024 ATM Program for approximately $99 million, net of commissions and other offering expenses. See Note 11 within the Consolidated Financial Statements.
Annualized Gross Bookings:
In 2025, we publicly disclosed our Annualized Gross Bookings metric. Annualized Gross Bookings represents the annualized revenue impact of stated monthly recurring revenues ("MRR") on newly executed contracts with a term of 12 months or more, net of any MRR decreases from cancellations or terminations associated with the new contracts and adjusted for the impact of pricing changes on existing contracts. This measure excludes contracts for recurring revenue from our joint ventures and the impact of power price adjustments. This measure only includes contracts that we anticipate will start generating revenue within 90 days. During the year ended December 31, 2025, we had total Annualized Gross Bookings of $1.6 billion, up 27% from 2024. This growth reflects the overall momentum in customer demand and our ability to capture that demand across our global platform.
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Capacity Trends:
Our cabinet utilization rate represents the percentage of cabinet space billed versus total cabinet capacity, which is used to measure how efficiently we are managing our cabinet capacity. Our cabinet utilization rate varies from market to market among our IBX data centers across our Americas, EMEA and Asia-Pacific regions. Our cabinet utilization rates were approximately 77% and 78%, as of December 31, 2025 and 2024, respectively. We continue to monitor the available capacity in each of our selected markets. To the extent we have limited capacity available in a given market, it may limit our ability for growth in that market. We perform demand studies on an ongoing basis to determine if future expansion is warranted in a market. In addition, power and cooling requirements for most customers are growing on a per unit basis. As a result, customers are consuming an increasing amount of power per cabinet. Although we generally do not control the amount of power our customers draw from installed circuits, we have negotiated power consumption limitations with certain high power-demand customers. This increased power consumption, which we expect to accelerate with the adoption of AI, has driven us to build out our new IBX data centers to support power and cooling needs twice that of previous IBX data centers. We could face power limitations in our existing IBX data centers, even though we may have additional physical cabinet capacity available within a specific IBX data center, and in our ability to expand our footprint in existing and new markets. Additionally, global supply chain challenges could result in a lack of availability or delays in the delivery of data center equipment. These challenges have driven us to invest in and commit to future purchases in advance of our standard practice to mitigate risks associated with these supply chain issues. These constraints could have a negative impact on our ability to grow revenues, affecting our financial performance, results of operations and cash flows and the growth opportunities presented by the adoption of new technologies, including AI.
Expansion Opportunities:
To serve the needs of the growing hyperscale data center market, including the world's largest cloud service providers and increased demand driven in part by the adoption of AI, we continue to look at attractive opportunities to grow our market share and selectively improve our footprint and offerings. As was the case with our recent expansions and acquisitions, our expansion criteria will be dependent on a number of factors, including but not limited to demand from new and existing customers, power availability and capacity, quality of the design, access to networks, clouds and software partners, capacity availability in the current market location, amount of incremental investment required by us in the targeted property, automation capabilities, developer talent pool, lead-time to break even on a free cash flow basis and in-place customers. Like our recent expansions and acquisitions, the right combination of these factors may be attractive to us. In addition, to serve the growing hyperscale requirements, we have entered into joint venture partnership arrangements across our Americas, EMEA and Asia-Pacific regions to develop and operate xScale data centers. Depending on the circumstances, these transactions may require additional capital expenditures funded by upfront cash payments or through long-term financing arrangements in order to bring these properties up to our standards. Property expansion may be in the form of purchases of real property, long-term leasing arrangements or acquisitions. Future purchases, construction or acquisitions may be completed by us or with partners or potential customers to minimize the outlay of cash, which can be significant.
Revenue:
Our business is primarily based on a recurring revenue model comprised of colocation, interconnection and managed infrastructure offerings. We consider these offerings recurring because our customers are generally billed
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on a fixed and recurring basis each month for the duration of their contract, which is generally one to five years in length, and thereafter automatically renews in one-year increments. Our recurring revenues have comprised more than 90% of our total revenues during the past three years. In addition, during the past three years, more than 90% of our monthly recurring revenue bookings came from existing customers, contributing to our revenue growth. Our largest customer accounted for approximately 3% of our recurring revenues for the years ended December 31, 2025, 2024 and 2023. Our 50 largest customers accounted for approximately 36%, 36% and 37% of our recurring revenues for the years ended December 31, 2025, 2024 and 2023, respectively.
Our non-recurring revenues are primarily derived from fees charged on installations related to a customer's initial deployment and professional services we perform for our customers, including our joint ventures. Non-recurring installation fees, although generally paid upfront upon installation, are deferred and recognized ratably over the contract term. Professional service fees are recognized in the period when the services were provided. Additionally, revenue from contract settlements, when a customer wishes to terminate their contract early, is generally treated as a contract modification and recognized ratably over the remaining term of the contract, if any. We expect non-recurring revenues to represent less than 10% of total revenues for the foreseeable future.
Operating Expenses:
Cost of Revenues. The largest components of our cost of revenues are depreciation, rental payments related to our leased IBX data centers, utility costs including electricity, bandwidth access, IBX data center employees' salaries and benefits including stock-based compensation, repairs and maintenance, supplies and equipment, and security. A majority of our cost of revenues is fixed in nature and should not vary significantly from period to period, unless we expand our existing IBX data centers or open or acquire new IBX data centers. However, there are certain costs that are considered more variable in nature, including utilities and supplies that are directly related to growth in our existing and new customer base. In addition, the cost of electricity is subject to seasonal fluctuations. Our costs of electricity may also increase as a result of the physical effects of climate change, global energy supply constraints, increased regulations driving alternative electricity generation due to environmental considerations or as a result of our election to use renewable energy sources. To the extent we incur increased utility costs, such increased costs could materially impact our financial condition, results of operations and cash flows.
Sales and Marketing. Our sales and marketing expenses consist primarily of compensation and related costs for sales and marketing personnel, including stock-based compensation, amortization of contract costs, marketing programs, public relations, promotional materials and travel, as well as bad debt expense and amortization of customer relationship intangible assets.
General and Administrative. Our general and administrative expenses consist primarily of salaries and related expenses, including stock-based compensation, accounting, legal and other professional service fees, and other general corporate expenses, such as our corporate regional headquarters office leases and depreciation expense on back office systems.
Taxation as a REIT:
We elected to be taxed as a REIT for U.S. federal income tax purposes beginning with our 2015 taxable year. As of December 31, 2025, our REIT structure included a majority of our data center operations in the Americas and EMEA regions, as well as the data center operations in Japan, Singapore, and Malaysia. Our data center operations in other jurisdictions are operated as TRSs. We have also included our share of the assets in xScale joint ventures (with the exception of the APAC 3 Joint Venture) in our REIT structure.
As a REIT, we generally are permitted to deduct from our U.S. federal taxable income the dividends we pay to our stockholders. The taxable income represented by such dividends is not subject to U.S. federal income taxes at the entity level but is taxed in the U.S., if at all, at the stockholder level. Depending on a shareholder's citizenry and residency, the income could be taxed by other jurisdictions as well. Nevertheless, the income of our TRSs which hold our U.S. operations is subject to U.S. federal and state corporate income taxes, as applicable. Likewise, our foreign subsidiaries continue to be subject to local income taxes in jurisdictions in which they hold assets or conduct operations, regardless of whether held or conducted through TRSs or through qualified REIT subsidiaries ("QRSs") for U.S. income tax purposes. We are also subject to a separate U.S. federal corporate income tax on any gain recognized from a sale of a REIT asset where our basis in the asset is determined by reference to the basis of the asset in the hands of a C corporation (such as an asset held by us or a QRS following the liquidation or other conversion of a former TRS). This built-in-gain tax is generally applicable to any disposition of such an asset during the five-year period after the date we first owned the asset as a REIT asset to the extent of the built-in-gain based
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on the fair market value of such asset on the date we first held the asset as a REIT asset. In addition, should we recognize any gain from "prohibited transactions," we will be subject to tax on this gain at a 100% rate. "Prohibited transactions," for this purpose, are defined as dispositions of inventory or property held primarily for sale to customers in the ordinary course of a trade or business other than dispositions of foreclosure property and other than dispositions excepted by statutory safe harbors. If we fail to remain qualified for U.S. federal income taxation as a REIT, we will be subject to U.S. federal income taxes at regular corporate income tax rates. Even if we remain qualified for U.S. federal income taxation as a REIT, we may be subject to some federal, state, local and foreign taxes on our income and property in addition to taxes owed with respect to our TRSs' operations. In particular, while state income tax regimes often parallel the U.S. federal income tax regime for REITs, many states do not completely follow federal rules, and some may not follow them at all.
We continue to monitor our REIT compliance in order to maintain our qualification for U.S. federal income taxation as a REIT. For this and other reasons, as necessary, we may convert some of our data center operations in other countries into the REIT structure in future periods.
On July 4, 2025, the One Big Beautiful Bill Act (“OBBBA”) was enacted, making permanent or extending key provisions of the Tax Cuts and Jobs Act, including 100% bonus depreciation, domestic R&D expensing, business interest expense limitations and the qualified business income deduction for ordinary REIT dividends. The OBBBA also revises international tax rules such as the net controlled foreign corporation ("CFC") tested income (before January 1, 2026, global intangible low-taxed income) inclusion and raises the REIT asset threshold for taxable REIT subsidiaries from 20% to 25%, effective for tax years beginning after December 31, 2025. The legislation does not have a material impact on our income tax position.
On each of March 19, 2025, June 18, 2025, September 17, 2025 and December 17, 2025, we paid a quarterly cash dividend of $4.69 per share. We expect all of our 2025 quarterly distributions and other applicable distributions to equal or exceed our REIT taxable income recognized in 2025.
Results of Operations
In order to provide a framework for assessing our performance excluding the impact of foreign currency fluctuations, we supplement the year-over-year actual change in results of operations with comparative changes on a constant currency basis. Presenting constant currency results of operations is a non-GAAP financial measure. See “Non-GAAP Financial Measures” below for further discussion.
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Years ended December 31, 2025 and 2024
Revenues. Our revenues for the years ended December 31, 2025 and 2024 were generated from the following revenue classifications and geographic regions ($ in millions):
Years Ended December 31,
$ Change
% Change
Actual
Actual
Constant Currency
Americas:
Recurring revenues
Non-recurring revenues
EMEA:
Recurring revenues
Non-recurring revenues
Asia-Pacific:
Recurring revenues
Non-recurring revenues
Total:
Recurring revenues
Non-recurring revenues
Revenues
($ in millions)
Americas Revenues. During the year ended December 31, 2025, Americas revenues increased by $249 million or 6% (7% on a constant currency basis). Growth in Americas revenues was primarily due to:
• approximately $99 million of incremental revenues generated from IBX data center expansion projects which were completed within the twelve months ended December 31, 2025; and
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• an increase in orders from both our existing customers and new customers during the period.
The increase was partially offset by a decrease of $29 million in revenues from non-recurring services provided to our joint ventures and a decrease of $29 million driven by the Equinix Metal Wind Down. See Note 16 within the Consolidated Financial Statements.
EMEA Revenues . During the year ended December 31, 2025, EMEA revenues increased by $163 million or 5% (4% on a constant currency basis). Growth in EMEA revenues was primarily due to:
• approximately $57 million of incremental revenues generated from IBX data center expansion projects which were completed within the twelve months ended December 31, 2025; and
• an increase in orders from both our existing customers and new customers during the period.
The increase was partially offset by a decrease of $12 million in revenues from non-recurring services provided to our joint ventures.
Asia-Pacific Revenues. During the year ended December 31, 2025, Asia-Pacific revenues increased by $57 million or 3% (3% on a constant currency basis). Growth in Asia-Pacific revenues was primarily due to:
• approximately $27 million of incremental revenues generated from IBX data center expansion projects which were completed within the twelve months ended December 31, 2025; and
• an increase in orders from both our existing customers and new customers during the period.
The increase was offset by a decrease of $89 million in revenues from non-recurring services provided to our joint ventures.
Cost of Revenues. Our cost of revenues for the years ended December 31, 2025 and 2024 by geographic regions were as follows ($ in millions):
Years Ended December 31,
$ Change
% Change
Actual
Actual
Constant Currency
Americas
EMEA
Asia-Pacific
Total
Cost of Revenues
($ in millions; percentages indicate expenses as a percentage of revenues)
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Americas Cost of Revenues. During the year ended December 31, 2025, Americas cost of revenues increased by $62 million or 3% (4% on a constant currency basis). The increase in our Americas cost of revenues was primarily due to:
• approximately $29 million of higher depreciation expense driven by IBX data center expansions and acceleration of depreciation expense for certain assets with shortened useful lives; and
• $23 million of higher utilities costs, driven by both increases in power costs and higher utility usage.
The remainder of the increase was driven by higher office and accretion expenses, offset by lower costs to provide non-recurring services.
EMEA Cost of Revenues. During the year ended December 31, 2025, EMEA cost of revenues decreased by $24 million or 1% (3% on a constant currency basis). The decrease in our EMEA cost of revenues was primarily due to lower utilities costs as a result of decreases in power prices in Germany, Netherlands and the United Kingdom, partially offset by:
• $17 million of higher rent and facilities cost; and
• $17 million of higher compensation costs, including stock-based compensation.
Asia-Pacific Cost of Revenues. Our Asia-Pacific cost of revenues did not materially change during the year ended December 31, 2025 compared to the year ended December 31, 2024 as increases in depreciation expense and compensation costs were substantially offset by decreases in utilities costs and costs to provide non-recurring services.
We expect cost of revenues to increase across all three regions in line with the growth of our business, including from the impact of acquisitions.
Sales and Marketing Expenses . Our sales and marketing expenses for the years ended December 31, 2025 and 2024 by geographic regions were as follows ($ in millions):
Years ended December 31,
$ Change
% Change
Actual
Actual
Constant Currency
Americas
EMEA
Asia-Pacific
Total
Sales and Marketing Expenses
($ in millions; percentages indicate expenses as a percentage of revenues)
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Americas Sales and Marketing Expenses . Our Americas sales and marketing expenses did not materially change during the year ended December 31, 2025 compared to the year ended December 31, 2024 as increases in advertising and consulting costs were substantially offset by decreases in bad debt expense.
EMEA Sales and Marketing Expens es. During the year ended December 31, 2025, EMEA sales and marketing increased by $9 million or 5% (2% on a constant currency basis) driven by insignificant increases across various categories.
Asia-Pacific Sales and Marketing Expenses. Our Asia-Pacific sales and marketing expenses did not materially change during the year ended December 31, 2025 compared to the year ended December 31, 2024.
We anticipate that we will continue to invest in sales and marketing initiatives across our three regions in line with the growth of our business. We expect our Americas sales and marketing expenses as a percentage of revenues to be higher than those of our other regions since certain global sales and marketing functions are located within the U.S.
General and Administrative Expenses. Our general and administrative expenses for the years ended December 31, 2025 and 2024 by geographic regions were as follows ($ in millions):
Years Ended December 31,
$ Change
% Change
Actual
Actual
Constant Currency
Americas
EMEA
Asia-Pacific
Total
General and Administrative Expenses
($ in millions; percentages indicate expenses as a percentage of revenues)
Americas General and Administrative Expense s. During the year ended December 31, 2025, Americas general and administrative expenses increased by $52 million or 4% (5% on a constant currency basis). The increase in our Americas general and administrative expenses was primarily due to $43 million of higher compensation costs, including stock-based compensation. The remainder of the increase was driven by higher costs across various categories including training and recruiting expense, tax and license fees and other operating expenses.
EMEA General and Administrative Expenses. During the year ended December 31, 2025, EMEA general and administrative expenses increased by $16 million or 5% (3% on a constant currency basis). The increase in our EMEA general and administrative expenses was primarily due to $25 million of higher compensation costs, including stock-based compensation, partially offset by lower consulting costs.
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Asia-Pacific General and Administrative Expenses. Our Asia-Pacific general and administrative expenses did not materially change during the year ended December 31, 2025 compared to the year ended December 31, 2024.
Going forward, although we are carefully monitoring our spending, we expect our general and administrative expenses to increase across all three regions as we continue to invest in our operations to support our growth, including investments to enhance our technology platform, to maintain our qualification for taxation as a REIT and to integrate recent acquisitions. Additionally, given that our corporate headquarters is located in the U.S., we expect the Americas general and administrative expenses as a percentage of revenues to be higher than that of other regions.
Restructuring and Other Exit Charges. During the years ended December 31, 2025 and December 31, 2024, we recorded restructuring and other exit charges of $33 million and $31 million, respectively, primarily related to severance and other employee costs. See Note 16 within the Consolidated Financial Statements.
Transaction Costs . During the years ended December 31, 2025 and 2024, we recorded transaction costs of $18 million and $50 million, respectively. These transaction costs were incurred in connection with evaluating and completing acquisitions and the formation of joint ventures. See Notes 3 and 5 within the Consolidated Financial Statements.
Impairment Charges. During the year ended December 31, 2025, we determined that the carrying amounts of certain long-lived assets may not be fully recoverable as we no longer intend to hold these assets long-term. We recognized impairment charges of $68 million during 2025 to reflect management’s estimate of fair value of these long-lived assets based primarily on sales of similar assets and ongoing negotiations with third parties. During the year ended December 31, 2024, we recorded impairment charges of $233 million as a result of the Equinix Metal Wind Down and current and projected future losses at a Hong Kong IBX. See Note 17 within the Consolidated Financial Statements.
Gain or Loss on Asset Sales. During the year ended December 31, 2025, we did not record a significant amount of gain or loss on asset sales. During the year ended December 31, 2024, we recorded a gain of $18 million related to the sale of the Silicon Valley 12x ("SV12x") data center. See Note 5 within the Consolidated Financial Statements.
Income from Operations. Our income from operations increased by $520 million or 39% in the year ended December 31, 2025 as compared to the same period in 2024. This increase is driven by the factors described above.
Interest Income. During the year ended December 31, 2025, interest income increased by $56 million or 41%. The increase was primarily due to interest income earned on a higher average balance of cash, cash equivalents and short-term investments as well as on the AMER 2 Loan further described in Note 15 within the Consolidated Financial Statements.
Interest Expense. During the year ended December 31, 2025, interest expense increased by $70 million or 15%. The increase was primarily due to the issuance of senior notes during 2025 and 2024. This increase was partially offset by the repayment of senior notes which matured during 2025 and 2024. See Note 10 within the Consolidated Financial Statements.
During the years ended December 31, 2025 and 2024, we capitalized $79 million and $36 million, respectively, of interest expense to construction in progress.
Other Income or Expense. We did not record a significant amount of other income or expense during the year ended December 31, 2025. For the year ended December 31, 2024, we recorded net other expense of $17 million, largely driven by our share of losses incurred on our equity method investments in our xScale joint ventures.
Gain or Loss on Debt Extinguishment. We did not record a significant amount of gain or loss on debt extinguishment during the year ended December 31, 2025. During the year ended December 31, 2024, we recorded $16 million of net loss on debt extinguishment primarily due to the modification of a financing obligation on a property in the Americas region.
Income Taxes. We operate as a REIT for U.S. federal income tax purposes. As a REIT, we are generally not subject to U.S. federal income taxes on our taxable income distributed to stockholders. We intend to distribute or have distributed the entire taxable income generated by the operations of our REIT and QRSs for the tax years ended December 31, 2025 and 2024, respectively. As such, other than certain state income taxes and foreign
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income and withholding taxes, no provision for income taxes has been included for our REIT and QRSs in the accompanying consolidated financial statements for the years ended December 31, 2025 and 2024.
We have made TRS elections for some of our subsidiaries in and outside the U.S. In general, a TRS may provide services that would otherwise be considered impermissible for REITs to provide and may hold assets that may not be REIT compliant.
U.S. income taxes for the TRS entities located in the U.S. and foreign income taxes for our foreign operations, regardless of whether the foreign operations are operated as QRSs or TRSs, have been accrued, as necessary, for the years ended December 31, 2025 and 2024.
For the years ended December 31, 2025 and 2024, we recorded $160 million and $161 million of income tax expenses, respectively. Our effective tax rates were 10.6% and 16.5%, respectively, for the years ended December 31, 2025 and 2024.
Net Income. Our net income increased by $534 million or 66% in the year ended December 31, 2025 as compared to the same period in 2024. This increase is driven by the factors described above.
Adjusted EBITDA . We define adjusted EBITDA as net income excluding income tax expense, interest income, interest expense, other income or expense, gain or loss on debt extinguishment, depreciation, amortization, accretion, stock-based compensation expense, restructuring and other exit charges, impairment charges, transaction costs, and gain or loss on asset sales. See "Non-GAAP Financial Measures" below for more information about adjusted EBITDA and a reconciliation of adjusted EBITDA to net income. Our adjusted EBITDA for the years ended December 31, 2025 and 2024 by geographic regions was as follows ($ in millions):
Years Ended December 31,
$ Change
% Change
Actual
Actual
Constant Currency
Americas
EMEA
Asia-Pacific
Total
Americas Adjusted EBITDA. During the year ended December 31, 2025, Americas adjusted EBITDA increased by $181 million or 11% (11% on a constant currency basis), primarily due to higher revenues as a result of IBX data center expansion activity and organic growth, partially offset by lower revenues as a result of non-recurring services provided to our joint ventures, as described above.
EMEA Adjusted EBITDA. During the year ended December 31, 2025, EMEA adjusted EBITDA increased by $183 million or 13% (12% on a constant currency basis), primarily due to higher revenues as a result of IBX data center expansion activity and organic growth and lower utilities costs, partially offset by lower revenues as a result of non-recurring services provided to our joint ventures, as described above.
Asia-Pacific Adjusted EBITDA. During the year ended December 31, 2025, Asia-Pacific adjusted EBITDA increased by $69 million or 7% (6% on a constant currency basis), primarily due to higher revenues as a result of IBX data center expansion activity and organic growth, offset by lower revenues as a result of non-recurring services provided to our joint ventures, as described above.
Non-GAAP Financial Measures
We provide all information required in accordance with GAAP, but we believe that evaluating our ongoing results of operations may be difficult if limited to reviewing only GAAP financial measures. Accordingly, we also use non-GAAP financial measures to evaluate our operations.
Non-GAAP financial measures are not a substitute for financial information prepared in accordance with GAAP. Non-GAAP financial measures should not be considered in isolation, but should be considered together with the most directly comparable GAAP financial measures. As such, we provide a reconciliation of the non-GAAP financial measures to the most directly comparable GAAP financial measures.
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Investors should note that the non-GAAP financial measures used by us may not be the same non-GAAP financial measures, and may not be calculated in the same manner, as those of other companies. Investors should therefore exercise caution when comparing non-GAAP financial measures used by us to similarly titled non-GAAP financial measures of other companies.
Our primary non-GAAP financial measures include Adjusted EBITDA and Adjusted Funds from Operations (“AFFO”), as described below. We present these measures to provide investors with additional tools to evaluate our results in a manner that focuses on what management believes to be our core, ongoing business operations. These measures exclude items which we believe are generally not relevant to assessing our long-term performance. Both measures eliminate the impacts of depreciation and amortization, which are derived from historical costs and we believe are not indicative of current or future expenditures, and other items for which the frequency and amount of charges can vary based on the timing and significance of individual transactions. We believe that presenting these non-GAAP financial measures provides consistency and comparability with past reports and that if we did not provide such non-GAAP financial information, investors would not have all the necessary data to analyze our business effectively.
Adjusted EBITDA
Adjusted EBITDA is used by management to evaluate the operating strength and performance of our core, ongoing business, without regard to our capital or tax structures. It also aids in assessing the performance of, making operating decisions for, and allocating resources to our operating segments. In addition to the uses described above, we believe this measure provides investors with a better understanding of the operating performance of the business and its ability to perform in subsequent periods.
We define adjusted EBITDA as net income excluding:
• income tax expense
• interest income
• interest expense
• other income or expense
• gain or loss on debt extinguishment
• depreciation, amortization and accretion expense
• stock-based compensation expense
• restructuring and other exit charges, which primarily include employee severance, facility closure costs, lease or other contract termination costs and advisory fees related to the realignment of our management structure, operations or products and other exit activities
• impairment charges
• transaction costs
• gain or loss on asset sales
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The following table presents a reconciliation of Adjusted EBITDA to net income (in millions):
Years Ended December 31,
Net income
Income tax expense
Interest income
Interest expense
Other (income) expense
(Gain) loss on debt extinguishment
Depreciation, amortization, and accretion expense
Stock-based compensation expense
Restructuring and other exit charges
Impairment charges
Transaction costs
(Gain) loss on asset sales
Adjusted EBITDA
Funds from Operations ("FFO") and AFFO
AFFO is derived from Funds from Operations (FFO) calculated in accordance with the standards established by the National Association of Real Estate Investment Trusts. Both FFO and AFFO are non-GAAP measures commonly used in the REIT industry. Although our measures may not be directly comparable to similar measures used by other companies, we believe that the presentation of these measures provides investors with an additional tool for comparing our performance with the performance of other companies in the REIT industry. Additionally, AFFO is a performance measure used in certain of our employee incentive programs and we believe it is a useful measure in assessing our dividend paying capacity as it isolates the cash impact of certain income and expense items and considers the impact of recurring capital expenditures.
We define FFO as net income attributable to common stockholders excluding:
• gain or loss from the disposition of real estate assets
• depreciation and amortization expense on real estate assets
• adjustments for unconsolidated joint ventures' and non-controlling interests' share of these items
We define AFFO as FFO adjusted for:
• depreciation and amortization expense on non-real estate assets
• accretion expense
• stock-based compensation expense
• stock-based charitable contributions
• restructuring and other exit charges, as described above
• impairment charges
• transaction costs
• an adjustment to remove the impacts of straight-lining installation revenue
• an adjustment to remove the impacts of straight-lining rent expense
• an adjustment to remove the impacts of straight-lining contract costs
• amortization of deferred financing costs and debt discounts and premiums
• gain or loss from the disposition of non-real estate assets
• gain or loss on debt extinguishment
• an income tax expense adjustment, which represents the non-cash tax impact due to changes in valuation allowances, uncertain tax positions and deferred taxes
• recurring capital expenditures, which represent expenditures to extend the useful life of data centers or other assets that are required to support current revenues
• net income or loss from discontinued operations, net of tax
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• adjustments from FFO to AFFO for unconsolidated joint ventures' and non-controlling interests' share of these items
The following tables present reconciliations of FFO and AFFO to net income (in millions):
Years Ended December 31,
Net income
Net (income) loss attributable to non-controlling interests
Net income attributable to common stockholders
Adjustments:
Real estate depreciation
(Gain) loss on disposition of real estate assets
Adjustments for FFO from unconsolidated joint ventures
FFO attributable to common stockholders
Years Ended December 31,
FFO attributable to common stockholders
Adjustments:
Installation revenue adjustment
Straight-line rent expense adjustment
Contract cost adjustment
Amortization of deferred financing costs and debt discounts
Stock-based compensation expense
Stock-based charitable contributions
Non-real estate depreciation expense
(Gain) loss on disposition of non-real estate assets
Amortization expense
Accretion expense adjustment
Recurring capital expenditures
(Gain) loss on debt extinguishment
Restructuring and other exit charges
Transaction costs
Impairment charges
Income tax expense adjustment
Adjustments for AFFO from unconsolidated joint ventures
AFFO attributable to common stockholders
Constant Currency Presentation
Our revenues and certain operating expenses (cost of revenues, sales and marketing and general and administrative expenses) from our international operations have represented and will continue to represent a significant portion of our total revenues and certain operating expenses. As a result, our revenues and certain operating expenses have been and will continue to be affected by changes in the U.S. dollar against major international currencies. During the year ended December 31, 2025 as compared to the same period in 2024, the U.S. dollar was stronger relative to the Brazilian real and Canadian dollar, which resulted in an unfavorable foreign currency impact on revenue and operating income, and a favorable foreign currency impact on operating expenses. During the year ended December 31, 2025 as compared to the same period in 2024, the U.S. dollar was weaker relative to the British pound and euro, which resulted in a favorable foreign currency impact on revenue and operating income, and an unfavorable foreign currency impact on operating expenses. In order to provide a
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framework for assessing how each of our business segments performed excluding the impact of foreign currency fluctuations, we present period-over-period percentage changes in our revenues and certain operating expenses on a constant currency basis in addition to the historical amounts as reported. Our constant currency presentation excludes the impact of our foreign currency cash flow hedging activities. Presenting constant currency results of operations is a non-GAAP financial measure and is not meant to be considered in isolation or as an alternative to GAAP results of operations. However, we have presented this non-GAAP financial measure to provide investors with an additional tool to evaluate our results of operations. To present this information, our current period revenues and certain operating expenses denominated in currencies other than the U.S. dollar are converted into U.S. dollars at constant exchange rates rather than the actual exchange rates in effect during the respective periods (i.e. average rates in effect for the year ended December 31, 2024 are used as exchange rates for the year ended December 31, 2025 when comparing the year ended December 31, 2025 with the year ended December 31, 2024).
Liquidity and Capital Resources
Sources and Uses of Cash
Customer collections are our primary source of cash. We believe we have a strong customer base, and have continued to experience relatively strong collections. As of December 31, 2025, our principle sources of liquidity were $3.2 billion of cash, cash equivalents and short-term investments. In addition to our cash balance, we had approximately $4.0 billion of additional liquidity available to us from our $4.0 billion revolving facility and general access to both public and private debt and the equity capital markets. We also have additional liquidity available to us from our 2024 ATM program, under which we may offer and sell from time to time our common stock in "at the market" transactions on either a spot or forward basis. As of December 31, 2025, we had approximately $1.2 billion available for sale remaining under the 2024 ATM Program.
We believe we have sufficient cash, coupled with anticipated cash generated from operating activities and external financing sources, to meet our operating requirements, including repayment of the current portion of our debt as it becomes due, distribution of dividends, completion of our publicly-announced acquisitions, ordinary costs to operate the business, and expansion projects.
As we continue to grow, we may pursue additional expansion opportunities, primarily the build out of new IBX data centers, in certain of our existing markets which are at or near capacity within the next year, as well as potential acquisitions and joint ventures. If the opportunity to expand is greater than planned we may further increase the level of capital expenditures to support this growth as well as pursue additional business and real estate acquisitions or joint ventures, provided that we have or can access sufficient funding to pursue such expansion opportunities. We may elect to access the equity or debt markets from time to time opportunistically, particularly if financing is available on attractive terms. We will continue to evaluate our operating requirements and financial resources in light of future developments.
Cash Flow
Years Ended December 31,
Change
(in millions)
Net cash provided by operating activities
Net cash used in investing activities
Net cash provided by financing activities
Operating Activities
Our cash provided by our operations is generated by colocation, interconnection, managed infrastructure and other revenues. Our primary uses of cash from our operating activities include compensation and related costs, interest payments, other general corporate expenditures and taxes. Net cash provided by operating activities increased by $662 million during the year ended December 31, 2025 as compared to December 31, 2024, primarily driven by improved results of operations partially offset by increases in cash paid for costs and operating expenses.
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Investing Activities
Net cash used in investing activities increased by $2.5 billion during the year ended December 31, 2025 as compared to December 31, 2024, primarily due to:
• $1.4 billion increase in purchases of short-term investments;
• $1.2 billion increase in capital expenditures;
• $657 million increase in real estate acquisitions; and
• $251 million increase in business acquisitions, net of cash acquired, including the TIM Acquisition (see Note 3 within the Consolidated Financial Statements).
This increase was partially offset by $1.0 billion in proceeds from the maturity of short-term investments.
Financing Activities
Net cash provided by financing activities decreased by $451 million for the year ended December 31, 2025 as compared to December 31, 2024, primarily driven by:
• $1.6 billion decrease in proceeds from the 2022 and 2024 ATM Programs;
• $213 million increase in dividend distributions; and
• $200 million increase in the repayment of senior notes.
The decrease was partially offset by $1.5 billion in proceeds from senior notes.
Material Cash Commitments
As of December 31, 2025, our principal commitments were primarily comprised of:
• approximately $18.4 billion of principal from our senior notes (gross of debt issuance costs and debt d is counts);
• approximately $4.2 billion of interest on mortgage payable, other loans payable, senior notes and term loans, based on their respective interest rates and recognized over the life of these instruments, and the credit facility fee for the revolving credit facility;
• $703 million of principal from our term loans, mortgage payable and other loans payable (gross of debt issuance costs and debt discounts);
• approximately $5.3 billion of total lease payments, which represents lease payments under finance and operating lease arrangements, including renewal options that are reasonably certain to be exercised;
• approximately $6.3 billion of unaccrued capital expenditure contractual commitments, primarily for real estate purchases, IBX infrastructure equipment not yet delivered and labor not yet provided in connection with the work necessary to complete construction and open IBX data center expansion projects prior to making them available to customers for installation, the majority of which is payable within the next 12 months; and
• approximately $2.1 billion of other non-capital purchase commitments, such as commitments to purchase power in select locations and other open purchase orders, which contractually bind us for goods, services or arrangements to be delivered or provided during 2026 and beyond, the majority of which is payable within the next two years.
We believe that our sources of liquidity, including our expected future operating cash flows, are sized to adequately meet both the near and long-term material cash commitments for the foreseeable future. For further information on maturities of lease liabilities and debt instruments, see Notes 9 and 10, respectively, within the Consolidated Financial Statements.
Other Contractual Obligations
We have additional future equity contributions and loan commitments to our joint ventures. For additional information, see the "Equity Method Investments" in Note 5 within the Consolidated Financial Statements.
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Additionally, we entered into lease agreements with various landlords primarily for data center spaces and ground leases which have not yet commenced as of December 31, 2025. For additional information, see “Maturities of Lease Liabilities” in Note 9 within the Consolidated Financial Statements.
Critical Accounting Estimates
Our consolidated financial statements are prepared in accordance with U.S. GAAP. The preparation of our financial statements requires management to make estimates and assumptions about future events that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported amounts of revenues and expenses during the reporting period. On an ongoing basis, management evaluates the accounting policies, assumptions, estimates and judgments to ensure that our consolidated financial statements are presented fairly and in accordance with GAAP. Management bases its assumptions, estimates and judgments on historical experience, current trends and various other factors that we believe to be reasonable under the circumstances. However, because future events and their effects cannot be determined with certainty, actual results may differ from these assumptions and estimates, and such differences could be material.
Our significant accounting policies are discussed in Note 1 to Consolidated Financial Statements in Item 8 of this Annual Report on Form 10-K. Management believes that application of the following accounting policies involves a significant level of estimation uncertainty that have had or are reasonably likely to have a material impact on our consolidated financial statements:
• Accounting for property, plant and equipment and finite-lived intangible assets; and
• Accounting for leases.
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Description
Estimation Uncertainties
Effect if Actual Results Differ from Assumptions
Accounting for Property, Plant and Equipment and Finite-Lived Intangible Assets
We have a substantial amount of property, plant and equipment recorded on our consolidated balance sheets. The majority of our property, plant and equipment balance represents the costs incurred to build out or acquire our IBX data centers. We depreciate our property, plant and equipment using the straight-line method over the estimated useful lives of the assets (subject to the term of the lease in the case of leased assets or leasehold improvements and integral equipment located in leased properties).
Accounting for property, plant and equipment includes determining the appropriate period over which to depreciate such assets, assessing such assets for potential impairment and assessing the asset retirement obligations required for certain leased properties that require us to return the leased properties back to their original condition at the time we decide to exit a lease property. We assess our property, plant and equipment for potential impairment together with finite-lived intangible assets and lease right-of-use ("ROU") assets at the asset group level.
Judgments are required in arriving at the estimated useful life of an asset. Judgments are also required in estimating the fair value of a liability for an asset retirement obligation. Significant assumptions include retirement costs, timing of retirement and inflation rates. We periodically review these estimates and changes to these estimates could have a significant impact on our financial position and results of operations.
We review our asset groups on an ongoing basis to identify any events or changes in circumstances indicating that the carrying amount of an asset group may not be recoverable, such as a significant decrease in market price of an asset group, a significant adverse change in the extent or manner in which an asset group is being used, a significant adverse change in legal factors or business climate that could affect the value of an asset group or a continuous deterioration of our financial condition. This assessment requires assumptions and estimates derived from a review of our actual and forecasted operating results, approved business plans, future economic conditions and other market data. If a potential impairment trigger is identified, the measurement of an impairment loss requires assumptions and estimates of undiscounted and discounted future cash flows, and assumptions about the market price of assets. These assumptions and estimates require significant judgment and are inherently uncertain.
As of December 31, 2025 and 2024, we had property, plant and equipment of $23.6 billion and $19.2 billion, respectively. During the years ended December 31, 2025, 2024 and 2023, we recorded depreciation expense of $1.9 billion, $1.8 billion, and $1.6 billion, respectively. We evaluated the estimated useful lives of our property, plant and equipment, and made certain revisions to these estimates during the years ended December 31, 2025 and 2024. Further changes in our estimated useful lives of our property, plant and equipment could have a significant impact on our results of operations. We recorded $53 million and $166 million impairment charges on property, plant and equipment during the years ended December 31, 2025 and 2024.
As of December 31, 2025 and 2024, we had asset retirement obligations of $228 million and $109 million, respectively.
The balance of our other intangible assets, net, as of December 31, 2025 and 2024 was $1.3 billion and $1.4 billion, respectively. We recorded $29 million impairment charges on finite-lived intangible assets during the year ended December 31, 2024.
Accounting for Leases
A significant portion of our data center spaces, office spaces and equipment are leased. Each time we enter into a new lease or lease amendment, we analyze each contract for the proper accounting, including assessing if it should be classified as an operating or finance lease.
ROU assets are assessed for impairment at the asset group level along with property, plant and equipment as discussed above.
Determination of the accounting treatment, including the result of the lease classification test for each new lease, lease amendment, or lease term reassessment is dependent on a variety of judgments, such as identification of lease and non-lease components, allocation of total consideration between lease and non-lease components, determination of lease term, including assessing the likelihood of lease renewals, valuation of leased property, and establishing the incremental borrowing rate to calculate the present value of the minimum lease payment for the lease test. The judgments used in the accounting for leases are inherently subjective; different assumptions or estimates could result in different accounting treatment for a lease.
Lease assumptions and estimates are determined and applied at the inception of the leases or at the lease modification or reassessment date. As of both December 31, 2025 and 2024, the total operating lease ROU assets were $1.4 billion and operating lease liabilities were $1.5 billion, respectively. As of December 31, 2025 and 2024, finance lease ROU assets were $2.3 billion and $2.2 billion, respectively and finance lease liabilities were $2.4 billion and $2.3 billion, respectively. For the years ended December 31, 2025, 2024 and 2023, we recorded finance lease costs of $310 million, $294 million and $280 million, respectively, and recorded rent expense of approximately $238 million, $229 million and $243 million, respectively.
We recorded $15 million and $38 million impairment charges on operating lease ROU assets during the years ended December 31, 2025 and 2024.
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Recent Accounting Pronouncements
See "Recent Accounting Pronouncements" in Note 1 within the Consolidated Financial Statements.
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