4Q23 adjusted EBITDA grew 10%, in line; FY24 adjusted EBITDA expected to grow by 10-13%
- Revenue increased 13% y-o-y to US$2,110m in 4Q23, with an 11% increase in MRR per cabinet
- Adjusted EBITDA increased 10% y-o-y to US$920m, in line
- Management expects FY24 adjusted EBITDA to grow by 10-13% y-o-y, also in line
4Q23 adjusted EBITDA increased 10% y-o-y, in line. Revenue increased 13% y-o-y to US$2,110m in 4Q23, in line with market expectations. Monthly recurring revenue (MRR) per cabinet increased by 11% y-o-y and 1% q-o-q, showing improvement across all regions. Adjusted EBITDA increased 10% y-o-y to US$920m, also in line with consensus estimates, while adjusted EBITDA margin remained largely stable at 44%. DPS increased by 17% y-o-y to US$14.49 in FY23. In terms of capacity expansion, Equinix added 14 new data centres in 12 cities in FY23 – including Dublin, Frankfurt, Kuala Lumpur, Madrid, Milan, Montreal, Paris, São Paulo, Seattle, Seoul, Tokyo and Washington, D.C. In addition, the company added seven new projects in Dallas, Lagos, Madrid, Milan, Warsaw and Washington, D.C.
Management expects FY24 adjusted EBITDA to grow 10-13%. The company introduced its FY24 guidance and expects adjusted EBITDA to grow by 10-13% y-o-y to US$3,306-3,376m in FY24, in line with market expectations. The company also anticipates an 18% y-o-y increase in cash dividend payout to US$17.04 per share, with payout ratio increasing to 48% (from 45%) in FY24. Additionally, the company has a robust pipeline, with 49 data centre projects underway in 35 markets across 21 countries. The company is currently trading at a c.22x EV/ adjusted EBITDA, largely in line with the historical average, and offers a stable 2% dividend yield.