Data center firm Equinix trims annual revenue forecast on weak corporate spending
Reuters
Published Oct 25, 2023 06:51PM ET
(Reuters) - Data center company Equinix (NASDAQ:EQIX) trimmed its annual revenue forecast on Wednesday on worries that a tough macroeconomic environment would prompt companies to scale back their plans for cloud-based infrastructure.
The Redwood (NYSE:RWT) City, California-based company expects annual revenue between $8.17 billion and $8.21 billion, compared with its prior outlook of $8.17 billion to $8.25 billion.
Analysts on average expect annual revenue of $8.20 billion, according to LSEG data.
For the third quarter, the company posted revenue of $2.06 billion, which was in line with analysts' estimates, according to LSEG data.
Adjusted core earnings rose 7% to $936 million, and the company said it expected a figure of between $899 million and $929 million for the current quarter, compared with expectations of $930.1 million.
Adjusted funds from operations - a key measure of cash flow - came in at $8.19 per share, 6% higher than a year earlier.
The company projects current-quarter revenue between $2.09 billion and $2.13 billion, the top end of which is in line with estimates.
While demand for data centers remains robust, the supply situation in major markets remains tight on account of availability of power, brokerage MoffettNathanson said on Monday.
Data center spending is expected to grow more than 3% this year compared with a prior outlook of 6% on slowing demand while top four cloud companies, including Microsoft (NASDAQ:MSFT)'s Azure and Amazon.com (NASDAQ:AMZN)'s AWS, are still clearing inventory, brokerage Raymond James said earlier in Oct.
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Written By: Reuters
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