Digital Realty Smashes Records in 2024 Q4, Poised for Continued Growth
Digital Realty, a leading provider of data center infrastructure, has just reported its fourth-quarter 2024 earnings, and the results are nothing short of impressive. The company has posted record-breaking leasing, capital raising, and revenue growth, setting it up for continued success in the ever-growing demand for data centers.
One of the standout highlights from the quarter is Digital Realty's second consecutive record-breaking leasing in its 0-1 megawatt plus interconnection segment. This segment has been a significant focus for the company, and the results are a testament to its growing strength and momentum. The company also reported a record $1 billion of total leasing completed in 2024, with over $250 million coming from the 0-1 megawatt plus interconnection category.
CEO Andy Power highlighted the company's strategic priorities, which have been executed to perfection. Digital Realty has strengthened its customer value proposition, adding nearly 600 new logos while expanding connectivity-rich solutions. The company also expanded its total portfolio capacity by over 200 megawatts and scaled its development pipeline by over 75% to $7-plus billion of projects underway that are 70% pre-leased.
"2024 was a breakout year for Digital Realty," said Power, "as we capitalized on a surge in demand for data center infrastructure positions the company for the opportunity that lies ahead and continue to execute on the key strategic priorities that we outlined on this call 2 years ago."
The company's financials also reflect its impressive performance. Digital Realty raised over $2 billion of new debt and equity capital, as well as over $500 million of net proceeds from asset sales and JV contributions, boosting its liquidity to over $6 billion and reducing leverage to 4.8x at year-end.
The company's core FFO per share growth was a respectable 6% in the fourth quarter, foreshadowing expectations for 2025. CFO Matt Mercier noted that this growth is a testament to Digital Realty's ability to execute on its strategic priorities and position itself for continued success in the industry.
As demand for data center capacity remains robust, both for larger AI-oriented and capacity blocks and to support growth in cloud and digital transformation while data center supply remains tight, Digital Realty is well-positioned to take advantage of this trend. The company has innovated and integrated across its unmatched global portfolio, rolling out new products and services such as high-density colo 2.0, the expansion of ServiceFabric to 38 metros around the world, and Private AI Exchange.
With a record-breaking year under its belt, Digital Realty is poised for continued growth in 2025. The company's commitment to diversifying and bolstering its capital sources will enable it to expand capacity to support customers' growing requirements, improve capital efficiency, and reduce leverage while increasing returns to shareholders.
