Equinix Inc. Delivers a Classic Beat-and-Raise Second-Quarter Report

By Markets Fool.com

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Image source: Equinix.

Equinix reported second-quarter results after the closing bell on Wednesday. The data-center operator crushed analyst expectations across the board and raised its guidance targets for the full year.

In the second quarter, Equinix saw a 10% year-over-year revenue increase. Landing at $666 million, the result left Wall Street's $658 million consensus far behind.

On the bottom line, Equinix tracks a non-GAAP profit measure known as adjusted funds from operations, or AFFO. Here, the company saw a 14% improvement over the year-ago period, with $3.75 of AFFO per diluted share. Analysts were expecting $3.41 per share.

Equinix CEO Steve Smith celebrated an unbroken streak of 50 straight quarters with sequential revenue growth.

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"We sit at the crossroads of the Internet where our customers use Platform Equinix to innovate and accelerate their businesses," Smith said in a press statement. "The scope, scale, reach, and diversity of our global offering remain without parallel and we are continuing to invest across systems, processes and people to ensure consistent service delivery worldwide."

Looking ahead, Equinix expects third-quarter revenues of roughly $683 million, again firmly above the Street view at $672 million. For the full year, the midpoint of revenue guidance now falls at $2.89 billion. AFFO profits should stop at $855 million, which translates into roughly $14.87 per diluted share at current share counts. Keep in mind that Equinix is no stranger to dilution, though -- the share count has increased 11% over the past four quarters.

The company likes to use newly printed shares to pick up strategic acquisitions, such as the $3.6 billion cash-plus-stock buyout of British data-center rival Telecity Group . Fully half of that pending acquisition will be paid for in new Equinix shares, growing the share count by another 11.6%. Then again, that deal isn't expected to close until the first half of 2016, and so it won't affect AFFO per share results in 2015. It's just a general share-printing attitude to keep in mind when thinking about Equinix in the long term.

In other news, Equinix also declared a regular cash dividend, payable on Sept. 16. The company converted into a real estate investment trust at the start of 2015 and has been paying the required dividends ever since. This is the third consecutive payout at exactly $1.69 per share.

The article Equinix Inc. Delivers a Classic Beat-and-Raise Second-Quarter Report originally appeared on Fool.com.

Anders Bylund has no position in any stocks mentioned. The Motley Fool recommends Equinix. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.