What's Happening?
Digital Realty Trust has increased its 2026 Core FFO outlook following a significant rise in second-quarter revenue. The company reported a 29% year-over-year increase in revenue, reaching $1.92 billion, and a record Core FFO of $2.65 per diluted share.
The data center operator has also expanded its portfolio, acquiring a 64% interest in three Northern Virginia data centers and purchasing land near Kansas City for future development. The company projects full-year Core FFO excluding net promote to be between $8.15 and $8.20 per share.
Why It's Important?
Digital Realty's expansion and increased revenue outlook highlight the growing demand for data center services, driven by the rise of AI and cloud computing. The company's strategic acquisitions and partnerships with hyperscale customers under long-term contracts position it well to capitalize on this demand. The financial growth and expansion plans could lead to increased investor confidence and further investment in the data center sector, impacting the broader technology infrastructure landscape.
What's Next?
Digital Realty plans to continue its expansion efforts, with pending transactions to increase its ownership in Teraco and add Columbia Capital. The company aims to provide up to 2 gigawatts of utility power at its new Kansas City site, indicating further growth in its data center capacity. Stakeholders will be watching for additional large signings and the impact of these expansions on the company's financial performance.
