AUSTIN, Texas, May 2, 2024 /PRNewswire/ -- Digital Realty (NYSE: DLR), the largest global provider of cloud- and carrier-neutral data center, colocation, and interconnection solutions, announced today financial results for the first quarter of 2024. All per share results are presented on a fully diluted basis. Highlights Reported net income available to common stockholders of $0.82 per share in 1Q24, compared to $0.20 in 1Q23 Reported FFO per share of $1.41 in 1Q24, compared to $1.60 in 1Q23 Reported Core FFO per share of $1.67 in 1Q24, compared to $1.66 in 1Q23 Reported "Same-Capital" cash NOI growth of 4.7% in 1Q24 Reported rental rate increases on renewal leases of 11.8% on a cash basis in 1Q24 Signed total bookings during 1Q24 that are expected to generate $252 million of annualized GAAP rental revenue, including a $40 million contribution from the 0–1 megawatt category and $13 million contribution from interconnection Maintained 2024 Core FFO per share outlook of $6.60 - $6.75 Financial Results Digital Realty reported revenues of $1.3 billion in the first quarter of 2024, a 3% decrease from the previous quarter and an 1% decrease from the same quarter last year.  The company delivered net income of $288 million in the first quarter of 2024, and net income available to common stockholders of $271 million, or $0.82 per diluted share, compared to $0.08 per diluted share in the previous quarter and $0.20 per diluted share in the same quarter last year.  Digital Realty generated Adjusted EBITDA of $711 million in the first quarter of 2024, a 2% increase from the previous quarter and 6% increase over the same quarter last year.  The company reported Funds From Operations (FFO) of $451 million in the first quarter of 2024, or $1.41 per share, compared to $1.53 per share in the previous quarter and $1.60 per share in the same quarter last year.  Excluding certain items that do not represent core expenses or revenue streams, Digital Realty delivered Core FFO per share of $1.67 in the first quarter of 2024, compared to $1.63 per share in the previous quarter and $1.66 per share in the same quarter last year. Digital Realty delivered Constant-Currency Core FFO per share of $1.67 for the first quarter of 2024. "Digital Realty saw accelerating demand in the first quarter, executing on a number of multifaceted AI-oriented opportunities, while continuing to support hybrid multi-cloud requirements. Strong demand supported a new leasing record, driven by large footprint deals," said Digital Realty President & Chief Executive Officer Andy Power. "In support of this demand, we sourced over $1 billion of fresh capital through asset sales and joint ventures, further reducing our reported leverage while positioning the company to meet our customers' growing needs." Leasing Activity In the first quarter, Digital Realty signed total bookings that are expected to generate $252 million of annualized GAAP rental revenue, including a $40 million contribution from the 0–1 megawatt category and a $13 million contribution from interconnection. The weighted-average lag between new leases signed during the first quarter of 2024 and the contractual commencement date was 7 months. In addition to new leases signed, Digital Realty also signed renewal leases representing $248 million of annualized cash rental revenue during the quarter. Rental rates on renewal leases signed during the first quarter of 2024 increased 11.8% on a cash basis and 13.0% on a GAAP basis.  New leases signed during the first quarter of 2024 are summarized by region and product as follows:  Annualized GAAP Base Rent Square Feet GAAP Base Rent GAAP Base Rent  Americas (in thousands) (in thousands) per Square Foot Megawatts per Kilowatt  0-1 MW $19,050 67 $283 6.5 $243  > 1 MW 175,200 636 275 84.0 174  Other (1) 495 10 51 — — Total $194,746 713 $273 90.5 $179  EMEA (2)  0-1 MW $14,754 60 $246 5.5 $224  > 1 MW 23,020 112 206 13.7 140  Other (1) 72 1 117 — — Total $37,846 173 $219 19.2 $164  Asia Pacific (2)  0-1 MW $6,192 18 $343 1.5 $333  > 1 MW — — — — —  Other (1) 159 3 56 — — Total $6,351 21 $304 1.5 $333  All Regions (2)  0-1 MW $39,996 145 $275 13.6 $246  > 1 MW 198,220 748 265 97.7 169  Other (1) 726 13 55 — — Total $238,942 907 $264 111.2 $178 Interconnection $13,240 N/A N/A N/A N/A Grand Total $252,182 907 $264 111.2 $178 Note:  Totals may not foot due to rounding differences. (1) Other includes Powered Base Building® shell capacity as well as storage and office space within fully improved data center facilities. (2) Based on quarterly average exchange rates during the three months ended March 31, 2024. Investment Activity As previously disclosed, in the first quarter, Digital Realty successfully resolved its relationship with Cyxtera, with the closing of a series of transactions with Brookfield Infrastructure Partners L.P., Cyxtera Technologies and Digital Core REIT. Digital Realty received $277 million for its interest in four data centers and redeployed $55 million to buy out Cyxtera's leases in Digital Realty's Frankfurt and Singapore data centers. Digital Realty also exercised its option to purchase a data center outside of London, UK, which is expected to close in the second quarter. Also previously disclosed, in January, Digital Realty and Blackstone Inc. established the first phase of their $7 billion hyperscale data center development joint venture, which includes campuses in Paris and Northern Virginia. The second phase is scheduled to close later this year, upon obtaining the required approvals. As announced in early March, Digital Realty and Mitsubishi Corporation established a joint venture to support the development of two build-to-suit data centers in the Dallas metro area. The two data centers commenced construction in the fourth quarter of 2022 and can deliver up to 48 megawatts of IT load. Mitsubishi initially invested approximately $200 million to acquire a 65% equity interest in the venture, while Digital Realty maintains a 35% interest. Each partner will fund its pro rata share of the remaining development costs for the two facilities, which are slated for initial completion and commencement in late 2024. Additionally, as previously disclosed, during the quarter, Digital Realty closed on the purchase of approximately 19 acres of land in Paris, France for approximately €70 million or $76 million. The parcel of land, which was previously leased to Digital Realty, is currently under development to support up to 77 megawatts of IT load. During the quarter, Digital Realty closed on the sale of 19 acres of vacant land in Sydney, Australia for approximately AU$96 million or $63 million. Digital Realty also received approximately $92 million of proceeds during the first quarter, pursuant to an agreement to grant land easements for the use of substations on its Digital Dulles campus. During the first quarter, MC Digital Realty closed on the acquisition of five acres of land in Osaka, Japan which could support the development of up to 18 megawatts of IT load, for approximately JPY1 billion or $7 million. Subsequent to quarter end, Digital Realty and GI Partners expanded their existing joint venture in Chicago, with the sale to GI Partners of a 75% interest in a stabilized hyperscale data center that is situated on the same campus as two stabilized hyperscale data centers that were previously contributed to a joint venture with GI Partners in July 2023. Digital Realty received approximately $388 million of gross proceeds and will maintain a 25% interest in the joint venture. Based on annualized in‐place cash NOI as of March 31, 2024, adjusted for a customary vacancy allowance, the transaction values the facility at a 6.5% cap rate. As previously disclosed, in January, GI Partners executed its option to increase its stake from 65% to 80% in the two original stabilized hyperscale data centers within the Chicago joint venture. Subsequent to quarter end, Digital Realty closed on the sale to Digital Core REIT (SGX: DCRU) of an additional 24.9% interest in a data center facility located in Frankfurt, Germany for €117 million, or approximately $129 million.  The transaction valued the Frankfurt facility at €470 million, or approximately $517 million (at 100% share). Digital Core REIT has an option to acquire up to an 89.9% total ownership interest in the facility. Balance Sheet Digital Realty had approximately $17.0 billion of total debt outstanding as of March 31, 2024, comprised of $16.4 billion of unsecured debt and approximately $0.6 billion of secured debt and other. At the end of the first quarter of 2024, net debt-to-Adjusted EBITDA was 6.1x, debt-plus-preferred-to-total enterprise value was 27.9% and fixed charge coverage was 4.0x. Pro forma for the completion of the second phase of the Blackstone development joint ventures announced in December 2023, as well as the expansion of the joint venture with GI Partners and the sale of an interest in an asset to Digital Core REIT subsequent to quarter end, net debt-to-Adjusted EBITDA was 5.8x. As previously disclosed, in January, Digital Realty sold 0.6 million shares of its common stock at a weighted average price of $133.43 per share for net proceeds of approximately $84 million. Subsequent to quarter end, the company repaid €600 million ($647 million) aggregate principal amount of its 2.625% notes. 2024 Outlook Digital Realty maintained its 2024 Core FFO per share and Constant-Currency Core FFO per share outlook of $6.60 - $6.75. The assumptions underlying the outlook are summarized in the following table.  As of As of  Top-Line and Cost Structure February 15, 2024 May 2, 2024  Total revenue $5.550 - $5.650 billion $5.550 - $5.650 billion  Net non-cash rent adjustments (1) ($35 - $40 million) ($35 - $40 million)  Adjusted EBITDA $2.800 - $2.900 billion $2.800 - $2.900 billion  G&A $450 - $460 million $450 - $460 million  Internal Growth  Rental rates on renewal leases  Cash basis 4.0% - 6.0% 5.0% - 7.0%  GAAP basis 6.0% - 8.0% 7.0% - 9.0%  Year-end portfolio occupancy +100 - 200 bps +100 - 200 bps  "Same-Capital" cash NOI growth (2) 2.0% - 3.0% 2.5% - 3.5%  Foreign Exchange Rates  U.S. Dollar / Pound Sterling $1.25 - $1.30 $1.25 - $1.30  U.S. Dollar / Euro $1.05 - $1.10 $1.05 - $1.10  External Growth  Dispositions / Joint Venture Capital  Dollar volume $1,000 - $1,500 million $1,000 - $1,500 million  Cap rate 6.0% - 8.0% 6.0% - 8.0%  Development  CapEx (Net of Partner Contributions) (3) $2,000 - $2,500 million $2,000 - $2,500 million  Average stabilized yields 10.0%+ 10.0%+  Enhancements and other non-recurring CapEx (4) $15 - $20 million $15 - $20 million  Recurring CapEx + capitalized leasing costs (5) $260 - $275 million $260 - $275 million  Balance Sheet  Long-term debt issuance  Dollar amount $0 - $1,000 million $0 - $1,000 million  Pricing 5.0% - 5.5% 5.0% - 5.5%  Timing Mid-Year Mid-Year  Net income per diluted share $1.80 - $1.95 $1.80 - $1.95  Real estate depreciation and (gain) / loss on sale $4.40 - $4.40 $4.40 - $4.40  Funds From Operations / share (NAREIT-Defined) $6.20 - $6.35 $6.20 - $6.35  Non-core expenses and revenue streams $0.40 - $0.40 $0.40 - $0.40  Core Funds From Operations / share $6.60 - $6.75 $6.60 - $6.75  Foreign currency translation adjustments $0.00 - $0.00 $0.00 - $0.00  Constant-Currency Core Funds From Operations / share $6.60 - $6.75 $6.60 - $6.75 (1) Net non-cash rent adjustments represent the sum of straight-line rental revenue and straight-line rental expense, as well as the amortization of above- and below-market leases (i.e., ASC 805 adjustments).  (2) The "Same-Capital" pool includes properties owned as of December 31, 2022 with less than 5% of total rentable square feet under development.  It excludes properties that were undergoing, or were expected to undergo, development activities in 2023-2024, properties classified as held for sale, and properties sold or contributed to joint ventures for all periods presented. (3) Excludes land acquisitions and includes Digital Realty's share of JV contributions. Figure is net of JV partner contributions. (4) Other non-recurring CapEx represents costs incurred to enhance the capacity or marketability of operating properties, such as network fiber initiatives and software development costs. (5) Recurring CapEx represents non-incremental improvements required to maintain current revenues, including second-generation tenant improvements and leasing commissions. Note: The Company does not provide a reconciliation for non-GAAP estimates on a forward-looking basis, where it is unable to provide a meaningful or accurate calculation or estimation of reconciling items and the information is not available without unreasonable effort. Please see Non-GAAP Financial Measures in this document for further discussion. Non-GAAP Financial Measures This document contains non-GAAP financial measures, including FFO, Core FFO, Adjusted FFO, Net Operating Income (NOI), "Same-Capital" Cash NOI and Adjusted EBITDA. A reconciliation from U.S. GAAP net income available to common stockholders to FFO, a reconciliation from FFO to Core FFO, a reconciliation from Core FFO to Adjusted FFO, reconciliation from NOI to Cash NOI, and definitions of FFO, Core FFO, Adjusted FFO, NOI and "Same-Capital" Cash NOI are included as an attachment to this document. A reconciliation from U.S. GAAP net income available to common stockholders to Adjusted EBITDA, a definition of Adjusted EBITDA and definitions of net debt-to-Adjusted EBITDA, debt-plus-preferred-to-total enterprise value, cash NOI, and fixed charge coverage ratio are included as an attachment to this document. The Company does not provide a reconciliation for non-GAAP estimates on a forward-looking basis, where it is unable to provide a meaningful or accurate calculation or estimation of reconciling items and the information is not available without unreasonable effort. This is due to the inherent difficulty of forecasting the timing and/or amount of various items that would impact net income attributable to common stockholders per diluted share, which is the most directly comparable forward-looking GAAP financial measure. This includes, for example, external growth factors, such as dispositions, and balance sheet items such as debt issuances, that have not yet occurred, are out of the Company's control and/or cannot be reasonably predicted. For the same reasons, the Company is unable to address the probable significance of the unavailable information. Forward-looking non-GAAP financial measures provided without the most directly comparable GAAP financial measures may vary materially from the corresponding GAAP financial measures. Investor Conference Call Prior to Digital Realty's investor conference call at 5:00 p.m. ET / 4:00 p.m. CT on May 2, 2024, a presentation will be posted to the Investors section of the company's website at https://investor.digitalrealty.com. The presentation is designed to accompany the discussion of the company's first quarter 2024 financial results and operating performance. The conference call will feature President & Chief Executive Officer Andy Power and Chief Financial Officer Matt Mercier. To participate in the live call, investors are invited to dial +1 (888) 317-6003 (for domestic callers) or +1 (412) 317-6061 (for international callers) and reference the conference ID# 1322262 at least five minutes prior to start time. A live webcast of the call will be available via the Investors section of Digital Realty's website at https://investor.digitalrealty.com. Telephone and webcast replays will be available after the call until June 2, 2024. The telephone replay can be accessed by dialing +1 (877) 344-7529 (for domestic callers) or +1 (412) 317-0088 (for international callers) and providing the conference ID# 7673278. The webcast replay can be accessed on Digital Realty's website. About Digital Realty Digital Realty brings companies and data together by delivering the full spectrum of data center, colocation, and interconnection solutions. PlatformDIGITAL®, the company's global data center platform, provides customers with a secure data meeting place and a proven Pervasive Datacenter Architecture (PDx®) solution methodology for powering innovation and efficiently managing Data Gravity challenges. Digital Realty gives its customers access to the connected data communities that matter to them with a global data center footprint of 300+ facilities in 50+ metros across 25+ countries on six continents. To learn more about Digital Realty, please visit digitalrealty.com or follow us on LinkedIn and X. Contact Information Matt MercierChief Financial OfficerDigital Realty(737) 281-0101 Jordan Sadler / Jim HusebyInvestor RelationsDigital Realty(737) 281-0101   Consolidated Quarterly Statements of Operations First Quarter 2024 Unaudited and in Thousands, Except Per Share Data Three Months Ended 31-Mar-24 31-Dec-23 30-Sep-23 30-Jun-23 31-Mar-23 Rental revenues $894,409 $885,694 $886,960 $869,298 $870,975 Tenant reimbursements - Utilities 276,357 316,634 335,477 330,416 317,148 Tenant reimbursements - Other 38,434 46,418 64,876 46,192 40,150 Interconnection & other 108,071 106,413 107,305 104,521 101,695 Fee income 13,010 14,330 7,819 14,908 7,868 Other 862 144 — 932 887 Total Operating Revenues $1,331,143 $1,369,633 $1,402,437 $1,366,267 $1,338,724 Utilities $324,571 $366,083 $384,455 $374,934 $346,364 Rental property operating 224,369 237,118 223,089 224,762 224,861 Property taxes 41,156 40,161 72,279 46,718 40,424 Insurance 2,694 3,794 4,289 4,385 4,355 Depreciation & amortization 431,102 420,475 420,613 432,573 421,198 General & administration 114,419 109,235 108,039 105,964 107,766 Severance, equity acceleration and legal expenses 791 7,565 2,682 3,652 4,155 Transaction and integration expenses 31,839 40,226 14,465 17,764 12,267 Provision for impairment — 5,363 113,000 — — Other expenses 10,836 5,580 1,295 655 — Total Operating Expenses $1,181,776 $1,235,598 $1,344,206 $1,211,407 $1,161,388 Operating Income $149,367 $134,035 $58,231 $154,860 $177,335 Equity in earnings / (loss) of unconsolidated joint ventures (16,008) (29,955) (19,793) 5,059 14,897 Gain / (loss) on sale of investments 277,787 (103) 810,688 89,946 — Interest and other income / (expense), net 9,709 50,269 24,812 (6,930) 280 Interest (expense) (109,535) (113,638) (110,767) (111,116) (102,220) Income tax benefit / (expense) (22,413) (20,724) (17,228) (16,173) (21,454) Loss from early extinguishment of debt (1,070) — — — — Net Income $287,837 $19,884 $745,941 $115,647 $68,839 Net income / (loss) attributable to noncontrolling interests (6,329) 8,419 (12,320) 2,538 (111) Net Income Attributable to Digital Realty Trust, Inc. $281,508 $28,304 $733,621 $118,185 $68,728 Preferred stock dividends (10,181) (10,181) (10,181) (10,181) (10,181) Net Income / (Loss) Available to Common Stockholders $271,327 $18,122 $723,440 $108,003 $58,547 Weighted-average shares outstanding - basic 312,292 305,781