Digital Realty Trust, Inc.

What they do

Digital Realty, through its operating partnership, owns and operates a portfolio of data centers offering space, power and interconnection to enterprise and cloud customers. As of June 30, 2026, it had 310 data centers (89 in unconsolidated entities) across the U.S., Europe, Latin America, Africa, Asia, Australia and Canada, with about 3.1 GW of IT capacity and 8.5 GW of buildable capacity under development or held for future development.

Revenue drivers

• Colocation and interconnection services — Core business: leasing data center space, power and connectivity to enterprise and cloud customers across multiple industry verticals; revenue has grown from $4.43B (2021) to $6.11B (2025).
• Global region diversification — Revenue generated across North America, Europe, Latin America, Africa, Asia, Australia and Canada; with 118 U.S. and 113 European data centers, these regions are the largest contributors.
• Cloud and IT service providers — Demand driven by cloud adoption, hybrid cloud and AI; leading cloud providers and IT service firms are key customers, with the top 20 customers by annualized rent disclosed in the latest earnings supplement.
• Development and build-to-suit — Internal growth through developing existing land and acquiring new properties; the company targets high-quality, strategically located sites and has 8.5 GW of buildable IT capacity for future development.

Recent performance

Quarterly revenue rose sequentially from $1.49B (Q2 2025) to $1.64B (Q1 2026). Annual revenue reached $6.11B in 2025, up from $5.55B in 2024, while net income jumped to $1.31B from $588.3M. Operating cash flow improved to $2.41B in 2025 from $2.26B in 2024. Diluted EPS increased to $3.58 in 2025 from $1.61 in 2024. The balance sheet shows total assets of $48.86B and cash of $2.43B as of March 31, 2026.

Strategy

Management aims to maximize earnings and FFO per share, cash flow and return on invested capital. Strategy includes prudently allocating capital, expanding global reach, developing existing land, and acquiring new properties. The company also pursues joint ventures (e.g., with BDIA in Indonesia and Blackstone) to expand into new markets. It targets a debt-to-Adjusted EBITDA ratio around 5.5x, fixed charge coverage above 3x, and floating-rate debt under 20% of total debt.

Risks

• Demand risk — Business depends on demand for data centers; reduced IT spending or slower cloud adoption could hurt occupancy and rental rates.
• Power supply risk — Relies on third-party utilities for power; service interruptions or price increases could raise costs and disrupt operations.
• Competition risk — Faces significant competition in the data center industry, which could pressure occupancy and rental rates.
• Macro and geopolitical risk — Global operations expose the company to tariffs, supply chain disruptions, inflation, political instability and currency fluctuations.

Outlook

Management has not provided specific forward guidance in the supplied excerpts, but it continues to highlight AI, hybrid cloud and enterprise data growth as demand drivers. The company is building out its development pipeline and expanding via JVs, aiming to capture sustainable long-term growth. It will keep focusing on capital allocation and maintaining a conservative balance sheet.