Equinix Raises Guidance, Sets Stock Sale
September 14th, 2007 By: Rich Miller
Equinix, Inc. (EQIX) today raised its revenue guidance for Wall Street for the third quarter and the full year of 2007, accounting for additional revenue from its acquisition of IXEurope, which has now closed. The company also said it would issue between 3.6 million and 4.2 million shares of common stock and $300 million of convertible notes to fund the $555 million IXEurope acquisition. In early trading, shares of Equinix surged $2.38 to $84.40 a share, a gain of about 3 percent.
The data center and interconnection service provider said it now expects third-quarter revenue in a range of $101 million to $102 million, up from its previous forecast of $96.5 million to $97.5 million. The increased estimate includes approximately $4 million in revenue from Europe.
Equinix now predicts full-year 2007 sales of $413 million and $415 million, including about $37 million in revenue from Europe. It previously forecast 2007 revenue of $373 million to $377 million. Capital expenditures for this year will range between $405 to $415 million, including approximately $40 million of ongoing capital expenditures and about $25 million of in new capital expenditures related to IXEurope facilities. The expansion capital will fund ongoing data center construction in the Chicago, northern New Jersey, Los Angeles, Silicon Valley and Washington D.C. markets.
Equinix’ also said it projects full-year 2008 revenues of between $605 and $625 million, including $140 to $150 million from Europe. The company said its long-term operating plan, which assumes full capacity of all existing data centers and those currently under construction, is capable of generating revenues of $890.0 to $940.0 million of which $200.0 to $220.0 million is attributable to Europe.
“Equinix continues to experience strong customer demand across each of our markets and is positioned to deliver strong 2007 financial results,” said Steve Smith, CEO of Equinix. “With the closing of the IXEurope acquisition, a robust 2007 exit rate, and our expansion projects on track to open in the next few months, initial 2008 guidance demonstrates our ability to capitalize on the opportunity ahead with our market leadership position.”