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Equinix: 'Significant Pickup' in March

Equinix (EQIX) saw a "significant pickup" in customer activity in the month of March, as customers that had deferred decisions made commitments.

Colocation and interconnection specialist Equinix (EQIX) saw a "significant pickup" in customer activity in the month of March, as customers that had deferred decisions made commitments. Company executives discussed their first-quarter performance yesterday in a conference call with analysts.

Equinix said that many of the colocation deals in March were with companies that had considered leasing space in the fourth quarter of 2008 but had postponed decisions due to the uncertain economy. 

"I think we started to see confidence show up back with decision makers back in March," said Equinix President and CEO Stephen Smith. "I wouldn't tell you that we've seen a trend here, but we feel good about what the pipeline's showing us and we feel good about some of the decisions that weren't made in the fourth quarter that did get made in the first quarter. So there's a lot of positive signals here, but we're early days into this thing."

Equinix reported first quarter revenues of $199.2 million for the quarter, a 4 percent increase from the previous quarter, and a 26% increase jump from year-earlier period. The company's revenue and EBITDA were in line with Wall Street's expectations, and management reaffirmed its forward-looking guidance.

In some cases, Equinix is structuring deals with a phased installation schedule to allow companies to spread out their capital spending. The comapny's average revenue per cabinet increased 2 percent from the previous quarter, reaching $1,858 in the U.S.

"It's safe to say in this type of environment that the rate of pricing increases is probably moderating, but for us it's holding pretty firm around the world," said Smith.   

Equinix said it was continuing to see strength in bookings from network companies and financial services firms with electronic trading operations.  The company added 161 new customers in the quarter, and now has 2,384 customers leasing 44,500 cabinets. Smith said the company would continue to invest in expanding its facilities in key markets, and will be able to self-fund the construction.   

"Historically, great companies have excelled in tough times; in the tough times customers increasingly turn to great companies," sadi Smith. "This is the reason we will continue to invest in our core business in a disciplined and measured way."

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