Upward Trend in Per-Cabinet Colo Revenue

Monthly per-cabinet revenue at Equinix (EQIX) has jumped nearly $200 in the U.S. since the beginning of 2008, continuing to strength throughout the economic crisis.


If you're a colocation provider, the trend is your friend. This chart shows the revenue trend at Equinix Inc. (EQIX), one of the leading providers of colocation and interconnection services. The average monthly per-cabinet revenue at Equinix has jumped nearly $200 since the beginning of 2008 in the U.S., continuing to strengthen throughout the economic crisis.  

This is driven by two trends - pricing strength for new and renewing cabinets, and the sale of additional interconnections to existing customers. Equinix finished the second quarter with 22,800 revenue-generating cabinets in the U.S., up from 18,900 in the first quarter of 2008.  

"Across the board, pricing is pretty darn strong," said Equinix CEO Steve Smith. "Part of the driver is that utilization is continuing to go up, which is also providing strength to pricing." Most of Equinix' data center footprint is focused in high-demand markets that serve as hubs for connectivity and financial trading, such as northern New Jersey, Chicago and northern Virginia.   

"Another part of the reason pricing is so strong is that customers are buying more products and services for an average cabinet," said CFO Keith Taylor. Equinix sold 31 new 10 Gigabit Ethernet ports on the Equinix Exchange peering system in the second quarter of 2009, bringing the total of 10 Gig ports to 255. Traffic on the Equinix Exchange in the U.S. reached a peak of 340 gigabits per second, a 13.3% increase over last quarter.

Will other colocation providers report similar strength? Earnings reports in the pipeline include Switch and Data (SDXC) on Tuesday, Savvis Inc. (SVVS) on Wednesday and  Terremark (TMRK) on August 6. 

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