Digital Realty Trust Inc (DLR)

Business Description

Digital Realty Trust, Inc. is a leading global provider of data center, colocation, and interconnection solutions, serving a diverse range of industry verticals including cloud and information technology services, social networking, communications, financial services, manufacturing, energy, healthcare, and consumer products . Operating as a Real Estate Investment Trust (REIT) for U.S. federal income tax purposes, the company conducts its business through Digital Realty Trust, L.P., which owns, acquires, develops, and operates data centers . As of December 31, 2023, Digital Realty's portfolio consisted of 309 data centers across the United States, Europe, Latin America, Africa, Asia, Australia, and Canada .

Data Centers - Owns, acquires, develops, and operates strategically located properties with infrastructure such as redundant electrical supply systems, multiple power feeds, and high-level security systems to support data center and technology industry customers.
Colocation Solutions - Provides space, power, and cooling for customers' IT equipment, enabling them to scale their operations efficiently.
Interconnection Solutions - Offers connectivity services that facilitate the exchange of data between different networks and cloud service providers, enhancing operational efficiency and performance.

Key Metrics

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Executive Team

Name	Position	Start Date	Short Bio
Andrew P. Power	President & Chief Executive Officer	December 2022	Andrew P. Power has been with Digital Realty since 2015, serving in various roles including CFO. He has over 20 years of investment, financial, and management experience, previously at Bank of America Merrill Lynch .
Matthew Mercier	Chief Financial Officer	January 1, 2023	Matthew Mercier joined Digital Realty in 2006. He was previously SVP of Global Finance and Accounting. He holds a Bachelor of Science and an MBA from UC Berkeley .
Cindy Fiedelman	Chief Human Resources Officer	January 2016	Cindy Fiedelman joined Digital Realty in 2015 as Interim Global Head of HR. She previously worked at American Airlines and Avaya, Inc., focusing on talent management and HR integration .
Christine B. Kornegay	Chief Accounting Officer	January 1, 2024	Christine B. Kornegay oversees global accounting at Digital Realty. She was previously CAO at McAfee and has held positions at Dynata, SomnoMed, and MetroPCS .
Jeannie Lee	Executive Vice President, General Counsel	January 2022	Jeannie Lee joined Digital Realty in 2010. She has held various legal positions and was previously a corporate attorney at Latham & Watkins LLP .
Jeannie Lee	Secretary	March 2022	Jeannie Lee has been serving as Secretary since March 2022 .
Christopher Sharp	Chief Technology Officer	August 2015	Christopher Sharp leads global design and engineering at Digital Realty. He has over 20 years of experience in the technology industry, previously at Equinix, Inc. .
Gregory S. Wright	Chief Investment Officer	January 2019	Gregory S. Wright leads investment and acquisition activities at Digital Realty. He was previously Co-Head of Americas Real Estate at Bank of America Merrill Lynch .

Questions to Ask Management

Given that about 50% of your total bookings this quarter were driven by AI-related demand, how confident are you in the sustainability of this growth, and what steps are you taking to prepare for potential fluctuations in AI-driven demand?
With the increased power densities required for AI workloads leading to higher build costs, how are these higher costs impacting your development yields, and what measures are you implementing to maintain or improve these yields in the face of rising construction expenses?
Considering the significant acceleration in your development pipeline, increasing capacity under construction by almost 50% to 644 megawatts, how are you managing the funding needs for these developments while maintaining your leverage targets, especially in the current interest rate environment?
Despite the strong bookings and record $66 million in 0-1 megawatt interconnection business, how are you addressing potential pricing pressures and renewal fatigue among enterprise customers to ensure this momentum continues and maintain margins in this competitive segment?
You've emphasized focusing on core markets with robust and diverse demand while avoiding markets with less long-term visibility; can you elaborate on how this strategy impacts your growth prospects, and how you balance the risks and opportunities when expanding into new markets?

Debt Maturity Schedule

Year	Amount Due (in $ millions)	Debt Type	Interest Rate (%)	% of Total Debt
2025	2,177.191	4.25% Senior Notes, 0.625% Senior Notes	4.25, 0.625	12.7% = (2,177.191 / 17,109) * 100
2026	1,649.340	2.50% Senior Notes, 0.20% Senior Notes, Unsecured Revolving Credit Facility, Yen Facility, USD Term Loan	2.50, 0.20	9.6% = (1,649.340 / 17,109) * 100
2027	1,419.752	1.70% Senior Notes, 3.70% Senior Notes, Euro Term Loan	1.70, 3.70	8.3% = (1,419.752 / 17,109) * 100
2028	2,484.856	1.125% Senior Notes, 4.45% Senior Notes, 5.55% Senior Notes	1.125, 4.45, 5.55	14.5% = (2,484.856 / 17,109) * 100
2029	N/A	0.55% Senior Notes, 3.60% Senior Notes, 3.30% Senior Notes	0.55, 3.60, 3.30	N/A
2030	N/A	1.50% Senior Notes, 3.75% Senior Notes	1.50, 3.75	N/A
2031	N/A	1.25% Senior Notes, 0.625% Senior Notes	1.25, 0.625	N/A
2032	N/A	1.00% Senior Notes, 1.375% Senior Notes	1.00, 1.375	N/A
2033	N/A	3.875% Senior Notes	3.875	N/A
Thereafter	9,377.767	Various	N/A	54.8% = (9,377.767 / 17,109) * 100

Customer Concentration

Customer	Relationship	Segment	Details
Fortune 50 Software Company	Data center hosting and colocation	All	$418.935 million (10.9%Of total ARR)
Social Content Platform	Data center hosting and colocation	All	$212.198 million (5.5%Of total ARR)
Oracle Corporation	Data center hosting and colocation	All	$164.487 million (4.3%Of total ARR)
Global Cloud Provider	Data center hosting and colocation	All	$156.892 million (4.1%Of total ARR)
IBM	Data center hosting and colocation	All	$129.569 million (3.4%Of total ARR)
Equinix	Data center hosting and colocation	All	$93.346 million (2.4%Of total ARR)
LinkedIn Corporation	Data center hosting and colocation	All	$81.438 million (2.1%Of total ARR)
Fortune 25 Investment Grade-Rated Co.	Data center hosting and colocation	All	$76.737 million (2.0%Of total ARR)
Fortune 25 Tech Company	Data center hosting and colocation	All	$69.304 million (1.8%Of total ARR)
Social Media Platform	Data center hosting and colocation	All	$62.117 million (1.6%Of total ARR)
Fortune 500 SaaS Provider	Data center hosting and colocation	All	$61.889 million (1.6%Of total ARR)
Meta Platforms, Inc.	Data center hosting and colocation	All	$60.873 million (1.6%Of total ARR)
Lumen Technologies, Inc.	Data center hosting and colocation	All	$49.804 million (1.3%Of total ARR)
Cyxtera	Data center hosting and colocation	All	$49.361 million (1.3%Of total ARR)
AT&T	Data center hosting and colocation	All	$42.096 million (1.1%Of total ARR)
Comcast Corporation	Data center hosting and colocation	All	$40.436 million (1.1%Of total ARR)
JPMorgan Chase & Co.	Data center hosting and colocation	All	$39.629 million (1.0%Of total ARR)
Rackspace	Data center hosting and colocation	All	$38.061 million (1.0%Of total ARR)
Verizon	Data center hosting and colocation	All	$34.103 million (0.9%Of total ARR)
Zayo	Data center hosting and colocation	All	$33.781 million (0.9%Of total ARR)

Auditor

Name	Start Date	End Date	Reason for Change
KPMG LLP	2004	Present	Current auditor