5db7de0d65e8921b0f7c031a34c1125a354d5fdb0715cfa83ce2ec7187ec272e

16e38f4a65ccfe59dad44ede16eeef0aaff9f2802141a79c9f8533c07bfaf04b

Iron Mountain Incorporated is a global leader in storage and information management services, offering a wide range of solutions to over 225,000 clients worldwide **[0001020569-24-000040_irm-20231231.htm:7]**. The company operates through two primary segments: the Global Records and Information Management (Global RIM) Business and the Global Data Center Business, providing both physical and digital storage solutions **[0001020569-24-000040_irm-20231231.htm:170]**. Iron Mountain's offerings include records management, data management, secure shredding, and enterprise-class data center facilities, with a strong focus on cross-selling opportunities among its diverse customer base **[0001020569-24-000040_irm-20231231.htm:170]** **[0001020569-24-000040_irm-20231231.htm:167]**.

1. **Global Records and Information Management (Global RIM) Business** - Offers comprehensive storage and management services for physical records, data management, and secure shredding, along with entertainment services and consumer storage solutions.
   - **Records Management** - Involves storing physical records and providing related services.
   - **Data Management** - Provides solutions for managing and protecting digital data.
   - **Secure Shredding** - Offers secure destruction of sensitive documents and materials.
   - **Entertainment Services** - Manages and stores media content for the entertainment industry.
   - **Consumer Storage** - Provides storage solutions for individual consumers.

2. **Global Data Center Business** - Delivers enterprise-class data center facilities and hyperscale-ready capacity, supporting the growing demand for digital infrastructure.

3. **Global Digital Solutions** - Focuses on digital transformation services, helping clients transition from physical to digital storage and management.

4. **Asset Lifecycle Management (ALM)** - Provides services for managing the lifecycle of IT assets, from acquisition to disposal, with a focus on sustainability and efficiency.

5bd3b41c7170ed6b6da8816e72100ce5794dc06f1a4c332b4b7dddd598c868f8

Adjustments for Non-Cash Items [USD, $]

Stock-Based Compensation [USD, $]

Changes in Working Capital [USD, $]

Capital Expenditures (CapEx) [USD, $]

Proceeds from / Repayments of Debt [USD, $]

Share Repurchases [USD, $]

Dividend Payments [USD, $]

Net Change in Cash [USD, $]

f4930bf79f2d6b71d9b337400ccd0939072dccda35e8fb361ea61ce277faab77

| Segment/Quarter | Q4 2022 | Q1 2023 | Q2 2023 | Q3 2023 | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 |
|-----------------|---------|---------|---------|---------|---------|---------|---------|---------|
| Global RIM Business ($ million) | **1,084.6**  **[0001020569-23-000036_q42022srpfinal.htm:7]**  | **1,126.5**  **[0001020569-23-000108_irm-20230331.htm:18]**  | **1,159.9**  **[0001020569-23-000169_irm-20230630.htm:26]**  | **1,180.0**  **[IRM_3363608_5]**  | **1,190.0**  **[IRM_3374543_5]**  | **1,210.2**  **[0001020569-24-000128_irm-20240331.htm:18]**  | **1,250.6**  **[IRM_3395671_4]**  | **1,260.4**  **[0001020569-24-000255_irm-20240930.htm:27]**  |
| Global Data Center Business ($ million) | **103.7**  **[0001020569-23-000036_q42022srpfinal.htm:7]**  | **112.3**  **[0001020569-23-000108_irm-20230331.htm:18]**  | **118.0**  **[0001020569-23-000169_irm-20230630.htm:26]**  | **128.0**  **[IRM_3363608_5]**  | **495.0**  **[0001020569-24-000040_irm-20231231.htm:168]**  | **143.9**  **[0001020569-24-000128_irm-20240331.htm:18]**  | **152.7**  **[IRM_3395671_4]**  | **153.2**  **[0001020569-24-000255_irm-20240930.htm:27]**  |
| Corporate and Other ($ million) | **90.7**  **[0001020569-23-000036_q42022srpfinal.htm:7]**  | **75.5**  **[0001020569-23-000108_irm-20230331.htm:18]**  | **80.0**  **[0001020569-23-000169_irm-20230630.htm:26]**  | **78.0**  **[0001020569-23-000214_irm-20230930.htm:45]**  | **323.0**  **[0001020569-24-000040_irm-20231231.htm:168]**  | **122.8**  **[0001020569-24-000128_irm-20240331.htm:18]**  | **131.1**  **[IRM_3395671_4]**  | **143.8**  **[0001020569-24-000255_irm-20240930.htm:27]**  |
| Total Revenue ($ million) | **1,279.0**  **[0001020569-23-000036_q42022srpfinal.htm:7]**  | **1,314.3**  **[0001020569-23-000108_irm-20230331.htm:18]**  | **1,357.9**  **[0001020569-23-000169_irm-20230630.htm:26]**  | **1,386.0**  **[IRM_3363608_5]**  | **1,420.0**  **[0001020569-24-000038_q42023earningspressrelea.htm:0]**  | **1,476.9**  **[0001020569-24-000128_irm-20240331.htm:18]**  | **1,534.4**  **[0001020569-24-000210_irm-20240630.htm:42]**  | **1,557.4**  **[0001020569-24-000255_irm-20240930.htm:27]**  |

f7aa4b2d6f3181ea039f4ef13b6d3ad227709db3267519cc7e2e72d380ec2c46

f5af1b358988d57af8634bd8613e0a19e566a0569c76362c54099eb00b11dae5

1. Given the significant capital investments in data centers and the limited sequential revenue growth in that segment this quarter, can you provide more details on when these investments will translate into meaningful revenue growth?  **[IRM_3406029_8]** 
2. With current annualized revenues in Asset Lifecycle Management around $400 million, how confident are you in achieving your target of $900 million by 2026, and what strategies will you employ to bridge this significant gap?  **[IRM_3406029_12]** 
3. Despite outperforming your projections and achieving record results, you've only adjusted your full year 2024 guidance to the high end of the previous range. Can you explain why the guidance wasn't raised further, especially with continued FX headwinds?  **[IRM_3406029_3]** ,  **[IRM_3406029_10]** 
4. Considering the increased capital expenditures approaching $1.8 billion primarily for data centers, how are you assessing the risks of overbuilding capacity, and what measures are in place to ensure these investments yield the expected returns?  **[IRM_3406029_7]** ,  **[IRM_3406029_8]** 
5. Can you elaborate on the profitability and revenue contribution of your InSight Digital Experience (DXP) platform, especially given initial strategies focused on cross-selling rather than direct monetization?  **[IRM_3406029_1]** ,  **[IRM_3406029_11]** 

5a1efd4f38152a2f6d772fba0759c96e9da06e5bda10d42ec519827281a669cf

Growth Investment CapEx

Recurring CapEx

049af253ecae78dc54097d968d90f605e1194ffd1559384eff6f7fa295195bc8

### Q3 2024 Earnings Call (Guidance Issued for Q4 2024 and FY 2024)
- **Fourth Quarter 2024 (Q4 2024) Guidance:**
  - Revenue: Approximately **$1.6 billion**  **[IRM_3406029_4]** .
  - Adjusted EBITDA: Approximately **$595 million**  **[IRM_3406029_4]** .
  - AFFO (Adjusted Funds From Operations): Approximately **$358 million**  **[IRM_3406029_4]** .
  - AFFO per share: Approximately **$1.21**  **[IRM_3406029_4]** .

- **Full Year 2024 (FY 2024) Guidance:**
  - On track to achieve the high end of their guidance range, although specific full-year figures were not detailed  **[IRM_3406029_4]** .

### Q2 2024 Earnings Call (Guidance Issued for Q3 2024 and FY 2024)
- **Third Quarter 2024 (Q3 2024) Guidance:**
  - Revenue: Approximately **$1.55 billion**  **[IRM_3395671_5]** .
  - Adjusted EBITDA: Approximately **$560 million**  **[IRM_3395671_5]** .
  - AFFO: Approximately **$325 million**  **[IRM_3395671_5]** .
  - AFFO per share: Approximately **$1.10**  **[IRM_3395671_5]** .

- **Full Year 2024 (FY 2024) Guidance:**
  - Expect to deliver results towards the high end of their guidance range on all metrics  **[IRM_3395671_5]** .

### Q1 2024 Earnings Call (Guidance Issued for Q2 2024 and FY 2024)
- **Second Quarter 2024 (Q2 2024) Guidance:**
  - Revenue: Approximately **$1.5 billion**  **[IRM_3382131_5]** .
  - Adjusted EBITDA: Approximately **$535 million**  **[IRM_3382131_5]** .
  - AFFO: Approximately **$310 million**  **[IRM_3382131_5]** .
  - AFFO per share: Approximately **$1.05**  **[IRM_3382131_5]** .

### Q4 2023 Earnings Call (Guidance Issued for Q1 2024 and FY 2024)
- **First Quarter 2024 (Q1 2024) Guidance:**
  - Revenue: Approximately **$1.45 billion**  **[IRM_3374543_6]** .
  - Adjusted EBITDA: In excess of **$510 million**  **[IRM_3374543_6]** .
  - AFFO: Approximately **$310 million**  **[IRM_3374543_6]** .
  - AFFO per share: Approximately **$1.05**  **[IRM_3374543_6]** .

- **Full Year 2024 (FY 2024) Guidance:**
  - Total Revenue: Expected to be within the range of **$6 billion to $6.15 billion**, representing year-on-year growth of **11%** at the midpoint  **[IRM_3374543_6]** .
  - Adjusted EBITDA: Expected to be within the range of **$2.175 billion to $2.225 billion**, representing year-on-year growth of **12%** at the midpoint  **[IRM_3374543_6]** .
  - AFFO: Expected to be within the range of **$1.3 billion to $1.335 billion**, representing year-on-year growth of **9%** at the midpoint  **[IRM_3374543_6]** .
  - AFFO per Share: Expected to be **$4.39 to $4.51**, representing year-on-year growth of **8%** at the midpoint  **[IRM_3374543_6]** .
  - Foreign Exchange Impact: A full year FX headwind of **$25 million** on revenue and approximately **$10 million** on EBITDA and AFFO  **[IRM_3374543_6]** .

6ba22d64b34e29a2174e5eea6ac3836508585e6705b12d351ffa733a068e5f7c

United States

United Kingdom

Canada

Australia

Remaining Countries

North American Records and Information Management Business

North American Data Management Business

Western European Business

Other International Business

Global Data Center Business

Corporate and Other Business

Total Revenue

5c7efd17b01b49e31175d08ef11fa61ad145bd9c45a4fa138d0519fa1accea75

**Quarterly guidance for Q4 2024:**
- **Revenue**: $1.6 billion  **[IRM_3406029_4]**  (no prior guidance)  
- **Adjusted EBITDA**: $595 million  **[IRM_3406029_4]**  (no prior guidance)  
- **AFFO**: $358 million  **[IRM_3406029_4]**  (no prior guidance)  
- **AFFO per share**: $1.21  **[IRM_3406029_4]**  (no prior guidance)

**Annual guidance for FY 2024:**
- **Revenue**: On track to achieve the high end of the guidance range  **[IRM_3406029_1]** **[IRM_3406029_4]**  (no change from prior guidance  **[IRM_3395671_5]** )  
- **Adjusted EBITDA**: On track to achieve the high end of the guidance range  **[IRM_3406029_1]** **[IRM_3406029_4]**  (no change from prior guidance  **[IRM_3395671_5]** )  
- **AFFO**: On track to achieve the high end of the guidance range  **[IRM_3406029_4]**  (no change from prior guidance  **[IRM_3395671_5]** )  

55d256ac4f04cdf8d84d3ff5060b5ac90ece0026bec78e45f24445b646f916a2

| Name                  | Start Date | End Date | Reason for Change |
|-----------------------|------------|----------|-------------------|
| Deloitte & Touche LLP | 2002  **[0001020569-24-000040_irm-20231231.htm:104]**    | Present  | Current auditor   |

bb3926b5128d594e1733cca7291e7c55aaf708d784d3a8160f418d06ae39ff4e

23794d91c53ae875c8e247d72561e35d9d06ee07c70c9e0dbcc977a6d161504a

cca346755eab9ff36d2d1c97f43f0b0ec0444af5e3034480d785e9a650155496

- Total Revenue: $1,557.4 million (+12% YoY)  **[0001020569-24-000255_irm-20240930.htm:3]** **[0001020569-24-000255_irm-20240930.htm:40]**   
- Global RIM Business: $1,260.4 million (+7% YoY)  **[0001020569-23-000214_irm-20230930.htm:27]** **[0001020569-24-000255_irm-20240930.htm:27]**   
- Global Data Center Business: $153.2 million (+20% YoY)  **[0001020569-23-000214_irm-20230930.htm:27]** **[0001020569-24-000255_irm-20240930.htm:27]**   
- **Corporate and Other: $143.8 million (+84% YoY)**  **[0001020569-23-000214_irm-20230930.htm:27]** **[0001020569-24-000255_irm-20240930.htm:27]**   
- **Information Destruction: $244.8 million (+44% YoY)**  **[0001020569-23-000214_irm-20230930.htm:29]** **[0001020569-24-000255_irm-20240930.htm:27]**   
- Operating Income (EBIT): $251.2 million (+6% YoY)  **[0001020569-23-000214_irm-20230930.htm:3]** **[0001020569-23-000214_irm-20230930.htm:40]** **[0001020569-24-000255_irm-20240930.htm:3]** **[0001020569-24-000255_irm-20240930.htm:40]**   
- Interest Expense: $186.1 million (+22% YoY)  **[0001020569-23-000214_irm-20230930.htm:3]** **[0001020569-23-000214_irm-20230930.htm:40]** **[0001020569-24-000255_irm-20240930.htm:3]** **[0001020569-24-000255_irm-20240930.htm:40]**   
- **Net Income: -$33.7 million (down from $91.4 million in Q3 2023)**  **[0001020569-23-000214_irm-20230930.htm:3]** **[0001020569-23-000214_irm-20230930.htm:40]** **[0001020569-24-000255_irm-20240930.htm:3]** **[0001020569-24-000255_irm-20240930.htm:40]**   

8f81e347e3ff40620d870d1d997d38e72bba470aa4b871b1f3133d9df0ecb9e0

609283c9c77c46fe3dbbd25159fa97f19a75bfd6fdf9ee640fbaf9bb4b56d5f8

| Year | Amount Due (in $M) | Debt Type                | Interest Rate (%) | % of Total Debt                                                                 |
|----------|-------------------------|------------------------------|------------------------|------------------------------------------------------------------------------------|
| 2026     | 186.3 **[0001020569-24-000255_irm-20240930.htm:21]**          | UK Bilateral Revolving Credit Facility | 7.0 **[0001020569-24-000255_irm-20240930.htm:24]**         | 1.4% = (186.3 / 13,245.5) * 100 **[0001020569-24-000255_irm-20240930.htm:21]**                                           |
| 2027     | 995.7 **[0001020569-24-000255_irm-20240930.htm:21]**          | 4 7/8% Notes                 | 4.875 **[0001020569-24-000255_irm-20240930.htm:21]**         | 7.5% = (995.7 / 13,245.5) * 100 **[0001020569-24-000255_irm-20240930.htm:21]**                                           |
| 2027     | 89.9 **[0001020569-24-000255_irm-20240930.htm:21]**           | Virginia 6 Term Loans        | 4.9 **[0001020569-24-000255_irm-20240930.htm:24]**           | 0.7% = (89.9 / 13,245.5) * 100 **[0001020569-24-000255_irm-20240930.htm:21]**                                            |
| 2028     | 820.9 **[0001020569-24-000255_irm-20240930.htm:21]**          | 5 1/4% Notes                 | 5.25 **[0001020569-24-000255_irm-20240930.htm:21]**          | 6.2% = (820.9 / 13,245.5) * 100 **[0001020569-24-000255_irm-20240930.htm:21]**                                           |
| 2028     | 497.2 **[0001020569-24-000255_irm-20240930.htm:21]**          | 5% Notes                     | 5.0 **[0001020569-24-000255_irm-20240930.htm:21]**           | 3.8% = (497.2 / 13,245.5) * 100 **[0001020569-24-000255_irm-20240930.htm:21]**                                           |
| 2029     | 990.8 **[0001020569-24-000255_irm-20240930.htm:21]**          | 7% Notes                     | 7.0 **[0001020569-24-000255_irm-20240930.htm:21]**           | 7.5% = (990.8 / 13,245.5) * 100 **[0001020569-24-000255_irm-20240930.htm:21]**                                           |
| 2029     | 992.8 **[0001020569-24-000255_irm-20240930.htm:21]**          | 4 7/8% Notes                 | 4.875 **[0001020569-24-000255_irm-20240930.htm:21]**         | 7.5% = (992.8 / 13,245.5) * 100 **[0001020569-24-000255_irm-20240930.htm:21]**                                           |
| 2030     | 1,291.2 **[0001020569-24-000255_irm-20240930.htm:21]**        | 5 1/4% Notes                 | 5.25 **[0001020569-24-000255_irm-20240930.htm:21]**          | 9.7% = (1,291.2 / 13,245.5) * 100 **[0001020569-24-000255_irm-20240930.htm:21]**                                         |
| 2031     | 1,833.6 **[0001020569-24-000255_irm-20240930.htm:21]**        | Term Loan B                  | SOFR + 2.0 **[0001020569-24-000255_irm-20240930.htm:21]**    | 13.8% = (1,833.6 / 13,245.5) * 100 **[0001020569-24-000255_irm-20240930.htm:21]**                                        |
| 2032     | 739.8 **[0001020569-24-000255_irm-20240930.htm:21]**          | 5% Notes                     | 5.0 **[0001020569-24-000255_irm-20240930.htm:21]**           | 5.6% = (739.8 / 13,245.5) * 100 **[0001020569-24-000255_irm-20240930.htm:21]**                                           |

57fd8eef2c3eec55c5c0870671af485ed09192bf2ea4fffd8e62feb31834d5d3

cfeb5eab9721733ffa5cdbcc380641933f7468867b9ad43bffb2e84dea651fb3

- **Strong growth and higher returns in the data center business, with a robust pipeline and improved pricing even in a higher interest rate environment.**  **[IRM_3374543_12]**
- **Potential for dividend increase due to payout ratio now in target range (low 60s%), indicating strong financial health and shareholder-friendly policies.**  **[IRM_3374543_15]**
- **Positive storage volume growth driven by new business wins and stable retention rates, contributing to strong revenue growth in Global RIM storage rental revenue (over 8% organic growth).**  **[IRM_3374543_11]** **[IRM_3374543_8]**

3f82c2809e743ebcf55fe56d99b6e3fe99da738b8851819fcd3a866b04232985

1. **CapEx Requirements and Data Center Growth**  
   **Q:** What are your CapEx plans to fuel growth going forward?  
   **A:** Iron Mountain plans to invest significantly in data center growth capital, expecting total capital expenditures to approach **$1.8 billion** this year, with about **$150 million** being recurring.  **[IRM_3406029_7]**  The vast majority of the growth capital is allocated to data centers due to strong leasing growth. They anticipate similar CapEx levels going forward in light of recent signings.  **[IRM_3406029_7]** 

2. **Data Center Revenue Growth and Commencements**  
   **Q:** How should we think about the pacing of data center revenue growth?  
   **A:** Iron Mountain expects an acceleration of data center revenue growth in the fourth quarter, driven by commencements completed at the end of the third quarter.  **[IRM_3406029_8]**  They have high visibility to over **$20 million** of incremental data center revenue in Q4 compared to Q3.  **[IRM_3406029_8]**  They anticipate ramping levels of data center revenue going forward due to commencements over the next few quarters.  **[IRM_3406029_8]** 

3. **ALM Growth and 2026 Targets**  
   **Q:** Are you still on track to achieve $900 million in ALM revenues by 2026?  
   **A:** Iron Mountain confirms they still have line of sight to the **$900 million** ALM revenue target by 2026.  **[IRM_3406029_12]**  This growth will come from a combination of strong organic growth and acquisitions.  **[IRM_3406029_12]**  They see immense market opportunity in ALM and aim to become the market leader.  **[IRM_3406029_12]** 

4. **RIM Volumes and Pricing Outlook**  
   **Q:** What are your expectations for RIM volumes and pricing in Q4 and next year?  
   **A:** Iron Mountain expects RIM volumes to continue expanding in the fourth quarter and into next year.  **[IRM_3406029_9]**  They anticipate physical volumes to be flattish to slightly up next year.  **[IRM_3406029_9]**  Pricing opportunities are expected to remain in the mid- to upper single-digit range, with total revenue in global RIM storage up over **7%** organically in the quarter.  **[IRM_3406029_9]** 

5. **Earnings Guidance and FX Headwinds**  
   **Q:** Why reaffirm guidance instead of raising it after beating estimates?  
   **A:** Despite beating estimates, Iron Mountain reaffirmed guidance due to foreign exchange headwinds.  **[IRM_3406029_10]**  FX has been a significant headwind throughout the year, especially from exposure to Latin American currencies.  **[IRM_3406029_10]**  They feel confident about their outlook and expect revenue and EBITDA to be at or slightly above the high end of guidance.  **[IRM_3406029_10]** 

6. **Details on Wisetek and APCD Acquisitions**  
   **Q:** Can you provide more details on Wisetek and APCD acquisitions and your M&A appetite?  
   **A:** Wisetek expands Iron Mountain's portfolio in Europe and North America, bringing strong relationships with enterprise and new hyperscale customers.  **[IRM_3406029_13]**  APCD enhances capabilities in Australia, an underpenetrated market for data center decommissioning.  **[IRM_3406029_13]**  Together, they represent around **$75-80 million** in run-rate revenue.  **[IRM_3406029_13]**  Iron Mountain is open to acquisitions but doesn't anticipate large deals, as most players in the space are relatively small.  **[IRM_3406029_13]** 

7. **ALM Business Trends: Volume and Pricing**  
   **Q:** Can you discuss trends in your ALM business regarding volumes and pricing?  
   **A:** Iron Mountain sees strong growth in data center decommissioning, especially as hyperscalers renew equipment to leverage the latest GPUs for AI.  **[IRM_3406029_6]**  Volume is driving revenue increases, with ALM organic revenue at **$64 million** this quarter compared to **$42 million** last year.  **[IRM_3406029_6]**  Pricing trends are variable based on specific components, with some spreads wider or tighter.  **[IRM_3406029_6]** 

8. **InSight Revenue Contributions**  
   **Q:** Are you generating revenues from InSight DXP platform wins?  
   **A:** Yes, Iron Mountain generates revenues from InSight DXP platform, with margins between **20% and 40%**, depending on contract length and productivity.  **[IRM_3406029_11]**  They consider these highly profitable service contracts and do not offer them for free.  **[IRM_3406029_11]**  The platform adds significant value through workflow solutions and is a growth area.  **[IRM_3406029_11]** 

db9de34e77bc5f176a1893f82d37db08203384c26838d18ee57ad511d21bd7df

- **Iron Mountain's Asset Lifecycle Management (ALM) business is experiencing strong growth**, with over **50% organic growth this quarter**, and the company is confident in reaching its **$900 million revenue target by 2026**, driven by both organic growth and strategic acquisitions.  **[IRM_3406029_12]** **[IRM_3406029_6]**
- **Expansion of data center capacity**, including a new site in Richmond with over **200 megawatts of critical IT load**, is expected to accelerate data center revenue growth by at least **$20 million in Q4**, with improving margins due to better pricing, setting up strong growth into 2025.  **[IRM_3406029_9]** **[IRM_3406029_8]**
- **Iron Mountain is outperforming its long-term growth targets**, running **200-300 basis points ahead** of its **10% CAGR goal**, with its growth portfolio (ALM, digital, data center) expected to sustain **over 20% growth** for a long period.  **[IRM_3406029_10]**

8b3103ed0fa231554cd654a6425554a9c2f505c2997c7460f265171f3b7e666a

- **Iron Mountain's Asset Lifecycle Management (ALM) business saw 30% organic revenue growth in the quarter**, driven by both increased volume (approximately two-thirds of growth) and pricing improvements (one-third), with a positive outlook for continued growth.  **[IRM_3395671_6]**  Additionally, the company is seeing increased decommissioning volume from hyperscale customers refreshing data centers for AI capabilities.  **[IRM_3395671_11]**
- **The Data Center business is exceeding expectations**, with **leasing ahead of projections** and strong demand from hyperscale customers. Iron Mountain feels confident in funding this growth without issuing equity, due to the strong cash generation from its core business.  **[IRM_3395671_9]** **[IRM_3395671_10]**
- **Storage Rental revenue organic growth was 7.7%**, driven by value-added services and disciplined revenue management, with expectations to maintain mid to upper single-digit growth over the longer term. The company continues to see **physical storage volumes at record levels**, contributing to strong margins and financial performance.  **[IRM_3395671_12]** **[IRM_3395671_8]**

81c79ba643fe67685e8af3b64d138d4f690031a8fd514056ca96753d7618cec3

- **Strong growth in the data center business**, with robust leasing activity, a fully funded expansion plan, and a pipeline exceeding 100 megawatts. The company is constructing new data centers and acquiring more land to support future growth.  **[IRM_3382131_11]** ,  **[IRM_3382131_7]** ,  **[IRM_3382131_8]**
- **Asset Lifecycle Management (ALM) business exceeding expectations**, with the integration of Regency Technologies going very well, leading to improved operational efficiencies and capabilities. The company is considering additional tuck-in acquisitions to further strengthen this segment.  **[IRM_3382131_10]** ,  **[IRM_3382131_13]** ,  **[IRM_3382131_8]**
- **Global Records and Information Management (RIM) business performing ahead of expectations**, with **storage volumes at an all-time high** and **storage rental revenue growth of 7.5%**, driven by effective revenue management actions. The company expects RIM volumes to be **consistent to slightly up** for the full year.  **[IRM_3382131_6]** ,  **[IRM_3382131_7]**

7f50fa94f903f7c931791ab20f8120e9294ef99fb30161c897a8641f14a6b6f0

- **Organic revenue growth in the storage business slowed to 7.5% in Q1 from 10.5% in Q4**, potentially indicating a deceleration in growth momentum.  **[IRM_3382131_6]**
- **RIM volumes are expected to be flat to slightly up for the full year**, suggesting limited growth potential in the company's core Records and Information Management segment.  **[IRM_3382131_7]**
- **Increasing capital expenditure requirements for data center expansion**, coupled with **narrowing spreads between data center investment returns and rising cost of capital**, may strain financial resources and impact profitability.  **[IRM_3382131_11]** **[IRM_3382131_8]**

aab1bff5d527bfd23f7b9d80b451505e32451a4b9d0f98f3d778cf9fc06c6603

1. **ALM Business Outlook**  
   **Q:** How are ALM volumes and component prices impacting 2024 guidance?  
   **A:** Iron Mountain expects component prices to strengthen during the year, aligning with industry trends.  **[IRM_3374543_7]**  In 2023, ALM delivered **$177 million** in revenue.  **[IRM_3374543_7]**  For 2024 guidance at the midpoint, they're assuming **$355 million** in total ALM revenue, including **$115 million** from the Regency acquisition, bringing organic ALM revenue to **$240 million**.  **[IRM_3374543_7]**  At the Q4 run rate, they would exceed **$205 million**, assuming no improvement in enterprise bookings or component pricing.  **[IRM_3374543_7]**  They've assumed a modest pricing benefit on component pricing as the year progresses.  **[IRM_3374543_7]** 

2. **Data Center Expansion and Returns**  
   **Q:** What are your targeted yields for data center investments, and can you accelerate leasing?  
   **A:** Returns on data center investments are improving, with pricing moving up **100–150 basis points** ahead of interest rates.  **[IRM_3374543_12]**  Iron Mountain is achieving higher returns despite higher interest rates.  **[IRM_3374543_12]**  They have a fully funded plan with no shortage of capital and can potentially do more than their current **100-megawatt** leasing guidance.  **[IRM_3374543_12]**  The RIM business, with over **70% gross margins**, generates substantial cash, providing deeper pockets than pure-play data center players.  **[IRM_3374543_12]**  Their leverage target range and EBITDA growth (over **$230 million** at the midpoint) give them significant capacity to invest in data center development while maintaining strong guidance.  **[IRM_3374543_12]** 

3. **RIM Revenue Growth and Pricing**  
   **Q:** How did pricing impact RIM revenue growth, and what's expected for 2024?  
   **A:** Global RIM storage rental revenue grew over **8%** organically in Q4 and about **8.5%** for the full year, driven by positive volume trends, good mix, and revenue management.  **[IRM_3374543_8]**  Revenue management includes value-added services, contributing to strong growth.  **[IRM_3374543_8]**  For 2024, the guidance embeds about **6%** growth at the midpoint for Global RIM, with expectations of continued positive trends in services and additional revenue management actions.  **[IRM_3374543_8]** 

4. **Data Center Pipeline and Pricing Trends**  
   **Q:** What's your outlook for RIM volumes and data center pricing in 2024?  
   **A:** Physical volume for RIM is expected to be slightly up for both Q1 and the full year, with growth driven by services and revenue management.  **[IRM_3374543_9]**  Data center mark-to-market trends have been positive over the last five to six quarters, and Iron Mountain continues to expect them to trend upward.  **[IRM_3374543_9]**  Colocation space is experiencing even higher pricing trends.  **[IRM_3374543_9]** 

5. **Dividend Payout Ratio and Potential Increase**  
   **Q:** Will you raise the dividend now that the payout ratio is below 65%?  
   **A:** Iron Mountain maintains a target payout ratio in the low **60%** range (60–65%) and is currently trending within that range.  **[IRM_3374543_15]**  While the decision lies with the Board, the company acknowledges that, mathematically, they are approaching another dividend increase in the not-too-distant future.  **[IRM_3374543_15]** 

6. **Matterhorn Sales Cycle and Growth**  
   **Q:** How is the Matterhorn initiative progressing, and what's the sales cycle like?  
   **A:** Sales cycles for Matterhorn are longer due to its solution-oriented nature.  **[IRM_3374543_10]**  However, more services are recurring or multiyear projects, allowing continued momentum and growth.  **[IRM_3374543_10]**  Approximately **30–40%** of revenue is now truly recurring or from long multiyear projects.  **[IRM_3374543_10]**  The cross-selling opportunity is substantial, with over **200,000** clients, most with relationships measured in decades.  **[IRM_3374543_10]**  Cross-selling efforts expanded significantly year-on-year, and Iron Mountain is ahead of targets.  **[IRM_3374543_10]** 

7. **Gross Margin Changes**  
   **Q:** Why did storage gross margins decline while services margins improved?  
   **A:** Services margins improved due to favorable mix and productivity gains, with some lower-margin deals shifting into Q1.  **[IRM_3374543_14]**  Storage gross margin includes all storage businesses, and while data center gross margins expanded sequentially and year-on-year, they are lower than records management margins.  **[IRM_3374543_14]**  The growth in data center revenue (up **35%** year-on-year in the quarter) affected overall storage gross margin due to mix.  **[IRM_3374543_14]**  Increased data center power costs, as clients draw more power, also impact storage costs.  **[IRM_3374543_14]** 

8. **Regency Acquisition Synergies**  
   **Q:** What early synergies are you seeing from the Regency acquisition?  
   **A:** Iron Mountain is excited about Regency's leadership team and capacity.  **[IRM_3374543_13]**  Regency brings a strong federal and local government customer portfolio and expertise in end-user devices.  **[IRM_3374543_13]**  There is ongoing collaboration to expand services using Iron Mountain's extensive resources.  **[IRM_3374543_13]**  The combination broadens their reach and ability to serve clients quickly, with considerable capacity for processing.  **[IRM_3374543_13]** 

9. **Retention Rates and Volume Growth**  
   **Q:** What drove the increase in volumes despite retention rates slipping slightly?  
   **A:** Retention rates remain in line with historical trends, with minor quarter-to-quarter variances.  **[IRM_3374543_11]**  Iron Mountain is pleased with retention and customer satisfaction scores.  **[IRM_3374543_11]**  Volume growth reflects the commercial team's success in winning new business, contributing to strong storage revenue growth and acceleration.  **[IRM_3374543_11]** 

b3193f4853338eedaee356456c25fd20b5ce9892690b0cdd9982d8666e0fbec2

- **Iron Mountain plans to invest approximately $1.8 billion in capital expenditures this year**, with the vast majority allocated to data center growth, potentially putting pressure on free cash flow and increasing financial risk.  **[IRM_3406029_7]**
- **Sequential revenue growth in the data center business was minimal in the quarter**, with recent capacity commencements contributing very little to headline results, raising concerns about the pace of revenue realization from these investments.  **[IRM_3406029_8]**
- **Physical storage volume in the Records and Information Management (RIM) business is expected to be only flattish to slightly up next year**, indicating limited growth potential in this core segment.  **[IRM_3406029_9]**

1ed77c3d0ccb86398ebafa2a26fb9773a0c38ed106a674de33e802aeed14194d

1. **ALM Business Growth**
   **Q:** Is ALM growth driven by volume or pricing, and what are the prospects?
   **A:** The ALM business saw **30% organic revenue growth**, with about **two-thirds driven by volume** and one-third from price improvements from record lows 12–18 months ago.  **[IRM_3395671_6]**  Pricing is expected to **trend higher**, and we anticipate the ALM business to **comp organically in the 40s** in the back half of the year or higher.  **[IRM_3395671_6]** 

2. **Data Center CapEx and Funding**
   **Q:** Are data center CapEx assumptions changing, and will you consider issuing equity?
   **A:** We are running ahead of the expectations shared at our 2022 Investor Event, generating more revenue, EBITDA, and cash.  **[IRM_3395671_9]**  While we may see a continued ramp in capital for data centers, we have a **fully funded plan** and do **not see any need to raise equity**, feeling confident in funding our growth without it.  **[IRM_3395671_9]** **[IRM_3395671_10]** 

3. **Hyperscalers and AI Impact**
   **Q:** Are hyperscalers releasing more equipment, increasing ALM volumes?
   **A:** Yes, hyperscalers are refreshing their data centers to bring in the latest GPUs and be **AI-ready**, leading to an **uptick in decommissioned equipment volumes**, which boosts our ALM business.  **[IRM_3395671_11]** 

4. **Global RIM Volume and Pricing**
   **Q:** What are your expectations for RIM volumes and revenue growth?
   **A:** We expect **physical volumes to be flat to slightly up**, with organic revenue growth in RIM storage of **7–8%** in the back half, driven mainly by **revenue management**.  **[IRM_3395671_8]**  Year-to-date, our Global RIM business is running at **7.5% growth**, outperforming initial expectations of around 6%.  **[IRM_3395671_12]** 

5. **Pricing Trends Amid Inflation**
   **Q:** Is pricing growth transitioning to mid-single digits as inflation wanes?
   **A:** We are pleased with **7.7%** organic constant currency growth in storage rentals.  **[IRM_3395671_12]**  While mid to upper single-digit growth is appropriate over the longer term, our pricing remains **300–400 basis points above normal inflation** due to the added value we provide to customers.  **[IRM_3395671_12]** 

6. **Data Center Construction Lead Times**
   **Q:** Are there issues with data center construction lead times?
   **A:** We have managed lead times effectively, keeping them similar to historical norms by **standardizing components across markets** as we scale.  **[IRM_3395671_13]**  This flexibility allows us to have the right equipment for customers and manage the supply chain efficiently.  **[IRM_3395671_13]** 

7. **Storage Gross Margin Improvement**
   **Q:** How did storage gross margin improve despite higher costs?
   **A:** Storage gross margin increased to **70%**, driven by our Global RIM business and operational productivity.  **[IRM_3395671_11]**  While "all other storage costs" rose due to power inflation, storage rent expense decreased thanks to improved warehouse efficiencies.  **[IRM_3395671_11]** 

8. **Regency Technologies Utilization**
   **Q:** Is there room to improve productivity at Regency Technologies?
   **A:** Yes, we have considerable capacity to **expand the business** and further utilize Regency at relatively low CapEx.  **[IRM_3395671_13]**  The highly capable team is poised to manage a much larger business, and we expect further utilization over time.  **[IRM_3395671_13]** 

9. **Currency Exchange Headwinds**
   **Q:** How are currency fluctuations impacting your guidance?
   **A:** FX continues to be a headwind with the stronger dollar, likely impacting reported results in the third quarter by a similar or slightly greater magnitude than the second quarter.  **[IRM_3395671_7]** 

10. **Increased Depreciation**
    **Q:** Why did real estate depreciation increase by $14 million?
    **A:** Depreciation is ramping up due to our CapEx investments in data centers, new warehouses, and digital innovation initiatives.  **[IRM_3395671_14]** 

ec280c17dc77baf2abda5967c3aed2ae781477fa224b690a49c786a274b04da9

- **Increased storage costs of $11.5 million pushed gross margins down by about 80 basis points sequentially** in the storage segment, primarily due to the lower-margin data center business and rising power costs.  **[IRM_3374543_11]**
- The Asset Lifecycle Management (ALM) business **faced significant challenges with declining component prices** earlier in the year, which stayed at trough levels, muting revenue despite increased volumes. Dependency on component prices poses a risk to this business segment.  **[IRM_3374543_7]**
- The shift in business mix towards data centers, which generally have **lower gross margins than records management**, could lead to overall margin pressure as data center expansion affects the company's profitability.  **[IRM_3374543_11]**

263bb471c954eb9c93e54b3d9104518e802ccad0f66904fc849096118b2fc8c2

- **Foreign exchange headwinds**: Iron Mountain anticipates continued negative impact from a stronger U.S. dollar, affecting reported results in the third quarter, "probably of the order of the same magnitude as the second quarter, if not a little bit more".  **[IRM_3395671_7]**
- **Pressure on gross margins due to mix and costs**: The company's gross margin was **slightly down from last year**, impacted by **mix issues**, including rising power costs and the addition of lower-margin operations like data centers and Regency Technologies, which "is, again, a mixed headwind on gross margin".  **[IRM_3395671_11]**
- **Limited growth in physical storage volumes and potential deceleration in pricing growth**: Iron Mountain expects physical storage volumes to be "flattish to slightly up" for the rest of the year, with future growth driven primarily by pricing, which may slow down from high single digits to mid-single digits as inflation wanes.  **[IRM_3395671_8]** **[IRM_3395671_12]**

39996cc2be6903b437a35c213aac1a77599ce0fbb67e673d90bdf8dcb6d10290

1. **Data Center Leasing Guidance**  
   **Q:** Is data center leasing guidance still 100 MW? What's the pipeline?  
   **A:** Management confirmed data center leasing guidance of **100 megawatts** for the year, with **30 megawatts** already leased in the first quarter.  **[IRM_3382131_7]**  They have a very strong pipeline, including building a third site in Phoenix, Arizona, and expect another strong year, benefiting from the growth in AI applications.  **[IRM_3382131_7]** 

2. **ALM Revenue Growth**  
   **Q:** How did ALM perform between increased volume and pricing?  
   **A:** ALM revenue totaled **$84 million**, with Regency contributing over **$32 million**.  **[IRM_3382131_7]**  Organically, ALM was up **25%**, exceeding expectations by about **$10 million**.  **[IRM_3382131_7]**  Both volume and price increased, with component pricing rising through the quarter and expected to continue rising.  **[IRM_3382131_7]** 

3. **Data Center CapEx and Land Acquisition**  
   **Q:** How should we think about future data center CapEx and land needs?  
   **A:** Future data center CapEx is within their multi-year plan and fully funded by cash flow and debt capacity.  **[IRM_3382131_11]**  They have multiple land parcels in active negotiations to support growth beyond this year, feeling confident in their land bank strategy.  **[IRM_3382131_11]** 

4. **Data Center Unlevered Yields**  
   **Q:** What are unlevered yields for new data center expansions?  
   **A:** Unlevered yields for hyperscale data centers are around **9-10%**, a couple of hundred basis points above historical returns.  **[IRM_3382131_8]**  Spreads remain positive despite higher interest rates, due to strong market demand.  **[IRM_3382131_8]** 

5. **Storage Business Revenue Growth**  
   **Q:** Can you discuss storage revenue growth and pricing?  
   **A:** Storage rental revenue growth in Global RIM was **7.5%**.  **[IRM_3382131_6]**  Timing of revenue management actions shifted to a more normal cadence starting in March.  **[IRM_3382131_6]**  They are ahead of expectations, having previously guided Global RIM growth at about **6%** for the year.  **[IRM_3382131_6]** 

6. **On-Time Data Center Delivery**  
   **Q:** How do you deliver data centers on time and budget versus peers?  
   **A:** They continue to drive strong deployments across all campuses with no change in ability to plan and execute.  **[IRM_3382131_9]**  Their strong construction team manages supply chain effectively, and customers trust them for on-time, on-budget delivery.  **[IRM_3382131_9]** 

7. **Regency Integration and M&A**  
   **Q:** How is Regency integration progressing, and are more tuck-ins planned?  
   **A:** The integration of Regency is going very well, ahead of plan with operational efficiencies and better margins.  **[IRM_3382131_13]**  They are considering additional tuck-in acquisitions and have a list of opportunities, seeing clear growth aligned with their business.  **[IRM_3382131_13]** 

8. **RIM Volume Expectations**  
   **Q:** What's the expectation for RIM volumes this year?  
   **A:** RIM volumes are expected to be up in the second quarter versus the first and consistent to slightly up for the full year.  **[IRM_3382131_7]**  They have never stored more physical volume than they are storing today.  **[IRM_3382131_7]** 

9. **Government Contracting Competitiveness**  
   **Q:** How competitive is the sovereign contracting space?  
   **A:** They work with governments in the UK, US, Germany, and France, building relationships over a 24-month horizon.  **[IRM_3382131_13]**  It's a strong part of their business that continues to grow across all segments, including data centers.  **[IRM_3382131_13]** 

0e27e0bf346a9a9b14edfee3db900eb8d631a63a0307d7e6cae1d9a916c789d0

Iron Mountain Inc (IRM)

Financials