Executive Summary

Q1 2025 delivered mixed results: revenue declined 2.7% YoY to $1.292B and Adjusted EBITDA fell 7.0% to $304M with margin down 110bps to 23.5%, while AFFO rose 48% to $219M and AFFO/share increased 6% to $0.86 .
Versus S&P Global consensus, revenue missed ($1.292B vs $1.339B*) while EPS beat (Company GAAP diluted EPS $0.01 vs consensus -$0.099*), aided by cost control and lower taxes; management cited tariff-driven customer hesitancy and normalizing seasonality as near-term headwinds (values retrieved from S&P Global) .
Guidance maintained: FY25 Adjusted EBITDA $1.35–$1.40B and AFFO/share $3.40–$3.60; modeling changes include higher interest expense (+$10M midpoint) and lower current tax expense (-$10M midpoint) due to acquisitions and international tax dynamics .
Strategic catalyst: “landmark” Tyson Foods agreements (4-asset acquisition for $247M and two automated greenfields, ~$1B total deployment) expected to add $100M+ stabilized annual EBITDA and ~$25M FY25 Adjusted EBITDA; integration and greenfield ramps are paced through 2027/2028 and represent medium-term compounding growth drivers .

What Went Well and What Went Wrong

What Went Well

AFFO strength and dividend continuity: AFFO rose 48% to $219M; AFFO/share increased 6% to $0.86; quarterly dividend declared at $0.5275 (annualized $2.11) supporting cash returns .
Strategic M&A momentum: Tyson agreements and acquisition of three Bellingham campuses ($121M on April 1) underpin external growth; Tyson is expected to contribute ~$100M+ stabilized annual EBITDA; FY25 guidance already includes ~$25M Adjusted EBITDA and ~$0.05 AFFO/share contribution from announced acquisitions .
Productivity and technology execution: Same-warehouse cost of operations declined 1.6% YoY; pilots of proprietary LinOS showed double-digit productivity gains across conventional buildings, with broader rollout planned for next year; “LinOS and Lean initiatives are offsetting cost increases” .

Management quotes:

“We’re proud to partner with our valued customer on these landmark agreements... leveraging our global footprint, data-driven approach, LinOS, and automation technology.” — Greg Lehmkuhl, CEO .
“Our team continues to control costs well and improve productivity... Our network is intentionally built with flexibility in mind.” — Greg Lehmkuhl .

What Went Wrong

Top-line and margin pressure: Total revenue fell 2.7% YoY to $1.292B; Adjusted EBITDA dropped 7.0% YoY to $304M; margin contracted 110bps to 23.5% due to lower revenue per pallet and tariffs-driven customer hesitancy .
Same-warehouse NOI declined 7.9% YoY to $337M as economic and physical occupancy fell (82.1% and 76.5%, respectively), with revenue per pallet metrics down low-single digits .
Pricing/mix headwinds: Customers reset minimum volume guarantees lower (to ~42% of rent/storage/blast freezing revenues) and new-business wins came at lower rates to keep physical occupancy high; this weighed on revenue per occupied and throughput pallets .

Analyst concerns:

Visibility on tariff impacts and occupancy cadence remains limited; management expects Q2 YoY declines similar to Q1 and recovery in H2 on normal seasonality and easier comps, but withheld precise same-store guidance due to uncertainty .

Financial Results

Consolidated Results vs Prior Periods and Estimates

Metric	Q3 2024	Q4 2024	Q1 2025
Revenue ($USD Billions)	$1.335	$1.339	$1.292
Adjusted EBITDA ($USD Millions)	$333	$335	$304
Adjusted EBITDA Margin (%)	24.9%	25.0%	23.5%
GAAP Diluted EPS ($)	(2.44)	(0.33)	0.01
AFFO ($USD Millions)	$208	$213	$219
AFFO per share ($)	$0.90	$0.83	$0.86

Vs S&P Global consensus (Q1 2025):

Metric	S&P Consensus*	Actual (Company)
Revenue ($USD Billions)	$1.339*	$1.292
Primary EPS ($)	-0.099*	0.01

Values retrieved from S&P Global.

Segment Breakdown (Q1 2025 vs Q1 2024)

Segment	Q1 2024 Revenue ($MM)	Q1 2025 Revenue ($MM)	Q1 2024 NOI ($MM)	Q1 2025 NOI ($MM)	Margin (%) Q1 2024	Margin (%) Q1 2025
Global Warehousing	$969	$944	$385	$360	39.7%	38.1%
Global Integrated Solutions	$359	$348	$59	$57	16.4%	16.4%

KPIs (Warehousing – Same Warehouse)

KPI	Q1 2024	Q1 2025
Economic Occupancy (%)	83.6%	82.1%
Physical Occupancy (%)	77.5%	76.5%
Storage Revenue per Economic Occupied Pallet ($)	$63.00	$60.88
Storage Revenue per Physical Occupied Pallet ($)	$67.97	$65.36
Throughput Pallets (000s)	12,109	11,894

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Adjusted EBITDA ($USD Billions)	FY 2025	$1.35–$1.40	$1.35–$1.40	Maintained
AFFO per share ($)	FY 2025	$3.40–$3.60	$3.40–$3.60	Maintained
Interest expense, net ($USD Millions)	FY 2025	$250–$270	$260–$280	Raised midpoint (+$10M)
Current income tax expense ($USD Millions)	FY 2025	$35–$45	$25–$35	Lowered midpoint (-$10M)
Recurring maintenance capex ($USD Millions)	FY 2025	$190–$205	$190–$205	Maintained
Adjusted diluted shares (Millions)	FY 2025	~257	~257	Maintained
Dividend ($/share)	Quarterly	$0.5275 (annualized $2.11)	$0.5275 (annualized $2.11)	Maintained

Notes: Guidance excludes unannounced future acquisitions/developments; includes ~$25M Adjusted EBITDA and ~$0.05 AFFO/share contribution from announced acquisitions (Tyson, Bellingham) .

Earnings Call Themes & Trends

Topic	Q3 2024 (Previous Mentions)	Q4 2024 (Previous Mentions)	Q1 2025 (Current)	Trend
LinOS / Technology	Technology and margin expansion highlighted; ongoing pilots	Pilots exceeding expectations; broader rollout contemplated	Double-digit productivity in pilots; complements Lean; broader rollout planned next year	Positive, execution building
Tariffs / Macro	Industry rebalancing; occupancy under pressure; IPO-funded deleveraging	Market stabilization post inventory rebalancing; normal seasonality expected	Elevated uncertainty; ~15% of U.S. throughput tied to import/export; customers pausing decisions	Negative near term, cautious
Occupancy / Pricing	Same-WH occupancy stable sequentially but pressured; muted Q4 seasonality	78.4% FY physical occupancy; normal seasonality blueprint explained	Physical occupancy 76.5%; economic 82.1%; volume guarantees reset lower; new wins at lower rates	Soft near term; H2 normalization
Regional Trends	GIS softness; warehousing NOI up; Europe mixed	Global footprint leveraged; technology-driven efficiency	APAC/EU performing well; U.S. pricing pressure concentrated	Mixed but improving ex-U.S.
External Growth / Tyson	Hazleton automated facility opened; ColdPoint acquired	Capacity to deploy $1.5B+ in 2025	Tyson agreements (~$1B deployment) add $100M+ stabilized EBITDA; $247M asset acquisition	Strong medium-term growth

Management Commentary

“As expected, we experienced more normal seasonal trends in the first quarter… Our team continues to control costs well and improve productivity… Our network is intentionally built with flexibility in mind” — Greg Lehmkuhl, CEO .
“We are maintaining our adjusted EBITDA and AFFO per share guidance… heightened level of uncertainty… evolving U.S. tariff policies… well positioned given our leading network, innovative technology, and deep customer relationships” — Greg Lehmkuhl .
“AFFO for the quarter was up 48%… aided by lower-than-expected tax expense and the timing of our annual maintenance CapEx” — Rob Crisci, CFO .
“LinOS pilots… are exceeding expectations… double-digit productivity improvements… expected to supercharge efforts and create meaningful cost advantages” — Greg Lehmkuhl .

Q&A Highlights

Tariffs and exposure: Management clarified import/export sensitivity is ~15% (not 50%) of U.S. throughput; customer hesitancy is delaying major supply chain decisions; potential upside from inventory disruptions exists but hard to predict .
Occupancy cadence: Expect YoY declines in Q2 similar to Q1, then H2 growth on seasonality and easier comps; normal seasonal pattern resumed since Q3 2024 .
Pricing and volume guarantees: Existing customers lowered guarantees early in Q1; new wins have >42% guarantees but at lower rates to sustain physical occupancy; goal is a tighter economic vs physical gap .
Tyson deal specifics: Low double-digit EBITDA multiple on acquired assets; assets in good condition; mix of production and distribution; smooth transition to public facilities as greenfields come online in 2027/2028 .
Labor and costs: Wage increases ~3.5% annually; Lean and LinOS supporting lower same-store costs despite inflation; funding capacity via revolver and potential public bonds while maintaining investment-grade profile .

Estimates Context

Q1 2025 vs S&P Global: Revenue missed ($1.292B actual vs $1.339B consensus*), while EPS beat (Company GAAP diluted EPS $0.01 vs consensus -$0.099*). Company-reported Adjusted EBITDA ($304M) is not directly comparable to S&P EBITDA consensus definitions (values retrieved from S&P Global) .
Implication: Street models likely need to reflect tariff headwinds in Q2 and stronger H2 seasonality; EPS beat suggests cost controls and lower taxes offset rate/mix pressure (values retrieved from S&P Global) .

Key Takeaways for Investors

Near-term: Expect another soft quarter in Q2 on comps and tariff hesitancy; watch for confirmatory H2 recovery signals (occupancy uptick and revenue per pallet stabilization) — potential trading catalyst into H2 .
Medium-term: Tyson agreements and greenfields underpin accretive growth with $100M+ stabilized annual EBITDA; integration milestones and groundbreakings in H2 2025 are key checkpoints .
Operational edge: LinOS pilot momentum plus Lean productivity should continue to offset inflation and support margin re-expansion as volumes normalize; monitor pilot expansion cadence .
Capital structure: Investment-grade balance sheet and ~$1.7B liquidity provide dry powder; expect disciplined revolver-funded deployment and opportunistic bonds as market permits .
Estimates: Revise near-term revenue/lane assumptions (lower guarantees, pricing pressure) and reflect lower tax and higher interest ranges; consider AFFO resilience and dividend coverage .
Regional mix: Stronger APAC/EU performance balances U.S. rate pressure; watch tariffs/regulatory developments for incremental demand shifts .
Risk/Reward: Macro/trade policy uncertainty is the main variable; Lineage’s scale, technology, and customer diversification position the company to outperform as supply chain patterns settle .

Notes:
- S&P Global values marked with * are “Values retrieved from S&P Global”.

Lineage, Inc. (LINE)·Q1 2025 Earnings Summary