Digital Realty Trust, Inc.

Digital Realty reported core FFO of $2.65 per share in Q2 2026, including a $0.52 benefit from net promote income; excluding promote, core FFO was a record $2.13 per share, up 14% year over year. Same capital cash NOI grew 8.9% year over year, or 7.2% on a constant-currency basis, and cash renewal spreads were over 25% with $261 million of renewals signed. The company recorded $108 million of bookings in its 0-1 MW plus interconnection business, $20.5 million of interconnection bookings, and $208 million of annualized rent commencements in the quarter. Backlog ended at a record $1.9 billion at 100% share, and the company said $635 million of annualized rent is scheduled to commence in 2H26, with $480 million in 2027 and $312 million in 2028 and beyond. Guidance for 2026 core FFO per share excluding promote was raised to $8.15-$8.20, same capital cash NOI growth was lifted to 4.25%-5.25% on a constant-currency basis, cash renewal spreads are expected at 9%-11%, and net of partner contributions CapEx is now expected at $4.25 billion-$4.75 billion.

Andy Power framed the quarter as evidence that the company’s “full spectrum” strategy is working, with colocation/connectivity, hyperscale and strategic private capital all contributing at the same time. He emphasized that AI and digital infrastructure demand are strengthening the value of connected, power-rich campuses, while large hyperscale demand remains healthy and global. His tone was highly upbeat and confident, repeatedly pointing to record bookings, a record backlog and expanding growth runway beyond 2026.

Matt Mercier said the quarter delivered double-digit growth across most operating and financial metrics, helped by strong leasing, commencements, renewals, fee income and low churn. He cited 4.7x debt-to-adjusted EBITDA at quarter end, about $6 billion of liquidity, $1.1 billion of development CapEx in the quarter, and a development pipeline of 1.4 GW under construction at a total cost of $20 billion. He also broke out the insurance recovery of $113 million gross/$94 million net, with $27 million or about $0.07/share included in core FFO, and the Blackstone promote of about $200 million gross, with $188 million or $0.52/share recognized in the core FFO reconciliation. He said fee income normalized for promote was a little above $45 million in Q2 and should scale as the private capital vehicles deploy roughly $10 billion-$12 billion of available capital over the next 1-2 years.

Analysts pressed management on how Digital Realty can sustain double-digit FFO growth, how much accretion comes from Blackstone, Teraco and Columbia Capital, and how higher CapEx will be funded. Management said growth should come from multiple levers at once: better renewal pricing, hyperscale leasing, higher 0-1 MW/interconnection demand, and fee income from private capital. Questions also focused on customer mix in AI/hyperscale, and management said large-footprint deals remain concentrated with traditional investment-grade hyperscalers, while smaller AI-related and enterprise deployments are broadening the funnel. On Kansas City and renewals, management said Kansas City is a new but strategically attractive hyperscale hub with power starting in 2028, and they expect pricing power to remain strong as supply stays constrained.