We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
The company registered operating revenues of $1.63 billion in the fourth quarter, surpassing the Zacks Consensus Estimate of $1.58 billion. Operating revenues surged 13.8% year over year. DLR also reported "Same-Capital" cash net operating income (NOI) growth of 7.7%.
For full-year 2025, core FFO per share came in at $7.39, up 10.1% from the prior-year tally, and beat the Zacks Consensus Estimate of $7.35. Total operating revenues grew 10% to $6.11 billion, outpacing the consensus mark of $6.06 billion.
DLR’s Fourth Quarter in Detail
In the reported quarter, DLR’s signed total bookings were estimated to generate $400 million of annualized GAAP rental revenues at its share. Total bookings were $175 million, including a $77 million contribution from the 0-1 megawatt category and a $19 million contribution from interconnection.
The weighted average lag between the new leases signed in the fourth quarter and the contractual commencement date was eight months.
Digital Realty signed renewal leases, marking $269 million of annualized cash rental revenues during the October-December quarter. Rental rates on renewal leases signed during the quarter rose 6.1% on a cash basis and 12% on a GAAP basis.
Adjusted EBITDA of $856.8 million in the quarter marked a 14.1% increase year over year.
DLR’s Portfolio Activity
During the quarter, DLR disposed of a non-core data center in the Dallas metro area for gross proceeds of around $33 million.
Digital Realty acquired two land parcels totaling around 20 acres in the Portland metro area, one in the fourth quarter and the other in January, for $23.6 million. These are expected to support 85 megawatts of IT capacity.
DLR bought out a building and land in Lisbon, Portugal, for $8.3 million, expected to support up to 2.4 megawatts of IT capacity.
DLR Mivne entered into a joint venture (JV) with MedOne Ltd., the leading data center operator in Israel. The JV acquired around 2.5 acres of land to develop an 18 megawatt campus for $29 million. DLR contributed $7.1 million.
DLR made contributions to the tune of an additional 40% interest in five operating data centers to its Digital Realty DC Partners NA Fund, with its stake at 80% at year-end.
Post the quarter-end, DLR announced an agreement to acquire the TelcoHub 1 data center in Cyberjaya, Malaysia. TelcoHub 1 is an operational 1.5 megawatt data center. DLR has further committed to the acquisition of adjacent land with the ability to support 14 megawatts of IT load to meet future capacity expansion needs.
DLR’s Balance Sheet Position
Digital Realty exited the fourth quarter of 2025 with cash and cash equivalents of $3.45 billion, up from $3.30 billion recorded as of Sept. 30, 2025.
As of Dec. 31, 2025, this data center REIT had $18.4 billion of total debt outstanding, of which $17.5 billion was unsecured debt and $0.9 billion was secured debt and other. As of the same date, its net debt-to-adjusted EBITDA was 4.9X, while the fixed charge coverage was 4.5X.
Its debt maturity schedule is well-laddered with modest near-term maturities, with a weighted average term to initial maturity of five years and a 2.9% weighted average coupon as of Dec. 31, 2025.
In October, DLR sold 0.4 million shares of common stock under its At-The-Market equity issuance program for net proceeds of around $77 million.
2026 Guidance by DLR
Digital Realty expects 2026 constant currency core FFO per share in the range of $7.90-$8.00. The Zacks Consensus Estimate of $7.87 lies below the guided range.
DLR projects total revenues in the band of $6.60-$6.70 billion. The consensus estimate stands at $6.60 billion. Adjusted EBITDA is expected in the range of $3.60-$3.70 billion.
This data center REIT projects rental rates on renewal leases to be within 6-8% on a cash basis and 8.5-10.5% on a GAAP basis. The year-end portfolio occupancy is expected to increase by 50-100 bps. The same-capital cash NOI is estimated to grow 4-5%.
We now look forward to the earnings releases of other REITs like Welltower (WELL - Free Report) and Host Hotels (HST - Free Report) , slated to report on Feb. 10 and Feb. 18, respectively.
The Zacks Consensus Estimate for Welltower’s fourth-quarter 2025 FFO per share is pegged at $1.44, implying a 27.4% year-over-year increase. WELL currently carries a Zacks Rank #3.
The Zacks Consensus Estimate for Host Hotels’ fourth-quarter 2025 FFO per share is pegged at 47 cents, calling for a 6.8% year-over-year increase. HST currently carries a Zacks Rank #3.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Digital Realty's Q4 Core FFO & Revenues Top Estimates, Rentals Rise
Key Takeaways
Digital Realty Trust (DLR - Free Report) reported fourth-quarter 2025 core funds from operations (FFO) per share of $1.86, beating the Zacks Consensus Estimate of $1.83. FFO also increased 7.5% year over year.
Results reflect steady leasing momentum with better rental rates amid rising demand.
The company registered operating revenues of $1.63 billion in the fourth quarter, surpassing the Zacks Consensus Estimate of $1.58 billion. Operating revenues surged 13.8% year over year. DLR also reported "Same-Capital" cash net operating income (NOI) growth of 7.7%.
For full-year 2025, core FFO per share came in at $7.39, up 10.1% from the prior-year tally, and beat the Zacks Consensus Estimate of $7.35. Total operating revenues grew 10% to $6.11 billion, outpacing the consensus mark of $6.06 billion.
DLR’s Fourth Quarter in Detail
In the reported quarter, DLR’s signed total bookings were estimated to generate $400 million of annualized GAAP rental revenues at its share. Total bookings were $175 million, including a $77 million contribution from the 0-1 megawatt category and a $19 million contribution from interconnection.
The weighted average lag between the new leases signed in the fourth quarter and the contractual commencement date was eight months.
Digital Realty signed renewal leases, marking $269 million of annualized cash rental revenues during the October-December quarter. Rental rates on renewal leases signed during the quarter rose 6.1% on a cash basis and 12% on a GAAP basis.
Adjusted EBITDA of $856.8 million in the quarter marked a 14.1% increase year over year.
DLR’s Portfolio Activity
During the quarter, DLR disposed of a non-core data center in the Dallas metro area for gross proceeds of around $33 million.
Digital Realty acquired two land parcels totaling around 20 acres in the Portland metro area, one in the fourth quarter and the other in January, for $23.6 million. These are expected to support 85 megawatts of IT capacity.
DLR bought out a building and land in Lisbon, Portugal, for $8.3 million, expected to support up to 2.4 megawatts of IT capacity.
DLR Mivne entered into a joint venture (JV) with MedOne Ltd., the leading data center operator in Israel. The JV acquired around 2.5 acres of land to develop an 18 megawatt campus for $29 million. DLR contributed $7.1 million.
DLR made contributions to the tune of an additional 40% interest in five operating data centers to its Digital Realty DC Partners NA Fund, with its stake at 80% at year-end.
Post the quarter-end, DLR announced an agreement to acquire the TelcoHub 1 data center in Cyberjaya, Malaysia. TelcoHub 1 is an operational 1.5 megawatt data center. DLR has further committed to the acquisition of adjacent land with the ability to support 14 megawatts of IT load to meet future capacity expansion needs.
DLR’s Balance Sheet Position
Digital Realty exited the fourth quarter of 2025 with cash and cash equivalents of $3.45 billion, up from $3.30 billion recorded as of Sept. 30, 2025.
As of Dec. 31, 2025, this data center REIT had $18.4 billion of total debt outstanding, of which $17.5 billion was unsecured debt and $0.9 billion was secured debt and other. As of the same date, its net debt-to-adjusted EBITDA was 4.9X, while the fixed charge coverage was 4.5X.
Its debt maturity schedule is well-laddered with modest near-term maturities, with a weighted average term to initial maturity of five years and a 2.9% weighted average coupon as of Dec. 31, 2025.
In October, DLR sold 0.4 million shares of common stock under its At-The-Market equity issuance program for net proceeds of around $77 million.
2026 Guidance by DLR
Digital Realty expects 2026 constant currency core FFO per share in the range of $7.90-$8.00. The Zacks Consensus Estimate of $7.87 lies below the guided range.
DLR projects total revenues in the band of $6.60-$6.70 billion. The consensus estimate stands at $6.60 billion. Adjusted EBITDA is expected in the range of $3.60-$3.70 billion.
This data center REIT projects rental rates on renewal leases to be within 6-8% on a cash basis and 8.5-10.5% on a GAAP basis. The year-end portfolio occupancy is expected to increase by 50-100 bps. The same-capital cash NOI is estimated to grow 4-5%.
Currently, DLR carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Digital Realty Trust, Inc. Price, Consensus and EPS Surprise
Digital Realty Trust, Inc. price-consensus-eps-surprise-chart | Digital Realty Trust, Inc. Quote
Upcoming Earnings Releases
We now look forward to the earnings releases of other REITs like Welltower (WELL - Free Report) and Host Hotels (HST - Free Report) , slated to report on Feb. 10 and Feb. 18, respectively.
The Zacks Consensus Estimate for Welltower’s fourth-quarter 2025 FFO per share is pegged at $1.44, implying a 27.4% year-over-year increase. WELL currently carries a Zacks Rank #3.
The Zacks Consensus Estimate for Host Hotels’ fourth-quarter 2025 FFO per share is pegged at 47 cents, calling for a 6.8% year-over-year increase. HST currently carries a Zacks Rank #3.
Note: Anything related to earnings presented in this write-up represents funds from operations (FFO), a widely used metric to gauge the performance of REITs.