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Rental revenues totaled $2.18 billion, up 7.5% year over year. The top line also exceeded the Zacks Consensus Estimate of $2.14 billion with a 1.68% surprise, supported by continued rent growth and resilient operating fundamentals.
PLD’s Q2 in Detail
Total revenues were $2.43 billion, up from $2.18 billion in the prior-year period. Strategic capital revenues climbed to $241.6 million from $147.2 million. On the earnings mix, Prologis generated $1.54 per share of core FFO from its real estate business and 9 cents per share from strategic capital, bringing total core FFO to $1.63 per share.
PLD’s Leasing and Same-Store Trends
Operating fundamentals remained healthy during the second quarter. Average occupancy for the owned and managed portfolio was 95%, while period-end occupancy stood at 95.5%. Customer retention came in at 72.7%.
Leasing activity remained robust, with 61.7 million square feet of leases commenced across the operating portfolio and properties under development during the quarter. Within the operating portfolio, leases commenced totaled 58.6 million square feet, including 38.0 million square feet of renewals and 20.6 million square feet of new leases.
Rent growth continued to support operating performance. Prologis' share of net effective rent change was 36.9%, while cash rent change was 22.3%. Cash same-store net operating income (NOI) growth (Prologis share) was 8.5%, and net effective same-store NOI growth was 6.4%, reflecting continued strength in the existing portfolio.
PLD’s Capital Deployment Activity
Prologis remained active in deploying capital during the second quarter of 2026. On a Prologis share basis, the company completed $1.12 billion of acquisitions at a weighted average stabilized cap rate of 4.1%. It also stabilized $646 million of development projects, generating an estimated 6.3% weighted average yield and $89 million of value creation.
Development activity stayed strong, with $1.34 billion of new starts on a Prologis share basis. These projects are expected to deliver a 7.2% weighted average yield and create $434 million in value. Build-to-suit projects represented 74.7% of total development starts, highlighting the company's focus on customer-driven development.
The company also continued recycling capital through $1.01 billion of dispositions and contributions on a Prologis share basis. Excluding land, properties under development and other real estate, these transactions achieved a weighted average stabilized cap rate of 5.1%, supporting portfolio optimization while funding future growth.
PLD’s Liquidity
Prologis ended the second quarter of 2026 with approximately $7.6 billion in available liquidity, maintaining ample financial flexibility. Debt-to-adjusted EBITDA stood at 4.7x, while debt accounted for 23.9% of total market capitalization, reflecting a disciplined balance sheet.
The company's financing profile remained strong, with a 3.3% weighted average interest rate on its share of total debt and a weighted average maturity of 7.9 years. During the quarter, Prologis and its co-investment ventures raised $3.4 billion of debt at a 4.4% weighted average interest rate and an average term of 6.2 years.
PLD’s 2026 Outlook
Management reaffirmed its outlook for 2026. The company continues to project average occupancy of 95.25-95.75%, cash same-store NOI growth (Prologis share) of 6.75-7.25% and net effective same-store NOI growth of 5.25-5.75%. Core FFO is expected in the range of $6.22-$6.30 per share The Zacks Consensus Estimate for the same is currently pegged at $6.17 per share.
For capital deployment, Prologis expects development stabilizations of $2.25-$2.75 billion (Prologis share), development starts of $4.5-$5.5 billion, acquisitions of $1.5-$2.0 billion, dispositions of $2.25-$2.75 billion and contributions of $2.0-$2.5 billion.
We now look forward to the earnings releases of other REITs, such as Digital Realty (DLR - Free Report) and W.P. Carey (WPC - Free Report) , which are slated to report on July 23 and July 28, respectively.
The Zacks Consensus Estimate for Digital Realty’s second-quarter 2026 FFO per share is pegged at $1.98, which implies a 5.9% year-over-year increase. Digital Realty currently carries a Zacks Rank #3 (Hold).
The Zacks Consensus Estimate for W.P. Carey’s second-quarter 2026 FFO per share is pegged at $1.31, which suggests a year-over-year increase of 2.3%. W.P. Carey currently carries a Zacks Rank #2.
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.
View the Zacks #1 Rank List
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PLD's Q2 Core FFO Beat Estimates, Revenues Rise on Higher Rental Income
Key Takeaways
Prologis, Inc. (PLD - Free Report) reported second-quarter 2026 core funds from operations (FFO) per share of $1.63, up from $1.46 in the year-ago quarter. The figure surpassed the Zacks Consensus Estimate of $1.53 by 6.54%.
Rental revenues totaled $2.18 billion, up 7.5% year over year. The top line also exceeded the Zacks Consensus Estimate of $2.14 billion with a 1.68% surprise, supported by continued rent growth and resilient operating fundamentals.
PLD’s Q2 in Detail
Total revenues were $2.43 billion, up from $2.18 billion in the prior-year period. Strategic capital revenues climbed to $241.6 million from $147.2 million. On the earnings mix, Prologis generated $1.54 per share of core FFO from its real estate business and 9 cents per share from strategic capital, bringing total core FFO to $1.63 per share.
PLD’s Leasing and Same-Store Trends
Operating fundamentals remained healthy during the second quarter. Average occupancy for the owned and managed portfolio was 95%, while period-end occupancy stood at 95.5%. Customer retention came in at 72.7%.
Leasing activity remained robust, with 61.7 million square feet of leases commenced across the operating portfolio and properties under development during the quarter. Within the operating portfolio, leases commenced totaled 58.6 million square feet, including 38.0 million square feet of renewals and 20.6 million square feet of new leases.
Rent growth continued to support operating performance. Prologis' share of net effective rent change was 36.9%, while cash rent change was 22.3%. Cash same-store net operating income (NOI) growth (Prologis share) was 8.5%, and net effective same-store NOI growth was 6.4%, reflecting continued strength in the existing portfolio.
PLD’s Capital Deployment Activity
Prologis remained active in deploying capital during the second quarter of 2026. On a Prologis share basis, the company completed $1.12 billion of acquisitions at a weighted average stabilized cap rate of 4.1%. It also stabilized $646 million of development projects, generating an estimated 6.3% weighted average yield and $89 million of value creation.
Development activity stayed strong, with $1.34 billion of new starts on a Prologis share basis. These projects are expected to deliver a 7.2% weighted average yield and create $434 million in value. Build-to-suit projects represented 74.7% of total development starts, highlighting the company's focus on customer-driven development.
The company also continued recycling capital through $1.01 billion of dispositions and contributions on a Prologis share basis. Excluding land, properties under development and other real estate, these transactions achieved a weighted average stabilized cap rate of 5.1%, supporting portfolio optimization while funding future growth.
PLD’s Liquidity
Prologis ended the second quarter of 2026 with approximately $7.6 billion in available liquidity, maintaining ample financial flexibility. Debt-to-adjusted EBITDA stood at 4.7x, while debt accounted for 23.9% of total market capitalization, reflecting a disciplined balance sheet.
The company's financing profile remained strong, with a 3.3% weighted average interest rate on its share of total debt and a weighted average maturity of 7.9 years. During the quarter, Prologis and its co-investment ventures raised $3.4 billion of debt at a 4.4% weighted average interest rate and an average term of 6.2 years.
PLD’s 2026 Outlook
Management reaffirmed its outlook for 2026. The company continues to project average occupancy of 95.25-95.75%, cash same-store NOI growth (Prologis share) of 6.75-7.25% and net effective same-store NOI growth of 5.25-5.75%. Core FFO is expected in the range of $6.22-$6.30 per share The Zacks Consensus Estimate for the same is currently pegged at $6.17 per share.
For capital deployment, Prologis expects development stabilizations of $2.25-$2.75 billion (Prologis share), development starts of $4.5-$5.5 billion, acquisitions of $1.5-$2.0 billion, dispositions of $2.25-$2.75 billion and contributions of $2.0-$2.5 billion.
PLD's Zacks Rank
Prologis currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Prologis, Inc. Price, Consensus and EPS Surprise
Prologis, Inc. price-consensus-eps-surprise-chart | Prologis, Inc. Quote
Upcoming Earnings Releases
We now look forward to the earnings releases of other REITs, such as Digital Realty (DLR - Free Report) and W.P. Carey (WPC - Free Report) , which are slated to report on July 23 and July 28, respectively.
The Zacks Consensus Estimate for Digital Realty’s second-quarter 2026 FFO per share is pegged at $1.98, which implies a 5.9% year-over-year increase. Digital Realty currently carries a Zacks Rank #3 (Hold).
The Zacks Consensus Estimate for W.P. Carey’s second-quarter 2026 FFO per share is pegged at $1.31, which suggests a year-over-year increase of 2.3%. W.P. Carey currently carries a Zacks Rank #2.
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.