Equinix shares fall on soft third-quarter forecast

Equinix Inc. saw its shares decline by 3% on Wednesday, as a cautious third-quarter revenue forecast overshadowed positive updates to its full-year and long-term financial outlook. The specialized data center operator's stock dip reflects investor sensitivity to near-term guidance, even amidst broader optimism. For the third quarter, Equinix projects revenue between $2.53 billion and $2.58 billion, a range that falls slightly below the $2.58 billion estimated by analysts. This near-term projection tempered enthusiasm for the company's revised outlook for 2026, which now anticipates revenue between $10.21 billion and $10.29 billion, an increase from previous guidance. Furthermore, Equinix raised its forecast for full-year adjusted funds from operations (AFFO) to $42.69-$43.29 per share, up from $42.31-$43.11. The company also boosted its long-term growth expectations, now forecasting annual revenue growth of 10% to 13% through 2029, up from 7% to 10%. AFFO per share growth is projected at 9% to 12% annually, an increase from the previous 5% to 9% range. Despite the cautious short-term revenue forecast, Equinix reported second-quarter revenue of $2.63 billion, surpassing analysts' expectations of $2.58 billion. The company emphasized that customer demand remains "broad-based and growing," positioning Equinix to meet the global demand for networking, cloud, and AI infrastructure. Equinix operates 281 data centers worldwide, serving clients including Nvidia, Netflix, and Adobe.