SmartStop Self Storage REIT Q2 2025 Earnings Call Transcript

SmartStop Self Storage REIT, Inc. reported Q2 2025 earnings. The conference operator welcomed attendees and introduced the call. No further information is provided in the given transcript.

SmartStop Self Storage REIT, Inc. (SMA) reported its second-quarter 2025 earnings, showcasing a strong operational performance despite missing analysts' expectations. The company reported an adjusted funds from operations (FFO) per share of $0.42, which was lower than the expected $0.46 per share. Revenue for the quarter reached $66.82 million, contributing to the company’s trailing twelve-month revenue of $235.8 million. Despite these results, the company’s stock declined by 0.86% to $34.62 in aftermarket trading.

Key Takeaways:
- FFO per Share: $0.42
- Revenue: $66.82 million
- Same-Store Revenue Growth: 40 basis points
- Average Occupancy: 93.1%
- Capital Raised: $1.3 billion

The company raised its full-year 2025 guidance for adjusted FFO per share to a range of $1.85-$1.93. This guidance reflects confidence in continued market recovery and strategic expansion efforts. Additionally, the company anticipates same-store revenue growth of 1.75%-2.75% and targets $350 million to $400 million in acquisitions.

SmartStop Self Storage demonstrated resilience in Q2 2025, with same-store revenue growth and a high average occupancy rate. The company successfully raised approximately $1.3 billion in capital, significantly bolstered by a $931 million IPO in April and a CAD 500 million Maple Bond issuance in June. These financial maneuvers underscore the company’s strategic focus on expansion and capital efficiency.

However, the company reported a net loss of $0.16 per share, falling short of market expectations. The revenue figure of $66.82 million was a key highlight, although it did not meet the anticipated targets. The company’s performance in this quarter contrasts with its historical trend of meeting or exceeding forecasts, reflecting challenges in aligning operational outcomes with market expectations.

Market Reaction:
The stock price of SmartStop Self Storage dipped by 0.86% to $34.62 in aftermarket trading following the earnings announcement. This decline reflects investor sentiment influenced by the earnings miss, despite the company’s positive operational metrics and strategic capital raises. The stock remains within its 52-week range, with a high of $37.79 and a low of $29.89.

InvestingPro analysis indicates that while the company’s short-term obligations exceed liquid assets, with a current ratio of 0.21, analysts expect the company to return to profitability this year. The stock’s Financial Health Score stands at 2.04, indicating FAIR overall condition.

Outlook & Guidance:
SmartStop has raised its full-year 2025 guidance for FFO as adjusted per share to a range of $1.85-$1.93. The company anticipates same-store revenue growth of 1.75%-2.75% and targets $350 million to $400 million in acquisitions. These projections reflect confidence in continued market recovery and strategic expansion efforts.

Executive Commentary:
CEO H. Michael Schwartz emphasized the company’s strategic agility, stating, "Storage is a marathon, not a sprint." He highlighted the dynamic pricing strategies, noting, "We’re making $3M in pricing changes on a monthly basis." Schwartz expressed optimism about the company’s prospects, saying, "We feel pretty good about the short, medium, and long-term prospects."

Risks and Challenges:
Market saturation could limit growth opportunities. Economic downturns may impact consumer spending on storage. Supply chain disruptions could affect new developments. Competitive pressures in the Canadian market may intensify. Regulatory changes could impact operational costs.

References:
[1] https://finance.yahoo.com/news/why-smartstop-self-storage-reit-125218418.html
[2] https://www.investing.com/news/transcripts/earnings-call-transcript-smartstop-self-storage-q2-2025-sees-stock-dip-93CH-4178991