Equinix's Q1 2025: Navigating Contradictions in Sales Cycles, Demand, and AI Impact

Earnings DecryptFriday, May 9, 2025 3:40 am ET
2min read
Sales cycle improvements and macroeconomic impact, demand funnel and capacity constraints, sales cycle and demand trends, xScale joint venture and capacity additions, AI demand and enterprise impact are the key contradictions discussed in Equinix's latest 2025Q1 earnings call.



Revenue Growth and Financial Performance:
- reported revenues of $2.2 billion for Q1 2025, up 8% year-over-year, excluding the impact of power pass-through.
- The growth was driven by strong recurring revenue and lower xScale leasing costs as expected.

Recurring Revenue and Bookings:
- Equinix experienced a strong recurring revenue growth, with bookings from the second half of 2024 starting to manifest.
- The increase in bookings was driven by improved deal conversion, shorter deal cycles, and favorable pricing actions.

Digital Infrastructure Demand and Strategy:
- There was significant customer demand for AI and cloud workloads, with notable AI wins and expansions in enterprise cloud ecosystems.
- Equinix's strategy focused on serving customers better, solving smarter, and building boulder, which has enhanced customer momentum.

Interconnection and Product Momentum:
- Interconnection revenues grew a healthy 9% year-over-year on a normalized and constant currency basis, with over 486,000 total interconnections deployed.
- This was supported by strong adoption of Equinix Fabric and expansion in new markets like Jakarta and Joe Barge.