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What were the key takeaways from Prologis’s earnings call?

- **Record Q3 Performance**: 62M sq ft leased, 49% net rent change, 95.3% occupancy, and 28Mw solar generation.
- **Data Center Growth**: 5.2GW pipeline, $1.6B build-to-suit signings, and 50%+ 2025 dev allocation.
- **Earnings Guidance**: Core FFO $5.78-5.86, GAAP EPS $3.40-3.50, with 2026 NOI growth 4.25-5.25%.
- **Market Recovery**: U.S. absorption 47M sq ft, 7.5% vacancy, and improving Southern California tone.
- **Strategic Initiatives**: Solar 1GW goal on track, 3.2% cost of debt, and 8-year debt life.

**【CEO Summary Section】**
- Prologis achieved record quarterly performance with 62 million square feet of leasing, driven by a 49% net effective rent change and 29% cash rent change.
- CEO Hamid Moghadam announced his transition to Executive Chairman, with Dan Letter succeeding him as CEO.
- Data center pipeline expanded to 5.2 gigawatts of secured or advanced-stage capacity, with 1.6 billion in build-to-suit signings year-to-date.
- Global occupancy reached 95.3%, up 20 basis points, with 75 million square feet of net absorption in the U.S.
- Solar and energy solutions contributed 28 megawatts, aligning with the 1-gigawatt goal by year-end.

**【CFO Financial Commentary】**
- Core FFO (including net promote expense) was $1.49 per share, excluding promotes at $1.50 per share, both above guidance.
- Same-store NOI growth: 3.9% net effective, 5.2% cash, with 900 million of NOI from lease mark-to-market.
- Capital deployment guidance updated to $2.75-3.25 billion in development starts, $1.5-2.25 billion in dispositions.
- Guidance for 2025: GAAP EPS $3.40-3.50, Core FFO $5.78-5.81 (including promotes), $5.83-5.86 (excluding promotes).
- Debt cost remains low at 3.2%, with 8-year average remaining life.

**【Q&A Key Highlights】**
- **Data Center Expansion**: Exploring new capitalization strategies for data centers, with 1.4 gigawatts secured or under construction. Build-to-suit pipeline exceeds $1.6 billion, targeting 50%+ of 2025 development.
- **Market Absorption**: U.S. net absorption of 47 million sq ft, up from prior quarters, with 60 million sq ft seen as normalized velocity.
- **Occupancy & Rents**: Global occupancy at 95%, with U.S. market vacancy at 7.5% and rent declines slowing. Southern California showing improvement despite softer rents.
- **E-commerce Growth**: E-commerce penetration at 24% of U.S. retail, driving 52 new customer signings in Q3.
- **Credit Risk**: Bad debt expense expected in the 40s basis points of revenue, below historical highs, due to improved customer selection.
- **2026 Outlook**: Same-store NOI growth 4.25-4.75% (net effective), 4.75-5.25% (cash), with data center and solar contributions accelerating.


Prologis, Inc. (PLD) Q3 2025 Earnings Call Transcript

Revenue

Sales and Services Revenue

Financing Services Revenue

Other Revenue

Cost of Revenue

Cost of Goods and Services

Cost of Financing Services

Other Cost

Gross Profit

Other Operating Income

Operating Expenses

Selling, General and Administrative Expenses

Selling and Marketing Expenses

General and Administrative Expenses

Research and Development Expenses

Loss on Bad Debts

Loss on Impairment of Other Assets

Loss on Disposal of Assets

Other Operating Expenses

Operating Income

Non-Operating Income (Loss)

Income (Loss) from Affiliates

Income (Loss) from Associates

Income (Loss) from Joint ventures

Gain (Loss) on Other Investment

Gain (Loss) on Change in Fair Value

Gain (Loss) on Foreign Currency Exchange

Other Non-Operating Income (Loss)

Net Interest Expense

Interest Expense

Interest Income

Pretax Income From Continuing Operations

Income Tax Expense

Current Income Tax

Deferred Income Tax

Income Tax Adjustments

Net Income from Continuing Operations

Income from Discontinued Operations

Other Items Before Net Income

Net Income

Net Income Attributable to Minority Interests

Net Income Attributable to Owners of the Company

Preferred Stock Dividends

Other Adjustments

Net Income Attributable to Common Stockholders

Other Comprehensive Income

Total Comprehensive Income

Total Comprehensive Income Attributable to Minority Interests

Total Comprehensive Income Attributable to Owners of the Company

Basic EPS

Basic EPS from Continuing Operations

Basic EPS from Discontinued Operations

Diluted EPS

Diluted EPS from Continuing Operations

Diluted EPS from Discontinued Operations

PLD

PLD fundamentals

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