Breaking News

Tweet TWEET

Equinix Reports First Quarter 2013 Results

  Equinix Reports First Quarter 2013 Results

  *Reported revenues of $519.5 million, a 3% increase over the previous
    quarter and a 17% increase over the same quarter last year
  *Reiterated 2013 annual guidance of revenues to be greater than $2,200.0
    million, adjusted EBITDA to be greater than $1,010.0 million and total
    capital expenditures to be in the range of $550.0 to $650.0 million

Business Wire

REDWOOD CITY, Calif. -- April 24, 2013

Equinix, Inc. (Nasdaq: EQIX), the global interconnection and data center
company, today reported quarterly results for the quarter ended March 31,
2013. The Company uses certain non-GAAP financial measures, which are
described further below and reconciled to the most comparable GAAP financial
measures after the presentation of our GAAP financial statements.

Revenues were $519.5 million for the first quarter, a 3% increase over the
previous quarter and a 17% increase over the same quarter last year. Recurring
revenues, consisting primarily of colocation, interconnection and managed
services were $495.3 million for the first quarter, a 3% increase over the
previous quarter and an 18% increase over the same quarter last year.
Non-recurring revenues were $24.2 million in the quarter.

“Equinix delivered solid financial results in the first quarter, and we are
well positioned for the remainder of 2013,” said Steve Smith, president and
CEO of Equinix.“We are executing with discipline and focus to capture
thedemand driven by strong secular trends in video, cloud, mobility and IP
traffic. This quarter we saw record bookings in Cloud as service providers
expand their services to meet the changing needs of enterprises who are
deploying hybrid cloud architectures across Platform Equinix.”

Cost of revenues were $259.3 million for the first quarter, a 4% increase over
the previous quarter and a 19% increase over the same quarter last year. Cost
of revenues, excluding depreciation, amortization, accretion and stock-based
compensation of $96.5 million, which we refer to as cash cost of revenues,
were $162.8 million for the first quarter, a 2% increase from the previous
quarter and a 19% increase over the same quarter last year. Gross margins for
the quarter were 50%, down from 51% for the previous quarter and 51% for the
same quarter last year. Cash gross margins, defined as gross profit before
depreciation, amortization, accretion and stock-based compensation, divided by
revenues, for the quarter were 69%, unchanged from the previous quarter and
the same quarter last year.

Selling, general and administrative expenses were $148.0 million for the first
quarter, a 4% increase over the previous quarter and a 19% increase over the
same quarter last year. Selling, general and administrative expenses,
excluding depreciation, amortization and stock-based compensation of $34.8
million, which we refer to as cash selling, general and administrative
expenses, were $113.2 million for the first quarter, a 5% increase over the
previous quarter and an 18% increase over the same quarter last year.

Interest expense was $60.3 million for the first quarter, a 19% increase from
the previous quarter and a 14% increase over the same quarter last year,
primarily attributed to the $1.5 billion senior notes offering in March 2013.
The Company recorded income tax expense of $12.2 million for the first quarter
and income tax expense of $13.9 million in the same quarter last year.

Income from continuing operations was $108.6 million for the first quarter, a
6% increase from the previous quarter and an 8% increase over the same quarter
last year. Adjusted EBITDA, defined as income or loss from continuing
operations before depreciation, amortization, accretion, stock-based
compensation, restructuring charges, impairment charges and acquisition costs,
for the first quarter was $243.5 million, an increase of 2% over the previous
quarter and a 16% increase over the same quarter last year.

Net income attributable to Equinix for the first quarter was $35.9 million.
This represents a basic net income per share attributable to Equinix of $0.73
and a diluted net income per share attributable to Equinix of $0.71 based on a
weighted average share count of 49.0 million and 53.5 million, respectively,
for the first quarter of 2013.

Capital expenditures, defined as gross capital expenditures less the net
change in accrued property, plant and equipment in the first quarter, were
$75.7 million, of which $41.7 million was attributed to expansion capital
expenditures and $34.0 million was attributed to ongoing capital expenditures.

The Company generated cash from operating activities of $84.2 million for the
first quarter as compared to $209.1 million in the previous quarter and $126.0
million for the same quarter last year. Cash used in investing activities was
$1,142.5 million in the first quarter, primarily attributed to $836.4 million
of the proceeds from the issuance of the $1.5 billion senior notes that was
placed into a restricted cash account for the redemption of the $750.0 million
8.125% senior notes, as compared to cash used in investing activities of
$209.3 million in the previous quarter and cash provided by investing
activities of $269.4 million for the same quarter last year. Cash provided by
financing activities was $1,496.8 million for the first quarter, primarily
attributed to the issuance of the $1.5 billion senior notes, as compared to
cash provided by financing activities of $12.2 million in the previous quarter
and cash used in financing activities of $44.0 million for the same quarter
last year.

As of March 31, 2013, the Company’s cash, cash equivalents and investments,
excluding restricted cash, were $1,212.1 million as compared to $546.5 million
as of December 31, 2012.

In April 2013, the Company redeemed the entire principal amount of the $750.0
million 8.125% senior notes pursuant to the optional redemption provisions of
such notes. As a result, the Company will recognize a loss on debt
extinguishment in the second quarter of 2013 of approximately $89.9 million,
representing the redemption premium paid of $80.9 million and the write-off of
unamortized debt issuance costs of $9.0 million related to the $750.0 million
8.125% senior notes.

Business Outlook

For the second quarter of 2013, the Company expects revenues to be in the
range of $530.0 to $534.0 million. Cash gross margins are expected to range
between 68% and 69%. Cash selling, general and administrative expenses are
expected to range between $120.0 and $124.0 million. Adjusted EBITDA is
expected to be between $240.0 and $244.0 million. Capital expenditures are
expected to be approximately $170.0 to $180.0 million, comprised of
approximately $45.0 million of ongoing capital expenditures and $125.0 to
$135.0 million of expansion capital expenditures.

For the full year of 2013, total revenues are expected to be greater than
$2,200.0 million, which absorbs approximately $21.0 million in negative
currency movements, when compared to our prior foreign currency exchange
rates. Total year cash gross margins are expected to range between 68% to 69%.
Cash selling, general and administrative expenses are expected to range
between $490.0 and $510.0 million. Adjusted EBITDA for the year is expected to
be greater than $1,010.0 million, which absorbs approximately $9.0 million in
negative currency movements, when compared to our prior foreign currency
exchange rates. Capital expenditures for 2013 are expected to be in the range
of $550.0 to $650.0 million, comprised of approximately $165.0 million of
ongoing capital expenditures and $385.0 to $485.0 million for expansion
capital expenditures.

The U.S. dollar exchange rates used for 2013 guidance have been updated to
$1.28 to the Euro, $1.52 to the Pound, S$1.24 to the U.S. dollar and R$2.02 to
the U.S. dollar. Updated global revenue breakdown by currency for the Euro,
Pound, Singapore dollar and Brazilian Real is 14%, 8%, 6% and 4%,
respectively.

Company Metrics and Q1 Results Presentation

The Company will discuss its results and guidance on its quarterly conference
call on Wednesday, April 24, 2013, at 5:30 p.m. ET (2:30 p.m. PT). A
presentation to accompany the call as well as the Company’s Non-Financial
Metrics tracking sheet will be available on the Company’s website at
www.equinix.com/investors. To hear the conference call live, please dial
210-234-8004 (domestic and international) and reference the passcode (EQIX). A
simultaneous live Webcast of the call will also be available at
www.equinix.com/investors.

A replay of the call will be available beginning on Wednesday, April 24, 2013,
at 7:30 p.m. (ET) through May 24, 2013, by dialing 203-369-0250 and
referencing the passcode (2013). In addition, the webcast will be available on
the Company’s web site at www.equinix.com/investors. No password is required
for the replay or the webcast.

About Equinix

Equinix, Inc. (Nasdaq: EQIX), connects more than 4,000 companies directly to
their customers and partners inside the world’s most networked data centers.
Today, businesses leverage the Equinix interconnection platform in 31
strategic markets across the Americas, EMEA and Asia-Pacific. www.equinix.com.

Non-GAAP Financial Measures

Equinix provides all information required in accordance with generally
accepted accounting principles (GAAP), but it believes that evaluating its
ongoing operating results may be difficult if limited to reviewing only GAAP
financial measures. Accordingly, Equinix uses non-GAAP financial measures,
such as adjusted EBITDA, cash cost of revenues, cash gross margins, cash
operating expenses (also known as cash selling, general and administrative
expenses or cash SG&A), adjusted EBITDA margins, free cash flow, adjusted free
cash flow, discretionary free cash flow and adjusted discretionary free cash
flow to evaluate its operations. In presenting these non-GAAP financial
measures, Equinix excludes certain items that it believes are not good
indicators of the Company's current or future operating performance. These
items are depreciation, amortization, accretion of asset retirement
obligations and accrued restructuring charges, stock-based compensation,
restructuring charges, impairment charges, acquisition costs and excess tax
benefits from employee equity awards.Legislative and regulatory requirements
encourage use of and emphasis on GAAP financial metrics and require companies
to explain why non-GAAP financial metrics are relevant to management and
investors. Equinix excludes these items in order for Equinix's lenders,
investors, and industry analysts who review and report on the Company, to
better evaluate the Company's operating performance and cash spending levels
relative to its industry sector and competitors.

Equinix excludes depreciation expense as these charges primarily relate to the
initial construction costs of our IBX centers and do not reflect our current
or future cash spending levels to support our business. Our IBX centers are
long-lived assets, and have an economic life greater than 10 years. The
construction costs of our IBX centers do not recur and future capital
expenditures remain minor relative to our initial investment. This is a trend
we expect to continue. In addition, depreciation is also based on the
estimated useful lives of our IBX centers. These estimates could vary from
actual performance of the asset, are based on historic costs incurred to build
out our IBX centers, and are not indicative of current or expected future
capital expenditures. Therefore, Equinix excludes depreciation from its
operating results when evaluating its operations.

In addition, in presenting the non-GAAP financial measures, Equinix excludes
amortization expense related to certain intangible assets, as it represents a
cost that may not recur and is not a good indicator of the Company's current
or future operating performance. Equinix excludes accretion expense, both as
it relates to its asset retirement obligations as well as its accrued
restructuring charges, as these expenses represent costs which Equinix
believes are not meaningful in evaluating the Company's current operations.
Equinix excludes stock-based compensation expense as it primarily represents
expense attributed to equity awards that have no current or future cash
obligations. As such, we, and many investors and analysts, exclude this
stock-based compensation expense when assessing the cash generating
performance of our operations. Equinix excludes restructuring charges from its
non-GAAP financial measures. The restructuring charges relate to the Company's
decision to exit leases for excess space adjacent to several of our IBX
centers, which we did not intend to build out, or our decision to reverse such
restructuring charges or severance charges related to the Switch and Data
acquisition. Equinix excludes impairment charges related to certain long-lived
assets. The impairment charges relate to expense recognized whenever events or
changes in circumstances indicate that the carrying amount of long-lived
assets are not recoverable. Equinix excludes acquisition costs from its
non-GAAP financial measures. The acquisition costs relate to costs the Company
incurs in connection with business combinations. Management believes such
items as restructuring charges, impairment charges and acquisition costs are
non-core transactions; however, these types of costs will or may occur in
future periods.

Equinix excludes excess tax benefits from employee equity awards from adjusted
discretionary free cash flow as they are required to appear as an operating
cash outflow with an offsetting financing cash inflow in the statement of cash
flows and, as a result, do not actually reflect a true cash outflow to the
Company. However, this type of cash flow activity will or may occur in future
periods.

Our management does not itself, nor does it suggest that investors should,
consider such non-GAAP financial measures in isolation from, or as a
substitute for, financial information prepared in accordance with GAAP.
However, we have presented such non-GAAP financial measures to provide
investors with an additional tool to evaluate our operating results in a
manner that focuses on what management believes to be our core, ongoing
business operations. Management believes that the inclusion of these non-GAAP
financial measures provides consistency and comparability with past reports
and provides a better understanding of the overall performance of the business
and its ability to perform in subsequent periods. Equinix believes that if it
did not provide such non-GAAP financial information, investors would not have
all the necessary data to analyze Equinix effectively.

Investors should note, however, that the non-GAAP financial measures used by
Equinix may not be the same non-GAAP financial measures, and may not be
calculated in the same manner, as that of other companies. In addition,
whenever Equinix uses such non-GAAP financial measures, it provides a
reconciliation of non-GAAP financial measures to the most closely applicable
GAAP financial measure. Investors are encouraged to review the related GAAP
financial measures and the reconciliation of these non-GAAP financial measures
to their most directly comparable GAAP financial measure.

Equinix does not provide forward-looking guidance for certain financial data,
such as depreciation, amortization, accretion, stock-based compensation, net
income (loss) from operations, cash generated from operating activities and
cash used in investing activities, and as a result, is not able to provide a
reconciliation of GAAP to non-GAAP financial measures for forward-looking
data. Equinix intends to calculate the various non-GAAP financial measures in
future periods consistent with how they were calculated for the periods
presented within this press release.

Forward Looking Statements

This press release contains forward-looking statements that involve risks and
uncertainties. Actual results may differ materially from expectations
discussed in such forward-looking statements. Factors that might cause such
differences include, but are not limited to, the challenges of acquiring,
operating and constructing IBX centers and developing, deploying and
delivering Equinix services; unanticipated costs or difficulties relating to
the integration of companies we have acquired or will acquire into Equinix; a
failure to receive significant revenue from customers in recently built out or
acquired data centers; failure to complete any financing arrangements
contemplated from time to time; competition from existing and new competitors;
the ability to generate sufficient cash flow or otherwise obtain funds to
repay new or outstanding indebtedness; the loss or decline in business from
our key customers; and other risks described from time to time in Equinix's
filings with the Securities and Exchange Commission. In particular, see
Equinix's recent quarterly and annual reports filed with the Securities and
Exchange Commission, copies of which are available upon request from Equinix.
Equinix does not assume any obligation to update the forward-looking
information contained in this press release.

Equinix and IBX are registered trademarks of Equinix, Inc. International
Business Exchange is a trademark of Equinix, Inc.

                                                             
EQUINIX, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share data)
(unaudited)
                            
                                                                    
                                Three Months Ended
                                March 31,        December 31,       March 31,
                                2013             2012               2012
                                                                    
    Recurring revenues          $ 495,271        $  481,738         $ 420,890
    Non-recurring                24,184           24,782           22,355
    revenues
    Revenues                      519,455           506,520           443,245
                                                                    
    Cost of revenues             259,268          250,121          217,098
    Gross profit                 260,187          256,399          226,147
                                                                    
    Operating expenses:
    Sales and marketing           58,276            55,690            46,410
    General and                   89,685            86,867            78,316
    administrative
    Impairment charges            -                 9,861             -
    Acquisition costs            3,662            1,939            675
    Total operating              151,623          154,357          125,401
    expenses
                                                                    
    Income from                  108,564          102,042          100,746
    continuing operations
                                                                    
    Interest and other
    income (expense):
    Interest income               747               758               691
    Interest expense              (60,331)          (50,516)          (52,818)
    Other expense                (459)            (717)            (154)
    Total interest and           (60,043)         (50,475)         (52,281)
    other, net
                                                                    
    Income from
    continuing operations         48,521            51,567            48,465
    before income taxes
                                                                    
    Income tax expense           (12,198)         (17,294)         (13,853)
                                                                    
    Net income from               36,323            34,273            34,612
    continuing operations
                                                                    
    Net income from
    discontinued                  -                 6                 199
    operations, net of
    tax
    Gain on sale of
    discontinued                 -                11,852           -
    operations, net of
    tax
                                                                    
    Net income                    36,323            46,131            34,811
                                                                    
    Net income
    attributable to
    redeemable                    (441)             (1,273)           (288)
    non-controlling
    interests
                                                                  
    Net income
    attributable to             $ 35,882         $  44,858          $ 34,523
    Equinix
                                                                    
    Net income per share
    attributable to
    Equinix:
                                                                    
    Basic net income per
    share from continuing       $ 0.73           $  0.68            $ 0.74
    operations
    Basic net income per
    share from                   -                0.24             0.00
    discontinued
    operations
    Basic net income per        $ 0.73           $  0.92            $ 0.74
    share (1)
                                                                    
    Diluted net income
    per share from              $ 0.71           $  0.66            $ 0.71
    continuing operations
    Diluted net income
    per share from               -                0.22             0.00
    discontinued
    operations
    Diluted net income          $ 0.71           $  0.88            $ 0.71
    per share (2)
                                                                    
    Shares used in
    computing basic net          49,029           48,673           46,955
    income per share
                                                                    
    Shares used in
    computing diluted net        53,480           52,917           51,061
    income per share
   
                                                                    
(1) The net income used in the computation of basic net income per share
    attributable to Equinix is presented below:
                                                                    
    Net income from             $ 36,323         $  34,273          $ 34,612
    continuing operations
    Net income
    attributable to               (441)             (1,273)           (288)
    non-controlling
    interests
    Adjustments
    attributable to
    redemption value of          -                -                209
    non-controlling
    interests
    Net income from
    continuing operations         35,882            33,000            34,533
    attributable to
    Equinix, basic
    Net income from
    discontinued                 -                11,858           199
    operations
    Net income
    attributable to             $ 35,882         $  44,858          $ 34,732
    Equinix, basic
                                                                    
(2) The net income used in the computation of diluted net income per share
    attributable to Equinix is presented below:
                                                                    
    Net income from
    continuing operations       $ 35,882         $  33,000          $ 34,533
    attributable to
    Equinix, basic
    Interest on                  1,851            1,707            1,699
    convertible debt
    Net income from
    continuing operations         37,733            34,707            36,232
    attributable to
    Equinix, diluted
    Net income from
    discontinued                 -                11,858           199
    operations
    Net income
    attributable to             $ 37,733         $  46,565          $ 36,431
    Equinix, diluted
                                                                    


EQUINIX, INC.
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS)
(in thousands)
(unaudited)
                                                        
                                                                     
                                  Three Months Ended
                                  March 31,        December          March 31,
                                  2013             31,               2012
                                                   2012
                                                                     
Net income                        $ 36,323         $  46,131         $ 34,811
                                                                     
Other comprehensive income
(loss), net of tax:
Foreign currency                    (72,554)          9,307            34,312
translation gain (loss)
Unrealized gain (loss) on
available for sale                 98               (37)            78
securities
Other comprehensive income         (72,456)         9,270           34,390
(loss), net of tax:
                                                                     
Comprehensive income               (36,133)         55,401          69,201
(loss), net of tax
                                                                     
Net income attributable to
redeemable non-controlling          (441)             (1,273)          (288)
interests
Other comprehensive income
(loss) attributable to             (769)            3,330           (1,059)
redeemable non-controlling
interests
                                                                     
Comprehensive income (loss)
attributable to Equinix,          $ (37,343)       $  57,458         $ 67,854
net of tax
                                                                     

                                                           
EQUINIX, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands)
(unaudited)
                       
Assets                                          March 31,         December 31,
                                                2013              2012
                                                                  
Cash and cash equivalents                       $ 685,019         $  252,213
Short-term investments                            233,289            166,492
Restricted cash                                   843,478            9,380
Accounts receivable, net                          185,163            163,840
Other current assets                             58,908            47,826
Total current assets                              2,005,857          639,751
Long-term investments                             293,751            127,819
Property, plant and equipment, net                3,888,624          3,918,999
Goodwill                                          1,018,777          1,042,564
Intangible assets, net                            191,935            201,562
Other assets                                     212,423           202,269
Total assets                                    $ 7,611,367       $  6,132,964
                                                                  
Liabilities and Stockholders' Equity
                                                                  
Accounts payable and accrued expenses           $ 248,395         $  268,853
Accrued property and equipment                    63,077             63,509
Current portion of capital lease and              16,304             15,206
other financing obligations
Current portion of loans payable                  47,350             52,160
Current portion of senior notes                   750,000            -
Current portion of deferred tax                   69,689             69,689
liabilities
Other current liabilities                        69,329            69,872
Total current liabilities                         1,264,144          539,289
Capital lease and other financing                 568,067            545,853
obligations, less current portion
Loans payable, less current portion               179,560            188,802
Senior notes, less current portion                2,250,000          1,500,000
Convertible debt                                  712,478            708,726
Other liabilities                                197,966           230,843
Total liabilities                                5,172,215         3,713,513
                                                                  
Redeemable non-controlling interests             96,891            84,178
                                                                  
Common stock                                      50                 49
Additional paid-in capital                        2,627,334          2,583,371
Treasury stock                                    (36,309)           (36,676)
Accumulated other comprehensive loss              (174,267)          (101,042)
Accumulated deficit                              (74,547)          (110,429)
Total stockholders' equity                       2,342,261         2,335,273
                                                                  

Total liabilities, redeemable
non-controlling interests and                   $ 7,611,367       $  6,132,964
stockholders' equity
                                                                  
                                                          
                                                                  
Ending headcount by geographic region is
as follows:
                                                                  
Americas headcount                                1,872              1,821
EMEA headcount                                    848                811
Asia-Pacific headcount                           553               521
Total headcount                                  3,273             3,153
                                                                  


EQUINIX, INC.
SUMMARY OF DEBT OUTSTANDING
(in thousands)
(unaudited)
                                                        
                                                                 
                                                March 31,         December 31,
                                                2013              2012
                                                                  
Capital lease and other financing               $ 584,371         $  561,059
obligations
                                                                  
U.S. term loan                                    170,000            180,000
ALOG financing                                    49,566             48,807
Paris 4 IBX financing                             7,308              8,071
Other loans payable                              36                4,084
Total loans payable                              226,910           240,962
                                                                  
Senior notes                                     3,000,000         1,500,000
                                                                  
Convertible debt, net of debt discount            712,478            708,726
Plus debt discount                               57,235            60,990
Total convertible debt principal                 769,713           769,716
                                                                  
Total debt outstanding                          $ 4,580,994       $  3,071,737
                                                                  

    
    EQUINIX, INC.
    CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
    (in thousands)
    (unaudited)
                                                     
                                                                   
                             Three Months Ended
                             March 31,           December          March 31,
                             2013                31,               2012
                                                 2012
                                                                   
    Cash flows from
    operating
    activities:
    Net income               $ 36,323            $ 46,131          $ 34,811
    Adjustments to
    reconcile net
    income to net cash
    provided by
    operating
    activities:
    Depreciation,
    amortization and           108,531             103,457           93,922
    accretion
    Stock-based                22,703              21,924            19,103
    compensation
    Debt issuance
    costs and debt             5,753               5,308             8,107
    discount
    Impairment charges         -                   9,861             -
    Gain on sale of
    discontinued               -                   (11,852)          -
    operations
    Excess tax
    benefits from              (18,990)            (19,457)          -
    employee equity
    awards
    Other reconciling          3,085               584               2,857
    items
    Changes in
    operating assets
    and liabilities:
    Accounts                   (24,663)            20,299            (19,677)
    receivable
    Income taxes, net          (1,609)             2,711             (8,763)
    Accounts payable
    and accrued                (27,996)            26,203            (40,535)
    expenses
    Other assets and          (18,956)           3,930            36,168
    liabilities
    Net cash provided
    by operating              84,181             209,099          125,993
    activities
    Cash flows from
    investing
    activities:
    Purchases, sales
    and maturities of          (232,965)           (15,162)          346,366
    investments, net
    Purchase of Dubai          -                   (22,918)          -
    IBX data center
    Purchase of Asia
    Tone, less cash            (107)               (13,540)          -
    acquired
    Purchases of real          -                   (24,656)          -
    estate
    Purchases of other
    property, plant            (75,667)            (210,408)         (145,490)
    and equipment
    Proceeds from sale
    of discontinued            -                   76,458            -
    operations
    Other investing           (833,801)          899              68,557
    activities
    Net cash provided
    by (used in)              (1,142,540)        (209,327)        269,433
    investing
    activities
    Cash flows from
    financing
    activities:
    Purchases of               -                   -                 (13,364)
    treasury stock
    Proceeds from
    employee equity            14,368              5,998             30,460
    awards
    Proceeds from              -                   4,049             8,909
    loans payable
    Proceeds from              1,500,000           -                 -
    senior notes
    Repayment of
    capital lease and          (3,516)             (3,471)           (2,826)
    other financing
    obligations
    Repayment of loans         (14,052)            (13,332)          (67,129)
    payable
    Excess tax
    benefits from              18,990              19,457            -
    employee equity
    awards
    Other financing           (19,030)           (453)            -
    activities
    Net cash provided
    by (used in)              1,496,760          12,248           (43,950)
    financing
    activities
    Effect of foreign
    currency exchange         (5,595)            506              2,645
    rates on cash and
    cash equivalents
    Net increase in
    cash and cash              432,806             12,526            354,121
    equivalents
    Cash and cash
    equivalents at            252,213            239,687          278,823
    beginning of
    period
    Cash and cash
    equivalents at end       $ 685,019           $ 252,213         $ 632,944
    of period
                                                                   
    Supplemental cash
    flow information:
    Cash paid for            $ 14,036            $ 17,133          $ 1,734
    taxes
    Cash paid for            $ 67,975            $ 27,404          $ 63,336
    interest
                                                                   
    Free cash flow (1)       $ (825,394)         $ 14,934          $ 49,060
                                                                   
    Adjusted free cash       $ (806,297)         $ 19,047          $ 49,060
    flow (2)
                                                                   
    Ongoing capital          $ 33,997            $ 43,497          $ 38,462
    expenditures (3)
                                                                   
    Discretionary free       $ 50,184            $ 165,602         $ 87,531
    cash flow (4)
                                                                   
    Adjusted
    discretionary free       $ 69,174            $ 185,059         $ 87,531
    cash flow (5)
               
                                                                   
    We define free cash flow as net cash provided by operating activities plus
(1) net cash provided by (used in) investing activities
    (excluding the net purchases, sales and maturities of investments) as
    presented below:
                                                                   
    Net cash provided
    by operating             $ 84,181            $ 209,099         $ 125,993
    activities as
    presented above
    Net cash provided
    by (used in)
    investing                  (1,142,540)         (209,327)         269,433
    activities as
    presented above
    Purchases, sales
    and maturities of         232,965            15,162           (346,366)
    investments, net
    Free cash flow
    (negative free           $ (825,394)         $ 14,934          $ 49,060
    cash flow)
                                                                   
    We define adjusted free cash flow as free cash flow (as defined above)
(2) excluding any purchases of real estate, acquisitions,
    sales of discontinued operations and any excess tax benefits from employee
    equity awards, as presented below:
                                                                   
    Free cash flow (as       $ (825,394)         $ 14,934          $ 49,060
    defined above)
    Less purchase of
    Dubai IBX data             -                   22,918            -
    center, less cash
    acquired
    Less purchase of
    Asia Tone, less            107                 13,540            -
    cash acquired
    Less purchases of          -                   24,656            -
    real estate
    Less sale of
    discontinued               -                   (76,458)          -
    operations
    Less excess tax
    benefits from             18,990             19,457           -
    employee equity
    awards
    Adjusted free cash
    flow (negative           $ (806,297)         $ 19,047          $ 49,060
    adjusted free cash
    flow)
                                                                   
    We refer to our purchases of other property, plant and equipment as our
    capital expenditures (or capex). We categorize our
(3) capital expenditures into expansion and ongoing capex. Expansion capex is
    capex spent to build out our new data centers
    and data center expansions. Our ongoing capex represents all of our other
    capex spending.
                                                                   
    Ongoing capital          $ 33,997            $ 43,497          $ 38,462
    expenditures
    Expansion capital         41,670             166,911          107,028
    expenditures
    Total capital            $ 75,667            $ 210,408         $ 145,490
    expenditures
                                                                   
    We define discretionary free cash flow as net cash provided by operating
(4) activities less ongoing capital expenditures
    (as described above), as presented below:
                                                                   
    Net cash provided
    by operating             $ 84,181            $ 209,099         $ 125,993
    activities as
    presented above
    Less ongoing
    capital                   (33,997)           (43,497)         (38,462)
    expenditures
    Discretionary free       $ 50,184            $ 165,602         $ 87,531
    cash flow
                                                                   
    We define adjusted discretionary free cash flow as discretionary free cash
(5) flow (as defined above) excluding
    any excess tax benefits from employee equity awards as presented below:
                                                                   
    Discretionary free       $ 50,184            $ 165,602         $ 87,531
    cash flow
    Excess tax
    benefits from             18,990             19,457           -
    employee equity
    awards
    Adjusted
    discretionary free       $ 69,174            $ 185,059         $ 87,531
    cash flow
                                                                   

                                                         
EQUINIX, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - NON-GAAP PRESENTATION
(in thousands)
(unaudited)
         
                                                                   
                                Three Months Ended
                                March 31,        December          March 31,
                                2013             31,               2012
                                                 2012
                                                                   
     Recurring revenues         $ 495,271        $ 481,738         $ 420,890
     Non-recurring               24,184          24,782           22,355
     revenues
     Revenues (1)                519,455         506,520          443,245
                                                                   
     Cash cost of                162,759         158,950          136,361
     revenues (2)
     Cash gross profit           356,696         347,570          306,884
     (3)
                                                                   
     Cash operating
     expenses (4):
     Cash sales and
     marketing expenses           46,280           43,996            38,119
     (5)
     Cash general and
     administrative              66,956          64,291           58,169
     expenses (6)
     Total cash
     operating expenses          113,236         108,287          96,288
     (7)
                                                                   
     Adjusted EBITDA (8)        $ 243,460        $ 239,283         $ 210,596
                                                                   
     Cash gross margins          69%             69%              69%
     (9)
                                                                   
     Adjusted EBITDA             47%             47%              48%
     margins (10)
                                                                   
     Adjusted EBITDA
     flow-through rate           32%             62%              81%
     (11)
                
                                                                   
(1)  The geographic split of our revenues on a services
     basis is presented below:
                                                                   
     Americas Revenues:
     Colocation                 $ 223,565        $ 218,442         $ 203,918
     Interconnection              58,206           56,426            51,739
     Managed                      13,616           12,529            13,936
     infrastructure
     Rental                      460             490              439
     Recurring revenues           295,847          287,887           270,032
     Non-recurring               12,707          11,456           9,097
     revenues
     Revenues                    308,554         299,343          279,129
                                                                   
     EMEA Revenues:
     Colocation                   100,532          95,823            83,951
     Interconnection              8,381            7,989             3,824
     Managed                      4,249            4,596             3,414
     infrastructure
     Rental                      120             325              344
     Recurring revenues           113,282          108,733           91,533
     Non-recurring               7,012           8,726            9,803
     revenues
     Revenues                    120,294         117,459          101,336
                                                                   
     Asia-Pacific
     Revenues:
     Colocation                   71,014           69,798            47,117
     Interconnection              9,404            9,090             7,320
     Managed                     5,724           6,230            4,888
     infrastructure
     Recurring revenues           86,142           85,118            59,325
     Non-recurring               4,465           4,600            3,455
     revenues
     Revenues                    90,607          89,718           62,780
                                                                   
     Worldwide Revenues:
     Colocation                   395,111          384,063           334,986
     Interconnection              75,991           73,505            62,883
     Managed                      23,589           23,355            22,238
     infrastructure
     Rental                      580             815              783
     Recurring revenues           495,271          481,738           420,890
     Non-recurring               24,184          24,782           22,355
     revenues
     Revenues                   $ 519,455        $ 506,520         $ 443,245
                                                                   
(2)  We define cash cost of revenues as cost of revenues less depreciation,
     amortization, accretion and stock-based compensation as presented below:
                                                                   
     Cost of revenues           $ 259,268        $ 250,121         $ 217,098
     Depreciation,
     amortization and             (94,907)         (89,530)          (79,420)
     accretion expense
     Stock-based
     compensation                (1,602)         (1,641)          (1,317)
     expense
     Cash cost of               $ 162,759        $ 158,950         $ 136,361
     revenues
                                                                   
     The geographic split of our cash cost of revenues is
     presented below:
                                                                   
     Americas cash cost         $ 88,473         $ 83,529          $ 79,082
     of revenues
     EMEA cash cost of            43,629           43,888            35,353
     revenues
     Asia-Pacific cash           30,657          31,533           21,926
     cost of revenues
     Cash cost of               $ 162,759        $ 158,950         $ 136,361
     revenues
                                                                   
(3)  We define cash gross profit as revenues less cash cost of revenues (as
     defined above).
                                                                   
     We define cash operating expenses as operating expenses less
     depreciation, amortization, stock-based compensation,
(4)  restructuring charges, impairment charges and acquisition costs. We also
     refer to cash operating expenses as
     cash selling, general and administrative expenses or "cash SG&A".
                                                                   
     We define cash sales and marketing expenses as sales and marketing
(5)  expenses less depreciation,
     amortization and stock-based compensation as presented below:
                                                                   
     Sales and marketing        $ 58,276         $ 55,690          $ 46,410
     expenses
     Depreciation and
     amortization                 (6,275)          (6,469)           (4,256)
     expense
     Stock-based
     compensation                (5,721)         (5,225)          (4,035)
     expense
     Cash sales and             $ 46,280         $ 43,996          $ 38,119
     marketing expenses
                                                                   
     We define cash general and administrative expenses as general and
(6)  administrative expenses less depreciation,
     amortization and stock-based compensation as presented below:
                                                                   
     General and
     administrative             $ 89,685         $ 86,867          $ 78,316
     expenses
     Depreciation and
     amortization                 (7,349)          (7,480)           (6,474)
     expense
     Stock-based
     compensation                (15,380)        (15,096)         (13,673)
     expense
     Cash general and
     administrative             $ 66,956         $ 64,291          $ 58,169
     expenses
                                                                   
(7)  Our cash operating expenses, or cash SG&A, as defined above, is presented
     below:
                                                                   
     Cash sales and             $ 46,280         $ 43,996          $ 38,119
     marketing expenses
     Cash general and
     administrative              66,956          64,291           58,169
     expenses
     Cash SG&A                  $ 113,236        $ 108,287         $ 96,288
                                                                   
     The geographic split of our cash operating expenses, or cash SG&A, is
     presented below:
                                                                   
     Americas cash SG&A         $ 73,551         $ 65,466          $ 66,849
     EMEA cash SG&A               27,611           28,043            19,099
     Asia-Pacific cash           12,074          14,778           10,340
     SG&A
     Cash SG&A                  $ 113,236        $ 108,287         $ 96,288
                                                                   
     We define adjusted EBITDA as income from continuing operations plus
(8)  depreciation, amortization, accretion, stock-based
     compensation expense, restructuring charges, impairment charges and
     acquisition costs as presented below:
                                                                   
     Income from
     continuing                 $ 108,564        $ 102,042         $ 100,746
     operations
     Depreciation,
     amortization and             108,531          103,479           90,150
     accretion expense
     Stock-based
     compensation                 22,703           21,962            19,025
     expense
     Impairment charges           -                9,861             -
     Acquisition costs           3,662           1,939            675
     Adjusted EBITDA            $ 243,460        $ 239,283         $ 210,596
                                                                   
     The geographic split of our adjusted
     EBITDA is presented below:
                                                                   
     Americas income
     from continuing            $ 62,597         $ 66,642          $ 61,566
     operations
     Americas
     depreciation,                63,224           59,761            56,649
     amortization and
     accretion expense
     Americas
     stock-based                  17,311           16,972            15,073
     compensation
     expense
     Americas impairment          -                6,972             -
     charges
     Americas                    3,398           1                (90)
     acquisition costs
     Americas adjusted           146,530         150,348          133,198
     EBITDA
                                                                   
     EMEA income from
     continuing                   22,863           18,738            27,279
     operations
     EMEA depreciation,
     amortization and             23,071           22,554            17,312
     accretion expense
     EMEA stock-based
     compensation                 3,038            2,633             2,164
     expense
     EMEA acquisition            82              1,603            129
     costs
     EMEA adjusted               49,054          45,528           46,884
     EBITDA
                                                                   
     Asia-Pacific income
     from continuing              23,104           16,662            11,901
     operations
     Asia-Pacific
     depreciation,                22,236           21,164            16,189
     amortization and
     accretion expense
     Asia-Pacific
     stock-based                  2,354            2,357             1,788
     compensation
     expense
     Asia-Pacific                 -                2,889             -
     impairment charges
     Asia-Pacific                182             335              636
     acquisition costs
     Asia-Pacific                47,876          43,407           30,514
     adjusted EBITDA
                                                                   
     Adjusted EBITDA            $ 243,460        $ 239,283         $ 210,596
                                                                   
(9)  We define cash gross margins as cash gross profit
     divided by revenues.
                                                                   
     Our cash gross margins by geographic
     region is presented below:
                                                                   
     Americas cash gross         71%             72%              72%
     margins
                                                                   
     EMEA cash gross             64%             63%              65%
     margins
                                                                   
     Asia-Pacific cash           66%             65%              65%
     gross margins
                                                                   
(10) We define adjusted EBITDA margins as adjusted EBITDA
     divided by revenues.
                                                                   
     Americas adjusted           47%             50%              48%
     EBITDA margins
                                                                   
     EMEA adjusted               41%             39%              46%
     EBITDA margins
                                                                   
     Asia-Pacific
     adjusted EBITDA             53%             48%              49%
     margins
                                                                   
     We define adjusted EBITDA flow-through rate as incremental adjusted
(11) EBITDA growth divided by incremental
     revenue growth as follows:
                                                                   
     Adjusted EBITDA -          $ 243,460        $ 239,283         $ 210,596
     current period
     Less adjusted
     EBITDA - prior              (239,283)       (228,298)        (193,441)
     period
     Adjusted EBITDA            $ 4,177          $ 10,985          $ 17,155
     growth
                                                                   
     Revenues - current         $ 519,455        $ 506,520         $ 443,245
     period
     Less revenues -             (506,520)       (488,730)        (422,116)
     prior period
     Revenue growth             $ 12,935         $ 17,790          $ 21,129
                                                                   
     Adjusted EBITDA             32%             62%              81%
     flow-through rate
                                                                   

Contact:

Equinix Investor Relations Contacts:
Equinix, Inc.
Katrina Rymill, 650-598-6583
krymill@equinix.com
or
Samir Patodia, 650-598-6587
spatodia@equinix.com
or
Equinix Media Contacts:
Equinix, Inc.
Melissa Neumann, 650-598-6098
mneumann@equinix.com
or
GolinHarris
Liam Rose, 415-318-4380
lrose@golinharris.com