Equinix Analysts Highlight AI Potential Despite Soft Guidance

Analysts revised/maintained the price forecast on Equinix, Inc. EQIX following the fourth-quarter earnings miss that was reported on Wednesday.

The company reported funds from operations (FFO) of $7.92, missing the consensus estimate of $8.09, and revenue of $2.26 billion came slightly below the expected $2.27 billion.

The Board of Directors raised the quarterly cash dividend by 10% over the previous quarter to $4.69 per share on its common stock.

Equinix expects first-quarter revenue of $2.191 billion-$2.231 billion, vs. the $2.285 billion estimate.

For 2025, the company sees revenue of $9.033 billion-$9.133 billion, vs. the $9.404 billion estimate and AFFO per share of $36.69-$37.51.

Oppenheimer analyst Timothy Horan raised the price forecast from $950 to $975 with an Outperform rating.

The analyst writes that headline guidance was weak, as anticipated, but when normalized for FX, Power, and bare metal shutdowns, the results were in line with expectations at 7%-8%.

Although there is a shortfall in capacity, the company is addressing this, and pricing, cabinets, and cross-connections should continue to improve, adds the analyst.

Horan says that the company is well-positioned to provide AI infrastructure and maintains strong pricing power as a key supplier to hyperscalers.

While capacity and supply chain risks remain in the short term, they are likely outweighed by the long-term growth driven by AI and cloud megatrends, adds the analyst.

Goldman Sachs analyst James Schneider maintains the Buy rating, viewing this as a buying opportunity given the accelerating recurring revenue trends and tight supply/demand outlook for 2025.

The analyst writes that he expects the stock to drop following results and guidance that missed Street estimates, though they align with his preview, which reflected headwinds like FX, Equinix Metal, and non-recurring fees.

The company is poised to benefit from rising AI demand, particularly in inference, adds the analyst.

Schneider lowered the 2025-2027 revenue estimates by an average of 2%, with EBITDA and AFFO estimates reduced by approximately 1% to account for slower pricing growth.

JMP Securities analyst Greg P. Miller says that he believes the guidance provides ample room for significant beats and raises in future quarterly reports, as data center momentum picks up and price increases outpace volume growth and the higher churn levels seen in the fourth quarter.

Despite the quarter’s volatility and the first-quarter guide, Miller sees strong underlying business fundamentals.

The analyst expects Equinix to remain an industry leader in a sector with robust demand momentum.

Miller revised the 2025 AFFO per share estimate to $37.81 from $38.25 and the 2026 estimate to $41.23 from $41.72.

Investors can gain exposure to the stock via Pacer Data & Infrastructure Real Estate ETF SRVR and Elevation Series Trust SRH REIT Covered Call ETF SRHR.

Price Action: EQIX shares are down 1.52% at $920.94 at last check Thursday.

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