GDS (GDS) Q1 2025 earnings summary

Executive summary

• Achieved 12% year-on-year revenue growth and 16.1% adjusted EBITDA growth in Q1 2025, with adjusted EBITDA margin reaching 48.6%.

• Net income reached RMB764.1 million, reversing a net loss in Q1 2024, mainly due to a gain on deconsolidation from an ABS transaction.

• Utilization rate reached 75.7%, with total area utilized at 462,423 sqm (+14.6% y/y) and strong customer commitments.

• Strong demand driven by AI, especially inferencing in tier-one markets, with a mega 152MW deal signed in Q2 2025.

• DayOne expanded internationally, securing commitments in Thailand and Finland, with total power committed over 750MW.

Financial highlights

• Adjusted gross profit for Q1 2025 was RMB1,455.4 million, up 14.6% y/y, with a margin of 53.4%.

• Operating cash flow for Q1 2025 was RMB780.1 million; capex was RMB1,055.6 million.

• Net debt at quarter-end was RMB34,915.9 million, with net debt/LQA adjusted EBITDA at 6.6x.

• Interest coverage ratio stood at 3.00x, and effective interest rate was 4.1%.

• Cash balance as of March 31, 2025, was RMB7,575.7 million (US$1,044.0 million).

Outlook and guidance

• FY25 revenue guidance: RMB11,290–11,590 million (+9.4% to +12.3% y/y); adjusted EBITDA: RMB5,190–5,390 million (+6.4% to +10.5% y/y).

• CapEx guidance for FY25 is ~RMB4,300 million, unchanged after ABS proceeds.

• Expect high single-digit percentage year-on-year growth in adjusted EBITDA for the next three quarters.