Iron Mountain (IRM) Q2 2024 earnings summary

Executive summary

• Achieved record Q2 2024 revenue of $1.534 billion, up 13% year-over-year, and record Adjusted EBITDA of $544 million, up 14% year-over-year, with net income rising to $35 million from $1.1 million in Q2 2023.

• Board authorized a 10% increase in quarterly dividend to $0.715 per share, reflecting AFFO per share growth and payable in Q3 2024.

• Data center leasing reached 66 MW in Q2, totaling 97 MW for H1, with full-year projection raised to 130 MW.

• Growth driven by organic storage rental and service revenue, acquisitions, and expansion in Global Data Center and ALM businesses.

• Strategy focused on growth in physical storage, digital solutions, data centers, and Asset Lifecycle Management (ALM).

Financial highlights

• Q2 revenue reached $1.534 billion, up 13% year-over-year, with 10% organic revenue growth.

• Storage rental revenue grew 11% to $920 million; service revenue up 17% to $615 million.

• Adjusted EBITDA was $544 million, up 14% year-over-year; margin improved to 35.5%, up 50 bps.

• AFFO was $321 million ($1.08 per share), up 12% and 10% year-over-year, respectively.

• Adjusted EPS increased 5% to $0.42; reported EPS was $0.12.

Outlook and guidance

• Full-year 2024 results expected at the high end of guidance on all metrics.

• 2024 guidance: revenue $6.0–$6.15 billion, Adjusted EBITDA $2.175–$2.225 billion, AFFO $1.3–$1.335 billion, AFFO per share $4.39–$4.51.

• Q3 2024 outlook: revenue ~$1.55 billion, Adjusted EBITDA ~$560 million, AFFO ~$325 million, AFFO per share ~$1.10.

• ALM business expected to achieve organic growth in the 40%+ range in the back half of the year.

• Project Matterhorn investments expected at ~$150 million annually through 2025 for global operating model transformation.