[Management View]
Digital Realty achieved record bookings of $177 million in gross new leases, with $135 million at the company's share. Core FFO per share reached a record $1.87, a 13% YoY increase. The company emphasized its strategic focus on the zero to one megawatt plus interconnection segment and large-scale hyperscale bookings, highlighting its global platform and effective inventory management.

[Outlook]
The company raised its full-year 2025 core FFO per share guidance to $7.15–$7.25. Revenue and adjusted EBITDA guidance were increased by $100 million and $75 million, respectively. Future plans include continued expansion in the zero to one megawatt plus interconnection segment and leveraging the US Hyperscale Data Center Fund for growth.

[Financial Performance]
Core FFO per share increased by 13% YoY to $1.87. Leasing momentum in the zero to one megawatt plus interconnection segment saw bookings exceed $300 million over the past four quarters. The backlog stood at $826 million, supporting multiyear growth visibility. Adjusted EBITDA rose 13% YoY, and data center revenue grew by 11% YoY.

[Q&A Highlights]
Question 1: Do you think is driving the inflection in growth in the zero to one megawatt category? Are we seeing growth in that market overall, or is it mostly Digital Realty Trust, Inc. market share? If it's market share, can you break down maybe break it down for us two or three things Digital Realty Trust, Inc. has changed in its go-to-market strategy to capture more market share?
Answer: Andy Power and Colin McLean explained that the growth is due to a combination of market expansion and Digital Realty's strategic execution. The company has focused on building a global footprint, enhancing connectivity, and revamping its go-to-market strategy. Recent changes include improving interconnection capabilities and offering a full spectrum of services, which have resonated with clients.

Question 2: Wondering if you could talk a little bit about more broadly interconnection bookings, which I think was a record, anything to comment on this goes at including around pricing as well as how the second half bookings environment is shaping up, and I got a quick follow-up.
Answer: Andy Power and Chris Sharp highlighted that interconnection bookings were a record, driven by sustained zero to one megawatt bookings, global pricing standardization, and a comprehensive interconnection suite. The second half of the year is expected to continue this momentum, with broad-based demand across all regions.

Question 3: The math of project now is the one we've about continuing by both existing people players and new players as well. Financial sponsors and so forth, stopping wealth fund. Gigawatt scale multibillion, Many of these are in remote locations But what do you see as the impact on sector and this overall competitive dynamics?
Answer: Andy Power noted that the trend of large-scale AI infrastructure projects indicates a continued commitment to building out AI infrastructure. Digital Realty's strategy focuses on major markets with robust and diverse demand, offering a competitive advantage due to supply barriers and the fungibility of demand.

Question 4: I wanted to get your sense for kind of the large capacity block market in hyperscale in the US. I think you talked about power availability kind of moving to late 2026 or early 2027. And just thinking through the timing of the prelease windows if you expect that to kinda snap back in the second half of the year, there to be more and markets like Virginia, Charlotte, Atlanta, or anywhere else where you see opportunity Thank you.
Answer: Andy Power and Colin McLean discussed the strong demand for large capacity blocks in hyperscale, particularly in North America. The company has a significant pipeline of capacity coming online in late 2026 and 2028, with active conversations around these projects. The demand profile remains strong, driven by AI and cloud use cases.

Question 5: Just wanna go back to some of your comments about the globalization of your footprint. And I'm curious if you could provide some context on, you know, why you're seeing the EMEA and APAC regions trailing behind the US on AI adoption, are there certain catalysts to watch for or just simply timing for demand in those regions to expand and accelerate for AI workloads.
Answer: Andy Power explained that while the US has seen a preponderance of AI-related activity, EMEA and APAC are also experiencing growth. The US multinational hyperscale landscape has driven initial demand, but other regions are making infrastructure a priority, which will likely lead to increased AI adoption outside the US.

Question 6: And you talked a little bit about extending the runways for long-term growth, and I'm hoping maybe you can speak to what that growth could look like. This year will be about 7% with some FX benefit. And seems like next year maybe could accelerate. But how are you thinking about what sustainable growth could look like over a longer-term multiyear time frame?
Answer: Andy Power emphasized the goal of being a consistent compounder in growth, aiming for at least 7% year-over-year growth. Near-term growth will be driven by the zero to one megawatt and interconnection segments, while longer-term growth will come from hyperscale bookings.

Question 7: I wanted to ask about your US hyperscale fund. So once fully funded and developed, what sort of implications will this have on your financial model longer term? So any thoughts on, you know, what the contribution from a fee income perspective and core FFO per share growth perspective longer term would be very helpful. Thanks.
Answer: Greg Wright and Matt Mercier explained that the US Hyperscale Fund will support approximately $10 billion of data center investment. The fund will provide near-term benefits through asset management fees and long-term growth through development returns, contributing to core FFO per share growth.

Question 8: Can you talk a little bit about the strategic rationale for keeping a majority stake in the operating assets but a minority stake in the development assets? And I'm curious, Greg, if maybe that's a fundraising trend you think we'll see across the industry with that structure, or would that maybe just specific to these assets and this deal?
Answer: Andy Power clarified that Digital Realty retains a 20% minority stake in both the stabilized and development assets of the US Hyperscale Fund. This structure provides strategic flexibility and aligns with the company's long-term growth objectives.

Question 9: There's been this trend we've seen probably just the last few quarters or maybe the last year or so about utility companies requiring larger upfront commitments. And I'm wondering how's that impacting your construction cost per megawatt and would you view that as a net positive or a net negative for a company as large as Digital Realty Trust, Inc.?
Answer: Andy Power viewed the trend as a positive development, indicating a maturing industry. Larger upfront commitments from utility companies help rationalize and stabilize the industry, benefiting established operators like Digital Realty.

Question 10: It's good to see the momentum in the zero to one bookings category. If that sustains itself, I'm just wondering, given that there's a smaller blocks of space, do you have availability in your existing installations for 2026 such that you could slot in more of that business into 2026 commencements and potentially drive further upside to 2026 financials? Is that a reasonable assumption?
Answer: Andy Power confirmed that Digital Realty has the inventory runway to support continued growth in the zero to one megawatt category. The company is well-positioned to accommodate additional bookings in 2026 and beyond, leveraging its global platform and repurposing existing capacity.

Question 11: I just wanna dig in more into the zero to one megawatt kind of pay slash capacity. You know, your peers obviously saying they're building boulder. Over the next, you know, five years or three years, building next two years and hoping to lease up. I guess, two parts. One, at your growing the, you know, the booking space, can you just elaborate? Are you taking share? Is it a bigger TAM as you see it?
Answer: Andy Power emphasized that Digital Realty is capturing market share through its strategic investments and execution. The company has built a compelling value proposition for customers, leading to strong growth in the zero to one megawatt category. The addressable market remains large and attractive, with significant opportunities for continued expansion.

Question 12: Andy, earlier in the call, you were talking about your strategy of sticking to tier one markets. Your expectation that over time, you'll see demand in those markets compound as enterprise AI adoption picks up. So what's your latest thinking, and what are you hearing from customers regarding, you know, when you think that compounding will really start to kick in? And along those lines, what's your sense as to the share of AI in certain use cases, you know, that are gonna need to be distributed across key metros for latency or other reasons?
Answer: Andy Power reiterated that enterprise AI adoption is still in the early stages, with most AI testing currently happening in cloud service providers. As AI use cases mature, demand for data center capacity in key metros will increase. Digital Realty is well-positioned to support this growth, offering a robust platform for both enterprise and hyperscale customers.

[Sentiment Analysis]
The tone of the earnings call was positive, with management expressing confidence in the company's strategic direction and growth prospects. Analysts' questions focused on understanding the drivers of growth and the company's ability to sustain its momentum.

[Quarterly Comparison]
| Metric | Q2 2025 | Q1 2025 | Q2 2024 |
|---------------------------------|---------------|---------------|---------------|
| Core FFO per Share | $1.87 | $1.76 | $1.65 |
| Gross New Leases | $177 million | $160 million | $150 million |
| Backlog | $826 million | $800 million | $750 million |
| Adjusted EBITDA | +13% YoY | +11% YoY | +10% YoY |
| Data Center Revenue | +11% YoY | +10% YoY | +9% YoY |

[Risks and Concerns]
- Potential delays in power availability for large capacity blocks.
- Competitive pressures in the hyperscale and interconnection markets.
- Macroeconomic and geopolitical factors impacting demand and operations.

[Final Takeaway]
Digital Realty delivered a strong Q2 2025 performance, driven by record bookings and strategic expansion in the zero to one megawatt plus interconnection segment. The company raised its full-year guidance, reflecting confidence in its growth trajectory. Management highlighted the success of the US Hyperscale Data Center Fund and emphasized the company's ability to meet diverse customer needs across its global platform. While challenges remain, Digital Realty is well-positioned to capitalize on the growing demand for data center capacity, particularly as AI adoption accelerates.