The clean earnings number beat expectations. Core FFO excluding the $188 million net promote was $2.13 per diluted share, versus the published consensus of approximately $1.98; the headline $2.65 included that promote and is therefore less useful as an underlying operating measure (Funds From Operations and Core Funds From Operations). The quarter also included roughly $27 million of business-interruption recovery from an insurance settlement, so the underlying beat was narrower than the headline suggests, but still better than feared (Earnings Release; Reconciliation of FFO to Core FFO).
| Measure | 2Q26 | Prior comparison / expectation |
|---|---|---|
| Core FFO per share, excluding promote | $2.13 | $2.04 in 1Q26; ~$1.98 consensus |
| Constant-currency Core FFO per share, excluding promote | $2.11 | $1.87 in 2Q25 (Constant Currency Core FFO Reconciliation) |
| Same-capital cash NOI growth | 7.2% constant currency | 4.25%-5.25% full-year outlook (Same-Capital Operating Trend Summary; 2026 Outlook) |
| Renewal rent increase | 25.4% cash | Full-year outlook raised to 9%-11% (Leasing Activity; 2026 Outlook) |
| Net debt / Adjusted EBITDA | 4.7x | 4.7x in 1Q26; 5.1x in 2Q25 (Financial Ratios) |
| 2026 Core FFO outlook, excluding promote | $8.15-$8.20 | Raised from $8.00-$8.10 (2026 Outlook) |
The more important surprise was the operating momentum behind the quarter. Same-capital cash NOI rose 8.9% year over year, or 7.2% excluding currency effects, while occupancy improved to 92.5% from 91.5%. Leasing was also unusually strong: $208 million of annualized bookings at Digital Realty’s share and a record $1.4 billion backlog, with 0-1 MW plus interconnection contributing $108 million (Same-Capital Operating Trend Summary; Summary of Leasing Activity; Earnings Release).
Guidance moved higher, confirming that the beat was not just a one-quarter result. Management raised full-year Core FFO excluding promote by $0.15-$0.20 per share and increased its same-capital NOI, renewal-rate, revenue, Adjusted EBITDA, development spending, and disposition/JV capital assumptions (2026 Outlook). The trade-off is heavier capital intensity and dilution: development capex rose to $4.25-$4.75 billion, while the company sold roughly $1.2 billion of stock through its ATM during the quarter to help fund growth (2026 Outlook; Balance Sheet). The net read remains a genuine beat because stronger leasing and higher guidance more than offset the one-time earnings items and increased share count.
Read the original 8-K on SEC EDGAR ↗