01—Abstract
Summary
Summary of the 10-Q filed May 1, 2026. Cited figures are marked; the original filing is the authoritative source.
Digital Realty (DLR) closed Q1 2026 with total operating revenues of $1.635 billiona, up 16.2% year over year, driven by a 10.0% increase in stabilized rental revenue and a 39.7% jump in non-stabilized revenue as the development pipeline leased up.
Net income attributable to Digital Realty Trust, Inc. rose to $179.3 millionb from $110.0 million, and diluted EPS was $0.46 versus $0.27. Operating income before property disposition gains rose to $266.9 million, and the consolidated portfolio occupancy reached 89.4% across 2,408 MW of white space IT load, up from 89.3% at year-end 2025. The company's capital position was shaped by heavy growth spending and equity issuance.
Cash flow from operations rose to $532.4 millionc, but capital expenditures were $795.4 million on a cash basis, and acquisitions totaled roughly $280 million. Digital Realty raised approximately $875 million of net equity through its ATM program at an average price of $178.36 per share, and cash fell to $2.43 billion from $3.45 billion at year-end. Total debt was $18.1 billion at a weighted average rate of 2.85%, with a debt-to-enterprise-value ratio of about 21.7%.
Management guides to $2.8 billion to $3.3 billiond of remaining 2026 capital expenditures, and 1,169 MW of projects were under construction, 61% pre-leased. Investors should weigh the strong top-line momentum and development pipeline against rising operating costs, notably utilities up 18.8% and G&A up 25.3%, and a sizable funding need. The company also has a €375 million term loan maturing August 11, 2026, and it sold a non-core Atlanta asset for $25 million after quarter-end.
Goodwill fell to $9.59 billion, largely from currency translation. A Teraco redeemable noncontrolling interest put right opens in February 2026, a potential future cash or share obligation.
02—Key points
Key Highlights
- Total operating revenues rose 16.2% year over year to $1.635 billion, with non-stabilized revenue up 39.7% as the development pipeline leased up.
- Net income attributable to Digital Realty Trust, Inc. was $179.3 million, and diluted EPS was $0.46 versus $0.27 a year earlier.
- Consolidated portfolio occupancy was 89.4% across 2,408 MW of white space IT load, with 1,169 MW under construction, 61% pre-leased, and an estimated 11.4% stabilized yield.
- The company raised approximately $875 million of net equity through its ATM program at an average price of $178.36 per share, and cash fell to $2.43 billion from $3.45 billion at year-end.
- Operating expenses rose 12.9%, led by rental property operating costs (up 15.7%, including utilities up 18.8%) and G&A (up 25.3%).
- Management expects $2.8 billion to $3.3 billion of capital expenditures for the remainder of 2026, against $18.1 billion of total debt at a 2.85% effective rate.
- The €375 million Euro Term Loan matures August 11, 2026, with an extension option or refinancing planned, and the Teraco redeemable noncontrolling interest put right opened February 1, 2026.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2026filed May 1, 2026Financial Statements
Q1 FY2026 against Q1 FY2025
| Line item | Q1 FY2026Q1 FY2025 | Change |
|---|---|---|
| Revenue | $1.64B$1.41B | +16.2% |
| Operating Expenses | $1.37B$1.21B | +12.9% |
| Operating Income | $267.81M$196.86M | +36.0% |
| Interest Expense | $116.38M$98.46M | +18.2% |
| Net Income | $179.27M$109.97M | +63.0% |
| EPS (Basic) | $0.49$0.30 | +63.3% |
| EPS (Diluted) | $0.46$0.27 | +70.4% |
| Shares Outstanding (Basic) | 345.01M336.68M | +2.5% |
| Shares Outstanding (Diluted) | 353.25M344.72M | +2.5% |
05—Questions
Frequently Asked Questions
How did Digital Realty perform financially in Q1 2026?
Revenue grew 16.2% to $1.635 billion and net income attributable to the parent rose to $179.3 million from $110.0 million. Diluted EPS was $0.46 versus $0.27, though the comparison benefits from business interruption insurance proceeds and lower transaction costs.
Is Digital Realty funding its growth sustainably?
Operating cash flow of $532 million covered only part of the roughly $795 million in cash capital expenditures and $280 million of acquisitions. The gap was bridged mainly by $875 million of ATM equity issuance and cash on hand, which declined by about $1 billion in the quarter. Continued reliance on equity and debt markets is a key consideration.
What are the main risks to watch in the filing?
Rising utility and operating costs, the pace of lease-up on the development pipeline, and refinancing needs, including the €375 million term loan due August 2026, are the key items. Currency exposure is also material, with about 65% of debt in euros and foreign currency translation driving a $77 million comprehensive loss. The Teraco put right, which opened February 2026, could require cash or share settlement.
How strong is the balance sheet?
Debt totaled $18.1 billion with 93% fixed-rate or swapped exposure and a weighted average term of about 4.7 years. Debt to enterprise value was about 21.7%, and the company reports compliance with all senior note and revolver covenants. Liquidity of about $3.7 billion was available under the revolvers as of April 29, 2026.
What drove the revenue growth?
Stabilized rental revenue grew $113 million on new leasing, renewals, higher utility reimbursements and favorable FX. Non-stabilized revenue added $100 million, mainly from completed development in Northern Virginia, Paris and Frankfurt, partly offset by properties sold or contributed to the Fund.
06—Continue