Despite macroeconomic volatility, Equinix sees growth as investment in cloud-enabled digital transformation continues
Looking back a decade, Equinix President and CEO Charles Meyers recalled service providers focused on networks and hyperscalers beginning what would become an incredible growth period. As the world of networks and cloud computing comes together with the deployment of 5G and edge computing infrastructure, he observed Jan. 4 at the Citi 2023 Communications, Media and Entertainment Conference hat the world of cloud and network service providers “is very different…Now you face a world where the range of service providers who are delivering as-a-service value propositions to the broader enterprise community as a supplement to the IT architectures or as a fundamental part of the IT architectures..is enormous.”
For Equinix’s data center, interconnection and co-location business, this means that the emergent customers of the 2010s are now massive customers. That said, Meyers noted that Equinix doesn’t have any single customer that generates more than 3% of the firm’s revenue.
Asked by Citi’s Mike Rollins about 2023 strategic operating priorities, Meyers said, “What we’re focused on is continuing to press the advantage that I think we have in our core retail colo and interconnect business around the world…where I think we’re the clear leader…Really pressing the advantage.”
He asserted that hybrid and multi-cloud operating models are becoming “the architecture of choice,” and that macroeconomic headwinds around inflation and other factors aren’t slowing cloud-enabled digital transformation trends. Looking at 2022, Meyers said, “The demand environment for digital transformation continued to gain momentum. And the commitment to distributed infrastructure…has been really, I think, very clear…I think despite peoples’ concerns about a slight slowing in the growth rate of the cloud providers, there is still a heavy movement to the cloud.”
On Equinix’s enterprise business, Meyers said sales have “dramatically outperformed the broader portfolio…as people go from IT the way it was done before and now to more cloud-centric, cloud-enabled architectures.”
Asked by Citi’s Mike Rollins if the macroeconomic picture has stifled enterprise investment into cloud-backed solutions, Meyers said it’s not a surprise to Equinix customers that the economy is where it is today. And, “They seem deeply committed to their digital transformation agenda…It’s fundamental to their ability to differentiate in their markets, it’s fundamental to their ability to do more with less, it’s fundamental to the way they retool how they work…We have seen them be very committed to that. And I think they see that we can play a particular role in helping accelerate that and gain leverage by being abler to effectively use all the cloud resources at their disposal.”
