[GUEST ACCESS MODE: Data is scrambled or limited to provide examples. Make requests using your API key to unlock full data. Check https://lunarcrush.ai/auth for authentication information.]  Rittenhouse Research [@RHouseResearch](/creator/twitter/RHouseResearch) on x 1510 followers Created: 2025-06-28 15:43:01 UTC Equinix $EQIX, the largest data center owner and operator in the world (~$76B market cap, ~$9B LTM revenue), hosted its analyst day on Thursday. The stock has since declined XX% as the company unveiled its updated, longer-term growth projections. Equinix guided towards a doubling of their total data center capacity over the next X years (15% CAGR) to capitalize upon "the AI opportunity". The issue? Revenue, AFFO (a REIT metric intended to reflect underlying cash flow), and Dividends per Share are only forecasted to grow 7-10%, 5-9%, and 8%, respectively. Said differently, investors were unhappy to learn that the company's growth in CapEx (or capacity) will be roughly double the growth in revenue and earnings. Why are CapEx and capacity growing well above the Company's revenue and earnings - shouldn't these move in lockstep? Equinix's problem is that their existing data center portfolio was built over the past two+ decades, rendering it entirely obsolete for serving AI-compute use-cases. Equinix essentially "came clean" to investors, highlighting that their existing data centers were built with 5-6kW per rack (or cabinet) power densities. It's no secret that the latest generations of Nvidia GPUs require rack densities of 100kW+. The lower rack densities in Equinix's legacy data centers are also often air cooled, which is incompatible with newer Nvidia GPUs which require liquid cooling. We suspect that a large driver of the discrepancy between Equinix's CapEx (or capacity) growth and the growth in underlying earnings reflects that earnings from their legacy data centers will decline as these older facilities become further obsolete with each new Nvidia product release. Equinix's customers (of which the hyperscalers represent a material concentration) will continue to shift their spend away from CPUs, the historical focus of Equinix's data centers, and towards GPUs. Equinix's data centers are unable to accommodate GPUs without lengthy retrofit construction projects. It's also unclear as to whether it's even economically feasible or rational for Equinix to conduct these retrofits. Their existing customers' CPUs are hosted in Equinix data centers on long-term contracts. In order to complete these retrofits, Equinix would likely need to significantly accelerate the decline in their legacy assets by terminating customer contracts, such to remove CPUs from their facilities to commence the retrofit construction process. This dynamic has created the opportunity for Bitcoin miners to step in to fulfill the demand requirements of hyperscalers, as their existing data centers are much better suited for AI / HPC retrofits. Certain Bitcoin mining data centers have been built with greater rack densities and liquid cooling infrastructure. Furthermore, Bitcoin miners don't have to worry about modifying customer contracts to commence retrofits - they own the ASICs within the facility. Finally, Bitcoin mining data centers are often significantly larger than $EQIX's legacy data centers (which avg. ~10MW per facility), which is key given AI's heightened demands for power. CoreWeave's $CRWV rumored acquisition of Core Scientific $CORZ highlights that Bitcoin mining data centers are valuable towards hyperscalers. We believe that certain Bitcoin mining data centers, such as Galaxy Digital's $GLXY Helios facility also have immense strategic value for not only AI cloud providers such as CoreWeave, but also to legacy data center owners and operators such as $EQIX and $DLR. It would be much quicker and easier for $EQIX or $DLR to acquire Bitcoin mining data centers than to retrofit their existing facilities or conduct greenfield builds.  XXXXX engagements  **Related Topics** [market cap](/topic/market-cap) [coins ai](/topic/coins-ai) [$9b](/topic/$9b) [$76b](/topic/$76b) [$eqix](/topic/$eqix) [stocks real estate](/topic/stocks-real-estate) [Post Link](https://x.com/RHouseResearch/status/1938986503364825195)
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Rittenhouse Research @RHouseResearch on x 1510 followers
Created: 2025-06-28 15:43:01 UTC
Equinix $EQIX, the largest data center owner and operator in the world (~$76B market cap, ~$9B LTM revenue), hosted its analyst day on Thursday. The stock has since declined XX% as the company unveiled its updated, longer-term growth projections.
Equinix guided towards a doubling of their total data center capacity over the next X years (15% CAGR) to capitalize upon "the AI opportunity".
The issue? Revenue, AFFO (a REIT metric intended to reflect underlying cash flow), and Dividends per Share are only forecasted to grow 7-10%, 5-9%, and 8%, respectively. Said differently, investors were unhappy to learn that the company's growth in CapEx (or capacity) will be roughly double the growth in revenue and earnings.
Why are CapEx and capacity growing well above the Company's revenue and earnings - shouldn't these move in lockstep? Equinix's problem is that their existing data center portfolio was built over the past two+ decades, rendering it entirely obsolete for serving AI-compute use-cases. Equinix essentially "came clean" to investors, highlighting that their existing data centers were built with 5-6kW per rack (or cabinet) power densities. It's no secret that the latest generations of Nvidia GPUs require rack densities of 100kW+.
The lower rack densities in Equinix's legacy data centers are also often air cooled, which is incompatible with newer Nvidia GPUs which require liquid cooling.
We suspect that a large driver of the discrepancy between Equinix's CapEx (or capacity) growth and the growth in underlying earnings reflects that earnings from their legacy data centers will decline as these older facilities become further obsolete with each new Nvidia product release. Equinix's customers (of which the hyperscalers represent a material concentration) will continue to shift their spend away from CPUs, the historical focus of Equinix's data centers, and towards GPUs. Equinix's data centers are unable to accommodate GPUs without lengthy retrofit construction projects.
It's also unclear as to whether it's even economically feasible or rational for Equinix to conduct these retrofits. Their existing customers' CPUs are hosted in Equinix data centers on long-term contracts. In order to complete these retrofits, Equinix would likely need to significantly accelerate the decline in their legacy assets by terminating customer contracts, such to remove CPUs from their facilities to commence the retrofit construction process.
This dynamic has created the opportunity for Bitcoin miners to step in to fulfill the demand requirements of hyperscalers, as their existing data centers are much better suited for AI / HPC retrofits. Certain Bitcoin mining data centers have been built with greater rack densities and liquid cooling infrastructure. Furthermore, Bitcoin miners don't have to worry about modifying customer contracts to commence retrofits - they own the ASICs within the facility. Finally, Bitcoin mining data centers are often significantly larger than $EQIX's legacy data centers (which avg. ~10MW per facility), which is key given AI's heightened demands for power.
CoreWeave's $CRWV rumored acquisition of Core Scientific $CORZ highlights that Bitcoin mining data centers are valuable towards hyperscalers. We believe that certain Bitcoin mining data centers, such as Galaxy Digital's $GLXY Helios facility also have immense strategic value for not only AI cloud providers such as CoreWeave, but also to legacy data center owners and operators such as $EQIX and $DLR. It would be much quicker and easier for $EQIX or $DLR to acquire Bitcoin mining data centers than to retrofit their existing facilities or conduct greenfield builds.
XXXXX engagements
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