Equinix, Inc. (EQIX) Earnings Call Transcript & Summary

Thanks for joining us. My name is Phil Cusick. I cover the comm services and infrastructure space here at JPMorgan. I want to welcome Charles Meyers, President and CEO of Equinix since September. Charles, thanks for joining us. You hear me?

Yes. Good to be here, Phil. Thanks.

All right, a little distracted. I want to start at a sort of a high level because we've got a bit of a wide audience here. Our world is increasingly connected through cloud service providers, and that's a key term of our conference. Can you just give us an overview of how Equinix helps to enable the cloud? And what you're most optimistic about in driving growth for the next few years? Thanks.

Sure. Again, thanks for having me, Phil. And before I, probably, jump in, I will yield to the IR team and read our disclosure. Some of what I'll talk about contains forward-looking statements. Please read our SEC filings for more information about factors that could affect these statements. So yes, I mean it is an incredibly dynamic time relative to kind of how the world is moving, how cloud is impacting the world, and particularly, the world of IT and how people are thinking about that. I think that there's a couple of dimensions here for us because we're relevant on both the supply side of that trend in terms of enabling cloud service providers of all sorts, of course, the big clouds that people think of, whether that be AWS, Azure, Google Cloud, Oracle, Alibaba, et cetera, and the list goes on in terms of the really big ones, but also a much broader cloud ecosystem, I think, in terms of all of the cloud-based services as service providers of various sorts. And we play a pretty significant role in enabling the growth of those folks. I talked last -- in 2018 at our Analyst Day about the scope and the scale of our relationship with hyperscalers, and it is very significant and continuing to grow. And I'm sure at some point we'll talk about our xScale adventures and what we're doing there. But broadly speaking, we play a pretty critical role in terms of enabling them. You saw that this last quarter, we had about a 75% market share of cloud on-ramps in Q1 that were deployed in that time frame. And we just continue to see a lot of success in terms of helping the cloud provider stand up their infrastructure across the world. And then there -- and then equally as important for us, I think, in terms of the performance of the business and the long-term opportunity, we play a significant side on the -- role on the demand side. And that is giving people advantaged access to the cloud ecosystem by locating their private infrastructure at Equinix and making that cloud connected and allowing them to pursue hybrid and multicloud as their architecture of choice.

So there's a lot in there -- or one thing you mentioned was the wins of Internet on-ramps. So what is an Internet on-ramp? And why does it matter that you have a high win rate?

Well, a cloud on-ramp, which is a little bit different than an Internet on-ramp, which we also have a pretty significant share of. But I mean, the cloud on-ramps are really these -- it's interesting because I think what has happened over the last handful plus of years is there's been an evolution of people gaining access to the cloud increasingly over private connectivity. And that's really -- there was -- people probably initially were doing that primarily over the Internet. But as they began to move more mission-critical applications to the cloud, they determined that a level of private interconnection between their infrastructure and the cloud was really necessary from a security standpoint, compliance, and particularly, performance. And so private interconnection to -- between people's infrastructure and the cloud are really what's being driven at these on-ramps. And in addition to the cloud being able to connect to their broader network for certain network providers that allows them to distribute content across the cloud. And so that's what one is. And it's important for us in that being able to provide that easy, high-performance scale from an economic standpoint. Interconnection to the cloud is a major part of the value proposition that we provide for enterprise customers.

So how many cloud ramps are there? And how many are located in your facilities?

Well, that's a great question. I don't have it off the top of my head. It's certainly, I would guess, at this point, hundreds in terms of -- or maybe low hundreds, I would guess, in terms of total cloud on-ramps, and we have about a 40% share globally. We had an over-indexed quarter last quarter, winning about 75% with the cloud on-ramps that were deployed in our markets around the world. So we're about a 40% share of that. But it's a very significant number in terms of total number of on-ramps that we operate in our markets around the world. We have -- again, we're -- we operate in 66 markets. Pretty significant portion of those have cloud on-ramps, and many of them, in fact, have multiple on-ramps. And we have, I think, the largest number of metros that have access to the top 6 cloud providers around the world. We have great visualization of that in our internal operating review that just shows the breadth and depth of our cloud on-ramp portfolio.

So what have you done to accelerate that share that you're getting? Has this been a specific focus of the company?

It has been. It's been a focus from the very beginning actually in terms of when we started to see the cloud opportunity, we actually created something that we call -- refer to as the cloud acceleration team, which is back, gosh, it must be 7, 8 years ago now in terms of when we launched that. And so we were very focused on working a business development -- the business development pipeline with the major cloud providers to win those. And candidly, it's just a dynamic of the strength of our ecosystem. And so they wanted to locate these on-ramps proximate to the network density, and then to the extent that they get a ready-made set of customers that can plug into that -- those on-ramps at our ecosystem across facilities that we operate, that's a bonus for the cloud providers. Now we're not the only game in town certainly because they're probably going to have multiple on-ramps in any given market. Sometimes, we actually have more than one, but we tend to have at least one with each of the major providers and have the largest number of providers of any of the other cloud providers out there.

So when one of these is located in your facility, does this drive demand? Does it drive pricing? I suppose it's both.

Exactly. Yes. I mean I think that the -- it's a key part of the -- basically, the value proposition that we offer, which is using our platform around the world to distribute private infrastructure, to interconnect it to the cloud and to be able to interconnect it to the broader ecosystem. And so -- and interconnect it with performance and with superior economics. And so it does provide both volume of demand and allows us to differentiate from a pricing perspective in the enterprise market.

Okay. Okay. Let's dig more into enterprise. We've heard from various people about how enterprises are sort of restructuring their infrastructure during and after COVID. What are you seeing from your customer base? Has there been an acceleration? And what's the latest conversations?

There has. I mean we've talked about this, which, I think, that probably the most enduring impact of COVID in addition to probably transforming the way work gets done and how that's working is prioritization of digital in the context of corporate priorities. And so I think we're definitely seeing that -- people have seen that those that were better prepared for an increasingly digital world are outperforming those that were less prepared. And it's putting a real emphasis on people saying we've got to transform how we do business, how we interact with our customers, certainly, how we interact with our employees, how we interact with our supply chain. All of those things are changing how people think about their infrastructure and how they purchase it, procure it and manage it. And so we've seen that. We think that we play a particularly relevant role in terms of people thinking about the nexus of their infrastructure, how to distribute it, how to cloud connect it. And I think that's just given us a lot of momentum in the pipeline.

So again, this has been a long evolution of enterprises moving toward cloud. Have you seen some acceleration in the last year? Or is this just a pretty steady pace?

No. I would say what we've seen is probably an acceleration of interest level and people pulling forward the plans at which they are going to migrate to a more evolved Internet or a more evolved IT infrastructure. Moving from centralized, procured, managed, maintained kind of IT infrastructure to a more distributed-as-a-service, cloud connected, interconnected kind of profile. And -- but I do think that IT is forever changed. I think that we are going to continue to see that the rate of change in IT infrastructure will have been permanently modified. It's just going to -- people are going to need to be more agile, more adaptive. And I think that, that's what people are trying to do by moving to cloud and cloud-centric architectures and also distributing them. Those are all things that are driving a different level of demand, and I think, that will sustain over time. So I do think there's some acceleration of interest. The actual pace at which people are accomplishing that maybe has not accelerated as much. But the interest levels are extremely high, and I think it is going to drive a bow wave of demand for an extended period of time.

Okay. Globalization is a trend we've been talking about for a long time. But increasingly, there are local regulations around security and privacy and local storage. Is that a risk for you? Is it an opportunity? What's the balance there?

It's been happening for a while as data sovereignty as well as security are both significant concerns for people. It tends to act as a tailwind for our business because as people identify needs for them to distribute infrastructure, to meet those compliance requirements or security requirements or whatever, we tend to have the most distributed sort of footprint. And so it's been more of the -- more of a tailwind for us. And also, I think that we've actually developed a pretty significant security ecosystem of players that are delivering services inside of our facilities around the world. And so as people think about these trade-offs and want to ensure both compliance, which is more of a data -- or more of a regulatory issue and security, which goes well beyond that, they feel well suited to do that at Equinix. And so it's probably, if anything, driven a bit more of a tailwind in our business. We saw this in -- there was some acute examples of it, for example, associated with Brexit in terms of people moving infrastructure, and they -- as they thought about how to deal with potentially the need to move infrastructure or duplicate infrastructure beyond London and they thought about that in Amsterdam or Frankfurt or whatever. Those kind of things tend to work in our favor in terms of people being able to extend and use our footprint for that purpose.

Okay. You mentioned your network is very distributed. Edge is one of the most popular buzzwords probably of this year. What does edge mean for you? I've always thought of you sort of as an edge ecosystem player, but how does that fit in for Equinix?

Well, we -- first of all, we totally agree with you, Phil, that's how we would think about ourselves, too. And I think that we've talked about this now, which is the best current manifestation of the digital edge is at Equinix. We're not the only one. There are -- it's a broader edge than certainly Equinix only. But in terms of the edge where people interconnect to get things done to achieve certain digital outcomes, I think Equinix is quite objectively probably the best manifestation of that with 60 -- 200-plus data centers, 66 markets. And these huge ecosystems of players 10,000 customers strong that represent these digital ecosystems. And with huge numbers of those being service providers popped into facilities all over the world, whether networks or clouds or other as-a-service providers. And so we think about ourselves as that current -- what we would refer to as more an aggregated edge or the digital edge. There is, I think when you hear -- of late -- when I'm here, people talk about edge. I'm hearing more people talk about that in the context of far-edge type use cases, where people are saying, hey, we want the need for compute, storage, other digital infrastructure, the need to have that more proximate end users, will that create a far edge opportunity outside of the current aggregated edge. I think the answer to that is probably yes, over time. And I think 5G densifying will be maybe a catalyst for that happening at more scale. But I would tell you right now that we're not seeing -- we're seeing the vast majority of our customers that are able to effect and implement use cases that are relevant to them with our current edge, which, again, is fairly extensive when you're talking about 66 markets and reaching a significant portion of the global population within 10 milliseconds at our facilities. They're able to meet the vast majority of those use cases with the current footprint. But I do think there is an opportunity. You're starting to see things that are certain industrial use cases and those kind of things, which will create, I think, the need for a more extended version of compute storage and other infrastructure. And we're watching that trend carefully, and we think we'll probably play a role in partnering with others to meet those use cases over time just because I don't think any single player is going to be able to comprehensively meet the needs of the far-edge.

It seems like we're -- it's unlikely we're going to go from, as you called it, an aggregated edge, maybe one or a few data centers per city to hundreds in every cell site or something like that any time soon. Does this drive you the 10-millisecond delta? Does this drive you into more second-tier cities, whether that's across developed markets or into more emerging markets over time? Do you see this as sort of a gradual push into more and more cities?

Well, I do think that the natural course of events has obviously taken us up from whatever it is 10, 15 markets 10 years ago to now 66. And that -- I think that trend will continue as we add critical points of interconnection and points of national aggregation around the world. I mean there's lots of good examples of that. Obviously, having added really some very large markets to our portfolio over the last several years, whether that be South Korea or Mexico or now India with the GPX transaction. That, I think, is going to continue to occur. As to whether secondary markets in major locations become more relevant, we're not really necessarily seeing that. And we're seeing that just -- there is -- like if you take Europe, for example, we were very flap-centric, Frankfurt, London, Amsterdam, Paris. But then as the cloud providers extended beyond those initial landing points across the continent, with the markets like Stockholm and Milan and Madrid and Warsaw and Istanbul sort of came into play for us, and we've been able to do those either organically or through M&A in terms of adding them. And so I think that dynamic will continue to occur globally, and we'll need to continue to adapt to -- extend our platform to provide that aggregated edge capability in the appropriate markets. But I think -- I actually don't think -- if you take a market like the U.S., I think that's less about "second-tier cities," like trying to make sure you cover St. Louis or Pittsburgh or Detroit or whatever. I think that the aggregated edge because of the nature of networking in the U.S. is probably going to meet -- the current aggregated edge is just going to meet the vast majority of needs until you start looking at much further distributed edge, and then you're well beyond second tier, you're talking about, I think, more edge locations that are across -- that -- the number in the hundreds or even thousands rather than just sort of a modest click out.

Is that -- and that would be a very different business than what you have today?

It would.

Is it like that interesting for you? Do you have efforts to sort of study it and figure it out?

Well, we do have efforts to make sure that we are staying close to it and understanding its evolution and understanding the role that we can play. I would say right now, the action, really interestingly, is more around service providers distributing infrastructure to a more -- a further distributed edge than it is about enterprise or other use cases that are edge-centric with possible exception of more content distribution kind of needs that are being -- that are out there. But I do think it's a different business. I think that we will probably look to have a partnership strategy to some degree because I think no single player is going to control sort of the population of fiber-connected edge -- far-edge real estate. There's just going to be the need for too much of it. And I think it's going to be a variety of players that might be involved there, sort of the ones that people would logically think of the tower companies, et cetera, may play and I think would like to play a role in that. But I think it will go beyond that. And I think our role is going to be more about extending the reach of our aggregated edge and our digital ecosystem out to that far-edge in a way that is appropriate. And I think those are areas that we could think of a number of possible ways that we can go there, including JV-type structures that might not look all that dissimilar from what we did with xScale. And so nothing decided there, but I think we continue to monitor it closely, and we'll think about how we would adapt to that over time.

Okay. You mentioned xScale. That's sort of the other end of the data center spectrum from...

Right.

You've been supporting some big cloud customers with your xScale launches. What -- why has this been the right thing to do? I always sort of wonder how much of this is driven by customers because these are not sort of dedicated builds, right? You're bidding for these wins. Why is this the right thing to do for Equinix?

Yes. It's -- I think it's -- you're right, to a large degree, it is the customers really because their demand is so significant. When I say they, I'm talking about this list of the first couple -- a dozen or 2 of these hyperscale providers, and that's a little bit evolving at the -- in terms of who's in that mix. But obviously, the ones that people think of right off the top of their head, their demand and their growth profile is such that they really want a trusted, stable, dependable set of partners to build out their infrastructure because -- and it's a combination for them. They're building out some of their own, but they can't possibly meet all the demand necessary on their own. And so they want this list of vendors that they -- and partners that they trust. That had always been a difficult proposition for us, Phil, as you know, because we didn't want to allocate capital towards that proposition when we had other uses of capital that we thought were better returning and that have demonstrated over time their ability to return -- have superior returns. So for us, the xScale was really a way to say, can we meet that need for our customers, continue to build these strategic relationships with those players, but do so without sort of an opportunity cost of the capital on our balance sheet. And the relationship, the JV structure and what we did with GIC, and now, we'll likely do with others around the world is really a way to sort of have your cake and eat it too in that regard. So I definitely think it was the right thing for us. I think it gives us the benefit of being able to extend our relationship with these customers, extend our leadership in the cloud ecosystem, continue to position us to win, not only these large-scale AZ-type deployments but also I think it adds to our ability to win other business with the hyperscalers within the retail portfolio. And so I think it all sort of fits together and gives us that leadership in the cloud ecosystem, which, I think, is going to be a central part of continuing to tap into the enterprise addressable market.

So expand on that as a benefit for the retail portfolio. We think of you as a fairly differentiated player. And was there a risk that if you didn't take this opportunity, someone else would and sort of cannibalize your time?

I think there's some modest risk of that in terms of -- there is -- sometimes, it's difficult to completely pinpoint -- if you could -- there was a time when the architectures of the cloud providers looked very distinct in terms of AZs and then sort of on-ramps and network nodes. And -- but the evolution of those caused some markets to look a little different, and you run the risk of losing the opportunity for core network nodes or on-ramps, not all the time, but in certain situations, your ability to provide the larger footprint requirements as a part of a portfolio is just a better point of -- better and more constructive relationship with the customer. And so it is about that, and it's about -- the other point -- the other thing is that being able to identify ways for customers to put AZs within greater proximity of the broader ecosystem provides benefits to them and to the end enterprise customer. And so I think that those are the reasons that we did it, and we're finding those to play out exactly as we would have expected.

Okay. When you announced this, your leverage restrictions were lower than they are today. Does the ability to take higher leverage change the math on doing some of these on your own? Or is it so much more attractive with the JV partner?

Yes. I think there is still such a rich opportunity, such a deep pool for us to deploy capital within our traditional core business of these interconnection-rich, ecosystem-centric business of people building hybrid infrastructure and interconnecting it to the cloud. I think that's our core strategy and our core value proposition. And I think there's plenty of opportunity for us to deploy capital into that. And so I still think that we're much better off having the opportunity to extend our balance sheet by working with JV partners. And believe me, I think we'll find very good high-return uses of the additional capital that we might be able to gain access to. But I do think that the additional leverage that we're -- that we've sort of garnered by getting the upgrade and the increased leverage from the rating agencies is an important piece of flexibility for us. And I think it will allow us to have access to dry powder for both organic and inorganic growth without needing to necessarily worry about sometimes the vagaries of the equity markets. And so I think just being able to have greater flexibility there to adapt and evolve your sources of capital when you need to, I think, is a huge benefit for our business, and in the end, I think will reduce our weighted average cost of capital, which is already unbelievably attractive.

Okay. We started talking about xScale even before your 2018 Analyst Day.

Sure.

And we're almost to the next one. But we haven't seen a lot of impact from these yet in the financials. Yes, how should we think about the -- how important these could be over the next couple of years?

Sure. I mean I think that's sort of the reality of this strategy, right, which is we're not going to consolidate this revenue. That will be joint venture revenue. Really, the only flow-through to the income statement will be fees that we get. Those will be a mix of both nonrecurring fees like that are essentially sales backed -- commissions when we bring in new business to the JV. And then recurring fees in the form of management fees and the like. And so I think that, that's -- those will begin to flow in. We have started to see that show up. We had about $8 million in fees that we talked about in Q1 as the business scales and that was on the -- we did about 40 megawatts of demand in Q1 that we leased. And so it's -- as you scale this up to, I think, hundreds and hundreds of megawatts, which I'm confident it will over time, I think it will become at least a meaningful contributor from the fee standpoint. But again, it's not going to be the major driver of our business since all the -- really the top line revenue of the actual footprints themselves are being -- are nonconsolidated and will go into the JV.

Okay. Okay. Digging into the regions, the Americas business has returned to solid growth after what's been pretty slow for the last few years. And it seems like it's really accelerating. So what's your current outlook for that activity? And how long is the runway for this faster growth?

Well, I think we're -- one, I've been very proud of the Americas team. I think they've done a great job of navigating through in integrating the Verizon acquisition. We did see that churn tail on that, which was expected all along. It just took a little longer to work its way out of the system candidly, which, I think, was value creating in aggregate, but just made for a longer discussion. But the team has now, I think, worked through that. In tandem with that, I think, we continue to expand the capabilities of our go-to-market machine, and we're just seeing great performance from the Americas booking engine, not only in terms of booking into Americas assets, which drives the performance of the Americas region as we reported, but just as importantly, booking -- driving bookings into the global platform because a huge portion of our global bookings is those that are exported from the U.S. or from the Americas team into other parts of the world. And so I think we're seeing real momentum there. I think we're seeing strong demand, as I said earlier, from customers who are seeing the relevance that we have in their digital transformation strategies. And so -- and we're seeing some strength in some markets that we've either brought online or invested in, markets like Mexico City, for example, which unsurprisingly, when we bring on a top 20 GDP market that wasn't currently on our platform, it always has this effect of sort of some nascent demand of people wanting to get there and interconnect. And -- so that's performing well in markets like Dallas, where we put in a fair amount of capital and are starting to see that and really reap the benefits of that, and then, of course, strength in our -- some of our traditional markets like New York and Silicon Valley and Ashburn. So all in all, I think that as we said, we expect that the Americas business will have a sort of 6% growth rate year-over-year for the remainder of the quarters in this year. And so we expect there's continued momentum in that business for a while.

Okay. Yes, you and Keith have talked about reducing churn this year as a big driver for growth. And to some extent, that's a little bit obvious, right, less churn, better growth?

Right.

But what are you seeing in that effort through the year? And what have you been doing to really push that down?

Well, we put a lot of emphasis on making sure that we are trying to use some of our analytic techniques to understand what the predictors of churn are, identify it, seek to mitigate it, and head it off the pass and -- or a minimum forecast of that so that we can properly plan capacity in the business. And there's a variety of -- I would say that the bulk of our churn is really a frictional churn, right? It's people adapting footprints. Service providers, in particular, do a lot of adaptation of their footprints as it relates to their ability to meet end-customer demands. And so that has always been the case in networking, for example, and creates a level of underlying frictional churn. Then there's other types of churns that are either people moving to multi-tiered architectures or, for example, today, people selecting and moving workloads from existing infrastructure that may live in colo to the cloud. Now we're a bit less subject to that churn than most because a lot of workloads that if they were well suited to sort of eventual public cloud migration, they may have been living in a more commodity colo-type footprint at a lower price point. So I think we're going to see less exposure to that, but there's definitely some of that, right? It would be naive to say that we aren't seeing a level of workloads that are currently living in cages somewhere at our facilities that are moving to public cloud. And in fact, you'll see that we're -- we have customers that, for example, may have large regional footprints for their IT sort of needs and are now moving to more distributed infrastructure with significant workloads -- significant levels of workloads moving to the cloud. Over time, they move from -- they might move from, say, 100 cabinet implementation in a regional IT data center to something that looks like 10 or 15 locations across the world with a smaller number of cabinets and more workloads interconnected to the cloud. In the end, that probably actually works to our advantage, but creates some churn along the way as people move from one type of deployment to their more long-term end state.

Right. It looks like churn regardless of whether they're moving or not. You talked about -- is there a level at which churn is sort of ideal? Are you running within 100 or 200 basis points of that? Or is there still a long way to go to bring down what you would consider sort of nonoptimal churn?

It's a great question. I think there is -- we've been using what has been, again, a reasonably broad range of 2% to 2.5%, right? And we operated in Q3 and Q4 of last year at the top end of that range; and in Q4, actually just tapped above it; and then in Q1, dropped all the way to the bottom end of the range, right? And so that's a pretty big movement. I think that we can continue to move, hopefully, more at the bottom end of the range or operate at the bottom end of the range. Over time, though, I do think the best defense against churn is to make sure that you're winning workloads and use cases that you're providing distinct and durable value to deliver. And I think that's why customer targeting and discipline in our sales force has been so key, not pursuing sort of more commoditized footprints at low price points that are going to be -- because we've shown statistically and analytically, those are much more subject to churn, right? And so if you -- in fact, if you take a provider, and we have a lot of evidence on this, and they have -- and they operate in a large number of facilities with a significant degree of interconnection, their retention -- their customer retention on those accounts is extremely high. So -- and therefore, lifetime value is extremely high. And so I think the short answer to your question is I do think there's opportunity for us over time to perhaps look at a recalibrated churn, and hopefully, that will start by us operating a bit more towards the lower end of the churn range that we've given.

Okay. It just seems like the demand is tremendous. And you have guidance of sort of mid-2s CapEx on your own and then nearly $3 billion if you include the xScale stuff. As I think out over the next few years, given the demand there and your willingness to go after these opportunities, any reason why we shouldn't think CapEx just keeps growing?

Well, I mean, I think that -- I do think there's significant opportunity out there. I think that we've -- it's crept up a little bit, partially due to xScale, but -- and even the portion of the xScale that's on balance sheet for us is going to provide a little bit of lift into that number. And I mean, I do think there's going to be -- I don't think it's going to be a hockey stick by any means. I think it's going to -- if we deliver well and the market continues to respond, I think some upward creep in that, it would be a good thing because I think we'd be doing it to satisfy demand. So -- but I don't think it will be dramatic. We've been -- obviously, we're a little higher than the $2 billion a year that we were talking about now as we look towards the end of that kind of reporting time frame. And we'll give -- we'll probably give you a fresh look at that at our Analyst Day here in the coming weeks.

Right. And that's where I was going to finish up. We're about out of time. But any sort of preview you can give us on that Analyst Day, new initiatives that you want to hit, anything like that?

Well, I mean, I think, overall, we'll try to hit a couple of areas. One, just giving people some insight into what we think the magnitude of the digital transformation opportunity is over the coming years, which we think is huge. How markets are changing to expand that addressable market opportunity for the right players within the digital infrastructure realm. What the changing face of digital infrastructure demand looks like in terms of -- and then importantly, how that aligns with the unique and distinctive needs of Equinix, and why we think we're so well positioned because I think if you look at it, we think there is going to be an acceleration of the overall demand for digital infrastructure. And the nature of that demand is going to be several things, more distributed, which plays to our advantage; more cloud connected, which plays to our advantage; more ecosystem connected. And I think those are things that I think we're positioned well to respond to. So we'll talk about that what that opportunity looks like and then how we're executing to respond to it. And we'll spend some time certainly on our continued platform strategy and the evolution of our new services, which for us are really just ways for us to extend and adapt the monetization of our core value proposition. And we're seeing incredible strength in that. With Fabric, with Network Edge now and with Metal, all things that are just really allowing us to tap into that traditional value proposition of reach ecosystems and interconnection and monetize them to expand and extend the addressable market opportunity for Equinix.

Look forward to it. Thanks very much, Charles.

Thanks, Phil. Thanks for having us.

Thanks, everybody, for joining us. Have a great day.

Thanks.

Thanks.