Tuesday, June 14, 2005

Equinix Expands in Silicon Valley, Raises 2005 Guidance

After opening its third Silicon Valley data center earlier this year, Equinix last week announced that it has acquired a fourth Silicon Valley center. The new 120,000 square foot Silicon Valley center was acquired through a long-term lease commencing in October 2005. It will add approximately 1,800 cabinets and increase Equinix's Silicon Valley footprint to more than 500,000 square feet. The center will be interconnected to Equinix's three other Silicon Valley centers through redundant dark fiber links managed by Equinix, enabling new customers in each center to have direct access to the more than 50 networks already operating in Equinix's Silicon Valley centers, as if they were in the same location.

The new center was originally built-out in 2001 at an estimated cost of $80 million for Exodus. Equinix intends to invest approximately $15.0 million of capital expenditures to upgrade the center to Equinix standards, of which $4.0 to $7.0 million is expected to be incurred in 2005. Equinix intends to open the new center for customers in mid-2006.

Equinix also raised its financial guidance for 2005. Total revenues for 2005 are expected to be in the range of $215.0 to $219.0 million, up from previous expectations of $209.0 to $215.0 million. EBITDA for the year is expected to be between $64.0 and $68.0 million, up from previous expectations of $61.0 to $65.0 million, including $1.0 million of operating costs associated with the Silicon Valley expansion.

Capital expenditures for 2005 are expected to be in a range of $33.0 to $37.0 million, comprised of approximately $17.0 to $18.0 million of ongoing capital expenditures and approximately $16.0 to $19.0 million of expansion capital expenditures. Free cash flow is expected to exceed $30.0 million.

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