The growing demand for computing power for artificial intelligence is clearly translating into financial performance for infrastructure providers. Iron Mountain, a company historically associated mainly with the secure storage of physical documents, showed strength in this segment. The company beat Wall Street’s estimates for its key earnings indicator for the third quarter, a direct result of the boom in AI applications such as ChatGPT and growing demand for data centre space rental.
Iron Mountain reported adjusted funds from operations (AFFO) of US$1.32 per share for the July-September period. This is well above analysts’ consensus of US$1.25, according to data compiled by LSEG. Importantly, the trend seems to have continued – the company’s forecast for the fourth quarter (US$1.39 per share) was also slightly ahead of market expectations (US$1.38).
However, the success of the data centre segment does not mean abandoning its roots. The company is successfully combining a new growth branch with stable cash flows from its core business of records management and storage. This traditional business, which serves a large and diverse customer base (such as Boeing, Akamai Technologies or Coca-Cola), continues to generate solid revenues.
Total revenue for the quarter ended 30 September increased by approximately 13% year-on-year to $1.75 billion. This growth was driven by both robust 16% growth in the services segment (often linked to digital transformation) and steady 10% growth in warehouse leasing. Iron Mountain’s results show how established companies are able to leverage the AI trend to drive a new wave of growth, while building on a profitable traditional business.
For Polish business, the key takeaway from Iron Mountain’s results is that the AI boom is realistically and exponentially increasing demand for data centre infrastructure, creating huge opportunities for the IT industry and real estate investors. At the same time, the case proves that stable, traditional revenue streams (such as archiving or logistics) should not be abandoned, but used as leverage for capital-intensive investments in new technologies. Success lies in smart diversification and finding synergies between physical assets and the growing digital services market.
