Cyxtera Technologies today announced its Q1 2021 earnings and provided updates on its bookings, churn, utilization of its 61 data centers, and capital expenditures.
Financial Performance in Q1 2021 – Cyxtera Technologies
In Q1 2021, Cyxtera Technologies reported revenue of $172.9m, a 0.2% increase year-over-year, and transaction adjusted EBITDA of $56.1m, a 2.7% increase year-over-year. Therefore, the company’s transaction adjusted EBITDA margin was 32.4% in Q1 2021, an ~80 bps improvement year-over-year.
Notably, Cyxtera Technologies’ transaction adjusted EBITDA for Q1 2021 includes a $10.3m add-back for “restructuring costs”. In contrast, this compares to an add-back of only $2.6m for “restructuring costs” as of Q1 2020.
Cyxtera’s revenue growth was challenged quarter-over-quarter by an $8.8m decline in net revenue from Lumen Technologies. Indeed, this equates to a $35.2m reduction on an annualized basis. However, Cyxtera was able to add $8.8m of recurring revenue during Q1 to replace the business lost from Lumen Technologies.
Additionally, monthly recurring revenue (MRR) declined 0.8% from $53.0m at year-end 2020 to $52.6m as of Q1 2021. This was primarily the result of $0.6m of net disconnects from Lumen Technologies.
Operational Performance in Q1 2021 – Cyxtera Technologies
Cyxtera’s annualized core bookings reached $27.1m in Q1 2021, with particular strength coming from channel partner bookings.
Cyxtera reports “core churn” of only 1.0% of average MRR, however, this figure excludes churn related to Lumen Technologies.
As of quarter-end, Cyxtera’s overall data center utilization, based on sqft, was 67%, which is unchanged quarter-over-quarter. Additionally, the company also provided disclosure of the utilization of its 61 data centers by region:
- East: 16 sites overall at 62% utilization, which includes Atlanta, Boston, New Jersey, Northern Virginia, and Tampa
- Central: 12 sites overall at 63% utilization, which includes Chicago, Columbus, Dallas, Minneapolis, Montreal, Toronto, and Vancouver
- West: 21 sites overall at 72% utilization, which includes Albuquerque, Denver, Los Angeles, Moses Lake (Washington), Phoenix, Seattle, and Silicon Valley
- International: 12 sites overall at 77% utilization, which includes Amsterdam, Frankfurt, London, Singapore, and Tokyo
Cyxtera spent $13.7m (cash basis) or $12.9m (accrual basis) on capital expenditures in Q1 2021. Of the accrual basis capital expenditures, $10.6m went to expansion projects, $2.0m was for maintenance, and $0.2m was corporate.