Iron Mountain (IRM 1.32%), a global leader in storage and information management services, reported a strong start to 2024 on May 2, surpassing expectations for the first quarter.
The company announced revenue of $1.477 billion, an uptick from analyst estimates of $1.453 billion and a 12% increase over the prior-year period. Likewise, adjusted funds from operations (AFFO) per share rose to $1.10, eclipsing the predicted $0.42 and marking a 9% increase from the previous year.
| Metric | Q1 2024 | Estimate | Q1 2023 | Change (YOY) |
|---|---|---|---|---|
| Revenue (in billions) | $1.477 | $1.453 | $1.314 | 12% |
| AFFO per share | $1.10 | $0.42 | $1.01 | 9% |
Data source: Analyst estimates for the quarter provided by FactSet. YOY = year over year.
Company overview
Iron Mountain provides a number of services, including secure storage, information management, digital transformation, and document destruction. Originally known for its secure physical storage capabilities, the company now also focuses on digital information management, meeting modern demands for data protection and accessibility.
Recently, Iron Mountain has focused in on a few key areas like expanding its global data center business and investing in sustainability. The company sees these steps as not just growth drivers but also enhancing its appeal in a market increasingly concerned with the environment.
Quarterly highlights
The first quarter saw 12% growth in revenue and a 9% increase in AFFO per share. This was driven by the company's expansion into digital information management. Iron Mountain leased 30 megawatts in its data center business, showing its ability to meet customers' needs in this area.
On the sustainability front, Iron Mountain continued to progress toward net-zero emissions, matching its data centers' energy consumption with 100% renewable energy.
However, Project Matterhorn, a key initiative aimed at transforming Iron Mountain's operations, has proven pricey. The company has allocated $150 million annually through 2025, a significant commitment that also comes with execution risks.
The company also announced it would maintain its quarterly payout of $0.65 per share.
Looking ahead
Iron Mountain reaffirmed its full-year 2024 guidance, reflecting management's ongoing optimism despite challenges like the strong U.S. dollar. Investors should watch for continued execution on its strategic initiatives, notably Project Matterhorn, and its effects on financial performance.
As Iron Mountain further develops its digital and global data center capacities, investors should also keep an eye on how well these efforts contribute to overall growth and profitability.
