The following is a summary of the GDS Holdings Limited (GDS) Q1 2024 Earnings Call Transcript:
Financial Performance:
GDS Holdings reported a consolidated revenue increase of 9.1% and adjusted EBITDA boost of 4.7% YoY for Q1 2024.
The China segment demonstrated a revenue rise of 1.8% and an adjusted EBITDA decrease of 1.6% YoY.
The International business segment indicated significant growth in both revenue and adjusted EBITDA with the commencement of its first data centers.
The guidance for FY 2024 predicts ongoing revenue growth and adjusted EBITDA increases alongside continued CapEx investments.
Capital expenditure for the current year is set at RMB 2.5 billion with the following years projected to maintain or decrease this level.
Debt financing costs in China are at an all-time low, and private equity financing has been upsized, reducing GDS Holdings' stake in GDS International to 52%.
Business Progress:
Development is reported across China and International markets, with growth focus upon EBITDA, free cash flow, debt reduction, and AI momentum in China.
International strategy comprises securing lands for new data centers, capturing large customer orders, and independent financial strategy.
The International portfolio reclines to a sizable amount with different stages of development in major data center hubs.
AI-driven demand from Tier 1 markets is a central element to the business strategy.
Series A issue size increase intended to support standalone operations of GDS International.
Demand recovery from Chinese customers has led to the highest quarterly moving speed since 2020, driven predominantly by AI.
International market demand and deal sizes have shown an increase over the last three months.
Active planning for future growth includes IPO considerations and a potential spin-off for GDS International.
A strong market position is set in Malaysia and Indonesia owing to first-move advantage and customer understanding.
More details: GDS Holdings IR
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