Equinix (EQIX) to Launch Data Center in Milan in Q1 2021

Equinix, Inc. EQIX will open its fourth data center in Italy in first-quarter 2021. Referred as ML5 IBX data center, this facility in Milan will offer colocation and a number of advanced interconnection services, including Equinix Cloud Exchange Fabric and Equinix Internet Exchange.

The $51-million first phase of ML5 will likely provide a capacity of 500 cabinet equivalents and colocation space of roughly 15,000 square feet. Following completion of the future phases, the facility is expected to offer a total capacity of more than 1,450 cabinet equivalents and colocation space of more than 45,000 square feet.

The move comes as part of the company’s effort to capitalize on growth opportunities in the thriving markets. Notably, the Italian market serves as a strategic inter-connection point. Bolstering the company’s presence with the latest facility will help it leverage on the digital transformation efforts of the local companies as well as support global companies to enhance their operations in Italy.

With growth in cloud computing, Internet of Things and big data, and an increasing number of companies opting for third-party IT infrastructure, data-center REITs are witnessing a booming market worldwide. Furthermore, the estimated growth rates for the artificial intelligence, autonomous vehicle and virtual/augmented reality markets will remain robust over the next five to six years.

Apart from these, data centers are poised to benefit from the heightening reliance on technology amid the coronavirus crisis. As such data-center REITs, including Equinix, Digital Realty DLR,CyrusOne Inc. CONE and CoreSite Realty Corporation COR, will keep witnessing significant demand.

Recently, Equinix announced that it will expand Alibaba Cloud’s accessibility to customers in 17 metros globally through Platform Equinix. Alibaba Cloud has also called for the integration of its API with Equinix Cloud Exchange Fabric to enable direct and seamless connection between enterprises from global markets and Alibaba Cloud on Platform Equinix.

While a global presence helps the company strengthen its competitive positioning, the pandemic has resulted in volatility in foreign-currency exchange rates, hurting Equinix’s revenue growth.

Shares of this Zacks Rank #3 (Hold) company have rallied 22.3% so far this year as against the real estate market’s decline of 16.5%.You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.


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