Iron Mountain Incorporated

Good morning and welcome to the Iron Mountain Third Quarter 2025 Earnings Conference Call. All participants will be in listen-only mode. Should you need assistance, please signal a conference specialist by pressing star then zero on your telephone keypad. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star then one on your telephone keypad. To withdraw your question, please press star then two. We will limit analysts to one question, and you can rejoin the queue. Please note, this event is being recorded. I would now like to turn the conference over to Mark Rupp, Senior Vice President of Investor Relations. Please go ahead.

Thanks, Chad. Good morning, everyone, and welcome to our third quarter 2025 earnings conference call. Joining us today are Bill Meany, our President and Chief Executive Officer, and Barry Heitman, our Executive Vice President and Chief Financial Officer. After our prepared remarks, we'll open the lines for Q&A. Today's call will include forward-looking statements, which are subject to risks and uncertainties. For a discussion of the major risk factors that could cause our actual results to differ from these statements, please refer to today's earnings materials, including the Safe Harbor language on slide two of the earnings presentation, and our annual and quarterly reports on Form 10-K and 10-Q. Each of these items, as well as reconciliations of non-GAAP financial measures referenced during this call, can be found on our investor relations website. With that, I'll turn the call over to Bill.

Thank you, Mark, and thank you all for joining us to discuss our third quarter results. We are pleased to report that our team has delivered another quarter of record financial performance and double-digit growth. We achieved an all-time high for quarterly revenue, adjusted EBITDA, and AFFO, driven by strength across our business. Revenue increased 13% to $1.8 billion, adjusted EBITDA grew 16% to $660 million, and AFFO increased 18% to $393 million. Our exceptional performance in the third quarter is a result of our team's unwavering focus on meeting our customers' needs, with innovative solutions, and consistent execution of our strategic priorities. We are delivering revenue growth in our physical storage business, achieving record revenue in Q3, driven by consistent volume growth and higher retention rates, as well as revenue management. Our digital solutions business is building momentum. We are winning new contracts with our AI-powered digital solutions across industry verticals, and drove record revenue and continued double-digit growth in the third quarter. We are capitalizing on robots data center industry demand with 33% revenue growth in Q3 and a strong outlook that supports more than 25% growth in 2026 based on our currently signed leases. Additionally, we saw a nice uptick in Q3 leasing and into Q4, which together with our pipeline puts us in a good position to execute against our portfolio capacity of 1.3 gigawatts. We are driving substantial growth in our asset lifecycle management business, increasing revenue with existing customers and winning new business through cross-selling, resulting in 65% reported and 36% organic growth in the third quarter. we expanded profitability with adjusted EBITDA increasing 16% and margin improving 110 basis points as compared to last year. This clearly shows that we have strong momentum behind our commitment to sustain industry-leading revenue and earnings growth. Our portfolio of growth businesses, including data center, digital, and ALM, drove two-thirds of our revenue growth in the quarter, or eight percentage points on a consolidated basis. This will remain an important tailwind going forward as the growth portfolio further increases its percentage of total revenue, expected to be nearly 30% of total revenue exiting 2025. This is on top of the strength in our physical storage business. which is growing at a mid single digit rate and will contribute approximately five points of consolidated growth in 2025. The momentum across our business, as I just highlighted, along with our foundation of established relationships and trust with over 240,000 customers, comprehensive solutions offering, reputation for security, and a global footprint firmly position us to deliver our growth commitment for the foreseeable future. Based on our strong outlook and excellent 2025 results, our board of directors authorized an increase of our quarterly dividend by 10%. Let me now share some recent commercial wins that illustrate the strength of our synergistic business model. First, in records management in Europe, we were selected as the single vendor for medical record storage for a hospital that has been a customer for more than 15 years, displacing a competitor. Additionally, we secured a new customer with a public sector entity that could no longer manage and store its records in-house. Both of these deals were attributed to our strong reputation for secure records management and our proven ability to provide efficient and cost-effective services. In our digital solutions business, we continue to win new business with our DXP platform. In late October, we successfully launched our Insight DXP 2.0 platform. The new platform offers enhanced content management and smart document processing, an easy-to-use secure platform with workflow tools, and AI agents. This will allow the customer to make faster and more insightful decisions, as well as eliminate obsolete and duplicative data to save costs. And as it relates to our digital award with the Department of Treasury, In September, Iron Mountain was awarded a new long-term contract for digitization services. This new five-year contract, with a value of up to $714 million, expands our current scope of work, subsuming the contract awarded to us in April. This is a significant win for Iron Mountain, and we are thrilled to continue supporting the United States government on this efficiency opportunity. We are currently executing under the new agreement and collaborating with the department on next steps whilst preparing for the high seasonal volume expected in the spring of 2026. Let me now turn to our data center business. The data center market remains very strong and we have seen leasing activity and pipeline pickup as hyperscalers resume their focus on building out inference and cloud capacity. We leased 13 megawatts in the quarter including a couple of larger enterprise deals with financial services firms. And in early Q4, a key hyperscaler leased our entire 36 megawatt Chicago site, transferring and expanding the customer's previous lease of 25 megawatts in London for a net incremental 11 megawatts lease. This is a great outcome for the customer who is looking to transfer to the Chicago market. And for us, given the strong interest we have in the London location, they are vacating. This London site has the power coming online in 2026. We have high confidence in sustaining our data center revenue growth with the levels we have achieved over the past few years. This is underwritten by our pre-leasing backlog, strong pipeline, as well as 450 megawatts, which is available for sale and will be energized over the next 18 to 24 months. These assets coming online within the next two years have a collective capacity, which is the size of our current operating portfolio. The large and expanding pipeline for these assets is from hyperscale customers having the highest credit quality. Turning to our asset lifecycle management business, as we've previously shared, ALM represents a major growth opportunity for Iron Mountain. The market is very large and highly fragmented, and we are well positioned to capitalize on growth through expanding business with existing customers, gaining new customers through our cross-selling efforts, and strategic acquisitions to expand our capabilities and geographic footprint. Our results in Q3 show that we are successfully capitalizing on this meaningful opportunity. And consistent with our strategy, in September, we acquired ACT Logistics, which further strengthens our ALM market leadership position in Australia. Let me now share some of our recent ALM wins that support our confidence in the long-term opportunity. A leading financial services company with more than 200,000 employees globally has selected Iron Mountain as its ALM partner for the first time, building on our decades-long partnership for records management and digital solutions. Our established relationship, strong reputation for security and compliance, and global footprint was an important factor in winning this deal. and a global company headquartered in Germany, has engaged Iron Mountain to support a key decommissioning and remarketing program across six data centers in the US, Europe, and the Asia-Pacific region. Iron Mountain has also provided records management, digital and data center co-location services for this customer over many years. We are pleased to extend our solutions thanks to our ALM team's operational scale and robust sustainability reporting capabilities, which are a critical requirement for this project. This relationship demonstrates the power of our synergistic business model where we successfully cross-sold all of our key lines of business to a long-term customer. In conclusion, I am proud of the exceptional results our dedicated Mountaineers have continued to deliver in 2025 and what that means to our shareholders as we announce another increase in our dividend of 10%. As you heard today, our record results are a testament to our strategic focus on customer needs, innovative solutions, and consistent execution. Our strong business momentum continues to build, and a tremendous growth opportunity continues to lie ahead of us. We are just scratching the surface of the $165 billion total addressable market for our services. With that, I'll turn the call over to Barry.