Stockholders' Equity

3 Months Ended

Mar. 31, 2022

Equity [Abstract]

Stockholders' Equity

Stockholders' Equity

Stockholders' Equity Rollforward

The following tables provide a rollforward of our stockholders' equity for the three months ended March 31, 2022 and 2021 (in thousands, except share and per share data):

											AOCI (Loss)		Retained Earnings		Equinix Stockholders' Equity		Non-controlling Interests		Total Stockholders' Equity
	Common Stock			Treasury Stock			Additional Paid-in Capital		Accumulated Dividends
	Shares	Amount		Shares	Amount
Balance as of December 31, 2021	90,872,826	$	91	(301,420)	$	(112,208)	$	15,984,597	$	(6,165,140)	$	(1,085,751)	$	2,260,493	$	10,882,082	$	(318)	$	10,881,764
Net income	—	—		—	—		—		—		—		147,453		147,453		240		147,693
Other comprehensive loss	—	—		—	—		—		—		32,837		—		32,837		3		32,840
Issuance of common stock and release of treasury stock for employee equity awards	430,973	—		11,445	4,259		39,617		—		—		—		43,876		—		43,876
Dividend distribution on common stock, $3.10 per share	—	—		—	—		—		(282,031)		—		—		(282,031)		—		(282,031)
Settlement of accrued dividends on vested equity awards	—	—		—	—		—		(497)		—		—		(497)		—		(497)
Accrued dividends on unvested equity awards	—	—		—	—		—		(2,045)		—		—		(2,045)		—		(2,045)
Stock-based compensation, net of estimated forfeitures	—	—		—	—		121,210		—		—		—		121,210		—		121,210
Balance as of March 31, 2022	91,303,799	$	91	(289,975)	$	(107,949)	$	16,145,424	$	(6,449,713)	$	(1,052,914)	$	2,407,946	$	10,942,885	$	(75)	$	10,942,810

							Additional Paid-in Capital		Accumulated Dividends		AOCI (Loss)		Retained Earnings		Equinix Stockholders' Equity		Non-controlling interests		Total Stockholders' Equity
	Common Stock			Treasury Stock
	Shares	Amount		Shares	Amount
Balance as of December 31, 2020	89,462,304	$	89	(328,052)	$	(122,118)	$	15,028,357	$	(5,119,274)	$	(913,368)	$	1,760,302	$	10,633,988	$	130	$	10,634,118
Net income (loss)	—	—		—	—		—		—		—		156,362		156,362		(288)		156,074
Other comprehensive loss	—	—		—	—		—		—		(95,480)		—		(95,480)		(1)		(95,481)
Issuance of common stock and release of treasury stock for employee equity awards	428,618	1		11,640	4,332		35,701		—		—		—		40,034		—		40,034
Dividend distribution on common stock, $2.87 per share	—	—		—	—		—		(256,321)		—		—		(256,321)		—		(256,321)
Settlement of accrued dividends on vested equity awards	—	—		—	—		—		(437)		—		—		(437)		—		(437)
Accrued dividends on unvested equity awards	—	—		—	—		—		(3,661)		—		—		(3,661)		—		(3,661)
Stock-based compensation, net of estimated forfeitures	—	—		—	—		102,349		—		—		—		102,349		—		102,349
Balance as of March 31, 2021	89,890,922	$	90	(316,412)	$	(117,786)	$	15,166,407	$	(5,379,693)	$	(1,008,848)	$	1,916,664	$	10,576,834	$	(159)	$	10,576,675

Accumulated Other Comprehensive Loss

The changes in accumulated other comprehensive loss, net of tax, by components are as follows (in thousands):

	Balance as of December 31, 2021		Net Change		Balance as of March 31, 2022
Foreign currency translation adjustment ("CTA") loss	$	(1,068,399)	$	(122,537)	$	(1,190,936)
Unrealized gain (loss) on cash flow hedges (1)	(6,590)		64,037		57,447
Net investment hedge CTA gain (loss) (1)	(9,952)		91,358		81,406
Net actuarial loss on defined benefit plans (2)	(810)		(21)		(831)
Accumulated other comprehensive gain (loss) attributable to Equinix	$	(1,085,751)	$	32,837	$	(1,052,914)

(1)Refer to Note 7 for a discussion of the amounts reclassified from accumulated other comprehensive loss to net income.

(2)We have two defined benefit pension plans covering all employees in two countries where such plan is mandated by law.

Changes in foreign currencies can have a significant impact to our condensed consolidated balance sheets (as evidenced above in our foreign currency translation loss), as well as our condensed consolidated results of operations, as amounts in foreign currencies are generally translated into more U.S. Dollars when the U.S. Dollar weakens or fewer U.S. Dollars when the U.S. Dollar strengthens. As of March 31, 2022, the U.S. Dollar was generally stronger relative to certain of the currencies of the foreign countries in which we operate as compared to December 31, 2021. Because of this, the U.S. Dollar had an overall unfavorable impact on our condensed consolidated financial position because the foreign denominations translated into fewer U.S. Dollars as evidenced by an increase in foreign currency translation loss for the three months ended March 31, 2022 as reflected in the condensed consolidated statements of comprehensive income (loss). The volatility of the U.S. Dollar as compared to the other currencies in which we operate could have a significant impact on our condensed consolidated financial position and results of operations including the amount of revenue that we report in future periods.

Common Stock

In October 2020, we established an ATM program, under which we may, from time to time, offer and sell our common stock to or through sales agents in "at the market" transactions (the "2020 ATM Program").

In February 2022, we entered into a forward sale amendment to the 2020 ATM Program, under which we may, from time to time, offer and sell shares under the equity distribution agreement pursuant to forward sale transactions (the "Equity Forward Amendment"). Under the 2020 ATM Program and Equity Forward Amendment we may, from time to time, offer and sell our common stock to or through sales agents at amounts up to an aggregate amount of $1.5 billion. The forward sale agreements provide three settlement alternatives: physical settlement, cash settlement or net share settlement. In accordance with ASC 815, the forward sale agreements are classified as equity for balance sheet purposes. In March 2022, we executed two forward sale agreements to sell shares of our common stock with maturity dates in March 2023. The aggregate proceeds for the two forward sale agreements to be received upon settlement is not significant.

For the three months ended March 31, 2022 and 2021, we did not sell any shares under the 2020 ATM Program. As of March 31, 2022, we had $1.0 billion of common stock remaining available for sale under the 2020 ATM Program.

Stock-Based Compensation

For the three months ended March 31, 2022, the Compensation Committee and/or the Stock Award Committee of our Board of Directors, as the case may be, granted an aggregate of 750,583 restricted stock units ("RSUs") to certain employees, including executive officers. These equity awards are subject to vesting provisions and have a weighted-average grant date fair value of $665.53 per share and a weighted-average requisite service period of 3.50 years. The valuation of RSUs with only a service condition or a service and performance condition require no

significant assumptions as the fair value for these types of equity awards is based solely on the fair value of our stock price on the date of grant. We use revenues, adjusted funds from operations ("AFFO") per share and digital services revenues as the performance measurements in the RSUs with both service and performance conditions that were granted in the three months ended March 31, 2022.

We use a Monte Carlo simulation option-pricing model to determine the fair value of RSUs with a service and market condition. We used total shareholder return ("TSR") as the performance measurement in the RSUs with a service and market condition that were granted in the three months ended March 31, 2022. There were no significant changes in the assumptions used to determine the fair value of RSUs with a service and market condition that were granted in 2022 compared to the prior year.

The following table presents, by operating expense category, our stock-based compensation expense recognized in our condensed consolidated statements of operations (in thousands):

	Three Months Ended March 31,
	2022		2021
Cost of revenues	$	10,443	$	8,467
Sales and marketing	20,184		17,703
General and administrative	59,325		52,180
Total	$	89,952	$	78,350