Equity Method Investments

3 Months Ended

Mar. 31, 2025

Equity Method Investments and Joint Ventures [Abstract]

We hold various equity method investments, primarily interests in joint venture partnership arrangements, in order to invest in certain entities that are in line with our business development objectives, including the development and operation of xScale data centers. Some of these joint ventures are classified as Variable Interest Entities ("VIEs").

The following table summarizes our equity method investments, which were included in other assets on the condensed consolidated balance sheets (in millions):


Investee	Ownership Percentage	March 31, 2025		December 31, 2024
EMEA 1 Joint Venture	20%	$	133	$	131
VIE Joint Ventures (1)	20%	432		374
Other	Various	13		14
Total		$	578	$	519

(1)Includes investments in the following xScale joint ventures in each of our three regions: "Asia-Pacific 1 Joint Venture", "Asia-Pacific 2 Joint Venture", "Asia-Pacific 3 Joint Venture", "EMEA 2 Joint Venture", "AMER 1 Joint Venture" and "AMER 2 Joint Venture". These investments share a similar purpose, design and nature of assets.

Non-VIE Joint Venture

EMEA 1 Joint Venture

The EMEA 1 Joint Venture is not a VIE given that both equity investors' interests have the characteristics of a controlling financial interest and it is sufficiently capitalized to sustain its operations, requiring additional funding from its partners only when expanding operations. Our share of income and losses of equity method investments from this joint venture was insignificant for the three months ended March 31, 2025 and 2024 and was included in other income (expense) on the condensed consolidated statement of operations.

We committed to make future equity contributions to the EMEA 1 Joint Venture for funding its future development. As of March 31, 2025, we had future equity contribution commitments of $44 million.

VIE Joint Ventures

The VIE Joint Ventures are considered VIEs because they do not have sufficient funds from operations to be self-sustaining. While we provide certain management services to these joint ventures and earn fees for the performance of such services, the power to direct the activities of these joint ventures that most significantly impact economic performance is shared equally between us and our partners. These activities include data center construction and operations, sales and marketing, financing, and real estate purchases or sales. Decisions about these activities require the consent of both Equinix and our partners. We concluded that neither party is deemed to have predominant control over the VIE Joint Ventures and neither party is considered to be the primary beneficiary. Our share of losses of equity method investments from the VIE Joint Ventures was insignificant for the three months ended March 31, 2025 and 2024, and were included in other income (expense) on the condensed consolidated statement of operations.

AMER 2 Joint Venture

On April 10, 2024, we invested in a joint venture to develop and operate an xScale data center in the Americas region (the “AMER 2 Joint Venture”). At closing, we sold the assets and liabilities of the Silicon Valley 12 (“SV12x”) data center site, which were included within our Americas region, for total consideration of $293 million, which was comprised of $246 million of net cash proceeds, a 20% partnership interest in the AMER 2 Joint Venture with a fair value of $26 million, and $21 million of receivables. We recognized a gain of $18 million on the sale of the SV12x data center in the second quarter of 2024.

The following table summarizes our maximum exposure to loss related to the VIE Joint Ventures as of March 31, 2025 (in millions):


	VIE Joint Ventures
Equity Investment	$	432
Outstanding Accounts Receivable	83
Other Receivables	40
Contract Assets	109
Loan Commitment (1)	392
Future Equity Contribution Commitments (2)	112
Maximum Future Payments under Debt Guarantees (3)	268
Total	$	1,436

(1)Concurrent with the closing of the AMER 2 Joint Venture, we entered into a loan agreement with the AMER 2 Joint Venture, as a lender, further discussed below.

(2)The joint ventures' partners are required to make additional equity contributions proportionately upon certain occurrences, such as a shortfall in capital necessary to complete construction or to make interest payments on their outstanding debt.

(3)In connection with our 20% equity investment in the EMEA 2 Joint Venture, we provided the lenders with our guarantees covering 20% of all payments of principal and interest due under the EMEA 2 Joint Venture's credit facility agreements. A portion of the guarantees relates to our AMER 1 Joint Venture. Refer to Note 10.

AMER 3 Joint Venture

On October 1, 2024, we entered into an agreement to form a joint venture to develop and operate xScale data centers in the Americas region (the "AMER 3 Joint Venture"), subject to regulatory approval and other closing conditions which were satisfied on October 30, 2024. As of March 31, 2025 there have been no equity contributions made to the AMER 3 Joint Venture.

Joint Venture Related Party Transactions

Concurrent with the closing of the AMER 2 Joint Venture, we entered into a loan agreement (the "AMER 2 Loan") with the AMER 2 Joint Venture, as a lender, with a maximum commitment of $392 million and a maturity date of April 10, 2028. We received an upfront fee of $4 million in connection with the origination of the loan, and earn interest at a contractual rate of 10% per annum on the drawn portion plus an unused commitment fee of 0.75% per annum on the undrawn portion, each payable quarterly. The term of the loan may be extended at the option of the borrower for one additional year subject to an extension fee, and may be prepaid subject to a penalty if such prepayment occurs within the first 18 months of issuance. The AMER 2 Loan is secured by the assets of the AMER 2 Joint Venture, including the SV12x data center site. The equity partners of the AMER 2 Joint Venture have provided limited guarantees in connection with the AMER 2 Loan, which require payments to the lender proportionately upon certain occurrences, such as a shortfall in capital necessary to complete construction or to make interest payments. Additionally, the equity partners may be liable for repayment of up to the entire debt balance upon the occurrence of certain adverse acts such as a non-permitted transfer of the SV12x data center site. The AMER 2 Loan was negotiated at arm's length. We have assessed the credit risk associated with the AMER 2 Loan to be low and the allowance for credit loss as of March 31, 2025 is insignificant. The maximum amount of credit loss we are exposed to is the outstanding principal, plus accrued interest and unused commitment fees. As of March 31, 2025, the total amount outstanding under the AMER 2 Loan, net of the unamortized upfront fee, was $258 million. Additional amounts may be drawn down by the borrower periodically as needed for the continuation of development and other working capital needs.

We have lease arrangements and provide various services to the EMEA 1 Joint Venture and the VIE Joint Ventures (collectively, the "Joint Ventures") through multiple agreements, including sales and marketing, development management, facilities management, asset management and procurement service agreements. These transactions are generally considered to have been negotiated at arm's length.

The following table presents the income and expenses from these arrangements with the Joint Ventures in our condensed consolidated statements of operations (in millions):


		Three Months Ended March 31,
Related Party	Nature of Transaction		2025		2024
EMEA 1 Joint Venture	Income		$	6	$	6
EMEA 1 Joint Venture	Expenses (1)		4		4
VIE Joint Ventures	Income (2)		61		38
VIE Joint Ventures	Expenses (3)		2		1

(1)Primarily consists of rent expenses for a sub-lease agreement with the EMEA 1 Joint Venture for a London data center with a remaining lease term of approximately 15-years as of March 31, 2025.

(2)Primarily consists of revenues related to service arrangements as described above and also includes interest income earned on the AMER 2 Loan during the three months ended March 31, 2025 of $7 million.

(3)Primarily consists of rent expenses for lease arrangements with the VIE Joint Ventures.

We have also sold certain data center facilities to our Joint Ventures and recognized gains or losses on asset sales as described above.

The following table presents the assets and liabilities from related party transactions with the Joint Ventures in our condensed consolidated balance sheets (in millions):


	EMEA 1 Joint Venture				VIE Joint Ventures
Balance Sheet	March 31, 2025		December 31, 2024		March 31, 2025		December 31, 2024
Accounts receivable, net	$	30	$	4	$	83	$	50
Other current assets (1)	19		19		139		128
Property, plant and equipment, net (2)	146		145		73		74
Operating lease right-of-use assets	2		2		29		2
Other assets (3)	—		—		276		302
Other current liabilities	6		5		8		10
Finance lease liabilities	169		164		78		78
Operating lease liabilities	2		2		27		2
Other liabilities (4)	49		48		11		11

(1)The balance primarily relates to contract assets and other receivables.

(2)The balance relates to finance lease right-of-use assets.

(3)The balance primarily relates to the AMER 2 Loan receivable.

(4)The balance primarily relates to the obligation to pay for future construction for certain sites sold as a part of the EMEA 1 Joint Venture transaction.