Power, Not Space: Risk Factors on Power in Equinix's Annual Report for 2025

Equinix signed its annual report on Form 10-K for the fiscal year ended December 31, 2025, on February 11, 2026. Some of the report's risk factors concern power. Parts of them follow, not the whole.

Supply, Capacity and Commitments

One risk factor is headed "Our business could be harmed by increased costs to procure power, prolonged power outages, shortages or capacity constraints." In each of its markets, the company says, it contracts with and relies on third parties, third-party infrastructure, governments and global suppliers to provide enough power to maintain its data centers and meet the needs of its current and future customers. In certain instances, it says, it has "experienced difficulties in securing the energy supply" it has contracted for or needs for its expansion plans.

"Each new facility requires access to significant quantities of electricity," the report says. Limitations on generation, transmission and distribution "may limit" its ability to obtain sufficient power capacity for potential expansion sites in new or existing markets. Utility companies and other third-party power providers "may impose onerous operating conditions" on an agreement to provide power, it says, or the company may meet significant delays, unfavorable contractual terms, new industry regulations and substantial increased costs to obtain the electrical service its current or future data center designs require.

In certain cases, the report says, the company must commit to power purchases before a data center is fully operational, "increasing fixed costs and the risk that these costs cannot be passed on to customers." Its ability to find reliable partners and appropriate sites for expansion "may also be limited by access to power," especially as it designs its data centers to the specifications of new and evolving technologies, such as AI, which it calls "more power-intensive."

Power and the Older Buildings

Under a risk factor on high-power density equipment, the report says that changes in server technologies "in some instances" can result in customers increasing their use of such equipment, which can increase the demand for power per cabinet, and that workloads related to new and evolving technologies such as AI are increasing the demand for high density computing power. Many of the company's data centers were built a number of years ago, it says, so "the current demand for power may exceed the designed electrical capacity" in them. Power, the report says, "not space, is a limiting factor" in many of its data centers, and its ability to fully use the space in those buildings may be affected.

Whether it can raise a data center's power capacity, should it decide to, depends on several factors, "including, but not limited to," the local utility's ability to provide more power, the time needed to provide it, and whether upgrading the electrical and mechanical infrastructure is feasible. The company says it is designing to a higher power specification than many of its older data centers and is considering redeveloping certain sites where appropriate. It says there is a risk that demand could keep increasing, or that redevelopment may not succeed, and that the space inside its data centers "could become underutilized sooner than expected."

On the report's own account, power can limit both where the company builds next and how fully it uses the space it already has.

Site Selection

Site selection, the report says, "is also a critical factor" in its expansion plans. There may not be suitable properties in its markets "with the necessary combination of high-power capacity, sufficient water supply and fiber connectivity," or the choice may be limited. The company says it expects to keep experiencing limited availability of water and power and grid constraints in many markets, as well as shortages of associated equipment, and that these shortages "could result in site selection challenges, construction delays or increased costs."

Which markets does the report mean by "many markets"?