EQIXEquinix, Inc.

Equinix leases data-centre space and sells interconnection between tenants — property whose value is created by the network.

Formally a property trust, in substance a network hub. The customer rents not square metres but proximity to hundreds of other networks and clouds in the same building: connecting to them inside the facility is faster and cheaper than over the internet. The more tenants, the more valuable the site becomes to the next — a network effect in its purest form.

Hence two revenue lines: renting capacity and charging for cross-connects. The second carries higher margins and grows faster, and it is what distinguishes the company from an ordinary data-centre operator selling kilowatts.

The constraint is power and sites: connecting new capacity in large cities takes years, and that limits growth more than demand does. Construction is capital-intensive, and the trust structure requires distributing profit, so expansion is funded with debt and equity issuance. The company pays a growing dividend.