Iron Mountain Q3 2026: Data Center Surge Powers Beat and Dividend Hike
As seen on the 24/7 Wall St. homepage on November 5, 2026.
The storage business is now funding an AI buildout: 102.5 MW of new data center leases signed in the quarter lifted that segment's revenue, and management raised full-year guidance along with the quarterly dividend. Revenue landed fractionally short of estimates, which barely registers next to a backlog management says supports data center growth above 25%.
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Iron Mountain's data center segment was the clear standout in the quarter, with revenue growing 34% year over year. The company signed 102.5 megawatts of new data center leases during the quarter alone, bringing the year-to-date total to 137 megawatts, with significant deals struck in Mumbai, London, and Chennai. Adjusted EBITDA margin in the data center segment expanded to 56.3% from 52.6% a year ago, a sign that the business is becoming more efficient as it scales.
On the earnings line, adjusted EPS came in at $0.64 against a consensus estimate of $0.6116, a beat of about 4.6%. That extends Iron Mountain's streak of topping EPS expectations to four consecutive quarters. Revenue of roughly $1.99 billion grew 13.5% year over year while narrowly missing expectations, a gap of just 0.08% that management's raised guidance largely rendered moot.
The board declared a quarterly dividend of $0.993 per share, a 15% increase, payable January 6, 2027 to shareholders of record as of December 15, 2026. CEO William L. Meaney tied the raise directly to the company's trajectory: "Based on our strong 2026 growth and continued positive outlook, we are pleased to increase the dividend by 15%." Management also committed to growing the dividend in line with AFFO per share growth going forward.
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Full-year 2026 guidance was lifted to revenue of $7.95 billion to $8.02 billion and AFFO per share of $5.94 to $6.00, even after absorbing headwinds from a stronger U.S. dollar. The existing data center backlog is expected to support growth above 25% and represents roughly $1.7 billion in annual revenue before any new leasing activity. About 325 megawatts of additional capacity is expected to come online over the next 24 months, with a longer-term plan to more than double the operating portfolio to 1.4 gigawatts.
Net lease-adjusted leverage stands at 4.8 times, and the current portion of long-term debt rose sharply to $1,232.9 million from $216.1 million. Capital expenditures for the quarter reached $589.7 million, up nearly 15% year over year, reflecting the intensity of the data center build. Foreign exchange movements remain an acknowledged drag, and storage rental gross margin slipped 130 basis points year over year, a reminder that the legacy business funding this expansion also faces pressure.
Mentioned: IRM