Title

Presentation

Iron Mountain Incorporated beats earnings expectations. Reported EPS is $1.17, expectations were $1.16.

Operator: Good morning, and welcome to the Iron Mountain First Quarter 2025 Earnings Conference Call. All participants will be in a listen-only mode. [Operator Instructions] After today’s presentation, there will be an opportunity to ask questions. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Mr. Mark Rupe, Senior Vice President of Investor Relations. Please go ahead, sir.

Mark Rupe: Thank you, Chuck. Good morning, and welcome to our first quarter 2025 earnings conference call. On today’s call, we will refer to materials available on our Investor Relations website. We are joined here today by Bill Meaney, President and Chief Executive Officer; and Barry Hytinen, our Executive Vice President and Chief Financial Officer. After prepared remarks, we’ll open the lines for Q&A. Today’s earnings materials contain forward-looking statements, including statements regarding our expectations. All forward-looking statements are subject to certain risks and uncertainties. Please refer to today’s earnings materials, the safe harbor language on Slide 2 and our annual and quarterly reports on Form 10-K and 10-Q for a discussion of the major risk factors that could cause our actual results to differ from those in our forward-looking statements.

In addition, we use several non-GAAP measures when presenting our financial results. We’ve included the reconciliations to these measures in our supplemental financial information. With that, I’ll turn the call over to Bill.

Bill Meaney: Thank you, Mark, and thank you all for joining us today to discuss our first quarter results. We are pleased with our strong start to 2025. Our team’s focus on providing solutions that meet our customers’ needs as part of our Matterhorn growth strategy continues to drive record results across the business and above our expectations. On a reported basis in the first quarter, we achieved all-time high quarterly revenue of $1.6 billion, representing 8% year-over-year growth and record first quarter adjusted EBITDA of $580 million, an increase of 12% as compared to last year. This performance was even better when excluding the effects of foreign exchange with revenue increasing 9% and adjusted EBITDA growing 13% to last year.

Strong growth was achieved in each of our key business units. Our portfolio of growth businesses, which represents more than 25% of our total revenue and includes data center, digital solutions, and asset lifecycle management collectively grew more than 20% in the quarter. And our traditional records business achieved record results as well. This formula supports our ability to sustainably drive double-digit revenue and profit growth. Our commercial team continues to make marked progress in executing our strategy. I’m especially pleased with the breadth and scope of customer deals we are winning. For example, during the first quarter, our global scale and reputation were key factors in securing multiple records management and ALM deals where customers consolidated to single vendors, further testimony of the benefits from our number one ranking in customer satisfaction by the Wall Street Journal of the top US-listed companies.

And we achieved broad cross-selling success through both traditional add-on solution sales and by partnering across the business to integrate multiple solutions for the customer. This approach met the customer need to get their job done seamlessly and truly differentiates our individual offerings by the whole suite being worth more than any single product. Our potential for growth remains significant, especially with the substantial expansion of our solutions offerings in recent years. To complement our cross-selling efforts and capitalize on this opportunity, we have marketing initiatives underway to increase awareness of our complete solutions offering. Let me now turn to an update of our key achievements and customer wins that showcase the success we are delivering against our strategic priorities, which are driving continued revenue growth in our physical storage records management business, delivering differentiated digital solutions, which truly — which give truly transformative results to our customers in terms of revenue, security, and cost, supplying differentiated data center offerings through our global scale and customer trust, and providing asset lifecycle management capabilities, which are secure, economic, and environmentally sustainable.

Let’s begin with our records and information management business. We are pleased with our consistent and strong performance. Storage volume continues to increase modestly each quarter and our revenue management is further accelerating growth by capturing the enhanced customer value we are providing through our global and integrated services. Additionally, we are driving record digital revenue and a growing percentage of this revenue is recurring. Let me highlight a few new projects we secured during the quarter, starting first with records management. A Greek bank, an existing customer for over 10 years, chose Iron Mountain to store records from 20 locations following a merger. The strength of our relationship, the security of our facility, and the speed and efficiency of our document retrieval services led to cost savings for the customer.

Additionally, a global insurance company’s operations in Thailand awarded Iron Mountain a three-year records management agreement with the first project utilizing our Smart Sort solution to manage over 3 million commingled files. I’m also excited to share recent accomplishments in our digital solutions business. Our InSight Digital Experience Platform, or DXP, continues to gain traction and acceptance in the market. Customers are realizing the value of this SaaS platform, which is reflected in larger deal values and shorter sales cycles. We are continuing to expand DXP’s capabilities to manage and create structure from unstructured content, increase efficiency through process automation, enable visibility of dark data, increase compliance, and make information actionable.

We are also tailoring DXP use cases to industry-specific requirements. I’ll highlight a few of our recent wins in digital solutions. In the United Kingdom, we have secured a 10-year contract with an existing customer, expanding our relationship significantly. Under the agreement, we will intake an additional 350,000 cubic feet of documents, digitize close to 9 million images per year, and provide DXP access to 2,500 users. Our store, digitize, and access solutions will enable the customer to realize financial savings, operational efficiencies, and an overall improved stakeholder experience. In Europe, we strengthened our relationship with a long-standing healthcare client through a three-year deal to digitize patient documents. Moreover, the customer is using our InSight DXP Platform’s AI capabilities to provide concise summaries of patient incidents and to facilitate efficient access to critical information.

We will digitize 500,000 documents and 750,000 images a month whilst also providing physical records management. Our solution will provide enhanced scalability and accelerated processing time, resulting in substantial cost reductions for the customer. As we mentioned on our last earnings call, we believe our many years of experience in providing digital transformation services to the United States government positions us well to assist the broad DOGE effort. And now let me briefly highlight a significant order we received yesterday. We have been awarded a contract for the Department of Treasury. We will be assisting with a broad digital transformation effort leveraging our DXP platform and its embedded AI capabilities. The contract value is approximately $140 million and will commence immediately with the majority of the revenue in 2026.

I would like to thank the Treasury and the Department of Government Efficiency for their trust in Iron Mountain. Lastly, during the process of this award, more people involved in transforming the federal government have learned about our capabilities and experience in digital transformation. The result has been that we have seen a marked increase in our digital services pipeline serving a broad range of federal agencies across a number of improvement and efficiency initiatives. Let me now turn to our data center business. For the quarter, we continued to execute on our strong leasing backlog with revenue growth of over 20% year-over-year, driven by more than 24% organic storage growth. In the first quarter, our enterprise leasing activity was in line with expectations, leasing approximately 4 megawatts of new business.

Whilst we did not sign new hyperscale contracts in the quarter, we are responding to strong interest across our US, European and Indian sites. We expect this to convert over the course of the year, which aligns with our projection for 125 megawatts of total new leasing. We continue to see strong demand for data center development across our global portfolio and our pipeline remains strong. When fully developed, our current portfolio will reach 1.3 gigawatts, more than triple the size of our current operating portfolio. Finally, I would also like to welcome Gary Aitkenhead, our new EVP and General Manager of Data Centers. Gary joins us from Equinix and reports to Mark Kidd, who leads our data center and ALM businesses. His global experience, proven leadership in driving transformation and growth, and commitment to fostering high-performing inclusive teams will be a key asset to our customers and team as we further expand the business.

Turning to our asset lifecycle management business, we continue to drive strong growth in this large and highly fragmented ALM market. In the first quarter, we achieved 44% reported revenue growth, including 22% organic growth with strength across both the enterprise and hyperscale channels. In the enterprise channel, our commercial team’s success is evidenced by the size and scope of deals we are winning. We think over time, as large enterprises become more sensitive to the cyber risks with the disposal of their IT assets, Iron Mountain’s brand will play an ever-increasing factor in their vendor selection. And in the hyperscale channel, given the robust growth in data center development in recent years, we anticipate strong tailwinds for decommissioning work for the foreseeable future.

We will leverage our differentiation as a data center operator in this channel to capture additional share. We will also continue to selectively acquire ALM enterprise businesses to expand our capabilities and geographic footprint. In late March, we acquired Premier Surplus in the Southern US, expanding our customer base and capabilities. To illustrate our growing strength in this segment, let me now share some of the ALM wins achieved during the quarter, which continued to drive strong double-digit organic growth. A large global fintech company specializing in online payments and employing over 20,000 people globally has selected Iron Mountain as its exclusive ALM partner for the secured disposition of its assets following the customers’ consolidation of providers.

Our long-standing relationship with this customer, our flexibility, and our experience handling sensitive assets contributed to this win. We also secured a new customer win with a global technology infrastructure provider with over 35,000 employees. Iron Mountain was chosen to manage a large batch of materials the customer accumulated through a series of acquisitions. Our solution met all of this customer’s requirements, including chain of custody, reconciliation, secured wiping, and remarketing. Our reputation and brand were also key to this win. In conclusion, I’m proud of the strong results that our dedicated Mountaineers continue to deliver. Our team’s commitment to meeting the needs of our nearly 250,000 customers worldwide is integral to our success.

As Barry will share in more detail, we are increasing our full year guidance to reflect the strong Q1 performance and positive outlook. With that, I’ll turn the call over to Barry.

Barry Hytinen: Thanks, Bill, and thank you all for joining us to discuss our results. Our team is off to a strong start this year, delivering record first quarter results across all of our key financial metrics. We achieved record revenue of $1.59 billion, up 8% on a reported basis and 9% on a constant currency basis. We delivered strong organic growth in the quarter of 8%. Total storage revenue was $948 million, up $64 million year-on-year and up 9% on an organic basis. Total service revenue was $644 million, up $52 million from last year. Organic service growth of 7.1% was ahead of our expectations and improved slightly from the fourth quarter rate despite lapping a much more difficult comparison from the prior year. Adjusted EBITDA of $580 million was a record for the first quarter and expanded $61 million year-on-year.

This was $5 million ahead of the projection we provided on our last call. The upside to our projection was driven by $4 million of operating performance and approximately $1 million from the US dollar’s weakening in the first quarter. Adjusted EBITDA margin was 36.4%, up 130 basis points year-on-year, which reflects improved margins across all of our businesses. A key highlight for me in the quarter was that our team delivered significant operating leverage with an incremental flow-through margin of greater than 50%, which is the highest we’ve achieved in years. AFFO was $348 million, up $25 million, which represents growth as compared to last year of 8% on a reported basis and 10% excluding FX. AFFO on a per share basis was $1.17, up 6% to last year on a reported basis and up 9% excluding FX.

Now, turning to segment performance. I’ll start with our Global RIM business, which achieved first quarter revenue of $1.26 billion, an increase of $46 million year-on-year, driven by revenue management and digital solutions, partially offset by the stronger US dollar, which negatively impacted revenue by approximately $20 million. Organic storage was up 6%, driven by revenue management and consistent volume. Organic service revenue was up 5% with contributions from digital and core services. Reported service revenue was down $4 million on a sequential basis due to a $3 million decline in terminations and permanent withdrawal revenue and another $3 million headwind from the stronger US dollar. Our digital business had another strong quarter, achieving record revenue.

We are also pleased to report improvement in our records management retention rate and storage capacity utilization, both of which achieved the highest levels we’ve seen in some time. Global RIM adjusted EBITDA was $556 million, an increase of $30 million year-on-year. Global RIM adjusted EBITDA margin of 44.3% was up 80 basis points from last year, driven by operating leverage and revenue management. Let me provide a brief update on our consumer storage business following our commentary on our last call. While consumer storage remained a headwind to revenue growth in the first quarter, the team is driving solid operating improvement. Profitability is increasing and we are seeing very positive trends in storage reservations, which is a key forward indicator for revenue.

Turning to our global data center business. Total data center revenue was $173 million in the first quarter, an increase of $29 million year-on-year. Organic storage rental growth increased 24% driven by lease commencements and continued strong pricing trends. In the first quarter, new commencements were 12 megawatts, including 8 megawatts in Northern Virginia. Pricing remains strong with the average price per kilowatt on new commencements up 15% as compared to last year. We renewed leases totaling 10 megawatts with strong renewal spreads of 19% and 27% on a cash and GAAP basis, respectively. First quarter data center adjusted EBITDA was $91 million, up 48%. Adjusted EBITDA margin was up 960 basis points from the first quarter of last year and up 60 basis points sequentially to 52.4%.

Improved pricing, recent commencements, and operating leverage were the key drivers of the strong margin expansion in the quarter. Turning to asset lifecycle management. Total ALM revenue was $121 million, an increase of $37 million or 44% year-over-year. On an organic basis, our ALM team delivered 22% growth. The strong performance was driven by volume increases in both our enterprise and hyperscale businesses. On an inorganic basis, Wisetek and APCD continued to perform well and contributed revenue of $18 million. We are pleased with the continued improvement in ALM profitability, which was up significantly as compared to last year, benefiting from acquisition synergies as well as improved operating performance across the business. As we discussed last quarter, our strong customer wins, both in enterprise and hyperscale give us high visibility to accelerating growth as we move through 2025.

I will note that our organic growth increased over 1,000 basis points on a sequential basis, ahead of our expectations, despite pricing being broadly flat to slightly down. Regarding our acquisition of Premier Surplus, I should note, this was completed right at the end of the first quarter. So, its results were not included in our quarterly financials. For modeling purposes, we expect Premier will contribute revenue of approximately $10 million to our full year results. Turning to capital allocation, we remain committed to our strategy that is balanced between funding our growth initiatives, delivering meaningful shareholder returns, and maintaining our strong balance sheet. Capital expenditures in the first quarter were $657 million with $629 million of growth and $28 million of recurring.

Our outlook for capital expenditures is unchanged from our prior call with approximately $1.8 billion of growth and approximately $150 million of recurring, both consistent with the levels from last year. We are planning for capital spending to be more first-half weighted. Turning to the balance sheet. With strong EBITDA performance, we ended the quarter with net lease adjusted leverage of 5.0 times, in line with our expectations for both the quarter and year-end. Turning to our dividend, our Board of Directors declared our quarterly dividend of $0.785 per share to be paid in early July. On a trailing four quarter basis, our payout ratio is now 62%, in line with our long-term target range. And now, turning to our outlook. Based on our strong first quarter performance and positive outlook and recent changes in currency exchange rates, we are pleased to increase our financial guidance.

For the full year 2025, we now expect total revenue to be within the range of $6.74 billion to $6.89 billion, which represents year-on-year growth of 11% at the midpoint. Relative to our prior guidance, we are raising revenue by $90 million based on the weaker US dollar, continued strong revenue management, improved outlook for ALM performance and the Premier Surplus acquisition. We now expect adjusted EBITDA to be within the range of $2.505 billion to $2.555 billion, which represents year-on-year growth of 13% at the midpoint. Relative to our prior guidance, we are raising adjusted EBITDA by $30 million. And we now expect AFFO to be within the range of $1.48 billion to $1.51 billion in AFFO per share to be $4.95 to $5.05. At the midpoint, this represents 11% and 10% growth respectively.

For the second quarter, we expect revenue of approximately $1.68 billion, an increase of 10% to last year. Adjusted EBITDA of approximately $620 million, up 14% year-on-year. AFFO of approximately $350 million, which is up 9%. And AFFO per share of approximately $1.18, up 9% to last year. Before closing, I would like to address two additional items. First, regarding the contract with the Department of the Treasury that Bill mentioned, as it was awarded just last night, we have not included it in our financial guidance. For modeling purposes, we expect the contract will generate revenue in both 2025 and 2026 with the majority of the benefit next year. We look forward to updating you on the progress of this deal and our [Technical Difficulty] on our next few calls.

Second, knowing that tariffs are a key area of investor interest, I wanted to provide some perspective on our exposure. In our Global RIM business, our exposure to tariffs is essentially zero as our revenues and costs are matched based on each market in which we operate. In our ALM business, the vast majority of the revenue is generated from IT gear that we decommission and then resell in the same market. For example, we decommissioned gear in the US and then resell it to US-based customers. And as a result, there is no cross-border impact. While we do have some components which are sold into China, let me share a couple of important points. First, over the last few years, the team has done a terrific job significantly diversifying our downstream sales away from China.

And for those components that are sold into China, I would highlight that tariffs tend to be based on the original manufacturing country of origin and as such, we would not anticipate an impact on our component sales. Lastly, in our data center business, the vast majority of the cost of construction is not subject to tariffs. We estimate that we have less than 5% exposure within data center construction. With that said, let me conclude. Our year is off to a great start with record-breaking first quarter results across all key financial metrics. Our outlook is strong and we are pleased to increase our full year guidance. We are focused on driving double-digit revenue growth over many years, supported by our strong cross-selling opportunity into what are very large fragmented markets.

I want to express my gratitude to all of our mountaineers for their continued dedication to serving our customers. And with that, Operator, would you please open the line for Q&A.

Operator: [Operator Instructions] And the first question will come from Shlomo Rosenbaum with Stifel. Please go ahead.

Shlomo Rosenbaum: Hi. Thank you very much. Bill or Barry, if you can just talk a little bit about the market for leasing. The leasing activity has been uncharacteristically low for the last three quarters. Last quarter, you talked about a large deal that you walked away from due to some market conditions you didn’t want to accept. If you could just talk about what’s going on, your confidence in being able to achieve that 125 million of megawatts, because it does assume pretty good step-up and down the rest of the year? And then if you don’t mind my just tagging on, Barry, at the end of your last comment, you talked about the data center expansion, less than 5% exposure. If you don’t mind just elaborating on that a little bit more because it’s very timely and your ability to potentially change terms of customers in terms of there’s tariff impacted cost changes with imports? Thank you.

Bill Meaney: Good morning, Shlomo. So, why don’t I start on the leasing and then, Barry can talk — give you a little bit more detail in terms of how we estimated the 5% impact on construction costs. So, on the leasing, first of all, we had a good quarter. If you look at the leasing activity that we had for our normal enterprise colocation sales, we were very pleased with the amount of activity in leasing and continued pipeline in terms of the enterprise colo side. On the hyperscale side is, we feel very good about our 125 megawatt guide for the year, and that’s based on our pipeline and also the conversations that we’re having with some of our largest hyperscale customers across a number of locations, both in the US, Europe, and India.

Barry Hytinen: And, Shlomo, it’s Barry. Yeah. So, when we look at the cost of construction on data center, of course, there’s a fair amount of labor in the development of the sites. Then there is — and that’s in the form of general contractors, there’s obviously design and other construction-related costs. There is some level of import both in things like steel, but also some of the component MEP that comes in. But when we look at it, we think the total exposure is sub-5%. Of course, I’ll note, we do run a global data center portfolio. So, when you factor in what’s affected in the US, that’s a factor of that as well. And then I’ll just say, as it relates to pricing, Shlomo, I think pricing in the data center market continues to be very strong.

You saw our mark-to-market renewal spreads. And my expectation is to the extent that there were tariffs ongoing, the market would absorb those and returns would continue to be quite strong. So, we feel very well-positioned and don’t see much in the way of tariff exposure to the data center business for the foreseeable future in light of the fact that a lot of the supply is on long-term supply commitments and we order those for delivery over a long period of time. Thanks.

Operator: The next question will come from George Tong with Goldman Sachs. Please go ahead.

George Tong: Hi. Thanks. Good morning. I want to stick on the topic of data centers. You mentioned you’re very pleased with leasing activity. You feel good about hyperscalers. But I want to take a step back. And so if you look at broader data center demand at the industry level, certainly has been evolving. Has there been any place within your business where you’ve seen any changes in demand in data centers from any part of your customer set?

Bill Meaney: Good morning, George. Thanks for the question. Actually no. I mean in the conversations that Mark and now Gary have been having, I tag along on some of those conversations, we haven’t seen anything that’s changed in terms of the appetite for the largest customer, the hyperscale side and that’s really across the three geographies I mentioned, across North America, Europe, and India. And I think the other side about that is also what you see there even their announcements. They’ve been pretty rock solid. In fact, some of them have even increased their guidance around CapEx — expected CapEx expenditure over the next 12 to 24 months. And you can kind of consider about half of their CapEx expenditure tends to be — depending on the hyperscale, but tends to be outsourced, some are more, some are less. So we haven’t seen any real change in that macro environment. And the scarcity of power and locations continues to give us a very strong pipeline.

Operator: Your next question will come from Tobey Sommer with Truist. Please go ahead.

Tobey Sommer: Thanks. With respect to your sales strategy and initiatives across the businesses, I was wondering if you could talk to us about what your most important initiatives are and how you think you’re tracking against them for this year and in the next.

Bill Meaney: Yeah. No, thanks, Tobey, for the question. At the core — you’re putting your finger on what really is the core behind the Matterhorn strategy. So, if you — and I know you’re catching up to the story, but the big shift that we made as part of Matterhorn is we created a Chief Commercial Officer, who is Greg McIntosh, and we have a central point, which is — that drives our relationships with the customers. So, as I said, critical to what Matterhorn is all about is not just the products of portfolio that we — or the increased portfolio of products that we’ve launched, which have taken us from $10 billion to now over $160 billion in terms of total addressable market, but it’s how we get after that in terms of offering our customers a single point of contact for Iron Mountain and the cross-selling across those businesses.

And that’s really what’s taken us from a single-digit growth company to a consistently double-digit growth company because people recognize that one-stop-shop, a broad range of products and services. And of course, it helps that 25% or a little bit more than 25% of those products and services just have macro tailwinds that typically grow more than 20%. But you’re spot on that the big part of the transformation story around Matterhorn was that single customer point of contact into Iron Mountain where we can sell the whole range, Mountain range, if you will, of products.

Operator: The next question will come from Kevin McVeigh with UBS. Please go ahead.

Kevin McVeigh: Great. Thanks so much. Hey. Hey, Barry, can you maybe disaggregate the $90 million of increase on the revenue and the EBITDA? How much of that was currency versus revenue management? It sounds like Premier was about $10 million. But how much of the additional $80 million or so was FX as opposed to other things?

Barry Hytinen: Hey, Kevin. Good morning. Thanks. The increase was $90 million. And of that $90 million, $75 million of that just — maybe just under that is the change in the FX rates. And then we’ve got $10 million from Premier and then the remainder, so between $5 million and $10 million — depending upon how you cut the FX, between $5 million and $10 million is just pure operating performance. And honestly, it’s still early in the year, Kevin. So, I would tell you that we feel extraordinarily good about way the business is trending. And as we mentioned on the call, I didn’t include the recent — yesterday contract win that we had with the US government. So, I feel good about where we are in terms of that guide and continue to update the market on how we’re trending through the year. So, thanks for that question.

Operator: The next question will come from Jonathan Atkin with RBC Capital Markets. Please go ahead.

Jonathan Atkin: Thanks. One on data centers and then one on ALM. So, for data centers, just interested in kind of where you see the opportunity set by region. Where might be the deal volumes or the deal sizes be the most meaningful relative to your portfolio?

Bill Meaney: Okay. No, thanks for the question. I think the — if we — let’s start with the US. In the US, we continue to have a lot of pipeline, as you would expect, in Northern Virginia and now also in Richmond, kind of the new Northern Virginia for that region. We also see strong pipeline and interest in our Chicago locations, relatively new to the portfolio. Miami, we just broke ground on that facility just recently. That’s a smaller facility. So, it’s more kind of edge deployment, but also strong pipeline. So, those three markets, we continue to see strong pipeline also in Arizona, but we’re almost completely full in Arizona. So, I’d say right now, it’s Northern Virginia, including our Manassas campus, as well as Richmond, which we’ve added capacity to Manassas, and Richmond is relatively new and then Chicago and then more edge deployment around Miami.

In Europe, the expansion of our Amsterdam campus, again, strong pipeline. As you know, Amsterdam is a key market for a lot of the hyperscalers and there’s limited capacity in Europe broadly, in Amsterdam in particular. So, we feel really good about the pipeline that we have associated with Amsterdam and now Madrid, right? So those are probably the biggest markets for us. We’re sold out in Frankfurt and London at this point. So, then if we go to India, which is relatively newer to our portfolio, and you might have noticed that we actually bought out the remaining stake in Web Werks. That’s now 100% owned. But we have really strong pipeline across their sites. But specifically, I would say, as you would expect, Mumbai, we’re expanding nicely in Mumbai — in the Mumbai market and as well as Chennai.

On the ALM, maybe, Barry, you might want to comment.

Barry Hytinen: Jon, did you have an ALM question there? I know you said you did.

Jonathan Atkin: Impressed, if you were going to answer it before I asked it.

Barry Hytinen: Well, I’m not doing my Kreskin impersonation this morning, Jon. So, we’ll take the question.

Jonathan Atkin: I was interested just the mix and how you see it evolving across cloud, hyperscale and enterprise, international versus US and then the lens with which you kind of evaluate potential for the M&A in that segment.

Bill Meaney: Maybe I’ll start with the mix and then, Barry, you can comment a little bit to the question on the M&A. On the mix is — I think we might have mentioned this on the last call, because of the ITRenew acquisition, is our mix has been historically more skewed towards the hyperscale or decommissioning of data center assets. That is starting to shift because the acquisitions, whether it’s Wisetek, Premier or Regency for that matter, have been more on the enterprise — and the market itself is more enterprise. So, if you think about the market is more like maybe 70%-30%, 70% enterprise end-user devices, other IT assets within enterprise customers, and 30% data center decommissioning, ours was almost the opposite. It was more like 60% data center decommissioning and 40% enterprise.

That’s starting to shift as we are doing the acquisitions and we feel good about that shift. It’s not that we love the hyperscale business, but you can imagine with also the cross-selling — our cross-selling ability into almost 250,000 customers on the enterprise side building out that footprint is really nice. In terms of geography is, although we’re really pleased that we have better coverage now in the southern part of the United States because of our recent acquisition, but I think we feel we’re pretty well covered in the United States from a geography standpoint where we need to get to in terms of serving the customers. Wisetek, which obviously was an Irish-based company, has really helped us fill out a lot of the European side, although they also have a small presence in Thailand.

So, that helped us in Asia. And I think in India, that’s a market that we are continuing to look at in terms of acquisitions. We have small presence in India, but I think it’s fair to say in India and the Middle East, we have more work to do. We go further into Asia Pacific in terms of major markets. We also — I think it was the last call, we announced an acquisition in Australia and I actually visited that acquisition maybe about a month ago and that’s off to a really, really nice start and that’s a — it’s a key market. So, I think the short answer to your question is, you’re going to see our business to reflect more like the macros of the industry that will start shifting to be more of a natural mix of, let’s say, 60%, 70% enterprise, 30%, 40% data center decommissioning.

And then geographically, I think we’re in really — we’re really well covered, I would say, in North America. I would say in Europe, we’re pretty well covered. I mean, there’s still some things that we’re looking at to fill in some countries on that. We could always do more in Eastern Europe. And then India, we’re looking at some acquisitions as well as the Middle East and Australia, we’re well covered. Now, there are other markets that we continue to look at like Latin America, as you expect in some locations in Eastern Europe.

Barry Hytinen: Jon, it’s Barry. Just a couple more thoughts there to add on. From an enterprise versus hyperscale perspective, in the first quarter, we were just about 59% enterprise, 41% hyperscale. Pro forma for the Premier deal would be in the low 60%s as Bill was suggesting and trending higher. We like both parts of the business, obviously, enterprise and hyperscale. On the hyperscale side, there’s a high visibility of a massive amount of volume that continues to grow in light of data center decommissioning needs in light of the fleets of data centers out there that have been growing and continue to grow at, as you know, very fast rates. And so, that brings with it a considerable amount of volume. As we’ve also talked about before, though, the margins on that business, it’s more of a revenue-share model.

So, margins are lower, but high degree of volume. On the enterprise side, where it’s much more of a flow business and a continuous business that somewhat annuity like, the margins are better. It’s more of a service offering. And we — and obviously, as Bill was mentioning, the market there is much larger than the hyperscale side. So, we do expect the business to continue to trend more enterprise. That brings with it a better margin mix, as I was mentioning. Also, it creates more opportunity for operating leverage and scale efficiencies across our network and to be able — as we service our clients better. And you’re seeing some of that play out as the business continues to get more scale. As I mentioned on the prepared remarks, the ALM profitability has continued to improve.

I think the team is doing a great job there and that’s thanks to acquisition synergies as well as improved operating leverage. And just one last point on acquisitions in the ALM space. We continue to be on the lookout and actively working on incremental tuck-ins here and there. We generally continue to see multiples in that mid to high single-digit of EBITDA. And on an acquisition synergy adjusted, that kind of very quickly gets down below five times. So, we think it’s a very positive way to both grow and augment the organic growth that the team is delivering. I’d just echo one of the points we made, the team delivered 22% organic growth in the quarter in ALM, a very strong performance as — and ticking up meaningfully from the fourth quarter.

And as we said earlier, we’ve got a strong trajectory for that organic growth to continue to accelerate, Jon. So, thanks for that question.

Operator: [Operator Instructions] Our next question will come from Brendan Lynch with Barclays. Please go ahead. Mr. Lynch your line is open.

Bill Meaney: Brendan, if you’re on mute, we just — we can’t hear you.

Brendan Lynch: Sorry, how about now?

Bill Meaney: Yeah, we got you, Brendan.

Brendan Lynch: Okay. Sorry about that. Yeah, sticking with the ALM theme, the volume was up quite a bit in the quarter. Can you talk about what triggered that? Did downstream pricing or something else change in the market that allowed you or your customers to accelerate the pace of selling inventory?

Bill Meaney: Yeah. So, Brendan, I think it’s much more aligned with the fact that we’ve been consistently winning more business and the team is both growing our enterprise book of business through the wins that we’ve made throughout last year, which kind of build on themselves. As I was describing earlier, it is kind of tends to be a flow-oriented business where you win an account and then you start taking on more and more volume from the account because of course, all of the accounts that we’re winning have an existing means for recycle reuse. So, the enterprise volume continues to come through. And then on the data center decommissioning, as we mentioned last year, we continue to win additional accounts and win more share within the accounts that we were already servicing.

Pricing, just I’ll reiterate something I made — comment I made in the prepared remarks, pricing in the market was actually kind of largely flat to slightly down, I would say. So, it wasn’t like pricing created a opportunity. And incidentally, in my go-forward projections, we got a little more conservative with pricing. We left our pricing assumptions at levels where they exited the first quarter, which I think could prove conservative, but we just felt like that was the right way to do it in light of what we were seeing in the quarter. So, feel very well positioned.

Operator: This concludes our question-and-answer session and the Iron Mountain first quarter 2025 earnings conference call. Thank you for attending today’s presentation. You may now disconnect.