Key Insights from American Tower's Strategic Updates

Jan 01, 2025

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American Tower, a global leader in wireless infrastructure, recently shared a few insights into its growth strategy and market positioning. Here are key takeaways from the company's latest updates:

1. Global Tower Portfolio

American Tower owns a network of 222,415 towers worldwide, with 42,124 located in the United States and Canada and 180,291 in international markets. This extensive portfolio underscores the company's global presence.

2. Net Organic Tenant Billings Growth

The company achieved a total net organic tenant billings growth of 5.3% in Q2 2024. This growth is broken down regionally as follows: U.S. and Canada (5.1%), Europe (5.7%), Latin America (2.2%), Africa (13.2%), and APAC (2.1%).

3. Shift in Investment Focus

American Tower plans to shift its focus toward developed economies, reducing its exposure to emerging markets. Capex investment in developed markets like the U.S. and Europe is on the rise, with mid-teens U.S. dollar yields being underwritten. In contrast, discretionary capital spending in Latin America, Africa, and APAC is expected to decrease by over 40% in 2024 vs 2021.

4. Data Center Expansion

American Tower’s CoreSite data centers offer 255.8 megawatts of power capacity across 3.67 million net rentable square feet, with total operating revenue up 12.7% year-over-year. CoreSite is expanding its data center presence, including a joint venture with Stonepeak to build a new data center in Denver, Colorado. This project will establish an 18 MW campus at a total cost of $250+ million.

5. Growth in Data Center Services

CoreSite data centers have seen a 4.9% year-over-year increase in interconnections, reaching 39,250 cross-connects. The Monthly Recurring Revenue (MRR) per Cabinet has risen to $1,799, up 8.5% year-over-year, with total occupancy at 85.5%. This growth highlights strong demand for hybrid cloud technology among enterprises.

6. Expansion into Edge Data Centers

CoreSite is also developing an edge data center in Raleigh, North Carolina, chosen for its strategic location on a tower site with access to fiber and low power costs. This facility will support enterprises working on edge applications, further enhancing CoreSite's market position.

7. Global 5G Deployment

In the U.S., over 50% of sites have mid-band spectrum deployment for 5G, with variations among carriers. International markets, however, generally lag behind developed markets in 5G deployment. Europe has seen significant progress, with high coverage in Spain and Germany, while Africa and Latin America are still in the early stages of 5G adoption.

These insights from American Tower illustrate a strategic focus on developed markets and data center expansion, alongside efforts to capitalize on the growing demand for 5G and hybrid cloud solutions in emerging and developed markets globally.

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Key Insights from American Tower's Strategic Updates

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