Iron Mountain Q3 Revenue Rises 13% on Data Center and ALM Growth

Iron Mountain Inc. (NYSE: IRM) reported record third-quarter 2026 results as rapid expansion in data centers and asset lifecycle management complemented continued growth in its core records and information management business. Revenue and adjusted EBITDA each increased 13% year over year, while the company issued full-year guidance that implies double-digit growth across its main financial measures despite a stronger U.S. dollar.

Revenue for the three months ended September 30 rose to $1.99 billion from $1.75 billion a year earlier. Net income increased 49% to $129 million, and reported earnings per share advanced 46% to $0.41.

Adjusted EBITDA, a non-GAAP measure, reached $748 million, up from $660 million. The adjusted EBITDA margin was unchanged at 37.6%. Adjusted EPS increased 19% to $0.64, while adjusted funds from operations rose 17% to $458 million. AFFO per share climbed 16% to $1.53.

Data centers and ALM lead growth

Global Data Center revenue increased 34% to $274 million. Iron Mountain signed 102 megawatts of new leases during the quarter, bringing year-to-date leasing through September to 137 MW. That total included 51 MW in Mumbai, 25 MW in London and 23 MW in Chennai, alongside an expansion of the company’s global hyperscale customer base.

Renewal pricing increased 10% on a cash basis and 15% under GAAP. Iron Mountain said its existing backlog is expected to support more than 25% Data Center revenue growth in 2026 and approximately $1.7 billion in annual revenue when fully reflected, before any additional leasing.

The company operates 32 data centers and has 545 MW in its current operating portfolio. Its total developable capacity is about 1.4 gigawatts, and approximately 325 MW of available-to-lease capacity is expected to be energized over the next 24 months. Management said industry demand continues to outpace supply and pointed to growing hyperscale demand for AI inference infrastructure.

Asset Lifecycle Management revenue rose 43% on a reported basis and 38% organically, driven by the enterprise ALM channel. The business also delivered a year-over-year improvement in its profit contribution. Iron Mountain highlighted a cross-selling agreement under which it will become the sole North American partner managing secure IT asset disposition for a leading global consulting firm. ALM results are reported within Corporate and Other, where quarterly revenue increased 34% to $284 million.

Core information management business remains steady

Global Records and Information Management revenue increased 7% on both a reported and organic basis to $1.43 billion. The segment benefited from revenue management and record Digital Solutions revenue, according to the presentation.

Iron Mountain reported a record level of storage volume during the quarter. The company described physical storage as a highly recurring business, with boxes retained for an average of about 15 years. It also won a $25 million multi-year records management contract with a new U.S. federal government customer.

Digital Solutions, which is included in Global RIM, is now an approximately $600 million business on a trailing-12-month basis. Iron Mountain said it is executing a backlog of signed government and enterprise projects, including a multi-year agreement to manage a digital transformation initiative for a Middle Eastern government using its AI-powered Insight DXP platform.

Full-year outlook and capital allocation

For 2026, Iron Mountain expects revenue of $7.95 billion to $8.02 billion, representing growth of about 16% at the midpoint. Adjusted EBITDA is projected at $2.95 billion to $2.98 billion, or approximately 15% growth, while AFFO is expected to range from $1.78 billion to $1.80 billion, up about 16% at the midpoint. AFFO per share is forecast at $5.94 to $6.00, implying roughly 15% growth.

Fourth-quarter expectations call for approximately $2.03 billion of revenue, $780 million of adjusted EBITDA, $473 million of AFFO and AFFO per share of about $1.57. The company said its increased guidance incorporates the negative impact of a stronger U.S. dollar since its previous earnings call. Iron Mountain does not provide GAAP reconciliations for the non-GAAP measures in its annual guidance because certain inputs are unavailable without unreasonable effort.

Growth businesses comprising Data Center, Digital Solutions and ALM are expected to generate 37% revenue growth in 2026 and account for 34% of total revenue. Iron Mountain expects those businesses to contribute 11 percentage points of consolidated growth, with the rest of the portfolio contributing five points.

The company ended the quarter with a long-term net lease-adjusted leverage ratio of 4.8 times, within its target range of 4.5 to 5.5 times. Iron Mountain also announced a 15% dividend increase effective January 2027, which will be its fifth increase in four years. Management said annual operating cash flow is approaching $2 billion and more than covers recurring capital expenditure and the dividend, leaving excess cash flow available for growth investment.

The outlook remains subject to execution and financing risks, including the company’s ability to fund data center development, complete and integrate acquisitions, manage global operations and maintain its target leverage. Other uncertainties identified by Iron Mountain include changing demand for physical storage, cybersecurity incidents, data privacy and regulatory requirements, power costs and service interruptions at data centers, competition, geopolitical disruption, currency movements and its continued qualification as a U.S. real estate investment trust.