One of the world's largest digital infrastructure companies has eliminated about 3% of its global workforce — or nearly 400 employees — as it pivots to building fewer, but larger, data center campuses.
Equinix, based in Redwood City, California, with more than 13,000 global employees, eliminated "a limited number of roles" to align with its current priorities, a spokesperson for the interconnection company providing data center services told CoStar News. Equinix did not immediately disclose a timeline of the job cuts or the markets involved.
"Equinix continues to evolve our services to ensure we provide the highest value to support the changing needs of our customers," the Equinix spokesperson told CoStar News. "As part of these ongoing efforts, we will at times make internal adjustments to reallocate resources and prioritize initiatives that accelerate our strategy."
The decision to change up its workforce comes on the heels of Equinix officials telling investors it would pivot from building smaller data centers to larger data center campuses to better secure power for its customers, CEO and President Adaire Fox-Martin said.
"We intend to build for the future and accelerate our development of differentiated campuses that support the broad range of our customers' needs," Fox-Martin said during the company's third-quarter 2024 earnings call last month.
"Essentially, this means moving from many smaller builds with phased capacity delivery to fewer, larger builds, balancing location with access to power on campuses that can service the full range of our customers' needs from small- to medium-sized enterprises to hyperscalers."
Shift in priorities
Robust demand from cloud computing and artificial intelligence led to a significant increase in data center construction in the first half of the year, according to CBRE research.
Equinix unveiled a joint venture partnership in early October with Singapore-based GIC Real Estate and the Canada Pension Plan Investment Board to invest $15 billion in U.S. data centers, CoStar News has reported. The partnership is expected to help Equinix grow its "state-of-the-art xScale facilities on multiple campuses across the United States, each with the capacity of hundreds of megawatts," Fox-Martin said during the recent earnings call.
Recently, Equinix closed on land and power for a 240-megawatt xScale campus in Atlanta as part of the new venture.
In the Dallas-Fort Worth region, large cloud providers known as hyperscalers often head to neighboring suburbs on the southern side of Dallas seeking high-powered campuses built by data center developers including Compass Datacenters, QTS Data Centers and DataBank to house the massive computing scale needed to run operations.
Those cloud providers may have a presence at the Equinix Infomart, one of the largest interconnection hubs in the United States, but it doesn't house its operations tackling the AI boom, according to industry sources. This new joint venture seems to be a shift in the company's larger strategy, brokers say.
About 90% of its operational and under-construction capacity is leased, the firm told investors. In all, the company has 57 projects underway in 35 markets across 22 countries, including 13 xScale projects.