Equinix 10-K 2020-12-31

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

__________________________

FORM 10-K

For the fiscal year ended December 31, 2020

OR

For the transition period from _____________ to _____________

Commission file number 000-31293

______________________

EQUINIX, INC.

(Exact name of registrant as specified in its charter)

One Lagoon Drive, Redwood City, California 94065

(Address of principal executive offices, including ZIP code)

(650) 598-6000

(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer as defined in Rule 405 of the Act. Yes ☒ No ☐

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐ No ☒

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See definitions of "large accelerated filer," "accelerated filer," "smaller reporting company," and "emerging growth company" in Rule 12b-2 of the Exchange Act.

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report. ☒

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The aggregate market value of the voting and non-voting common stock held by non-affiliates computed by reference to the price at which the common stock was last sold as of the last business day of the registrant's most recently completed second fiscal quarter was approximately $62.2 billion. As of February 18, 2021, a total of 89,287,863 shares of the registrant's common stock were outstanding.

DOCUMENTS INCORPORATED BY REFERENCE

Part III – Portions of the registrant's definitive proxy statement to be issued in conjunction with the registrant's 2021 Annual Meeting of Stockholders, which is expected to be filed not later than 120 days after the registrant's fiscal year ended December 31, 2020. Except as expressly incorporated by reference, the registrant's proxy statement shall not be deemed to be a part of this report on Form 10-K.

TABLE OF CONTENTS

PART I

Forward-Looking Statements

The words "Equinix", "we", "our", "ours", "us" and the "Company" refer to Equinix, Inc. All statements in this discussion that are not historical are forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, including statements regarding Equinix's "expectations", "beliefs", "intentions", "strategies", "forecasts", "predictions", "plans" or the like. Such statements are based on management's current expectations and are subject to a number of factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Equinix cautions investors that there can be no assurance that actual results or business conditions will not differ materially from those projected or suggested in such forward-looking statements as a result of various factors, including, but not limited to, the risk factors discussed in this Annual Report on Form 10-K. Equinix expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward looking statements contained herein to reflect any change in Equinix's expectations with regard thereto or any change in events, conditions, or circumstances on which any such statements are based.

Summary of Risk Factors

Our business is subject to numerous risks and uncertainties that make an investment in our common stock speculative or risky, any one of which could materially adversely affect our results of operations, financial condition or business. These risks include, but are not limited to, those listed below. This list is not complete, and should be read together with the section titled “Risk Factors” in this Annual Report on Form 10-K, as well as the other information in this Annual Report on Form 10-K and the other filings that we make with the U.S. Securities and Exchange Commission (the “SEC”).

Risks Related to Our Business and Our Operations

• The ongoing COVID-19 pandemic could have a negative effect on our business, results of operations and financial condition.

• We experienced an information technology security breach in the past and may be vulnerable to future security breaches, which could disrupt our operations and have a material adverse effect on our business, results of operation and financial condition.

• Terrorist activity, or violence stemming from the current climate of political and economic uncertainty, could adversely impact our business.

• Our offerings have a long sales cycle that may harm our revenue and results of operations.

• Any failure of our physical infrastructure or negative impact on our ability to meet our obligations to our customers or damage to customer infrastructure within our IBX data centers, could lead to significant costs and disruptions that could reduce our revenue and harm our business reputation and financial condition.

• We are currently making significant investments in our back-office information technology systems and processes. Difficulties from or disruptions to these efforts may interrupt our normal operations and adversely affect our business and results of operations.

• The level of insurance coverage that we purchase may prove to be inadequate.

• The use of high power density equipment may limit our ability to fully utilize our older IBX data centers.

• If we are unable to implement our evolving organizational structure or if we are unable to recruit or retain key executives and qualified personnel, our business could be harmed.

• We may not be able to compete successfully against current and future competitors.

• If we cannot continue to develop, acquire, market and provide new offerings or enhancements to existing offerings that meet customer requirements and differentiate us from our competitors, our results of operations could suffer.

• Our results of operations results may fluctuate.

• Our days sales outstanding ("DSO") may be negatively impacted by process and system upgrades and acquisitions.

• We may incur goodwill and other intangible asset impairment charges, or impairment charges to our property, plant and equipment, which could result in a significant reduction to our earnings.

• We have incurred substantial losses in the past and may incur additional losses in the future.

• The failure to obtain favorable terms when we renew our IBX data center leases, or the failure to renew such leases, could harm our business and results of operations.

• We depend on a number of third parties to provide internet connectivity to our IBX data centers; if connectivity is interrupted or terminated, our results of operations and cash flow could be materially and adversely affected.

• We have government customers, which subjects us to risks including early termination, audits, investigations, sanctions and penalties.

• Because we depend on the development and growth of a balanced customer base, including key magnet customers, failure to attract, grow and retain this base of customers could harm our business and results of operations.

• Industry consolidation may have a negative impact on our business model.

Risks Related to Our Expansion Plans

• Our construction of additional new IBX data centers or IBX data center expansions could involve significant risks to our business.

• Acquisitions present many risks, and we may not realize the financial or strategic goals that were contemplated at the time of any transaction.

• The anticipated benefits of our joint ventures with GIC Private Limited, Singapore’s sovereign wealth fund (“GIC”) may not be fully realized or take longer to realize than expected.

• Joint venture investments, such as our joint ventures with GIC, could expose us to risks and liabilities in connection with the formation of the new joint ventures, the operation of such joint ventures without sole decision-making authority, and our reliance on joint venture partners who may have economic and business interests that are inconsistent with our business interests.

• If we cannot effectively manage our international operations, and successfully implement our international expansion plans, or comply with evolving laws and regulations, our revenues may not increase, and our business and results of operations would be harmed.

• We are continuing to invest in our expansion efforts but may not have sufficient customer demand in the future to realize expected returns on these investments.

Risks Related to Our Capital Needs and Capital Strategy

• Our substantial debt could adversely affect our cash flows and limit our flexibility to raise additional capital.

• The phase-out of the London Interbank Offered Rate (“LIBOR”), and uncertainty as to its replacement, may adversely affect our business.

• Sales or issuances of shares of our common stock may adversely affect the market price of our common stock.

• If we are not able to generate sufficient operating cash flows or obtain external financing, our ability to fund incremental expansion plans may be limited.

• Fluctuations in foreign currency exchange rates in the markets in which we operate internationally could harm our results of operations.

• Our derivative transactions expose us to counterparty credit risk.

Risks Related to Environmental Laws and Climate Change Impacts

• Environmental regulations may impose upon us new or unexpected costs.

• Our business may be adversely affected by climate change and responses to it.

• Our business could be harmed by prolonged power outages, shortages or capacity constraints.

Risks Related to Certain Regulations and Laws, including Tax Laws

• Changes in U.S. or foreign tax laws, regulations, or interpretations thereof, including changes to tax rates, may adversely affect our financial statements and cash taxes.

• Government regulation may adversely affect our business.

Risks Related to Our Taxation as a REIT

• We have a number of risks related to our taxation as a REIT, including the risk that we may not be able to maintain our qualification as a REIT which could expose us to substantial corporate income tax and have a materially adverse effect on our business, financial condition, and results of operations.

Overview: Powering the World’s Digital Leaders

Equinix is a global digital infrastructure company. Digital leaders harness our trusted platform to bring together and interconnect the foundational infrastructure that powers their digital success. We enable our customers to access all the right places, partners and possibilities they need to accelerate their digital advantage. Platform Equinix® combines a global footprint of International Business Exchange™ ("IBX®") data centers in the Americas ("AMER"), Asia-Pacific ("APAC"), and Europe, the Middle East and Africa ("EMEA") regions, interconnection solutions, edge services, unique business and digital ecosystems and expert consulting and support. Equinix was incorporated on June 22, 1998 as a Delaware corporation and operates as a real estate investment trust for federal income tax purposes ("REIT").

Al Avery and Jay Adelson founded Equinix as a vendor-neutral multi-tenant data center ("MTDC") provider where competing networks could connect and share data traffic to help scale the rapid growth of the early internet. The company’s name, Equinix (composed from the words "equality", "neutrality" and "internet exchange"), reflects that vision. The founders also believed they not only had the opportunity but also the responsibility to create a company that would be the steward of some of the most important digital infrastructure assets in the world. Two decades later, we have expanded upon that vision to build Platform Equinix, with unmatched scale and reach.

Our interconnected data centers around the world allow our customers to bring together and interconnect the infrastructure they need to fast-track their digital advantage. With Equinix, they can scale with agility, speed the launch of digital services, deliver world-class experiences and multiply their value. We enable them to increase information and application delivery performance for users, and quickly deploy distributed IT infrastructures and access business and digital ecosystems, all while significantly reducing costs and latency. The Equinix global platform, and the quality of our IBX data centers, interconnection offerings and edge services, have enabled us to establish a critical mass of customers. As more customers choose Platform Equinix, for bandwidth cost and performance reasons it benefits their suppliers and business partners to colocate in the same data centers and connect directly with each other. This adjacency creates a “network effect” that attracts new customers and enables our existing customers to capture further economic and performance benefits from our offerings.

In 2020, we opened six new IBX data centers, invested in xScaleTM data centers, and added capacity in 14 markets resulting in an increase in our total number of IBX and xScaleTM data center facilities to more than 225, including our acquisition of 13 data centers in Canada. 2020 highlights include:

• New data center openings in 2020 included six new IBX sites in the following metros: Washington DC, Dallas, Warsaw, and Hamburg, with an opening in Muscat, Oman held in an unconsolidated entity and a new market entry announced for Bordeaux, France.

• We began construction on five additional xScaleTM sites in 2020. xScaleTM data centers serve the needs of the growing hyperscale data center market, including the world's largest cloud service providers, and are engineered to meet the technical and operational requirements and price points of core hyperscale workload deployments. xScaleTM data centers also offer access to our comprehensive suite of interconnection and edge services that tie into the hyperscale companies' existing access points at Equinix, thereby increasing the speed of connectivity to their existing and future enterprise customers. In xScaleTM sites, hyperscale companies can consolidate core and access point deployments into one global provider to streamline and simplify their rapid growth.

• In the fourth quarter of 2020, we acquired 13 data centers from BCE Inc. ("Bell') in Canada (the "Bell Acquisition"), solidifying our position as a leading digital infrastructure provider in the country, with a total of 15 data centers that we now operate coast-to-coast across eight metros. The Bell Acquisition allows us to expand our reach with seven new metros in six provinces, adding more than 600 customer accounts from diverse sectors, including enterprise, cloud, IT, government, energy and financial services. In addition to adding new capacity in Toronto where we already operated two IBX data centers, we acquired data centers in Calgary, Kamloops, Saint John, Montreal, Ottawa, Vancouver and Winnipeg. The transaction opens key gateways from North America to Asia through Vancouver and North America to Europe through the submarine cable systems in the Saint John area in New Brunswick.

• In August 2020, we announced our intended expansion into India, a new market, entering into an agreement to purchase the India operations of GPX Global Systems, Inc. ("GPX India"). The acquisition, expected to close in Q2 2021 subject to regulatory approval, includes the two most interconnected data centers in India, with a well-established ecosystem in Mumbai that includes more than 200 interconnection-rich customers, international brands and key local players. India has the world’s second largest population and the second largest base of internet subscribers, fueling demand for data centers and colocation offerings. This planned acquisition underscores our goal to extend Platform Equinix to support our customers’ digital edge strategies.

• In March 2020, we completed our acquisition of leading bare metal automation company Packet Host, Inc. ("Packet") (the "Packet Acquisition"). Packet’s capabilities became Equinix MetalTM which adds direct integration to Equinix FabricTM and expands the services to new global locations. With Equinix Metal, enterprises, SaaS companies and digital service providers can provision interconnected bare metal resources in minutes instead of months, while reducing the capital expenditures and operational requirements of owning hardware. They can also reduce cloud costs while retaining the flexibility and operational expenditures of cloud services via on demand, reserved or spot market capacity in our global data centers using the Equinix Metal portal or DevOps-friendly APIs and integrations. An important piece of our Platform strategy, this acquisition advances our vision to deliver the most advanced solutions for customers to rapidly deploy digital infrastructure at global scale.

• In January 2020, we expanded into two new Mexico metros, with our acquisition of three data centers from Axtel S.A.B. de C.V. ("Axtel") that serve the Mexico City and Monterrey metro areas. This expansion, when combined with previous Equinix acquisitions of key regional traffic hubs in Dallas ("Infomart") and Miami (the NAP of the Americas), further strengthens our global platform by increasing interconnection between North, Central and South America. Mexico is the world's eleventh-largest economy and the second largest in Latin America. The country's telecommunications reform of 2013 has created opportunities for many businesses seeking to expand into Mexico, allowing for open competition by non-governmental entities and providing an opportunity for the growth of service provider and enterprise ecosystems that flourish within our network-neutral data centers globally.

Industry Trends: Taking Digital Business to the Edge

Digital transformation is changing where and how businesses deploy and deliver IT services to employees and is creating new digital business models for partners and customers. The convergence of these global trends and the impact of the ongoing COVID-19 pandemic have created additional pressure for many companies to transform. The collective influence of these trends is driving complexity and risk that must be addressed in multiple locations for companies to effectively compete in the global digital economy. These trends include:

• Digital business**: As organizations transform their traditional lines of business, they are being asked to reduce costs and become more efficient while accelerating the development of new insights. This requires transforming network architecture while distributing digital infrastructure in strategic locations to support local interconnection between user services, data, clouds and ecosystem partners.

• Urbanization**: This is driving an increase in population centers needing digital engagement; however, a more recent trend has been migration out of cities due to the ongoing COVID-19 pandemic. This is causing an expansion in the overall digital edge, which requires companies to locate digital services close to users to deliver great user experiences. These same concentrations of people provide an economy of scale which makes it cost effective to distribute applications, data, content and networking to serve these locations.

• Cybersecurity**: A cybersecurity breach is one of the most serious risks facing companies today, and many of the most serious breaches occur via a penetration of a company’s business partners’ networks. To protect against this, businesses need to develop best practices to distribute their security controls and infrastructure out to digital exchanges where most traffic exchange is happening.

• Data volumes and compliance**: Demand for local data analysis and data exchange to support digital workflows is outpacing organizations’ ability to classify, secure, privately transport and process data across regions. To meet new regulations and drive new strategic value, companies need to deploy distributed data storage, analytics and clouds within the same jurisdiction, and then replicate this across multiple global locations.

• Business ecosystems**: Digital trade flows involve an increasing variety of customers, partners and employees. To enable this, companies deploy a digital presence in close physical proximity to an application exchange point and then connect to it directly to support real-time engagement. In the aggregate, these form a business ecosystem. These ecosystems are expanding in depth and number.

These trends are accelerating the need for companies like Equinix who can provide a secure, agile global business platform that leverages digital interconnection—or private data exchange—to deliver real-time interactions around the world.

As part of their digital transformation, businesses in most industries are shifting their centralized IT infrastructures to the edge to bring digital services closer to users for better performance, which has become a significant driver of digital business value. To realize the full potential of the edge, IT organizations require greater interconnection bandwidth. Interconnection bandwidth is defined as the total capacity provisioned to privately and directly exchange traffic, with a diverse set of partners and providers, at distributed IT exchange points inside carrier-neutral colocation data centers. Private interconnection capacity between businesses, as reported in the fourth annual Global Interconnection Index ("GXI"), a market study published by Equinix, is anticipated to grow at a compound annual growth rate of 45% by 2023, reaching 16,300+ terabits per second of data exchanged annually.

Worldwide Interconnection Bandwidth Capacity Growth (2018 - 2022) in Terabits per Second (Tbps)

Source: GXI Volume 4

Equinix Business Proposition: Bring together and interconnect the infrastructure you need to fast-track your digital advantage

In 2020, we continued to build new data center, interconnection and edge services capabilities that we intend will further our vision to power the world’s digital leaders. On Platform Equinix, digital leaders can bring together all the right places, partners and possibilities to create the foundational infrastructure they need to succeed. We offer a comprehensive, integrated suite of data center, interconnection and edge services and products to close to 10,000 enterprise and service provider customers worldwide.

The following are the leading revenue generating product and other offerings that collectively make up Platform Equinix:

Data Center Solutions

Our global, state-of-the-art data centers meet strict standards of security, reliability, certification and sustainability. Offerings in these data centers are typically billed based on the space and power a customer consumes, are delivered under a fixed duration contract and generate monthly recurring revenue ("MRR").

• IBX Data Centers** consist of more than 220 IBX vendor-neutral colocation data centers worldwide, providing our customers with secure, reliable and robust environments (including space and power) that are necessary to aggregate and distribute information and connect digital and business ecosystems globally. IBX data centers provide access to vital ecosystems where enterprises, network, cloud and SaaS providers, and business partners directly and securely interconnect to each other.

• xScale****TM** Data Centers are designed to serve the unique core workload deployment needs of a targeted group of hyperscale companies, which include the world's largest cloud service providers. With xScaleTM data centers, hyperscale customers add to their core hyperscale data center deployments and existing customer access points at Equinix, allowing streamlined expansion with a single global vendor.

• IBX SmartView** is a fully integrated monitoring software which provides customers visibility into the operating data relevant to their specific Equinix footprint as if they were in-house. The software provides online access to real-time environmental and operating data through the Equinix Customer Portal or API integrations. With real-time alerts and configurable reporting, IBX SmartView allows customers to maintain their IBX operations and plan for future growth.

Interconnection Solutions

Our interconnection solutions connect businesses directly, securely and dynamically within and between our data centers across our global platform. Our interconnection services are typically billed based on the outbound connections from a customer and generate MRR.

• Equinix Fabric™** provides secure, on-demand, software-defined interconnection. Built specifically for digital infrastructure, Equinix Fabric enables businesses to connect globally to their choice of thousands of networking, storage, compute and application service providers in the industry’s largest infrastructure ecosystem. As the foundation of Platform Equinix’s interconnection capability, Equinix Fabric enables customers to quickly and easily connect their physical and virtual digital infrastructures.

• Cross Connects** provide a point-to-point cable link between two Equinix customers in the same IBX data center. Cross Connects deliver fast, convenient, affordable and highly reliable connectivity and data exchange with business partners and service providers within the Equinix ecosystem.

• Equinix Internet Exchange™** enables networks, content providers and large enterprises to exchange internet traffic through the largest global peering solution. Service providers can aggregate traffic to multiple counterparties, called peers, on one physical port and handle multiple small peers while moving high-traffic peers to private interconnections. This reduces latency for end-users when accessing content and applications.

• Equinix Connect** is an agile, scalable, resilient and high performing internet access solution. With at least two upstream ISPs in each market, Equinix Connect offers the resiliency that organizations demand and direct connections to major content destinations, resulting in superior performance. It provides the convenience of a one-stop shop and the flexibility required to connect to the internet as a primary or secondary access solution. Available globally in more than 40 markets, Equinix Connect allows businesses to grow as their needs grow with scalable bandwidth options to meet their emerging usage requirements.

Edge Services

Our edge services help businesses rapidly deploy as-a-service networking, security and hardware across our global data center footprint - as an alternative to buying, owning and managing the physical infrastructure. Our edge services are typically billed based on the number of instances and the capacity used by a customer and generate MRR.

• Network Edge** allows customers to modernize networks within minutes, by deploying network functions virtualization ("NFV") from multiple vendors across Equinix metros. Companies can select, deploy and connect virtual network services at the edge quickly, with no additional hardware requirements.

• Equinix SmartKey™** helps customers simplify data protection across any cloud architecture via a global SaaS-based, hardware security module management and cryptography service that provides on-premises and hybrid multicloud encryption key management.

• Equinix Metal™** allows enterprises, SaaS companies and digital service providers to provision interconnected bare metal resources in minutes instead of months, while reducing the capital expenditures and operational requirements of owning hardware. They can also reduce cloud costs while retaining the flexibility and operational expenditures of cloud services via on demand, reserved or spot market capacity in Equinix’s global data centers using the Equinix Metal portal or DevOps-friendly APIs and integrations.

Colocation Offerings

Equinix offers a variety of colocation offerings designed to speed and streamline digital transformation and data center deployments for its customers. These services are typically billed based on consumption and generate non-recurring revenue ("NRR").

• Equinix Smart Hands** provides around-the-clock, on-site, operational support service for remote management, installation and troubleshooting of customer data center equipment. Using Equinix IBX data

center technicians, Smart Hands allows customers to manage and outsource their business operations and maximize uptime whether from within an IBX data center or from a remote location. Providing remote management through Smart Hands has helped enable some customers to continue managing business operations in spite of the impact of the COVID-19 pandemic.

• Equinix Infrastructure Services** (EIS) provides customers with a one-stop shop for data center installation, migration and equipment procurement. With proven practices developed over many years of successfully building, migrating and optimizing our customers’ data center needs, EIS services lend expertise to address larger, more complex data center jobs including installation and implementation of new builds, planned migrations, structured cabling, labelling and documentation, procurement recommendations and coordination, and secure de-installation.

Competition

While a large number of enterprises and service providers, such as hyperscale cloud service providers, own their own data centers, We believe the industry is shifting away from single-tenant solutions and outsourcing some or all of their IT housing and interconnection requirements to third party facilities, such as those operated by us.

Historically, that outsourcing market was served by large telecommunications carriers who bundled their products and services with their colocation offerings. The data center market landscape has evolved to include private and vendor-neutral MTDC providers, hyperscale cloud providers, managed infrastructure and application hosting providers, and systems integrators. It is estimated that Equinix is one of more than 1,200 companies that provide MTDC offerings around the world. The global MTDC market is highly fragmented. Each of these data center solutions providers can bundle various colocation, interconnection and network offerings and outsourced IT infrastructure solutions. We believe that this outsourcing trend is likely to accelerate in the coming years, especially in light of changes to digital business as a result of the ongoing COVID-19 pandemic.

Equinix is differentiated in this market by being able to offer customers a global platform that reaches 26 countries and contains the industry’s largest and most active ecosystem of partners in our sites. This ecosystem creates a “network effect” which improves performance and lowers cost for our customers and is a significant source of competitive advantage for Equinix.

Customers

Our customers include telecommunications carriers, mobile and other network services providers, cloud and IT services providers, digital media and content providers, financial services companies, and global enterprise ecosystems in various industries. We provide each company access to a choice of business partners and solutions based on their colocation, interconnection and managed IT service needs, and delivered 99.9999% operational uptime across our global data centers in 2020. As of December 31, 2020, we had over 10,000 customers worldwide. No one customer made up 10% or more of our total business revenues for the year ended December 31, 2020.

The following companies represent some of our leading customers and partners:

We serve our customers with a direct sales force and channel marketing program. We organize our sales force by customer type, as well as by establishing a sales presence in diverse geographic regions, which enables efficient

servicing of the customer base from a network of regional offices. We also support our customers with a global customer care organization.

Human Capital

As of December 31, 2020, we had 10,013 employees worldwide with 4,599 based in the Americas, 3,405 based in EMEA and 2,009 based in APAC. Of those employees, 4,436 employees were in engineering and operations, 1,911 employees were in sales and marketing and 3,666 employees were in management, finance and administration. We recognize that attracting, developing and retaining talent at all levels is vital to continuing our success and offer industry competitive compensation and benefits, along with development opportunities to help every employee achieve their full potential. In 2020, we expanded our portfolio of development programs for our employees. We have invested in a digital learning platform, providing access to on-demand learning to each of our employees. We have developed and rolled out several programs to help our leaders navigate the current environment. To ensure we are continuously improving employee experience and enabling our talent to thrive, we have enhanced our listening strategy, moving to more frequent surveys at several steps along an employee’s journey at Equinix.

At Equinix, we strive to build a culture where every employee, every day, can say “I’m Safe, I Belong and I Matter” and develop our workforce, at all levels, to better reflect and represent the communities in which we operate. Our objective is to continue to make our culture a critical competitive advantage, engaging every leader and every employee in the process. To ensure we are upholding our core corporate values and making progress toward our goals, we monitor our employee satisfaction through our quarterly survey, which is our listening mechanism. In 2020, employee satisfaction averaged 85%.

We are integrating a focus on diversity, inclusion and belonging ("DIB") into every aspect of how we run our business and have initiated a multi-year DIB strategy with governance through a DIB Council chaired by our CEO and CHRO, in partnership with our Sustainability Program Office, that oversees our progress on environment, social and governance ("ESG") matters. Our DIB strategy focuses on attracting, retaining and developing a diverse, global workforce; building leadership capability; and empowering our people to bring DIB to life. Equinix representatives have joined the G100 Talent Consortium Task Force on Racial Inequity in Business to consider core inequity issues, including anti-racism, bias, and hiring and promotability practices, in order to develop tangible best practices that companies can use as guide rails to increase representation and career mobility for black, indigenous and people of color ("BIPOC") employees. In 2020, we hosted a Days of Understanding event as part of an initiative of CEO ACT!ON, a pledge Equinix has taken along with hundreds of other companies to embrace difference in our organizations, educate our people and build more inclusive cultures inside and outside of our workplaces. We also have employee-led connection networks ("ECNs"), each representing an identity/community that is underrepresented at Equinix, has faced historical discrimination or shares unique challenges, integrated in our DIB strategy.

Our Community Impact program promotes connection and belonging, and enables employees to give back, with the support of Equinix, to the communities in which we work and live. In total, our Community Impact efforts in 2020 resulted in approximately $2.8 million in employee donations, corporate matching and grants, and more than 9,350 volunteer hours, to approximately 1,750 nonprofits worldwide.

We believe our commitment to the highest standards of honesty, integrity and ethical behavior differentiates our business as much as our technology. We promote these high standards through a number of policies including the Equinix Code of Business Conduct. All employees are required to complete trainings on ethics and the company’s anti-bribery and corruption policies. In addition, we maintain a confidential ethics helpline where employees are encouraged to speak up if they have any questions or concerns that our code is being violated. We have a zero-tolerance, non-retaliation policy that protects our employees when they speak up.

In a year disrupted by the unprecedented global pandemic caused by COVID-19, we implemented a number of precautionary measures in line with our business continuity and pandemic plans to minimize the risk of operational impacts and to protect the health and safety of employees, customers, partners and our communities. During the pandemic, we have offered a range of support to our employees including “work from home” policies, financial assistance and health and wellness resources. We also incurred one-time cash bonuses and compensation expense of $8.6 million for our IBX employees as well as other employees to support their work-from-home requirements during the first quarter of 2020. To ensure a careful, safe and responsible eventual return to office, we have developed a roadmap based on guidance from health experts and other leaders from around the world.

We believe that all of these programs and initiatives support our human capital goals, align with our company culture, and increase employee satisfaction.

Sustainability

Equinix is committed to protecting, connecting and powering a more sustainable digital world and to greening our customers' supply chains. Through our sustainability efforts, Equinix strives to protect our planet and climate, unleash our people's potential to be a force for good, and lead with purpose and integrity in everything we do. Our definition of business growth and success includes steadfastly adhering to best-in-class ESG practices.

Environmental Performance

Equinix was the first data center company to commit to a long-term goal of 100% renewable energy across our global portfolio. Equinix uses local renewable energy sources where possible, seeks new or recently built renewable sources and advocates for favorable renewable energy policies. In the U.S., Equinix purchases nearly 2.3 million megawatt-hours ("MWh") of green power annually from a portfolio of renewable energy projects, including 225 MW of wind power under long-term virtual power purchase agreements ("VPPAs") located in Texas and Oklahoma. In 2019, over 90% of Equinix's global electricity consumption, and 100% of U.S. electricity consumption was covered by renewable energy sources. Calendar year data for 2020 will become available Q2 2021 and will be published in our annual Corporate Sustainability Report.

We have won numerous awards for our leading sustainability practices and our significant contributions to the renewable energy market. In 2020, Equinix was named the Green Power Partner of the Year by the U.S. Environmental Protection Agency ("EPA"). The award recognizes Equinix's leadership and commitment to advancing the development of the nation's voluntary green power market.

Equinix is committed to transparently measuring and reporting our global carbon footprint across direct (Scope 1), indirect energy (Scope 2) and indirect value chain (Scope 3) emissions. Since 2015, we have achieved a 60% reduction in carbon emissions on an absolute basis (Scope 1 and Scope 2 market-based metric tons of carbon dioxide-equivalent (mtCO2e)), even as we doubled our footprint in both energy consumption and number of sites. In 2020, CDP, a global non-governmental organization ("NGO") dedicated to helping investors and companies measure and manage their climate risks, recognized our commitments, actions and progress on climate change. Equinix received an 'A-' CDP leadership score for climate action.

To support our ongoing sustainability initiatives, in 2020, we issued our first green bonds totaling $1.35 billion. An amount equal to the net proceeds of the green bonds will be allocated to finance or refinance, in whole or in part, ongoing and new projects in categories such as green buildings, renewable energy, energy efficiency, sustainable water and wastewater management, waste management and clean transportation, as outlined in our Green Finance Framework. Our Green Finance Framework aligns Equinix's sustainability commitments with our long-term financing needs and highlights our pipeline of green projects and data center innovations.

Sustainability Accounting Standards Board ("SASB") Disclosures

SASB published the Sustainability Accounting Standard ("Standard") for the Real Estate Industry in October 2018. Equinix has aligned its SASB disclosures with the Real Estate Standard to enhance corporate disclosure around ESG performance. In our comprehensive disclosures in our annual Corporate Sustainability Report we also document our progress against metrics as outlined in other frameworks such as the Global Reporting Initiative ("GRI"), UN Sustainable Development Goals ("SDGs") and the Task Force on Climate-related Financial Disclosures ("TCFD"). The following tables detail our energy metrics, aligned with the SASB Real Estate Standard. We intend to expand our reporting around the Real Estate Standard in the future.

The following metrics represent Equinix's colocation and hyperscale (xScaleTM) data center facilities' performance in the calendar years specified. Energy, renewable energy and greenhouse gas emissions are independently assured to ISO 14064-3:2006 standards for the quantification and reporting of greenhouse gas emissions. Calendar year data for 2020 is expected to become available Q2 2021.

Energy Management: Energy Consumption

(1)The scope of energy consumed includes diesel, natural gas, purchased electricity, purchased chilled water and purchased electricity from fuel cells installed onsite. The only asset type included is data centers (Equinix’s 2019 sustainability report also included offices and the Infomart at DA99). The coverage is Whole Building.

(2)Like-for-like computed for stabilized asset list for the overlapping list of sites designated as stabilized in 2018 and 2019.

(3)Excludes renewable energy supplied in the standard generation mix from local utilities. Includes renewable energy certificates (through VPPAs, bundled supplier agreements, green tariffs and unbundled purchases).

(4)Excludes reseller sites (DA99, JK1, OS99, SH1).

(5)2018 portfolio coverage excludes xScaleTM sites: PA8x, LD13x.

(6)The 2019 10-K included recently constructed or acquired sites for which no utility data had been included within the greenhouse gas inventory boundary. This includes the following sites with no energy data reported within the SASB metrics for 2019: Data Centers: Asia-Pacific (ME2, SG4, SY5, TY11, SL1). Reseller sites are also excluded in the energy metrics (DA99, JK1, OS99, SH1). Equinix's Axtel Acquisition and Bell Acquisition sites from 2020 are also excluded.

(7)2019 portfolio coverage includes xScaleTM sites: PA8x, LD13x.

Energy Management: Green Building Ratings

Equinix's environmental efforts aim to deliver meaningful and measurable progress against sustainability goals that positively impact its customers, partners, investors and employees. Our data centers are designed to take advantage of local environmental conditions and to maximize operational efficiency. Equinix evaluates cost-efficient opportunities to enhance energy efficiency and bring renewable energy to the site for existing or acquired sites.

Equinix is protecting our planet's resources through green data center innovations and building and operating energy-efficient data centers around the world. Equinix's Energy Efficiency Center of Excellence is driving a global approach to cooling its existing data centers more efficiently. The program engages customers to manage their implementations more sustainably at Equinix's facilities, leading to overall improved site efficiencies.

Equinix certifies to numerous green buildings and energy management certifications and schemes. These include USGBC LEED green buildings certifications, ISO 14001:2015 Environmental Management Standard, ISO 50001:2011 Energy Management Standard, BCA Green Mark, U.S. EPA Energy Star for Data Centers and others.

Data centers receiving green building ratings in 2019 and 2020 totaled more than 1.3 million gross sq. ft. The following new sites received ratings in 2019 or 2020. Additional sites and phases are pending final submissions.

In 2020, Equinix had 16.1 million gross sq. ft., or 72% of global footprint, in operation with green buildings and energy management certifications. Within the U.S., Equinix had 4.7 million gross sq. ft or 49% of its footprint under certification including 0.8 million of gross sq. ft., or 8% of U.S. footprint, having achieved U.S. EPA Energy Star for Data Centers.

(1)Countries excluded from metrics above: Americas (Mexico), Asia-Pacific (Indonesia, South Korea).

(2)Ratings included in our totals: ISO 50001 Energy Management, ISO 14001 Environmental Management, LEED green buildings certifications, U.S. Environmental Protection Agency Energy Star for Data Centers, BCA Green Mark, NABERS and Green Globes.

(3)Equinix is currently evaluating its approach to U.S. EPA Energy Star for Data Centers. In 2019 and 2020, five sites received Energy Star for Data Centers recognition, representing 8% of our U.S. portfolio. In contrast, Equinix's U.S. portfolio has 17 LEED-certified data centers or 41% of the U.S. portfolio by gross square footage.

Our Business Segment Financial Information

We currently operate in three reportable segments comprised of our Americas, EMEA and Asia-Pacific geographic regions. Information attributable to each of our reportable segments is set forth in Note 17 within the Consolidated Financial Statements.

Available Information

Equinix owns and maintains intellectual property in the form of trademarks, patents, application programming interfaces, customer portals and a variety of products and other offerings.

We were incorporated in Delaware in June 1998. We are required to file reports under the Securities Exchange Act of 1934, as amended, with the Securities and Exchange Commission ("SEC"). The SEC maintains an internet website at http://www.sec.gov that contains reports, proxy and information statements and other information.

You may also obtain copies of our annual reports on Form 10-K, our quarterly reports on Form 10-Q and our current reports on Form 8-K, and any amendments to such reports, free of charge by visiting the Investor Relations page on our website, www.equinix.com. These reports are available as soon as reasonably practical after we file them with the SEC. Information contained on or accessible through our website is not part of this Annual Report on Form 10-K.

In addition to the other information contained in this report, the following risk factors should be considered carefully in evaluating our business:

Risk Factors

Risks Related to Our Business and Our Operations

The ongoing COVID-19 pandemic could have a negative effect on our business, results of operations and financial condition.

We have continuously monitored our global operations as the COVID-19 pandemic has spread across the globe and have implemented procedures focusing on the health and safety of our employees, customers, partners and communities, the continuity of our business offerings and compliance with governmental regulations and local public health guidance and ordinances. We have activated our business continuity and pandemic plans and while our business operations have continued without interruption and our IBX data centers have remained fully operational to date, we cannot guarantee our business operations or our IBX data centers will not be negatively impacted in the future. Our IBX data centers have been designated “essential businesses” or “critical infrastructure” for purposes of remaining open during the COVID-19 pandemic in all of the jurisdictions that have published these exemptions but not all jurisdictions have created such designations. Any change in these classifications could cause operational disruptions or closures of the affected IBX data centers.

We have implemented processes to limit and schedule access to certain IBX data centers as well as implemented social distancing and hygiene protocols in response to the growing number of suspected and confirmed COVID-19 cases. These proactive actions we have taken or may take in the future and any restrictions imposed by the government could result in business delays, operational disruption and customer dissatisfaction. Employee illnesses resulting from the pandemic could result in further inefficiencies or delays and a suspected or confirmed case in an IBX data center could require temporary closure of the affected IBX data center for cleaning or until local regulatory requirements are fulfilled. Any closure of an IBX data center or limitation of customer access could cause customer dissatisfaction if customers are unable to access their equipment within the IBX data center. We also have service level agreements which could be affected if we are required to close an IBX data center for any reason.

Preventative measures instituted by governments and businesses to mitigate the spread of COVID-19, including travel restrictions, social distancing requirements, shelter in place orders and quarantines, have negatively impacted the global economy and may adversely impact us, our customers and vendors. Some of our customers have been negatively impacted by the COVID-19 pandemic which could affect our revenues. Certain customers have requested revised payment terms and more customers could potentially request such terms. If such an increase in requests for revised payment terms occurs, some delays in accounts receivable collection would result. We also expect some customers are relying on the governmental support via various COVID-19 related stimulus packages. If these stimulus packages do not continue or if they are not sufficient to meet our customers' needs, we could experience more customer churn as a result. In general, a prolonged economic downturn could result in a larger customer churn than we currently anticipate and reduced demand for our services, in which case our revenues could be significantly impacted. Given the uncertainty around the duration and extent of the COVID-19 pandemic, we cannot accurately predict at this time how the pandemic will affect our business over time.

We do not expect the construction delays that we have experienced to have a material effect on the company at this time, but additional supply disruptions because of the ongoing COVID-19 pandemic could occur and cause construction delays that are significant in the future. Significant construction delays would interfere with our ability to meet commitments to customers who have contracted for space in new IBX data centers under construction and could have a material impact on our business. While we have received "essential business" permits for construction in some jurisdictions, these classifications may not extend to the construction of new IBX data centers in all of our jurisdictions. We are also reliant on third party construction labor to build and expand our IBX data centers, to which we may not have access due to the ongoing COVID-19 pandemic. We rely on materials, products and manufacturing from regions of the world which are impacted by the pandemic. It may not be possible to find replacement products or supplies and ongoing delays could affect our business and growth.

While the full extent and impact of the ongoing COVID-19 pandemic cannot be reasonably estimated at this time, it could have a material adverse impact on our business and financial condition. The extent to which the ongoing COVID-19 pandemic will impact our financial condition or results of operations will depend on many factors and future developments, including new information about the ongoing COVID-19 pandemic, additional surges in infection rates and any new government regulations which may emerge to contain the virus, among others.

We experienced an information technology security breach in the past and may be vulnerable to future security breaches, which could disrupt our operations and have a material adverse effect on our business results of operation and financial performance.

Despite our efforts to protect against cyber-attacks, we are not fully insulated from these types of security breaches, and such an attack could adversely impact our competitiveness and results of operations. In September 2020, we discovered ransomware on certain of our internal systems, encrypting files and holding them for ransom. Our teams responded quickly to address the incident and notified law enforcement, and after a thorough review of the incident by our management and experts retained to assist in this incident, the investigation was closed as of October 14, 2020. Our IBX data centers and our service offerings, including managed services, remained fully operational during the attack and the incident did not affect our ability to support our customers. We further believe that we were able to contain the incident and that the resolution will prevent the release of any data associated with this attack. While the event has been resolved and has not caused a material disruption to our systems nor resulted in any material costs to Equinix, our team is also working to protect against any future attacks. We will continue to face risks associated with unauthorized access to our computer systems, loss or destruction of data, computer viruses, ransomware, malware, distributed denial-of-service attacks or other malicious activities. These threats may result from human error, equipment failure or fraud or malice on the part of employees, vendors or third parties. As techniques used to breach security change frequently and are generally not recognized until launched against a target, we may not be able to promptly detect that a cyber breach has occurred, or implement security measures in a timely manner or, if and when implemented, we may not be able to determine the extent to which these measures could be circumvented. Because of the ongoing COVID-19 pandemic, many of our non-IBX employees are working from home and could potentially be exposed to new security risks or attempted breaches because of these new work environments. A party who is able to compromise the security measures on our networks or the security of our infrastructure could misappropriate either our proprietary information or the personal information of our customers or our employees, or cause interruptions or malfunctions in our operations or our custo

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There is no disclosure to report pursuant to Item 1B.

Our executive offices are located in Redwood City, California, with sales offices in several cities throughout the U.S. Our Asia-Pacific headquarters office is located in Hong Kong and we also have sales offices in several cities throughout Asia-Pacific. Our EMEA headquarters office is located in Amsterdam, the Netherlands and our regional sales offices in EMEA are based in our IBX data centers in EMEA.

The following tables present the locations of our leased and owned IBX data centers and xScaleTM data centers investments as of December 31, 2020.

			AMERICAS
Metro						Leased (1)						Owned (1) (2)
Atlanta						●						●
Bogota												●
Boston						●						●
Calgary						●						●
Chicago						●						●
Culpeper												●
Dallas						●						●
Washington DC/Ashburn						●						●
Denver						●						●
Houston												●
Kamloops												●
Los Angeles						●						●
Mexico City												●
Miami						●						●
Monterrey						●
Montreal						●
New York						●						●
Ottawa												●
Philadelphia						●
Rio de Janeiro						●						●
Saint John												●
Sao Paulo						●						●
Seattle						●						●
Silicon Valley						●						●
Toronto						●						●
			Vancouver						●
			Winnipeg						●

			EMEA
Metro						Leased (1)						Owned (1) (2)
Abu Dhabi						●
Amsterdam						●						●
Barcelona						●
Dubai						●
Dublin						●						●
Dusseldorf												●
East Netherlands						●
Frankfurt						●						●
Geneva						●
Hamburg												●
Helsinki						●						●
Istanbul												●
Lisbon												●
London						●						●
Madrid						●
Manchester						●
Milan						●						●
Munich						●
Muscat												●
Paris						●						●
Seville						●
Sofia												●
Stockholm						●						●
Warsaw						●						●
Zurich						●						●

			Asia-Pacific
Metro						Leased (1)						Owned (1) (2)
Adelaide												●
Brisbane												●
Canberra												●
Hong Kong						●
Melbourne												●
Osaka						●
Perth												●
Seoul						●
Singapore						●
Shanghai						●						●
Sydney						●						●
Tokyo						●						●

(1)"●" denotes locations with one or more data centers.

(2)Owned sites include IBX data centers subject to long-term ground leases.

The following table presents an overview of our portfolio of IBX data centers as of December 31, 2020:

(1)Excludes three unconsolidated entities (two xScaleTM IBX data centers and the MC1 IBX data center)

(2)Cabinets represent a specific amount of space within an IBX data center. Customers can combine and use multiple adjacent cabinets within an IBX data center, depending on their space requirements.

(3)The cabinet utilization rate represents the percentage of cabinet space billed versus total cabinet capacity, taking into consideration power limitations.

(4)MRR per cabinet represents average monthly recurring revenue recognized divided by the average number of cabinets billing during the fourth quarter of the year. Americas MRR per cabinet excludes Brazil, Columbia and Infomart non-IBX tenant income and Asia-Pacific MRR per Cabinet excludes Bit-isle MIS.

The following table presents a summary of our significant IBX data center expansion projects under construction as of December 31, 2020:

(1)Capital expenditures are approximate and may change based on final construction details.

The following is a description of reportable legal proceedings, including those involving governmental authorities under federal, state and local laws regulating the discharge of materials into the environment.

In March 2019, charges were brought by the Public Prosecutor in Milan, Italy against Equinix (Italia) S.r.l. and Eric Schwartz, at that time one of the directors of Equinix (Italia) S.r.l., following the discovery of levels of copper in ground water in excess of those permitted by law and alleged to have been released by Equinix into the water supply. We determined that the copper levels detected had been misinterpreted by the Public Prosecutor's office, which had multiplied the findings tenfold. On March 13, 2019, we asked for an initial extension to file our defense and requested that the charges against both Equinix and Mr. Schwartz be dropped on the grounds that the levels of copper found were in fact less than double the permitted amounts. The Public Prosecutor accepted that the number it originally used was incorrect, but did not agree to drop the charges and requested a trial date. Our defense was filed April 15, 2019. A trial date was set for March 6, 2020, but the hearing was postponed due to the COVID-19 pandemic. The prosecutor has agreed to a plea bargain for Mr. Schwartz comprising of payment of an amount between €12,700 and €25,000, plus a fine of €2,700. This arrangement must be approved by the Court. In a hearing on December 17, 2020, the presiding judge decided that there was insufficient evidence of a crime and acquitted Equinix. The Public Prosecutor has until February 24, 2021 to issue an appeal.

We have recently completed adoption of a formal compliance program pursuant to Italian Legislative Decree No. 231/2001 ("Decree 231"), which we expect will reduce our exposure to fines and penalties in any Court verdict by 50%. After adoption of Decree 231, the exposure for Equinix would be effectively reduced to €175,000.

While it is not possible to accurately predict whether the Public Prosecutor will appeal this decision, if an appeal is lodged and any subsequent final outcome of this pending Court proceeding is decided adversely to Equinix, we expect there would be no material effect on our consolidated financial position. Nevertheless, this proceeding is reported pursuant to Securities and Exchange Commission regulations in effect at the inception of this proceeding.

Not applicable.

PART II

Our common stock is quoted on the NASDAQ Global Select Market under the symbol of "EQIX." Our common stock began trading in August 2000. As of January 31, 2021, we had 89,184,799 shares of our common stock outstanding held by approximately 329 registered holders. During the years ended December 31, 2020 and 2019, we did not issue or sell any securities on an unregistered basis.

Stock Performance Graph

The graph set forth below compares the cumulative total stockholder return on Equinix's common stock between December 31, 2015 and December 31, 2020 with the cumulative total return of:

• the S&P 500 Index;

• the NASDAQ Composite Index; and

• the FTSE NAREIT All REITs Index.

The graph assumes the investment of $100.00 on December 31, 2015 in Equinix's common stock and in each index, and assumes the reinvestment of dividends, if any.

Equinix cautions that the stock price performance shown in the graph below is not indicative of, nor intended to forecast, the potential future performance of Equinix's common stock.

Notwithstanding anything to the contrary set forth in any of Equinix's previous or future filings under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended, that might incorporate this Annual Report on Form 10-K or future filings made by Equinix under those statutes, the stock performance graph shall not be deemed filed with the Securities and Exchange Commission and shall not be deemed incorporated by reference into any of those prior filings or into any future filings made by Equinix under those statutes.

COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*

*$100 invested on 12/31/15 in stock or index, including reinvestment of dividends. Fiscal year ending December 31.

The following consolidated statement of operations data for the five years ended December 31, 2020 and the consolidated balance sheet data as of December 31, 2020, 2019, 2018, 2017, and 2016 have been derived from our audited consolidated financial statements and the related notes. Our historical results are not necessarily indicative of the results to be expected for future periods. The following selected consolidated financial data for the five years ended December 31, 2020 and as of December 31, 2020, 2019, 2018, 2017, and 2016, should be read in conjunction with our audited consolidated financial statements and the related notes in Item 8 of this Annual Report on Form 10-K and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Item 7 of this Annual Report on Form 10-K. We completed acquisitions of certain data centers from Bell in Canada in October 2020, Packet bare metal automation platform in March 2020, Axtel data center business in Mexico in January 2020, Switch Datacenters' AMS1 data center business in Amsterdam, Netherlands in April 2019, Metronode and Infomart Dallas in April, 2018, the Zenium data center business in Istanbul and Itconic in October 2017, certain colocation business from Verizon in May 2017, IO UK's data center operating business in Slough, United Kingdom in February 2017 (the "IO Acquisition), certain Paris IBX data centers in August 2016 (the "Paris IBX Data Center Acquisition"), and Telecity Group plc in January 2016. In December 2020, we sold three Japan development sites, Osaka 2, Tokyo 12, and Tokyo 14 in the Asia-Pacific region to the Asia-Pacific Joint Venture with GIC. In December 2020, we sold Paris 9 to the EMEA Joint Venture and in October 2019, we sold our London 10 and Paris 8 data centers, as well as certain data center sites in Europe to the EMEA Joint Venture. In addition, we sold our New York 12 data center in October 2019, solar power assets of Bit-isle in November 2016 and eight of our IBX data centers located in the U.K., the Netherlands and Germany in July 2016. For further information on our acquisitions and divestitures during the three years ended December 31, 2020, see Note 3 and Note 5 within the Consolidated Financial Statements.

On January 1, 2019 and 2018, we adopted Topic 842, Leases, and Topic 606, Revenue from Contracts with Customers, respectively. The consolidated statement of operations is presented under the new accounting standards from the periods when accounting standards were adopted, while the prior period financial statements have not been restated and continue to be reported under accounting standards in effect for those periods. See Note 1 within the Consolidated Financial Statements for further discussion.

The following commentary should be read in conjunction with the financial statements and related notes contained elsewhere in this Annual Report on Form 10-K. The information in this discussion contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are based upon current expectations that involve risks and uncertainties. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. For example, the words "believes," "anticipates," "plans," "expects," "intends" and similar expressions are intended to identify forward-looking statements. Our actual results and the timing of certain events may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such a discrepancy include, but are not limited to, those discussed in "Liquidity and Capital Resources" and "Risk Factors" elsewhere in this Annual Report on Form 10-K. All forward-looking statements in this document are based on information available to us as of the date hereof and we assume no obligation to update any such forward-looking statements.

Item 7 of this Form 10-K focuses on discussion of 2020 and 2019 items as well as 2020 results as compared to 2019 results. For the discussion of 2018 items and 2019 results as compared to 2018 results, please refer to Item 7 of our 2019 Form 10-K as filed with the SEC on February 21, 2020.

Our management's discussion and analysis of financial condition and results of operations is intended to assist readers in understanding our financial information from our management's perspective and is presented as follows:

• Overview

• Results of Operations

• Non-GAAP Financial Measures

• Liquidity and Capital Resources

• Contractual Obligations and Off-Balance-Sheet Arrangements

• Critical Accounting Policies and Estimates

• Recent Accounting Pronouncements

Overview

Equinix is a global digital infrastructure company, enabling digital leaders to harness a trusted platform to bring together and interconnect the foundational infrastructure that powers their success. Equinix enables today’s businesses to access all the right places, partners and possibilities they need to accelerate their advantage. Global enterprises, service providers and business ecosystems of industry partners rely on Equinix IBX data centers and

expertise around the world for the safe housing of their critical IT equipment and to protect and connect the world's most valued information assets. They also look to Platform Equinix® for the ability to directly and securely interconnect to the networks, clouds and content that enable today's information-driven global digital economy. Recent Equinix IBX data center openings and acquisitions, as well as xScaleTM data center investments, have expanded our total global footprint to 227 IBXs, including two xScaleTM data centers and the MC1 data center that were held in unconsolidated joint ventures, across 63 markets around the world. Equinix offers the following solutions:

• premium data center colocation;

• interconnection and data exchange solutions;

• edge services for deploying networking, security and hardware; and

• remote expert support and professional services.

Our interconnected data centers around the world allow our customers to increase information and application delivery performance to users, and quickly access distributed IT infrastructures and business and digital ecosystems, while significantly reducing costs. The Equinix global platform and the quality of our IBX data centers, interconnection offerings and edge services have enabled us to establish a critical mass of customers. As more customers choose Platform Equinix, for bandwidth cost and performance reasons it benefits their suppliers and business partners to colocate in the same data centers. This adjacency creates a “network effect” that enables our customers to capture the full economic and performance benefits of our offerings. These partners, in turn, pull in their business partners, creating a "marketplace" for their services. Our global platform enables scalable, reliable and cost-effective interconnection that increases data traffic exchange while lowering overall cost and increasing flexibility. Our focused business model is built on our critical mass of enterprise and service provider customers and the resulting "marketplace" effect. This global platform, combined with our strong financial position, continues to drive new customer growth and bookings.

Historically, our market was served by large telecommunications carriers who have bundled their products and services with their colocation offerings. The data center market landscape has evolved to include private and vendor-neutral MTDC providers, hyperscale cloud providers, managed infrastructure and application hosting providers, and systems integrators. It is estimated that Equinix is one of more than 1,200 companies that provide MTDC offerings around the world. Each of these data center solutions providers can bundle various colocation, interconnection and network offerings and outsourced IT infrastructure solutions. We are able to offer our customers a global platform that reaches 26 countries with the industry’s largest and most active ecosystem of partners in our sites, proven operational reliability, improved application performance and a highly scalable set of offerings.

The cabinet utilization rate represents the percentage of cabinet space billed versus total cabinet capacity, which is used to measure how efficiently we are managing our cabinet capacity. Our cabinet utilization rate varies from market to market among our IBX data centers across the Americas, EMEA and Asia-Pacific regions. Our cabinet utilization rates were approximately 79%, as of December 31, 2020 and 2019. Excluding the impact of our IBX data center expansion projects that have opened during the last 12 months, our cabinet utilization rate would have increased to approximately 80% as of December 31, 2020. We continue to monitor the available capacity in each of our selected markets. To the extent we have limited capacity available in a given market, it may limit our ability for growth in that market. We perform demand studies on an ongoing basis to determine if future expansion is warranted in a market. In addition, power and cooling requirements for most customers are growing on a per unit basis. As a result, customers are consuming an increasing amount of power per cabinet. Although we generally do not control the amount of power our customers draw from installed circuits, we have negotiated power consumption limitations with certain high power-demand customers. This increased power consumption has driven us to build out our new IBX data centers to support power and cooling needs twice that of previous IBX data centers. We could face power limitations in our IBX data centers, even though we may have additional physical cabinet capacity available within a specific IBX data center. This could have a negative impact on the available utilization capacity of a given IBX data center, which could have a negative impact on our ability to grow revenues, affecting our financial performance, results of operations and cash flows.

In 2019, we closed our EMEA Joint Venture with GIC to develop and operate xScaleTM data centers to serve the needs of the growing hyperscale data center market, including the world's largest cloud service providers. Upon closing, the EMEA Joint Venture acquired certain data center sites, including the London 10 data center, Paris 8 data center and few data center sites in London and Frankfurt, with the opportunity to add additional facilities i

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Market Risk

The following discussion about market risk involves forward-looking statements. Actual results could differ materially from those projected in the forward-looking statements. We may be exposed to market risks related to changes in interest rates and foreign currency exchange rates and fluctuations in the prices of certain commodities, primarily electricity.

The uncertainty that exists with respect to the economic impact of the ongoing COVID-19 pandemic introduced significant volatility in the financial markets. See Part I, Item 1A. Risk Factors for additional information regarding potential risks to our business, financial condition and results of operations related to the ongoing COVID-19 pandemic.

We employ foreign currency forward and option contracts, cross-currency interest rate swaps and interest rate locks for the purpose of hedging certain specifically identified exposures. The use of these financial instruments is intended to mitigate some of the risks associated with fluctuations in currency exchange and interest rates, but does not eliminate such risks. We do not use financial instruments for trading or speculative purposes.

Investment Portfolio Risk

We maintain an investment portfolio of various holdings, types, and maturities that is prioritized on meeting REIT asset requirements. All of our marketable securities are recorded on our consolidated balance sheets at fair value with changes in fair values recognized in net income. We consider various factors in determining whether we should recognize an impairment charge for our securities, including the length of time and extent to which the fair value has been less than our cost basis and our intent and ability to hold the investment for a period of time sufficient to allow for any anticipated recovery. We anticipate that we will recover the entire cost basis of these securities and have determined that no other-than-temporary impairments associated with credit losses were required to be recognized during the year ended December 31, 2020.

As of December 31, 2020, our investment portfolio of cash equivalents and marketable securities consisted of money market funds, certificates of deposits and publicly traded equity securities. The amount in our investment portfolio that could be susceptible to market risk totaled $615.6 million.

Interest Rate Risk

We are exposed to interest rate risk related to our outstanding debt. An immediate 10% increase or decrease in current interest rates from their position as of December 31, 2020 would not have a material impact on our interest expense due to the fixed coupon rate on the majority of our debt obligations. However, the interest expense associated with our senior credit facility and term loans, that bear interest at variable rates, could be affected. For every 100 basis point change in interest rates, our annual interest expense could increase by a total of approximately $10.9 million or decrease by a total of approximately $0.2 million based on the total balance of our primary borrowings under the Term Loan Facility as of December 31, 2020. As of December 31, 2020, we had no outstanding interest rate derivative hedges against our debt obligations. However, we may enter into interest rate hedging agreements in the future to mitigate our exposure to interest rate risk.

The fair value of our long-term fixed interest rate debt is subject to interest rate risk. Generally, the fair value of fixed interest rate debt will increase as interest rates fall and decrease as interest rates rise. These interest rate changes may affect the fair value of the fixed interest rate debt but do not impact our earnings or cash flows. The fair value of our mortgage and loans payable and 5.000% Infomart Senior Notes, which are not traded in the market, is estimated by considering our credit rating, current rates available to us for debt of the same remaining maturities and the terms of the debt. The fair value of our other senior notes, which are traded in the market, was based on quoted market prices. The following table represents the carrying value and estimated fair value of our mortgage and loans payable and senior notes as of (in thousands):

(1)The carrying value is gross of debt issuance cost, debt discount and debt premium.

Foreign Currency Risk

A significant portion of our revenue is denominated in U.S. dollars, however, approximately 59% of our revenues and 53% of our operating costs are attributable to Brazil, Mexico, Canada, Colombia and the EMEA and Asia-Pacific regions, and a large portion of those revenues and costs are denominated in a currency other than the U.S. dollar, primarily the Euro, British pound, Japanese yen, Singapore dollar, Hong Kong dollar, Australian dollar and Brazilian real. To help manage the exposure to foreign currency exchange rate fluctuations, we have implemented a number of hedging programs, in particular:

• a cash flow hedging program to hedge the forecasted revenues and expenses in our EMEA region;

• a balance sheet hedging program to hedge the remeasurement of monetary assets and liabilities denominated in foreign currencies; and

• a net investment hedging program to hedge the long term investments in our foreign subsidiaries.

Our hedging programs reduce, but do not entirely eliminate, the impact of currency exchange rate movements on our consolidated balance sheets, statements of operations and statements of cash flows.

We have entered into various foreign currency debt obligations. As of December 31, 2020, the total principal amount of foreign currency debt obligations was $1.9 billion, including $611.1 million denominated in Euro, $589.7 million denominated in British Pound, $408.5 million denominated in Japanese Yen and $293.9 million denominated in Swedish Krona. As of December 31, 2020, we have designated $1.9 billion of the total principal amount of foreign currency debt obligations as net investment hedges against our net investments in foreign subsidiaries. For a net investment hedge, changes in the fair value of the hedging instrument designated as a net investment hedge are recorded as a component of other comprehensive income (loss) in the consolidated balance sheets. Fluctuations in the exchange rates between these foreign currencies and the U.S. Dollar will impact the amount of U.S. Dollars that we will require to settle the foreign currency debt obligations at maturity. If the U.S. Dollar would have been weaker or stronger by 10% in comparison to these foreign currencies as of December 31, 2020, we estimate our obligation to cash settle the principal of these foreign currency debt obligations in U.S. Dollars would have increased or decreased by approximately $211.5 million and $173.0 million, respectively.

We also entered into cross-currency interest rate swaps where we receive a fixed amount of U.S. Dollars and pay a fixed amount of Euros. As of December 31, 2020 and 2019, the total notional amounts of U.S. Dollar to Euro cross-currency interest rate swap contracts were $3.3 billion and $750.0 million, respectively. The cross-currency interest rate swaps are designated as hedges of our net investment in European operations and changes in the fair value of these swaps are recorded as a component of accumulated other comprehensive income (loss) in the consolidated balance sheet. If the U.S. Dollar weakened or strengthened by 10% in comparison to Euro, we would have recorded an additional loss of $409.6 million or gain of $337.3 million, respectively, within accumulated other comprehensive income (loss) as of December 31, 2020.

The U.S. Dollar weakened relative to certain of the currencies of the foreign countries in which we operate during the year ended December 31, 2020. This has impacted our consolidated financial position and results of operations during this period, including the amount of revenues that we reported. Continued strengthening or weakening of the U.S. Dollar will continue to impact us in future periods.

With the existing cash flow hedges in place, a hypothetical additional 10% strengthening of the U.S. dollar during the year ended December 31, 2020 would have resulted in a reduction of our revenues and operating expenses, including depreciation and amortization expenses, by approximately $171.1 million and $169.7 million, respectively.

With the existing cash flow hedges in place, a hypothetical additional 10% weakening of the U.S. dollar during the year ended December 31, 2020 would have resulted in an increase of our revenues and operating expenses, including depreciation and amortization expenses, by approximately $209.2 million and $207.4 million, respectively.

We may enter into additional hedging activities in the future to mitigate our exposure to foreign currency risk as our exposure to foreign currency risk continues to increase due to our growing foreign operations; however, we do not currently intend to eliminate all foreign currency transaction exposure.

Commodity Price Risk

Certain operating costs incurred by us are subject to price fluctuations caused by the volatility of underlying commodity prices. The commodities most likely to have an impact on our results of operations in the event of price changes are electricity, supplies and equipment used in our IBX data centers. We closely monitor the cost of electricity at all of our locations. We have entered into several power contracts to purchase power at fixed prices in certain locations in the Australia, Brazil, Bulgaria, Canada, China, Finland, France, Germany, Ireland, Italy, Japan, the Netherlands, Poland, Portugal, Singapore, Spain, Sweden, Switzerland, the United Kingdom and the U.S..

In addition, as we are building new, or expanding existing, IBX data centers, we are subject to commodity price risk for building materials related to the construction of these IBX data centers, such as steel and copper. In addition, the lead-time to procure certain pieces of equipment, such as generators, is substantial. Any delays in procuring the necessary pieces of equipment for the construction of our IBX data centers could delay the anticipated openings of these new IBX data centers and, as a result, increase the cost of these projects.

We do not currently employ forward contracts or other financial instruments to address commodity price risk other than the power contracts discussed above.

The financial statements and supplementary data required by this Item 8 are listed in Item 15(a)(1) and begin at page F-1 of this Annual Report on Form 10-K.

There is no disclosure to report pursuant to Item 9.

Conclusion Regarding the Effectiveness of Disclosure Controls and Procedures

Under the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer, we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Rule 13a-15(e) promulgated under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). Based on this evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that our disclosure controls and procedures were effective at the reasonable assurance level as of December 31, 2020.

Management's Report on Internal Control Over Financial Reporting

Our management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Exchange Act Rule 13a-15(f). Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting based on the framework in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

Based on our evaluation under the framework in Internal Control – Integrated Framework (2013), our management concluded that our internal control over financial reporting was effective as of December 31, 2020.

The effectiveness of our internal control over financial reporting as of December 31, 2020 has been audited by PricewaterhouseCoopers LLP, an independent registered public accounting firm, as stated in their report which is included herein on page F-1 of this Annual Report on Form 10-K.

Limitations on the Effectiveness of Controls

Our management, including our Chief Executive Officer and Chief Financial Officer, believes that our disclosure controls and procedures and internal control over financial reporting are designed and operated to be effective at the reasonable assurance level. However, our management does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent all errors and all fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints, and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision making can be faulty, and that breakdowns can occur because of a simple error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people or by management override of the controls. The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions, or the degree of compliance with policies or procedures may deteriorate. Because of the inherent limitations in a cost effective control system, misstatements due to error or fraud may occur and not be detected.

Changes in Internal Control Over Financial Reporting

There was no change in our internal controls over financial reporting during the fourth quarter of fiscal 2020 that has materially affected, or is reasonable likely to affect, our internal controls over financial reporting.

There is no disclosure to report pursuant to Item 9B.

PART III

The information required by this Item is incorporated by reference to the definitive Proxy Statement for our 2021 Annual Meeting of Stockholders, which will be filed with the SEC no later than 120 days after December 31, 2020 pursuant to Regulation 14A.

We have adopted a Code of Ethics applicable for the Chief Executive Officer and Senior Financial Officers and a Code of Business Conduct, which are both "Code(s) of Ethics for Senior Financial Officers" as defined by applicable rules of the SEC. This information is incorporated by reference to the Equinix proxy statement for the 2021 Annual Meeting of Stockholders and is also available on our website, www.equinix.com.

The information required by this Item is incorporated by reference to the definitive Proxy Statement for our 2021 Annual Meeting of Stockholders, which will be filed with the SEC no later than 120 days after December 31, 2020 pursuant to Regulation 14A.

Information required by this item is incorporated by reference to the Equinix proxy statement for the 2021 Annual Meeting of Stockholders.

The information required by this Item is incorporated by reference to the definitive Proxy Statement for our 2021 Annual Meeting of Stockholders, which will be filed with the SEC no later than 120 days after December 31, 2020 pursuant to Regulation 14A.

The information required by this Item is incorporated by reference to the definitive Proxy Statement for our 2021 Annual Meeting of Stockholders, which will be filed with the SEC no later than 120 days after December 31, 2020 pursuant to Regulation 14A.

PART IV

(a)(1) Financial Statements:

(a)(2) Financial statements and schedule:

(a)(3) Exhibits: