• Digital Realty Trust, Inc. reported second-quarter 2026 results showing sales rising to US$1,145.94 million and revenue to US$1,924.04 million, while net income and earnings per share from continuing operations declined compared with a year earlier.
• Alongside beating analyst revenue and FFO estimates, the company raised its full-year earnings outlook and expanded its data center footprint, including buying Blackstone’s stakes in three fully leased hyperscale facilities and entering the Kansas City market to capture AI and cloud demand.
• Next, we’ll explore how Digital Realty’s raised full-year earnings outlook and record leasing tied to AI demand affect its investment narrative.

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Digital Realty Trust Investment Narrative Recap

To own Digital Realty Trust, you need to believe in sustained demand for its global data center platform, especially from AI and cloud customers, and in its ability to fund expansion without overstretching its balance sheet. The latest quarter supports the near term demand catalyst through record leasing and a higher earnings outlook, but the sharp drop in net income and rising capital needs mean financing conditions and interest costs remain a key risk that this update does not eliminate.

Among recent announcements, the large Kansas City land acquisition stands out in this context, since it pairs the stronger earnings guidance with a sizable new development commitment aimed at hyperscale data center growth. That move reinforces the growth story tied to AI and cloud demand, while also underscoring how dependent the thesis is on leasing momentum keeping pace with Digital Realty’s rapidly expanding U.S. footprint.

Yet investors should also be aware that if interest rates stay elevated and financing costs rise...

Digital Realty Trust's narrative projects $8.6 billion revenue and $1.0 billion earnings by 2029. This requires 10.8% yearly revenue growth and an earnings decrease of $0.3 billion from $1.3 billion today.

Uncover how Digital Realty Trust's forecasts yield a $218.72 fair value, a 22% upside to its current price.

Exploring Other Perspectives

Two fair value estimates from the Simply Wall St Community sit between US$218.72 and US$262.81 per share, reflecting a wide band of individual expectations. Against this, the recent guidance raise and record AI related leasing highlight how strongly different investors can weigh growth potential versus financing and interest rate risks, so it is worth comparing several viewpoints before forming a view.

Explore 2 other fair value estimates on Digital Realty Trust - why the stock might be worth just $218.72!

Decide For Yourself

Don't just follow the ticker - dig into the data and build a conviction that's truly your own.

• A great starting point for your Digital Realty Trust research is our analysis highlighting 4 key rewards and 2 important warning signs that could impact your investment decision.
• Our free Digital Realty Trust research report provides a comprehensive fundamental analysis summarized in a single visual - the Snowflake - making it easy to evaluate Digital Realty Trust's overall financial health at a glance.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.