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    BXDC
    Earnings call· Jun 2026(Q2 FY26)

    Blackstone Digital Infrastructure Trust Q2 FY26 earnings call BXDC

    Aug 4, 2026 Source

    Executive summary

    Blackstone Digital Infrastructure Trust Q2 FY26 — Successful IPO and Robust Investment Pipeline

    Blackstone Digital Infrastructure Trust successfully completed its IPO in Q2 FY26, raising $2 billion as a blind pool REIT to capitalize on the massive and growing stabilized data center market. With no real estate operations during the quarter, reported financial results are not indicative of future performance. The company is actively pursuing a robust investment pipeline, leveraging Blackstone's expertise and relationships to acquire high-quality, income-producing data centers in Tier 1 markets with long-term leases to hyperscalers.

    Highlights

    5

    • Successfully completed IPO in May 2026, raising $2 billion of gross proceeds, making it the largest blind pool REIT IPO in history.

    • Robust pipeline of attractive investments, with management confident in near-term capital deployment.

    • U.S. data center market vacancy at an all-time low of 1% in Q1, and 0.4% in target markets, driving rent growth.

    • Blackstone's deep relationships and experience position BXDC to capitalize on the massive digital infrastructure opportunity, with Blackstone and employees owning 11% of BXDC shares.

    • Management fees are waived for 6 months post-IPO, aligning with the expected capital deployment timeline.

    Concerns

    2

    • Reported Q2 FY26 GAAP net income of $0.14 per share, FFO of $0.07 per share, and AFFO of $0.08 per share are not indicative of future operating performance due to no real estate operations during the quarter.

    • Growing NIMBYism and pushback around new data center development could impact future supply dynamics and capital recycling for developers.

    Guidance & targets

    2
    CategoryTargetConfidence
    Leverage target
    40% leverage
    high materiality
    High
    IPO capital deployment
    within 6 months following our IPO
    high materiality
    High

    Operational metrics

    25
    GAAP net income per share
    $0.14
    Q2 FY26

    As a reminder, we completed our initial public offering in May 2026 and had no real estate operations during the quarter ended June 30, 2026, as the net proceeds of the offering were invested in cash and cash equivalents. Therefore, we do not believe 2Q results are indicative of the operating performance we expect to achieve upon deployment of our capital into target assets.

    FFO per share
    $0.07
    Q2 FY26

    As a reminder, we completed our initial public offering in May 2026 and had no real estate operations during the quarter ended June 30, 2026, as the net proceeds of the offering were invested in cash and cash equivalents. Therefore, we do not believe 2Q results are indicative of the operating performance we expect to achieve upon deployment of our capital into target assets.

    AFFO per share
    $0.08
    Q2 FY26

    As a reminder, we completed our initial public offering in May 2026 and had no real estate operations during the quarter ended June 30, 2026, as the net proceeds of the offering were invested in cash and cash equivalents. Therefore, we do not believe 2Q results are indicative of the operating performance we expect to achieve upon deployment of our capital into target assets.

    Weighted average share count (GAAP)
    50 million
    Q2 FY26

    Our net income per share is based on a weighted average share count of 50 million shares, which is in accordance with GAAP and includes the period prior to the completion of our IPO, during which we effectively have no shares outstanding.

    Adjusted share count (non-GAAP)
    99 million
    Q2 FY26

    Our non-GAAP metrics of FFO and AFFO per share are based on an adjusted share count of 99 million shares that only reflects the period following the closing of our IPO at quarter end. We believe this adjusted share count better reflects the economic experience of our investors.

    Interest income
    $9.3 million
    Q2 FY26

    Following our IPO, our net cash proceeds generated $9.3 million of interest income during the quarter.

    Interest expense
    $800,000
    Q2 FY26

    We also incurred $800,000 of interest expense, reflecting fees associated with our revolving credit facility

    G&A expenses
    $1.4 million
    Q2 FY26

    and $1.4 million of G&A expenses, including $535,000 of costs associated with the IPO and formation of our business.

    IPO and formation costs
    $535,000
    Q2 FY26

    including $535,000 of costs associated with the IPO and formation of our business. Such organizational costs are the primary adjustment between FFO and AFFO this quarter.

    Total assets
    $2 billion
    Q2 FY26

    we ended the quarter with total assets of $2 billion, effectively all cash and cash equivalents.

    Cash and cash equivalents
    $2 billion
    Q2 FY26

    we ended the quarter with total assets of $2 billion, effectively all cash and cash equivalents.

    Unused revolving credit facility capacity
    $1 billion
    Q2 FY26

    And with $1 billion of unused capacity on our revolving credit facility, we have ample flexibility and dry powder to capitalize on our robust investment pipeline today.

    Blackstone and employee share ownership
    11%
    Q2 FY26

    Blackstone is highly aligned with BXDC shareholders with 11% of BXDC shares owned by Blackstone and its employees.

    Management fee rate
    1%
    Current

    Our management fees are also tiered, starting at 1% of market cap today, but stepping down as we scale and allowing BXDC stockholders to benefit from future operating efficiencies.

    Incentive fee rate
    25 basis points
    Current

    And our incentive fee, 25 basis points on our market cap, is only payable if the stock is above the IPO price and achieved an 8% annualized total return for the quarter, a good outcome for our stockholders.

    Management fee waiver
    6 months
    Post-IPO

    100% of base and incentive management fees have been waived for the 6 months following our IPO to roughly align with our expected time line to deploy the proceeds from our offer.

    US data center market vacancy
    1%all-time low
    Q1 FY26

    vacancy in U.S. data center markets continues to trend lower and reached an all-time low of approximately 1% in Q1.

    Target market data center vacancy
    0.4%
    Current

    And in our target markets, vacancy is essentially nonexistent at just 0.4% today.

    US data center rent growth
    more than 100%
    Since 2021

    With limited availability, rent growth has accelerated, increasing by more than 100% from 2021 levels in the U.S.

    Hyperscaler CapEx spend (top 5)
    exceed $800 billionnearly double last year
    This year

    given the accelerating hyperscaler CapEx spend, which is expected to exceed $800 billion this year, just from the top 5 alone, nearly double last year

    Hyperscaler CapEx spend
    $3 trillion
    Next 5 years

    and a fraction of the $3 trillion we expect to see over the next 5 years.

    Comparable transaction cap rates
    low to mid-6
    Recent

    close to $30 billion of recent comparable transactions in the market pricing at the low to mid-6 cap rates.

    Data center REIT peers stock performance
    approximately 30%
    Year-to-date

    Our data center REIT peers are up approximately 30% year-to-date

    US data center leasing volume
    north of 20 gigawattsvs 13 gigawatts last year
    This year

    leasing this year in the United States will probably be north of 20 gigawatts versus 13 gigawatts last year

    US data center leasing volume
    13 gigawattsmore than double the prior year
    Last year

    versus 13 gigawatts last year, which was more than double the prior year.

    Risks & headwinds

    2
    Growing NIMBYism and pushback against new data center developmentCurrent

    growing NIMBYism

    Mitigation: Management notes significant development is still occurring, and developers' motivation to recycle capital remains strong due to rising capital requirements.

    Debt capital markets volatilityRecent

    recent debt capital markets volatility

    Mitigation: Viewed as a "potential catalyst for new deal flow" by creating opportunities for developers to unlock liquidity. Management believes uncertainty and volatility generally facilitate the market.

    What to watch in Q3 FY26

    3

    IPO capital deployment

    Next quarter
    CurrentActively engaged with a number of third parties
    TargetAcquisition of first assets

    Why it matters

    This is a blind pool REIT, and capital deployment is essential for generating operating performance and FFO/AFFO.

    We are confident in the near-term prospects for capital deployment.

    Q&A highlights

    6

    How is growing NIMBYism affecting developers' willingness to sell assets and recycle capital, given potential difficulties in new development?

    Management acknowledges growing NIMBYism but states that significant development is still occurring. The motivation for developers to sell and recycle capital remains strong due to increasing capital requirements for new projects, despite potential difficulties.

    “So I will say you're spot-on. There is growing NIMBYism and just, sort of, pushback around new development. That being said, there is still an enormous amount of development that's taking place in the market.”

    asked by Brendan Lynch · answered by Mike Forman

    2 min read6 chapters

    Detailed Narrative

    01

    Successful IPO and Strategic Positioning

    Blackstone Digital Infrastructure Trust completed its IPO in May 2026, raising $2 billion in gross proceeds, marking the largest blind pool REIT IPO in history. This strategic move positions BXDC as a first mover in the public REIT sector for stabilized data centers, offering perpetual capital and access to public debt and equity markets. The company aims to be a capital solutions provider for data center developers seeking liquidity.

    02

    Massive Market Opportunity and Demand Drivers

    The total addressable market for digital infrastructure is projected to exceed $1 trillion in the coming years, with the sector anticipated to double in size. Unprecedented🌐 demand for compute, driven by AI, cloud computing, and digitalization, is fueling this growth. Vacancy rates in U.S. data center markets are at an all-time low of 1% in Q1, and 0.4% in target markets, leading to rent growth exceeding 100% since 2021.

    03

    Investment Strategy and Pipeline

    BXDC's strategy focuses on acquiring recently built, high-quality, income-producing data centers in Tier 1 markets. These assets are fully leased to investment-grade hyperscalers with long-term leases, mitigating development, power, and entitlement risks. The company reports a robust pipeline of attractive investments fitting these parameters and is actively engaged with third parties to acquire its first assets, expressing confidence in near-term capital deployment.

    04

    Blackstone's Competitive Advantage

    BXDC benefits significantly from its integration with Blackstone's global real estate and infrastructure platform, leveraging proprietary insights into market dynamics, tenant demand, and transaction flow. Blackstone's extensive experience as a major investor in data centers globally provides a "bird's-eye view" of the AI ecosystem, informing BXDC's dedicated strategy. Blackstone and its employees also own 11% of BXDC shares, ensuring strong alignment with shareholders.

    05

    Impact of Debt Capital Markets and NIMBYism

    Recent volatility in debt capital markets is viewed as a potential catalyst for new deal flow, as developers may seek to unlock liquidity from successful projects. While growing NIMBYism and pushback against new development are acknowledged, management notes that significant development is still occurring, and the motivation for developers to recycle capital remains strong due to increasing capital requirements for new builds.

    06

    Agnostic Approach to Workloads

    BXDC maintains an agnostic approach to the specific types of workloads (e.g., training vs. inference, open vs. closed weight models) running through its data centers. The core investment thesis is based on the fundamental and growing demand for compute capacity as digitalization expands, and the value of owning hard-to-create infrastructure that underpins various technology solutions.

    AI-generated summary of the company’s earnings call. Not investment advice.