Good morning and welcome to the Iron Mountain Fourth Quarter 2024 Earnings Conference Call. All participants will be in a listen-only mode. After today's presentation, there will be an opportunity to ask questions. Please note, this event is being recorded. I would now like to turn the conference over to Mark Rupe, Senior Vice President of Investor Relations. Please go ahead.

Thank you, Betsy. Good morning and welcome to our fourth quarter 2024 earnings conference call. On today's call, we will refer to materials available on our Investor Relations website. We're joined here today by Bill Meaney, President and Chief Executive Officer; and Barry Hytinen, our Executive Vice President and Chief Financial Officer. After prepared remarks, we'll open the lines for Q&A. Today's earnings materials contain forward-looking statements, including statements regarding our expectations. All forward-looking statements are subject to risks and uncertainties. Please refer to today's earnings materials, the Safe Harbor language on Slide 2 and our annual and quarterly reports on Form 10-K and 10-Q for a discussion of the major risk factors that could cause our actual results to differ from those in our forward-looking statements. In addition, we use several non-GAAP measures when presenting our financial results. We have included the reconciliations to these measures in our supplemental financial information. With that, I'll turn the call over to Bill.

Thank you, Mark, and thank you all for joining us today to discuss our fourth quarter and full year results. 2024 marked another year of record performance and double-digit growth for Iron Mountain. We achieved all-time highs for revenue, adjusted EBITDA, and AFFO for the year and for the fourth quarter. Our record results were also broad-based across all of our businesses. For the full year, revenue increased 12% to $6.1 billion. Adjusted EBITDA grew 14% to $2.2 billion and AFFO increased 11% to $1.3 billion. And in the fourth quarter, revenue increased 11%, adjusted EBITDA grew 15%, and AFFO increased 12%. These outstanding results reflect the strength of our highly profitable business model, broad and growing portfolio of solutions, long tenure customer relationships, and the hard work and dedication of mountaineers across the world. The results also validate that Project Matterhorn has proven to be very beneficial to our business and we are exceeding the growth targets we established at our Investor Day presentation in 2022. I should also point out that a foundational element behind Project Matterhorn was to accelerate growth through embracing a customer-centric culture. While we are still on a journey in this regard, it was pleasing to be ranked number one for customer satisfaction by the latest Wall Street Journal ranking of the top US listed companies. For this, I want to thank my fellow mountaineers. Since 2021, we have grown both revenue and adjusted EBITDA at an 11% CAGR on a reported basis. On a constant currency basis, this growth is 13% annually, delivering a result on both a reported and constant currency basis well above the 10% targets we established. We are also performing above our targets for AFFO, which has grown at a 9% CAGR on a reported basis or 11% on a constant currency basis versus the 8% target. Our success and the momentum we have built over the past three years gives us increased confidence as we look ahead and is reflected in our guidance for 2025. Our portfolio of growth businesses, including digital solutions, data center, and asset lifecycle management, are collectively growing at a CAGR greater than 20% and becoming an increasingly larger portion of our revenue. If you recall at the beginning of our Matterhorn climb, our growth portfolio represented 15% of our total revenue. As we enter 2025, the growth portfolio represents 25%, which continues to build the momentum behind our consolidated growth goals. Together with our records management business increasing at a mid to high-single-digit rate, we naturally expect to deliver consolidated growth in excess of 10% for the foreseeable future. Our growth is driven by three principal factors: the recurring nature of our revenue streams, both from our traditional as well as our newer business areas, the strong macro factors supporting double-digit demand for our portfolio of growth businesses, and the success we continue to demonstrate in cross-selling to our loyal customer base comprising nearly 250,000 customers, which includes 95% of the Fortune 1000. We are already the market leader in multiple businesses and are focused on building our scale, increasing our operating leverage, broadening our solutions offerings, and leveraging our commercial platform to capitalize on Iron Mountain's unique position as a truly end-to-end solutions provider transcending both the physical and digital worlds. Based on our excellent results exceeding our expectations in 2024 and the strong confidence we have in our outlook for 2025, our Board of Directors has authorized an increase of our quarterly dividend by 10%. Let me now turn to an update of our key achievements in customer wins to showcase the success we are delivering against our strategic priorities, which are driving continued revenue growth in our physical storage records management business, delivering differentiated digital solutions that give truly transformative results to our customers in terms of revenue, cost, and cybersecurity, supplying differentiated data center offerings through our global scale and customer trust, and providing asset lifecycle management capabilities that are both economic and environmentally sustainable. Let's begin with our Records and Information Management business, which grew 7% in 2024. Our recent customer wins are a testament to the power of our solutions portfolio and success in cross-selling. In the US, we have secured a four-year contract with a Fortune 500 company, which included renewing and expanding the number of locations we serve for records management as well as adding additional services from across our portfolio, underlying our continued focus on cross-selling. Our records management, asset lifecycle management, and digital solutions will provide comprehensive solutions to enable this customer to streamline internal processes to enhance efficiency. Our team's customer-centric approach successfully demonstrated the value of forging a partnership with one provider to support their broader needs. I am also excited to share recent accomplishments in our Digital Solutions business. Our Digital Solutions business achieved record revenue in 2024, with recurring storage, service, and software growing to more than 30% of digital revenue. We continue to see momentum and adoption of our SaaS-based platform, InSight Digital Experience Platform or DXP, with emerging use cases that are enabling our customers to improve their ability to access, manage, govern, and monetize their physical and digital information to drive insights and intelligent decisions. On last quarter's call, we highlighted 24 DXP deals booked. In Q4, we signed 39 deals. Our customers are leveraging AI machine learning-based capabilities within the DXP platform to automatically extract metadata and deliver business outcomes through process automation. Some of the use cases include consumer lending, compliance, HR and benefits management, and providing a platform that future-proofs the ability to search unstructured data. I'll highlight a couple of our recent wins in Digital Solutions. In the US, we secured a multiyear deal with a long-standing global financial services customer for our InSight DXP Solution. Our client was looking for a solution to enhance its operational efficiency by automating metadata extraction, streamline exception processing within an integrated environment, and support long-term scalability. By integrating DXP into its workflow, the customer is able to seamlessly manage process exceptions, reducing manual intervention and improving accuracy across its treasury operations. This is another example of a successful cross-sell. Our Intelligent Business Process Management solutions also continue to gain traction across regions due to our unique ability to provide unified end-to-end solutions across physical and digital assets with proven capabilities to operate at scale across various environments and industries. In Australia, a government department that has been a customer for more than 25 years has turned to Iron Mountain to improve processes related to records management and data retrieval while ensuring retention compliance. Our end-to-end solution includes document imaging and secure destruction under a five-year plan that will manage risk, drive efficiencies, and enable our customer to deliver best-in-class service and answering inquiries. Our proven track record and ability to deliver a comprehensive suite of services at scale enabled us to secure this important work. Turning to our Data Center business, industry demand for Data Center development remains incredibly strong. In 2024, we grew our Data Center revenue by 25% to a record $620 million. Also given the strong demand for our Data Centers, we added to our land portfolio and now have a total capacity of nearly 1.3 gigawatts when fully built out. This is an increase of 420 megawatts year-over-year or a growth of almost 50%. As it relates to leasing, we had a very good year of activity in 2024, our third consecutive year where we leased more than 100 megawatts, including 10 megawatts in the fourth quarter. While we exceeded our original leasing projection of 100 megawatts with 116 megawatts, this was slightly below our updated view at midyear. Given the continued strength and build of our pipeline as we enter 2025 and beyond, we maintained our underwriting returns expectations and decided to pass on a significant opportunity in the fourth quarter. For 2025, we expect another year of strong leasing activity with 125 megawatts projected. Our strong leasing activity shows that we are an attractive partner to customers looking for infrastructure that can support their very dense IT workloads associated with their AI-enabled services. I would also like to highlight the announcement today of our joint venture with Ooredoo, the publicly listed telecom and data center company, which serves Qatar as well as the region broadly. This joint venture furthers our existing footprint in the Middle East by adding data center services to our portfolio. The Middle East is one of the fastest-growing data center markets globally. We will take a minority stake in the venture. The joint venture will serve their existing data center portfolio in Qatar, Kuwait, Tunisia, as well as the expansion across multiple markets in the Middle East Region. Ooredoo was looking for a partner with global operating expertise in hyperscale data centers to assist with capitalizing on the significant market opportunity. This partnership is a testament to our operational strength and credibility within the data center market as well as our relationships with the top global hyperscalers. Let me now turn to our Asset Lifecycle Management business, which continues to represent a significant growth opportunity as we expand our capabilities and geographic footprint in this highly fragmented market. In 2024, ALM revenue increased 119% with nearly 30% organic growth. Regency Technologies had a very strong year and our recent acquisitions of Wisetek and APCD are also performing well. We recently secured a long-term agreement with a large global healthcare company to manage the lifecycle of their IT assets. We will provide IT services and workstation deployment for end-user devices as well as data center infrastructure decommissioning and remarketing services. The combination of our global footprint in logistics infrastructure, operational scalability, and remarketing expertise enabled our team to deliver meaningful synergies to the customer. We have also secured our first significant Asset Lifecycle Management contract in Canada. This is with a large North American insurance company for whom we provide a range of records management and digital services. We are now providing its Canadian subsidiary with ALM services, including laptop sanitization and end-user redeployment, helping to address inefficiencies in workstation management across 60 locations and supporting process automation and other cost optimizations. Our track record of delivery for this customer over many years helped secure this deal, as did our ability to offer a comprehensive, flexible, and streamlined solution that includes automation and security best practices. Staying with the ALM business, we are partnering with the US State Government to deliver a fully managed hard drive destruction program across its agencies. This deal builds on the existing records management and digital services we provide to this customer, demonstrating we have the compliance and security credentials and the operational expertise and scale to deliver a comprehensive range of information management solutions for our customers. This is a good illustration of the kind of work we do for governments in general, including the US federal government. Given the recent interest in our federal business as well as the growth opportunity that we believe DOGE will offer us, let me provide a bit more background. We work for more than 200 agencies of the US federal government, both as a direct provider and subcontractor of services. The physical storage of documents accounts for approximately $10 million in revenue. Correspondingly, this represents about 0.5% of our total physical volume. We also generate $130 million in data center and digitization transformation services. We have been growing in both of these areas with the government over the last few years as we assist certain agencies with process automation and digitization. As the government continues to drive to be more efficient, we see this as a continued opportunity for the company. To conclude, I'm very proud of the strong results our dedicated mountaineers continue to deliver. At the core of our success is how our team meets the needs and serves our nearly 250,000 customers around the world each and every day. As we look to 2025 and beyond, we continue to have a tremendous opportunity ahead of us and are still just scratching the surface of the $150 billion total addressable market for our services. We have a very strong and growing foundation, and the momentum across each of our growth businesses is clear and tangible. As Barry will share in more detail, our guidance outlook represents another record year of double-digit revenue growth for Iron Mountain in 2025. With that, I'll turn the call over to Barry.

Thanks, Bill, and thank you all for joining us to discuss our results. As you've heard this morning, our team continues to execute very well against our strategy. We delivered record fourth quarter and full year results across all of our key financial metrics, and we are entering 2025 with strong momentum. Turning to our financial results. During the fourth quarter, we achieved record revenue of $1.58 billion, up 11% on a reported basis and 12% on a constant currency basis. This was driven by 8% storage growth and 17% service growth on a reported basis. We delivered strong organic growth in the quarter of 8%. Total storage revenue in the quarter was $942 million, up $71 million year-on-year. We drove 9% organic storage growth, half of which was driven by revenue management trends in our Global RIM business and half from our Data Center business. Total service revenue was $639 million, up $91 million from last year. Organic service revenue increased 7% year-on-year, driven by our ALM and Global RIM businesses. Reported service revenue growth reflects the inclusion of our recent ALM acquisitions. Adjusted EBITDA was $605 million, a new record and up 15% year-on-year. This was above the $595 million projection we provided on our last call and would have been nearly $610 million on the same FX rates that we used in that projection. The performance upside was driven by improved price margin realization and cost productivity across our company. Adjusted EBITDA margin was 38.3%, up 130 basis points year-on-year, which reflects improved margins across all of our businesses. AFFO was $368 million, up $40 million, which represents growth as compared to last year of 12% on a reported basis and 14% excluding FX. AFFO on a per share basis was $1.24, up $0.13 from last year and also ahead of the projection we provided on our last call of $1.21. Now let me briefly summarize the full year, which marked our fourth consecutive year of record performance across all key financial metrics. Revenue of $6.15 billion increased 12% on a reported basis and 13% on a constant currency basis. Our full year revenue achieved the high end of our guidance range despite the negative FX we incurred throughout the year. Our commercial team's focus to sell across our entire range of products and services continues to be an important driver of our growth, and we are still in the very early days of capitalizing on this large cross-selling opportunity. Adjusted EBITDA increased 14% year-on-year to $2.24 billion, an increase of $275 million. With this performance, we exceeded the high end of our full year guidance. AFFO increased over 11% to $1.3 billion or $4.54 on a per share basis. And now turning to segment performance. I'll start with our Global RIM business, which achieved fourth quarter revenue of $1.26 billion, an increase of $66 million year-on-year. Revenue management continued to be a key driver in the quarter across storage and service, leading to adjusted EBITDA margin reaching a new all-time high. Organic storage was up in excess of 5%, driven by revenue management and consistent volume. Sequentially, it was down slightly due to the stronger dollar and our focus to drive operating performance in our Consumer Storage business. And I should note, our Records Management business was up sequentially and year-over-year in line with our normal trends. Organic Service revenue was up 8% with contributions from digital and core services. Our Digital business had another strong quarter, achieving record revenue. Global RIM adjusted EBITDA was $579 million, an increase of $45 million year-on-year. Global RIM adjusted EBITDA margin was up 130 basis points from last year, driven by operating leverage and revenue management. Turning to our Global Data Center business, the team delivered revenue of $170 million, an increase of $33 million. This was a 24% increase from the fourth quarter of last year, driven by strong organic storage rental growth of 27%. For the full year, Data Center revenue grew 25% to $620 million, continuing the multiyear trend of accelerating growth. Our visibility to revenue growth and our pipeline both continue to be very strong, supporting our outlook for further acceleration in 2025. I'll also note that 94% of our under-construction assets are already leased, and as such, we have very high visibility to this revenue projection. Fourth quarter Data Center adjusted EBITDA was $88 million, up 51%. Adjusted EBITDA margin was up 930 basis points from the fourth quarter of last year and up 820 basis points sequentially. Improved pricing, recent commencements, and operating leverage were the key drivers of the strong margin expansion in the quarter. We saw a continued positive trend in pricing for new and expansion leases with the full year average price per kilowatt increasing more than 40% as compared to full year 2023. Based on our visibility into commencements, we expect strong adjusted EBITDA margin improvement in 2025 with the full year increasing 400 basis points year-over-year as compared to the 45.6% achieved in 2024. Turning to Asset Lifecycle Management, total ALM revenue in the quarter was $112 million, an increase of $60 million or 118% year-over-year. On an organic basis, our ALM team delivered double-digit growth, which was driven by expansion in our Enterprise business. Regency Technologies performed very well this quarter with revenue of $34 million and strong profit contribution. Our recent acquisitions of Wisetek and APCD performed ahead of our expectations in the quarter. We are especially pleased with the continued improvement in ALM profitability, which is benefiting from Regency synergies as well as improved efficiencies in both the Enterprise and Data Center decommissioning channels. Turning to Capital Allocation. We remain committed to our strategy that is balanced between funding our growth initiatives while delivering meaningful returns to our shareholders and maintaining our strong balance sheet. Capital expenditures in the fourth quarter were $721 million with $685 million of growth and $36 million of recurring. For 2025, we are planning for capital expenditures to be similar to last year with approximately $1.8 billion of growth and approximately $150 million of recurring. Turning to the balance sheet, with strong EBITDA performance, we ended the year with net lease adjusted leverage of 5.0 times, which remains at the lowest level we have achieved since prior to the company's REIT conversion in 2014. For 2025, we expect to end the year at similar levels to year-end 2024. Turning to our dividend, our target payout ratio is low to mid-60s%. And on a trailing basis, we ended the year at 60%. In light of our favorable outlook for AFFO, our Board increased the dividend by 10% effective with the April payout. This marks the third consecutive year where we have increased the dividend. Now let me share our projections for full year 2025. We anticipate another record year of performance across all of our key financial metrics. For 2025, we expect total revenue to be within the range of $6.65 billion to $6.8 billion, which represents year-on-year growth of 9% at the midpoint. On constant FX rates, this implies growth of 11% at the midpoint. This includes 10% organic growth for 2025, which is ahead of the 9% and 7% organic growth we delivered in 2024 and 2023, respectively, and reflects the growth across our portfolio. We expect adjusted EBITDA to be within the range of $2.475 billion to $2.525 billion, which represents year-on-year growth of 12% at the midpoint. On constant FX rates, this implies growth of 13% at the midpoint. We expect AFFO to be within the range of $1.45 billion to $1.48 billion, which represents year-on-year growth of 9% at the midpoint. On constant FX rates, this implies growth of 11% at the midpoint. And we expect AFFO per share to be $4.85 to $4.95. This represents year-on-year growth of 8% at the midpoint, and on constant FX rates, this implies growth of 10% at the midpoint. Turning to the first quarter, we expect revenue of approximately $1.59 billion, adjusted EBITDA of approximately $575 million, AFFO of approximately $342 million, and AFFO per share of approximately $1.15. A couple of last points for modeling. We expect AFFO growth to accelerate through the year as the phasing of cash taxes will be more first half weighted than last year. And we expect the FX impacts on reported results will be less of a headwind as we move through 2025 based on the timing of the US dollar strengthening last year. To conclude, we are pleased to have delivered another record year in 2024, and we are entering 2025 with strong momentum. I would like to express my thanks to our entire team for their continued dedication to serving our clients. And with that operator, would you please open the line for Q&A?

We will now begin the question and answer session. The first question today comes from George Tong with Goldman Sachs. Please go ahead.

Hi. Thanks. Good morning. Can you elaborate on how organic growth in the ALM business in 4Q was split between volumes and component prices and what broader trends you're seeing with both?

Yes, George. Hi, George. This is Barry. Good morning. Thanks for that question. Generally speaking, it was largely volume. It was almost all volume driven, George, because and it, of course, varies based on the channel. But, as you've seen, we're becoming more and more enterprise driven in the company, which is consistent with the size of the market. And that's where the margin improvement is substantial in terms of from both what we're doing for clients at being more of a service-oriented business as well as, much more consistent in terms of the to book a business that continues to build. What we saw in component prices on the data center decommissioning side was generally flattish. Some of the components were down a little bit. Some were up a little bit. But on average, it was basically flattish, and so that was also volume driven. The organic business performed well, and we actually feel very good as we move into 2025 as it relates to both businesses, the data center decommissioning and the enterprise, because we won some new clients on the data center side and additional project revenue. As you know, that is a project-oriented kind of business, can be a little bit more, quarter-to-quarter, project oriented. And then on the Enterprise business, that continues to ramp. And as Bill mentioned, we won some very big deals there relative to our portfolio. So we expect enterprise to continue to perform throughout the year on a growing basis. And I will just say that we are not planning for component pricing to be of much change at all to where it ended 2024. And that may be proven conservative, but we'd rather just plan that way and let you know that we see a lot of volume coming in 2025, thanks to our pipeline. Thank you, George.

The next question comes from Nate Crossett with BNP. Please go ahead.

Hey, good morning. What's your expectation for RIM volumes in Q1 and maybe the balance of 2025? And what should we be kind of expecting for RIM pricing growth this year? Thank you.

Thanks, Nate, for the question. I think you can expect 2025 to be consistent with the last couple of years, flat to slightly up volumetrically. And most of the growth will be revenue management and pricing. So you're kind of mid-single-digit, mid to upper-single-digit overall revenue growth coming out of our room business. So very consistent with what you've seen in '23 and '24.

Yes. And Nate, it's Barry. I'll just add that we expect volume to be flat to slightly up throughout the year, and that includes the first quarter to your question. Also from a standpoint of timing on revenue management actions, we would expect that to be more consistent in terms of the timing of actions this year, whereas you recall last year, we had a little bit of phasing and so that helps bolster the point Bill was making about mid to upper-single. And with that, I will say, we continue to feel that we differentiate very strongly based on the value we bring to clients in terms of the ancillary services they can generate by storing with us, which they really can't get from anybody else, such as our Smart Sort, our digitization on demand and our very fast-growing digital business. Thanks.

The next question comes from Eric Luebchow with Wells Fargo. Please go ahead.

Great. Thanks for taking the questions. I wanted to touch on the Data Center business. Maybe you could just, Bill, at a high level, talk about any longer-term implications from the DeepSeek announcement a few weeks ago, it kind of did create a lot of noise in the market and people questioning the pacing of AI training CapEx and what impact that could have on the Data Centers. And I think you also made a comment about how you passed on a large opportunity that didn't meet your underwriting returns. Just curious to get any more color there and what you're seeing in terms of market pricing going forward and forward returns. Thank you.

Thank you, Eric. Let me address the last part of your question and then discuss DeepSeek. Regarding our pipeline and leasing activity, we have a very strong pipeline that underpins our guidance for this year and our multiyear forecast. Last year, we set our guidance at 100 megawatts, and this year it's 125 megawatts, reflecting a 25% year-on-year growth. This aligns with the financial and multiyear plans we presented in 2022. As we move forward, we anticipate revenue growth as these leases begin and reflect in our reported revenue and EBITDA. We're optimistic about our prospects. During the last Q3 call, we identified a significant opportunity in our pipeline that offered visibility to over 130 megawatts for the year. However, we decided not to pursue it because we were concerned about the pricing expectations that customers might have at year-end for lease agreements. Rather than making short-term decisions just to hit leasing targets, we're concentrating on the longer-term hyperscale contracts we have in our pipeline. Our business typically sees around 10 megawatts added in any quarter alongside the larger, more variable hyperscale deals, and we have good visibility over the next 12 to 24 months, which supports our growth guidance. As for your question about DeepSeek, we see it as two parts. First, we believe it will accelerate our digitalization business since there's growing competition around large language models. This will likely impact the pricing of our AI-driven tools used in our digitization efforts. More broadly, we've observed that none of our major customers have reduced their capital expenditures in recent weeks. Despite the buzz around DeepSeek, we don’t foresee any significant changes in our customer base or their plans to expand their data center infrastructure.

Eric, I want to mention that when we examine the price per kilowatt we've been signing and the work we've started, you'll notice that compared to previous years, it’s growing quite nicely. The average price has significantly increased, which is reflected in the EBITDA margin as we begin to establish a more robust book of business. As Bill pointed out, we will maintain our focus on disciplined pricing and returns, and looking at our backlog for upcoming projects gives us strong confidence in the revenue and margin forecasts we discussed. Thank you, Eric.

The next question comes from Brendan Lynch with Barclays. Please go ahead.

Great. Thanks for taking my question. Maybe a follow-up on DeepSeek. It did raise some questions about the flow of US hardware and chips into China. If the US were to implement tighter restrictions on exporting IT hardware to China, how do you think that would affect the ALM business?

Thanks, Brendan, for the question. So first of all, think about it, most of our ALM business that gets sold into China is multi-generations previous. So none of these have been touched upon in terms of export restriction. We are continuing to, as we've talked about before, driving a diversification strategy to be less reliant on China where we actually resell components. And I should say that a big part of our resales, which I think we talked about in the last call, has been more and more on hard drives recently than even the CPUs and GPUs, which are more sensitive in terms of technology. So I think we continue to drive the diversification. So far, anyway, all our components of multi-generation old and don't come trapped on that. The other thing I should say is Barry talked about is that we see very much see our strategy as continuing to build on a mixed basis the enterprise side of the business. And that's, it means that you'll be less project-based, less reliant in terms of selling into China. But the other part of that Enterprise business is some of the work that we're doing with some of the OEMs on reintroducing the components back into their own supply chain. So we really see that's where a lot of the business will be going because as we all know is electronic components generally fail at the beginning of their life, not kind of in the middle of their life. And a lot of our OEM customers are now starting to ask us to actually do that harvesting and help them reintroduce it back into their supply chain.

The next question comes from Kevin McVeigh with UBS. Please go ahead.

Great. Thanks so much. Just following up on the Data Center. Barry, the churn in Q4 was 4.4%. I don't think that was related to the client you passed on, but just any thoughts on what drove that and probably onetime, but just maybe help us understand that a little bit.

Yes. Sure, Kevin. That's something that we've had on the horizon for some time and it's been in our expectations because what happened is at year-end, we had a couple of clients who have been in the business for a long time like I think 10-plus years predecessors to some of the as we acquired, which were on, like I said, with us for a long time, and they've been moving load to more of a cloud. And so those two churn, absent that, churn was very much in line, in fact, below our normal expectations in the quarter. And I don't see other items like that going forward. In fact, I expect our 2025 churn to be below where we've been historically running. So I usually say something like 1% to 2%, 1.5% to 2% a quarter, which kind of equates to say 5%, 6%, 7%, 8%. This year I would think it's going to be 5% maybe even a little bit lower than that as we look at our book of business. Importantly, we've essentially already released that space, which speaks to the demand environment and the fact that we are heavily leased in terms of our operating portfolio, Kevin, and I'll just also underscore that we're very pleased with the price per kilowatt that we're generating across the portfolio, whether that be on the hyperscale side or colo, which, of course, is this. So thanks for the question, Kevin.

The next question comes from Andrew Steinerman with JPMorgan. Please go ahead.

Hi Barry. I wanted to dive a little bit further into your prepared remarks about organic storage revenues being down sequentially in the fourth quarter. Was it down sequentially on an organic constant currency basis kind of ex FX? And you said something about normal seasonality of a fourth quarter, maybe dive into that. And then you also said something about the consumer business, is that direct-to-consumer business now being deemphasized at Iron Mountain?

Yes. Thanks, Andrew. I'll try to unpack all that here. So what I was explaining was that FX, first and foremost, was a big headwind to us on that line sequentially because as you probably know the US dollar strengthened significantly in the fourth quarter as compared to the third quarter. And in our records business, that's where we are the most diversified from a global footprint, working in 60-plus countries around the world and being exposed to currencies from the euro to the Brazilian real to the Canadian. And the dollar obviously strengthened meaningfully. That's on the order of $10 million sequentially of a headwind quarter-to-quarter. Then on top of that, you're right, we have been and we have been very focused on improving the profitability of our Consumer Storage business. You'll recall when we acquired Clutter and put it together with our remaining business, we mentioned that business was losing $2 million or $3 million of EBITDA a quarter. And so what we've done there is we've realized that we shouldn't chase business that's not profitable. And as you know, with any storage business, in and out is not where you want to be. You want to be with things that are going to store long-term. So the team has done a lot of analysis and has focused its both marketing and as well as where we're targeting on that business to be a much more profitable segment, and we've also driven a lot of operating efficiencies there. So long-winded way of saying consumer was also down sequentially. And from a run rate standpoint, that's about nearly 10%. And so when you take those two and put it up against the organic storage rental revenue that you're asking about in total, what falls out is the core records business was up nicely sequentially in line with normal trends and our pricing trends. So we feel very good about where the Records Management business is trending. And having the consumer business now being a profitable run rate is obviously the place we want to be, and we'll continue to expand on that. And that helped, obviously, with the Global RIM adjusted EBITDA margin improvement. Thanks.

The next question comes from Shlomo Rosenbaum with Stifel. Please go ahead.

Hi. Good morning and thank you for taking my question. Barry, can you just, maybe this is a follow-up to what you were explaining to Andrew. But could you talk a little bit about the factors that led to the revenue coming in a little bit lower than you expected in the quarter, right? The guidance was for about $1.6 billion. It was like $1,581 million. If you just rounded it's like 19 lower. Is it that $10 million on FX and $10 million on exiting some stuff in storage or what are the factors, anything in ALM in there? Maybe you could just unpack that for us?

Yes. Shlomo, obviously, you and Anthony have been following the company for a long time. So you're right, it is those two things. It's the FX. And just to be clear, the FX sequentially was even a little bit more than that because, of course, it hits us on other lines. I was specifically speaking about the organic storage rental revenue line. And then the consumer business, we have been very intentional, as I mentioned in the prepared remarks. So we are being very focused on driving returns for our shareholders and we're going to continue to do that while growing our business very substantially. We see a tremendous amount of runway there. You mentioned about ALM. ALM performed pretty much right in line with our expectations. The Wisetek and APCD business that we recently acquired did a little bit better than what we were expecting. It was a little north of $20 million. And so we had decent organic growth in the core enterprise pipeline and bookings continuing to grow. And as Bill alluded to, we've booked some very nice enterprise ALM deals here already this year. So feel good about where we're trending and feel very good about where we are in our core records business. Thank you, Shlomo.

The next question comes from Jon Atkin with RBC Capital Markets. Please go ahead.

Thank you. I have a question regarding the guidance or expectations for 2025. Can you share anything about capital recycling in your data center portfolio and expectations around cash renewal spreads? Additionally, I would like to know about the land held for development in various markets such as India, Amsterdam, Madrid, Richmond, Northern Virginia, Chicago, and others. Are there any highlights regarding permitting milestones, construction delivery, or long lead time items that might allow development to start in some of these markets sooner than others? Thank you.

Thanks for the question, Jon. I'll start, and then Barry may want to add some details. In terms of building the land bank, as you know, permitting and access to power are taking longer than they used to. However, looking ahead, we feel confident about our progress in getting the land bank ready for lease. Key markets like India, Amsterdam, Madrid, Miami, Chicago, Northern Virginia, and Richmond are on track with our expectations and align with our goal of leasing 125 megawatts this year. We're optimistic about the state of our land bank and the progress in the permitting process, much of which is already completed. This aligns with our multiyear plan for continued growth, reflecting in our guidance for 125 megawatts this year, which is a 25% increase from last year. Regarding capital recycling, we don't have specific plans at this time. However, I want to emphasize that we've increased our design and construction capacity, which should enhance efficiency in securing our supply chain for data center components. As we scale up, we believe we can achieve greater operating leverage despite ongoing inflation, which is evident in our CapEx guidance that Barry discussed.

Yes. And Jon, on cash renewal spreads, probably no surprise, we expect them to continue to rise. And that's just due to where demand is versus where supply is in the industry I think. I would only add that from a standpoint of what we're expecting for a data center, the growth that we're seeing is upwards of high 20s, 30% year-on-year from a revenue perspective with all that margin improvement that we were talking about. So we feel very well positioned with respect to growing that portfolio.

This concludes our question-and-answer session and the Iron Mountain Fourth Quarter 2024 Earnings Conference Call. Thank you for attending today's presentation. You may now disconnect.