Iron Mountain (NYSE:IRM) reported record second-quarter results for 2026, with revenue rising 19% year over year to $2.03 billion and adjusted EBITDA increasing 16% to $727 million, as growth in data centers, asset lifecycle management and digital solutions outpaced the company’s expectations.
President and Chief Executive Officer Will Meaney said organic revenue grew 17% during the quarter, while adjusted funds from operations, or AFFO, increased 17%. The company’s data center, asset lifecycle management, or ALM, and digital businesses collectively grew by more than 50%, contributing 35% of second-quarter revenue, up 750 basis points from a year earlier.
Data Center Leasing and Capacity
Iron Mountain’s data center business generated $263 million in second-quarter revenue, up $73 million, or 39%, from the prior year. The segment’s adjusted EBITDA rose $41 million to $137 million, and its adjusted EBITDA margin increased 140 basis points year over year to 52.2%.
The company signed 13 megawatts of new data center leases in the second quarter, including a 10-megawatt lease in Amsterdam. In July, it signed an additional 75 megawatts of leases, bringing year-to-date leasing to 110 megawatts. July activity included a 25-megawatt lease that fully leased Iron Mountain’s London Three asset and a 51-megawatt, 10-year agreement with a major global hyperscaler in Mumbai.
Meaney said the company has about 325 megawatts of capacity expected to be energized during the next 24 months, following leasing activity in the first half and July. He said demand is strong across the company’s pipeline, including at its Richmond campus, in Europe and in India.
Management said it expects to “meaningfully exceed” its original 100-megawatt full-year leasing target, though executives noted that large hyperscale leases can be uneven from quarter to quarter. Chief Financial Officer Barry Hytinen said the company plans to emphasize its energization schedule rather than issue annual leasing guidance, describing the available capacity as located in attractive markets with robust customer pipelines.
ALM Growth Drives Revenue Upside
ALM revenue rose 88% year over year to $288 million, including 82% organic growth. Hytinen said the segment exceeded the company’s prior projection by more than $45 million, supported by both enterprise ALM services and hyperscale data center decommissioning.
Enterprise ALM revenue grew more than 60% organically, aided by expansion with existing customers and new contract wins. Data center decommissioning revenue increased more than 100% from the prior year, partially reflecting about $30 million of timing benefits from large hyperscaler projects that were accelerated into the second quarter.
Meaney characterized ALM as a multibillion-dollar opportunity, citing a $35 billion addressable market. The company said the enterprise channel accounts for roughly 75% of that market and offers recurring activity and cross-selling opportunities across Iron Mountain’s customer base of more than 240,000 customers.
Iron Mountain raised its full-year ALM revenue outlook and now expects the business to approach $1 billion in 2026 revenue. Hytinen said the enterprise ALM business is expected to grow more than 50% this year and generate slightly more than $600 million of full-year revenue.
The company also recently acquired Group ATF, an ALM provider in France and Belgium. Hytinen said the transaction closed around Aug. 1 and involves annual revenue in the high teens of millions. Iron Mountain expects approximately $7 million of revenue contribution during the second half, with the acquired business carrying an EBITDA margin in the low 20% range before expected cost and revenue synergies.
Records and Digital Businesses Continue to Expand
Global records and information management revenue reached a quarterly record of $1.4 billion, up 8% on a reported basis and 7% organically. Storage revenue rose 5% organically, while services revenue increased 9% organically.
Iron Mountain’s digital business grew more than 25%, according to Hytinen. Meaney said digital solutions posted record quarterly revenue and that more than 45% of digital revenue is now recurring. He also cited traction for the company’s AI-powered InSight DXP platform, including new deployments with financial services and fintech customers in the United Kingdom and Australia.
Hytinen said physical storage volumes continued to increase, with the company storing more physical volume for customers than at any prior point. He expects physical volumes to remain modestly positive, supported by continued outsourcing in markets including India.
The company also said its Internal Revenue Service digital-services contract ramped faster than expected. Hytinen said the contract generated more than $15 million of second-quarter revenue, compared with about $9 million in the first quarter, and that Iron Mountain continues to expect annual revenue from the program to exceed $100 million in 2027.
Raised 2026 Outlook
Iron Mountain raised its full-year financial outlook following the second-quarter performance. The company now expects:
- Total revenue of $7.94 billion to $8.01 billion, representing 16% growth at the midpoint.
- Adjusted EBITDA of $2.945 billion to $2.975 billion, representing 15% growth at the midpoint.
- AFFO of $1.76 billion to $1.78 billion, or $5.87 to $5.93 per share.
For the third quarter, the company expects approximately $1.98 billion in revenue, $745 million in adjusted EBITDA and $440 million in AFFO, or $1.47 per share.
Iron Mountain generated $888 million in year-to-date operating cash flow, up $315 million from the prior-year period. The company invested $553 million in growth capital expenditures and $38 million in recurring capital expenditures during the second quarter. It ended the period with net lease-adjusted leverage of 4.8 times and declared a quarterly dividend of $0.864 per share, payable in early October.
About Iron Mountain (NYSE:IRM)
Iron Mountain Incorporated is a global information management company that helps organizations protect, store, and manage their physical and digital information. The firm provides a range of services including secure records storage, document imaging and digitization, secure shredding and destruction, and information governance solutions designed to support regulatory compliance and business continuity. Iron Mountain also offers specialized secure storage environments and logistics for sensitive assets such as art, medical records, and legal archives.
Beyond traditional records management, Iron Mountain has expanded into technology-driven services to support customers’ digital transformation.
