American Tower Corporation (AMT) Earnings & Analysis

Latest quarter

American Tower reported Q3 FY2026 revenue of $2.8 billion, up from $2.7 billion a year earlier and 0.44% above the consensus, although both figures round to $2.8 billion. Adjusted EPS was $2.87, above the $2.84 consensus; diluted EPS fell to $1.68 from $1.82 a year earlier.

The company’s filing shows data-center revenue rose to $313.0 million, supported by new leases, customer expansions and higher power revenue. U.S. and Canada property revenue declined, primarily because of lower straight-line accounting revenue. Services revenue also fell, with the filing citing reduced activity in site applications, permitting, structural analyses and construction management.

American Tower reported gross margin of 72.8%, compared with 73.8% a year earlier, while operating margin moved to 45.6% from 45.4%. Free cash flow was $995.4 million, compared with $994.5 million in the prior-year quarter.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

CEO Steve Vondran said data-center customer demand and pricing exceeded expectations in the quarter, with demand continuing to accelerate into the fourth quarter. He said customers connecting cloud, network, enterprise and AI systems were driving demand for connected campuses and interconnection services.

Asked about data-center pricing, CFO Rod Smith said cash mark-to-market increases had reached double digits in the second and third quarters, compared with a traditional three to 4% increase. He cautioned that the full-year figure was expected to be in the 6% range. Smith also said the company expected mid-teen stabilized returns on its investments in the business.

On towers, Smith said new-business contributions stepped down in the third quarter and that activity was front-end loaded for the year. He noted that “not all carriers are active at the moment” and said the second-half slowdown was consistent with the company’s original outlook. For the fourth quarter, he expected new business to be consistent with the third quarter.

Vondran said carriers were becoming more interested in adding sites to increase network capacity. He also described satellite and terrestrial wireless infrastructure as complementary, and said additional providers could become customers. When asked about a potential satellite customer, he declined to discuss specific conversations.

Smith said cash adjusted EBITDA margins declined approximately 50 basis points year over year, primarily because of DISH-related churn and lower services contributions. Asked about delayed customer projects, Vondran called the delay a “change in timing, not expectation” and said he expected the associated services and rental business when the customer builds.

Vondran said American Tower had agreed to sell its Canada business and would consider reinvesting proceeds in its tower portfolio, data centers, debt reduction and repurchases. Smith said leverage ended the quarter at 4.9 times, within the company’s target range.

Guidance

CFO Rod Smith said American Tower raised its FY2026 property revenue outlook by $55 million at the midpoint, citing data-center performance and other items. He raised the data-center growth outlook to approximately 16% year over year.

Smith said the company raised its attributable AFFO outlook by $0.02 per share, primarily reflecting repurchases, while maintaining its adjusted EBITDA outlook. In the Q&A, he said the updated outlook included about $220 million in services revenue, with delayed customer projects reducing expected EBITDA by roughly $15 million.