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SHANGHAI - On Wednesday, GDS Holdings Limited (NASDAQ:GDS), a leading developer and operator of high-performance data centers in China, reported second quarter financial results that exceeded analyst expectations, driven by continued expansion of its data center operations.
The company’s shares surged 3.93% in pre-market trading after the release.
The company reported a second quarter net loss of RMB0.06 per share, significantly better than the analyst estimate of a RMB0.39 loss. Revenue climbed 12.4% YoY to RMB2.9 billion ($404.9 million), surpassing the consensus estimate of RMB2.83 billion. The strong performance was primarily attributed to the continued ramp-up of the company’s data centers.
"Our disciplined execution drove another quarter of solid operational and financial performance," stated William Huang, Chairman and CEO of GDS. "We continued to accelerate the delivery of our backlog while maintaining a selective approach to new orders."
GDS reported an Adjusted EBITDA of RMB1.37 billion ($191.5 million), representing an 11.2% increase YoY, with an Adjusted EBITDA margin of 47.3%, slightly down from 47.8% in the same period last year. The company’s area utilized increased by 14.1% YoY to 479,186 square meters, while the utilization rate improved to 77.5% from 72.4% a year earlier.
The company also highlighted a strategic milestone with the successful initial public offering of its China REIT (C-REIT) on the Shanghai Stock Exchange, which provides enhanced financing flexibility. The C-REIT began trading on August 8, 2025.
"On the funding side, we raised net proceeds of US$676 million through new convertible senior notes and equity. Our new C-REIT platform provides us with enhanced financing flexibility," added Dan Newman, Chief Financial Officer.
GDS maintained its previously provided guidance for 2025, projecting total revenues of RMB11,290-11,590 million and Adjusted EBITDA of RMB5,190-5,390 million, while revising its total capex guidance downward from RMB4,300 million to RMB2,700 million.
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