Yahoo Finance DigitalBridge Group Inc (DBRG) (Q1 2024) Earnings Call Transcript Highlights: Robust Growth and ...
FEEUM Growth: Increased by 17% year-over-year to $32.5 billion.
New Capital Formation: Closed on $1.1 billion, up 47% over the prior year.
Fee Revenues: Reported $72.8 million, a 21% increase from the previous year.
Fee-Related Earnings: $19.6 million, up 28% year-over-year.
Distributable Earnings: $2.2 million for the quarter.
Carried Interest Reversal: Reversal of $2.7 million due to changes in fund investment values.
Principal Investment Income: $2.8 million, with $2.3 million in realized distributions.
Release Date: April 30, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q & A Highlights
Q: Can you elaborate on the strategic importance of power in relation to data centers and AI, and how DigitalBridge is addressing potential challenges in power transmission and distribution? A: (Marc Ganzi, CEO) - Power transmission and distribution, rather than generation, are the main constraints facing data centers. The company is innovating by integrating power generation with data centers, either by situating data centers near power sources or bringing power solutions closer to data centers. This strategy is crucial for supporting AI workloads, which are becoming increasingly central in digital infrastructure.
Q: How is the landscape for data center locations changing in response to power availability, and how does this affect network connectivity strategies? A: (Marc Ganzi, CEO) - The company is exploring data center sites in less conventional locations with ample power availability. This involves enhancing connectivity through extensive fiber networks to maintain low latency, crucial for AI-driven operations. The interplay between data center platforms and fiber networks is key to delivering comprehensive solutions to hyperscalers.
Q: What are the financial implications of the carried interest reversal noted in the earnings report? A: (Thomas Mayrhofer, CFO) - The carried interest reversal is primarily a mark-to-market adjustment and does not impact adjusted earnings. It reflects quarterly changes in the fair value of fund investments.
Q: With the reiteration of the full-year PUM guidance, can you discuss the expected pacing of capital formation and its impact on financial targets? A: (Marc Ganzi, CEO) - The company is confident in meeting its capital formation targets, emphasizing a multi-strategy approach that is resonating with LPs. The guidance remains unchanged, and the company anticipates strong fundraising through diversified strategies.
Q: How is DigitalBridge enhancing its financial reporting and what benchmarks are being used to align with industry peers? A: (Thomas Mayrhofer, CFO) - The company has simplified its financial reporting to make it more transparent and comparable to peers. This includes integrating all financial metrics into a company-wide basis and focusing on fee-related earnings that reflect true operational performance.
Q: Can you provide insights into the M&A strategy for towers and how it fits into the broader infrastructure goals, especially in the context of 5G and AI? A: (Marc Ganzi, CEO) - DigitalBridge continues to pursue tower acquisitions globally, focusing on markets with strong growth potential for 5G and AI applications. The company views towers as essential infrastructure for supporting the increasing data demands and connectivity requirements of advanced technologies.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
