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Stockholders' Equity | 3 Months Ended
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Mar. 31, 2023
Equity [Abstract] |
Stockholders' Equity | Stockholders' Equity Stockholders' Equity Rollforward The following tables provide a rollforward of our stockholders' equity for the three months ended March 31, 2023 and 2022 (in thousands, except share and per share data):
|  |  |  |  |  |  |  |  |  |  |  |  | AOCI (Loss) |  | Retained Earnings |  | Equinix Stockholders' Equity |  | Non-controlling Interests |  | Total Stockholders' Equity
| Common Stock |  | Treasury Stock |  | Additional Paid-in Capital |  | Accumulated Dividends |  |  |  |  |
| Shares |  | Amount |  | Shares |  | Amount |  |  |  |  |  |  |
Balance as of December 31, 2022 | 92,813,976 |  |  | $ | 93 |  |  | (193,273) |  |  | $ | (71,966) |  |  | $ | 17,320,017 |  |  | $ | (7,317,570) |  |  | $ | (1,389,446) |  |  | $ | 2,964,838 |  |  | $ | 11,505,966 |  |  | $ | (134) |  |  | $ | 11,505,832 |
Net income | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 258,786 |  |  | 258,786 |  |  | (56) |  |  | 258,730 |
Other comprehensive income | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 104,258 |  |  | — |  |  | 104,258 |  |  | — |  |  | 104,258 |
Issuance of common stock and release of treasury stock for employee equity awards | 419,490 |  |  | — |  |  | 16,066 |  |  | 5,978 |  |  | 38,565 |  |  | — |  |  | — |  |  | — |  |  | 44,543 |  |  | 1 |  |  | 44,544 |
Issuance of common stock under ATM Program | 458,459 |  |  | 1 |  |  | — |  |  | — |  |  | 300,774 |  |  | — |  |  | — |  |  | — |  |  | 300,775 |  |  | — |  |  | 300,775 |
Dividend distribution on common stock,$3.41 per share | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (318,736) |  |  | — |  |  | — |  |  | (318,736) |  |  | — |  |  | (318,736) |
Settlement of accrued dividends on vested equity awards | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (483) |  |  | — |  |  | — |  |  | (483) |  |  | — |  |  | (483) |
Accrued dividends on unvested equity awards | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (2,406) |  |  | — |  |  | — |  |  | (2,406) |  |  | — |  |  | (2,406) |
Stock-based compensation, net of estimated forfeitures | — |  |  | — |  |  | — |  |  | — |  |  | 136,345 |  |  | — |  |  | — |  |  | — |  |  | 136,345 |  |  | — |  |  | 136,345 |
Balance as of March 31, 2023 | 93,691,925 |  |  | $ | 94 |  |  | (177,207) |  |  | $ | (65,988) |  |  | $ | 17,795,701 |  |  | $ | (7,639,195) |  |  | $ | (1,285,188) |  |  | $ | 3,223,624 |  |  | $ | 12,029,048 |  |  | $ | (189) |  |  | $ | 12,028,859 |
|  |  |  |  |  |  |  |  | Additional Paid-in Capital |  | Accumulated Dividends |  | AOCI (Loss) |  | Retained Earnings |  | Equinix Stockholders' Equity |  | Non-controlling interests |  | Total Stockholders' Equity
| Common Stock |  | Treasury Stock |  |  |  |  |  |  |
| Shares |  | Amount |  | Shares |  | Amount |  |  |  |  |  |  |
Balance as of December 31, 2021 | 90,872,826 |  |  | $ | 91 |  |  | (301,420) |  |  | $ | (112,208) |  |  | $ | 15,984,597 |  |  | $ | (6,165,140) |  |  | $ | (1,085,751) |  |  | $ | 2,260,493 |  |  | $ | 10,882,082 |  |  | $ | (318) |  |  | $ | 10,881,764 |
Net income | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 147,453 |  |  | 147,453 |  |  | 240 |  |  | 147,693 |
Other comprehensive loss | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | 32,837 |  |  | — |  |  | 32,837 |  |  | 3 |  |  | 32,840 |
Issuance of common stock and release of treasury stock for employee equity awards | 430,973 |  |  | — |  |  | 11,445 |  |  | 4,259 |  |  | 39,617 |  |  | — |  |  | — |  |  | — |  |  | 43,876 |  |  | — |  |  | 43,876 |
Dividend distribution on common stock, $3.10 per share | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (282,031) |  |  | — |  |  | — |  |  | (282,031) |  |  | — |  |  | (282,031) |
Settlement of accrued dividends on vested equity awards | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (497) |  |  | — |  |  | — |  |  | (497) |  |  | — |  |  | (497) |
Accrued dividends on unvested equity awards | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | (2,045) |  |  | — |  |  | — |  |  | (2,045) |  |  | — |  |  | (2,045) |
Stock-based compensation, net of estimated forfeitures | — |  |  | — |  |  | — |  |  | — |  |  | 121,210 |  |  | — |  |  | — |  |  | — |  |  | 121,210 |  |  | — |  |  | 121,210 |
Balance as of March 31, 2022 | 91,303,799 |  |  | $ | 91 |  |  | (289,975) |  |  | $ | (107,949) |  |  | $ | 16,145,424 |  |  | $ | (6,449,713) |  |  | $ | (1,052,914) |  |  | $ | 2,407,946 |  |  | $ | 10,942,885 |  |  | $ | (75) |  |  | $ | 10,942,810 |
Accumulated Other Comprehensive Loss The changes in accumulated other comprehensive loss, net of tax, by components are as follows (in thousands):
| Balance as of December 31, 2022 |  | Net Change |  |  |  | Balance as of March 31, 2023
Foreign currency translation adjustment ("CTA") gain (loss) | $ | (1,838,237) |  |  | $ | 157,214 |  |  |  |  | $ | (1,681,023) |
Unrealized gain (loss) on cash flow hedges (1) | 33,953 |  |  | (12,881) |  |  |  |  | 21,072 |
Net investment hedge CTA gain (loss) (1) | 415,749 |  |  | (39,960) |  |  |  |  | 375,789 |
Net actuarial loss on defined benefit plans (2) | (911) |  |  | (115) |  |  |  |  | (1,026) |
| $ | (1,389,446) |  |  | $ | 104,258 |  |  |  |  | $ | (1,285,188) |
(1)Refer to Note 7 for a discussion of the amounts reclassified from accumulated other comprehensive loss to net income. (2)We have two defined benefit pension plans covering all employees in two countries where such plans are mandated by law. We do not have any defined benefit plans in any other countries. Changes in foreign currencies can have a significant impact to our condensed consolidated balance sheets (as evidenced above in our foreign currency translation loss), as well as its condensed consolidated results of operations, as amounts in foreign currencies are generally translated into more U.S. Dollars when the U.S. Dollar weakens or fewer U.S. Dollars when the U.S. Dollar strengthens. As of March 31, 2023, the U.S. Dollar was generally weaker relative to certain of the currencies of the foreign countries in which we operate as compared to December 31, 2022. Because of this, the U.S. Dollar had an overall favorable impact on our condensed consolidated financial position because the foreign denominations translated into more U.S. Dollars as evidenced by a decrease in foreign currency translation loss for the three months ended March 31, 2023 as reflected in the above table. The volatility of the U.S. Dollar as compared to the other currencies in which we operate could have a significant impact on our condensed consolidated financial position and results of operations including the amount of revenue that we report in future periods. Common Stock In October 2020, we established an "at the market" equity offering program (the "2020 ATM Program"), under which we could, from time to time, offer and sell shares of our common stock to or through sales agents up to an aggregate of $1.5 billion. In February 2022, we entered into a forward sale amendment to the 2020 ATM Program, under which we could, from time to time, offer and sell shares under the equity distribution agreement pursuant to forward sale transactions (the "Equity Forward Amendment"). In November 2022, we established a successor ATM program, also with substantially the same terms as the Equity Forward Amendment noted above, under which we may, from time to time, offer and sell on a spot or forward basis up to an aggregate of $1.5 billion of our common stock to or through sales agents in "at the market" transactions (the "2022 ATM Program"). The forward sale agreements provide three settlement alternatives to us: physical settlement, cash settlement or net share settlement. In accordance with ASC 815, the forward sale agreements are classified as equity for balance sheet purposes. During the first half of 2022, we executed five forward sale agreements under the 2020 ATM Program to sell 579,873 shares of our common stock. On August 3, 2022, we physically settled these forward sale shares for approximately $393.6 million, net of payment of commissions to sales agents and other offering expenses, at an aggregate weighted-average forward sale price of $678.72 per share. In the fourth quarter of 2022, we executed three additional forward sale agreements to sell 458,459 shares of our common stock with maturity dates ranging from February 2023 to November 2023. Of this amount, 308,875 shares were executed under the 2020 ATM Program and the remaining 149,584 shares were executed under the 2022 ATM Program. As of December 31, 2022, no shares remained available for sale under the 2020 ATM Program. On February 28, 2023, we physically settled these forward sale shares for approximately $301.6 million, net of payment of commissions to sales agents and other offering expenses, at an aggregate weighted-average forward sale price of $657.75 per share. For the three months ended March 31, 2023, other than as noted above, we sold no additional shares and for the three months ended March 31, 2022, we did not sell any shares under the 2022 and 2020 ATM Program. As of March 31, 2023, we had approximately $1.4 billion of common stock available for sale under the 2022 ATM Program. Stock-Based Compensation For the three months ended March 31, 2023, the Talent, Culture and Compensation Committee and/or the Stock Award Committee of our Board of Directors, as the case may be, granted an aggregate of 845,473 restricted stock units ("RSUs") to certain employees, including executive officers. These equity awards are subject to vesting provisions and have a weighted-average grant date fair value of $685.99 per share and a weighted-average requisite service period of 3.48 years. The valuation of RSUs with only a service condition or a service and performance condition require no significant assumptions as the fair value for these types of equity awards is based solely on the fair value of our stock price on the date of grant. We use revenues, adjusted funds from operations ("AFFO") per share and digital services revenues as the performance measurements in the RSUs with both service and performance conditions that were granted in the three months ended March 31, 2023. We use a Monte Carlo simulation option-pricing model to determine the fair value of RSUs with a service and market condition. We used total shareholder return ("TSR") as the performance measurement in the RSUs with a service and market condition that were granted in the three months ended March 31, 2023. There were no significant changes in the assumptions used to determine the fair value of RSUs with a service and market condition that were granted in 2023 compared to the prior year. The following table presents, by operating expense category, our stock-based compensation expense recognized in our condensed consolidated statements of operations (in thousands):
|  |  | Three Months Ended March 31,
|  |  |  |  | 2023 |  | 2022
Cost of revenues |  |  |  |  | $ | 11,323 |  |  | $ | 10,443 |
Sales and marketing |  |  |  |  | 19,505 |  |  | 20,184 |
General and administrative |  |  |  |  | 67,887 |  |  | 59,325 |
Total |  |  |  |  | $ | 98,715 |  |  | $ | 89,952 |

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