The information in this discussion contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and
Section 21E of the Securities Exchange Act of 1934, as amended. Such statements are based upon current expectations that involve risks and uncertainties. Any statements contained herein that are not statements of historical fact may be deemed to be forward-looking statements. For example, the words "believes," "anticipates," "plans," "expects," "intends" and similar expressions are intended to identify forward-looking statements. Our actual results and the timing of certain events may differ significantly from the results discussed in the forward-looking statements. Factors that might cause such a discrepancy include, but are not limited to, those discussed in "Liquidity and Capital Resources" below and "Risk Factors" in Item 1A of Part II of this Quarterly Report on Form 10-Q. All forward-looking statements in this document are based on information available to us as of the date of this Report and we assume no obligation to update any such forward-looking statements.

Our management's discussion and analysis of financial condition and results of operations is intended to assist readers in understanding our financial information from our management's perspective and is presented as follows:

• Overview

• Results of Operations

• Liquidity and Capital Resources

• Contractual Obligations and Off-Balance-Sheet Arrangements

• Critical Accounting Estimates

• Recent Accounting Pronouncements

In January 2009, we adopted FASB Staff Position No. APB 14-1, "Accounting for Convertible Debt Instruments That May Be Settled in Cash upon Conversion" ("FSP APB 14-1") and FASB Staff Position No. EITF 03-6-1, "Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities" ("FSP EITF 03-6-1"). As a result, we adjusted our previously issued comparative condensed consolidated financial statements. See Note 2 of Notes to Condensed Consolidated Financial Statements in Item 1 of this Quarterly Report on Form 10-Q.

Overview

Equinix provides network-neutral colocation, interconnection and managed services to global enterprises, content providers, financial companies and the world's largest network service providers. As of March 31, 2009, we operated IBX centers in the Chicago, Dallas, Los Angeles, New York, Silicon Valley and Washington, D.C. metro areas in the United States, France, Germany, the Netherlands, Switzerland and the United Kingdom in the Europe region, and Australia, Hong Kong, Japan and Singapore in the Asia-Pacific region. In February 2008, we acquired Virtu Secure Webservices B.V., or Virtu, based in the Netherlands to supplement our European operations. We refer to this transaction as the Virtu acquisition.

Direct interconnection to our aggregation of networks, which serve more than 90% of the world's Internet routes, allows our customers to increase performance while significantly reducing costs. Based on our network-neutral model and the quality of our IBX centers, we believe we have established a critical mass of customers. As more customers locate in our IBX centers, it benefits their suppliers and business partners to do so as well to gain the full economic and performance benefits of direct interconnection. These partners, in turn, pull in their business partners, creating a "network effect" of customer adoption. Our interconnection services enable scalable, reliable and cost-effective interconnection and traffic exchange thus lowering overall cost and increasing flexibility. Our focused business model is based on our critical mass of customers and the resulting network effect. This critical mass and the resulting network effect, combined with our strong financial position, continue to drive new customer growth and bookings.

Historically, our market has been served by large telecommunications carriers who have bundled their telecommunications products and services with their colocation offerings. Each of these colocation providers own and operate a network. We do not own or operate a network, yet have greater than 300 networks operating out of our IBX centers. As a result, we are able to offer our customers a substantial choice of networks given our network neutrality thereby allowing our customers to choose from numerous network service providers. We believe this is a distinct and sustainable competitive advantage.

Our customer count increased to 2,384 as of March 31, 2009 versus 1,994 as of March 31, 2008, an increase of 20%. Our utilization rate represents the percentage of our cabinet space billing versus net sellable cabinet space available taking into account power limitations. Our utilization rate increased to 80% as of March 31, 2009 versus approximately 78% as of March 31, 2008; however, further excluding the impact of our IBX center expansion projects that have opened during the last 12 months, our utilization rate would have been approximately 86% as of March 31, 2009. Our utilization rate varies from market to market among our IBX centers across the U.S., Europe and Asia-Pacific. We continue to monitor the available capacity in each of our selected markets. To the extent we have limited capacity available in a given market it may limit our ability for growth in that market. We perform demand studies on an ongoing basis to determine if future expansion is warranted in a market. In addition, power and cooling requirements for most customers are growing on a per unit basis. As a result, customers are consuming an increasing amount of power per cabinet. Although we generally do not control the amount of power our customers draw from installed circuits, we have negotiated power consumption limitations with certain of our high power demand customers. This increased power consumption has driven the requirement to build out our new IBX centers to support power and cooling needs twice that of previous IBX centers. We could face power limitations in our centers even though we may have additional physical cabinet capacity available within a specific IBX center. This could have a negative impact on the available utilization capacity of a given center, which could have a negative impact on our ability to grow revenues, affecting our financial performance, operating results and cash flows.

Strategically, we will continue to look at attractive opportunities to grow our market share and selectively improve our footprint and service offerings. As was the case with our recent expansions and acquisitions, our expansion criteria will be dependent on a number of factors such as demand from new and existing customers, quality of the design, power capacity, access to networks, capacity availability in current market location, amount of incremental investment required by us in the targeted property, lead-time to break-even and in-place customers. Like our recent expansions and acquisitions, the right combination of these factors may be attractive to us. Dependent on the circumstances, these transactions may require additional capital expenditures funded by upfront cash payments or through long-term financing arrangements in order to bring these properties up to Equinix standards. Property expansion may be in the form of purchases of real property, long-term leasing arrangements or acquisitions. Future purchases, construction or acquisitions may be completed by us or with partners or potential customers to minimize the outlay of cash, which can be significant.

Our business is based on a recurring revenue model comprised of colocation, interconnection and managed infrastructure services. We consider these services recurring as our customers are generally billed on a fixed and recurring basis each month for the duration of their contract, which is generally one to three years in length. Our recurring revenues comprise greater than 90% of our total revenues. Over the past few years, greater than half of our then existing customers ordered new services in any given quarter representing greater than half of the new orders received in each quarter, contributing to our revenue growth.

Our non-recurring revenues are primarily comprised of installation services related to a customer's initial deployment and professional services that we perform. These services are considered to be non-recurring as they are billed typically once and upon completion of the installation or professional services work performed. The majority of these non-recurring revenues are typically billed on the first invoice distributed to the customer in connection with their initial installation. As a percentage of total revenues, we expect non-recurring revenues to represent less than 10% of total revenues for the foreseeable future.

Our U.S. revenues are derived primarily from colocation and interconnection services while our Europe and Asia-Pacific revenues are derived primarily from colocation and managed infrastructure services.

The largest cost components of our cost of revenues are depreciation, rental payments related to our leased IBX centers, utility costs, including electricity and bandwidth, IBX center employees' salaries and benefits, including stock-based compensation, repairs and maintenance, supplies and equipment and security services. A substantial majority of our cost of revenues is fixed in nature and should not vary significantly from period to period, unless we expand our existing IBX centers or open new IBX centers. However, there are certain costs which are considered more variable in nature, including utilities and supplies that are directly related to growth in our existing and new customer base. We expect the cost of our utilities, specifically electricity, will increase in the future on a
per-unit or fixed basis in addition to the variable increase related to the growth of consumption by the customer. In addition, the cost of electricity is generally higher in the summer months as compared to other times of the year.

Sales and marketing expenses consist primarily of compensation and related costs for sales and marketing personnel, including stock-based compensation, sales commissions, marketing programs, public relations, promotional materials and travel, as well as bad debt expense and amortization of customer contract intangible assets.

General and administrative expenses consist primarily of salaries and related expenses, including stock-based compensation, accounting, legal and other professional service fees, and other general corporate expenses such as our corporate headquarters office lease and some depreciation expense.

Due to our recurring revenue model, and a cost structure which has a large base that is fixed in nature and generally does not grow in proportion to revenue growth, we expect our cost of revenues, sales and marketing expenses and general and administrative expenses to decline as a percentage of revenue over time, although we expect each of them to grow in absolute dollars in connection with our growth. This is evident in the trends noted below in our discussion on our results of operations. However, for cost of revenues, this trend may periodically be impacted when a large expansion project opens and before it starts generating any meaningful revenue.

Results of Operations

Our results of operations for the three months ended March 31, 2008 include the operations of Virtu from February 5, 2008 to March 31, 2008.

Three Months Ended March 31, 2009 and 2008

Revenues. Our revenues for the three months ended March 31, 2009 and 2008 were generated from the following revenue classifications and geographic regions (dollars in thousands):

Three months ended March 31, Change 2009 % 2008 % $ % U.S:

      Recurring revenues       $   121,250    61 %   $  95,118    60 %   $ 26,132      27 %
      Non-recurring revenues         3,644     2 %       4,078     3 %       (434 )   (11 %)

                                   124,894    63 %      99,196    63 %     25,698      26 %

      Europe:
      Recurring revenues            44,988    23 %      38,233    24 %      6,755      18 %
      Non-recurring revenues         2,812     1 %       2,616     2 %        196       7 %

                                    47,800    24 %      40,849    26 %      6,951      17 %

      Asia-Pacific:
      Recurring revenues            25,049    12 %      17,008    10 %      8,041      47 %
      Non-recurring revenues         1,488     1 %       1,165     1 %        323      28 %

                                    26,537    13 %      18,173    11 %      8,364      46 %

      Total:
      Recurring revenues           191,287    96 %     150,359    95 %     40,928      27 %
      Non-recurring revenues         7,944     4 %       7,859     5 %         85       1 %

                               $   199,231   100 %   $ 158,218   100 %   $ 41,013      26 %

U.S. Revenues. The period over period growth in recurring revenues was primarily the result of an increase in orders from both our existing customers and new customers during the period as reflected in the growth in our customer count and utilization rate, as discussed above, in both our new and existing IBX

centers, as well as selective price increases in each of our IBX markets. During the three months ended March 31, 2009, we recorded approximately $4.9 million of revenue generated from our recently-opened IBX centers or IBX center expansions in the Silicon Valley and Washington, D.C. metro areas. We expect that our U.S. revenues will continue to grow in future periods as a result of continued growth in these recently-opened IBX centers and additional expansions currently taking place in the Chicago, Los Angeles and New York metro areas, all of which are expected to open during the remainder of 2009.

Europe Revenues. Our revenues from the United Kingdom, the largest revenue contributor in the Europe region, represented approximately 36% and 41%, respectively, of the regional revenues for the three months ended March 31, 2009 and 2008. As in the U.S., Europe revenue growth was due to an increase in orders from both our existing customers and new customers during the period as reflected in the growth in our customer count and utilization rate, as discussed above, which was primarily generated from our recently-opened IBX center expansions in the Amsterdam, Frankfurt, London and Paris metro areas. We expect that our Europe revenues will continue to grow in future periods as a result of continued growth in recently-opened IBX center expansions in the Amsterdam, Frankfurt, London and Paris metro areas and additional expansions currently taking place in the Amsterdam, Frankfurt, London and Paris metro areas, all of which are expected to open during mid-2009, with the exception of the current London expansion which is expected to open during the first half of 2010.

Asia-Pacific Revenues. Our revenues from Singapore, the largest revenue contributor in the Asia-Pacific region, represented approximately 36% and 35%, respectively, of the regional revenues for the three months ended March 31, 2009 and 2008. As in the U.S., Asia-Pacific revenue growth was due to an increase in orders from both our existing customers and new customers during the period as reflected in the growth in our customer count and utilization rate, as discussed above, in both our new and existing IBX centers, as well as selective price increases in each of our IBX markets. During the three months ended March 31, 2009, we recorded approximately $6.1 million of revenue generated from our IBX center expansions in the Hong Kong, Singapore, Sydney and Tokyo metro areas. We expect that our Asia-Pacific revenues will continue to grow in future periods as a result of continued growth in these recently-opened IBX center expansions and additional expansion currently taking place in the Hong Kong and Singapore metro areas which are expected to open during the second half of 2009.

Cost of Revenues. Our cost of revenues for the three months ended March 31, 2009 and 2008 were split among the following geographic regions (dollars in thousands):

                                Three months ended March 31,             Change
                               2009         %        2008      %         $       %
             U.S.           $    63,811     57 %   $ 54,870    58 %   $  8,941   16 %
             Europe              31,842     29 %     28,221    30 %      3,621   13 %
             Asia-Pacific        16,152     14 %     11,418    12 %      4,734   41 %

             Total          $   111,805    100 %   $ 94,509   100 %   $ 17,296   18 %

                                                        Three months ended
                                                             March 31,
                                                        2009           2008
      Cost of revenues as a percentage of revenues:
      U.S.                                                  51 %           55 %
      Europe                                                67 %           69 %
      Asia-Pacific                                          61 %           63 %
      Total                                                 56 %           60 %

U.S. Cost of Revenues. U.S. cost of revenues for the three months ended March 31, 2009 and 2008 included $24.2 million and $20.7 million, respectively, of depreciation expense. Growth in depreciation expense was due to our IBX center expansion activity. Excluding depreciation, the increase in U.S. cost of revenues was primarily due to overall growth related to our revenue growth and costs associated with our expansion projects, including (i) an increase of $2.8 million in utility costs as a result of increased customer

installations, (ii) an increase of $1.8 million in rent and facility costs and
(iii) $1.5 million in higher compensation costs, primarily as a result of headcount growth (290 U.S. employees as of March 31, 2009 versus 255 as of March 31, 2008). We anticipate that our U.S. cost of revenues will continue to increase in the foreseeable future to the extent that the occupancy levels in our U.S. IBX centers increase and as our recently-opened IBX centers or IBX center expansions commence operations more fully during the remainder of 2009 and from our additional expansion activity currently taking place in the Chicago, Los Angeles and New York metro areas. We expect U.S. cost of revenues to increase as we continue to grow our business.

Europe Cost of Revenues. Europe cost of revenues for the three months ended March 31, 2009 and 2008 included $8.1 million and $7.0 million, respectively, of depreciation expense. Growth in depreciation expense was due to our IBX center expansion activity. Excluding depreciation expense, the increase in Europe cost of revenues was primarily the result of costs associated with our expansion projects and overall growth in connection with revenue growth, such as $2.4 million of higher utility costs arising from increased customer installations and revenues attributed to customer growth. We expect Europe cost of revenues to increase as we continue to grow our business.

Asia-Pacific Cost of Revenues. Asia-Pacific cost of revenues for the three months ended March 31, 2009 and 2008 included $6.1 million and $3.4 million, respectively, of depreciation expense. Growth in depreciation expense was due to our IBX center expansion activity. Excluding depreciation expense, the increase in Asia-Pacific cost of revenues was primarily the result of costs associated with our expansion projects and overall growth in connection with revenue growth, such as $1.2 million of higher utility costs arising from increased customer installations and revenues attributed to customer growth. We expect Asia-Pacific cost of revenues to increase as we continue to grow our business.

Sales and Marketing Expenses. Our sales and marketing expenses for the three months ended March 31, 2009 and 2008 were split among the following geographic regions (dollars in thousands):

                               Three months ended March 31,              Change
                              2009        %         2008      %        $         %
            U.S.           $    8,134      57 %   $  8,644    56 %   $ (510 )    (6 %)
            Europe              3,934      27 %      4,608    30 %     (674 )   (15 %)
            Asia-Pacific        2,335      16 %      2,099    14 %      236      11 %

            Total          $   14,403     100 %   $ 15,351   100 %   $ (948 )    (6 %)

                                                              Three months ended
                                                                   March 31,
                                                              2009           2008
Sales and marketing expenses as a percentage of revenues:
U.S.                                                               7 %            9 %
Europe                                                             8 %           11 %
Asia-Pacific                                                       9 %           12 %
Total                                                              7 %           10 %

U.S. Sales and Marketing Expenses. Our U.S. sales and marketing expenses did not change significantly. We generally expect U.S. sales and marketing expenses to increase as we continue to grow our business and invest further in various branding initiatives; however, as a percentage of revenues, we expect them to decrease.

Europe Sales and Marketing Expenses. Our Europe sales and marketing expenses for the three months ended March 31, 2009 and 2008 included $1.2 million and $1.6 million, respectively, of amortization expense related to customer contract intangible assets. Excluding amortization expense, our Europe sales and marketing expenses did not change significantly. We generally expect Europe sales and marketing expenses to increase as we continue to grow our business; however, as a percentage of revenues, we expect them to decrease.

Asia-Pacific Sales and Marketing Expenses. Our Asia-Pacific sales and marketing expenses did not change significantly. We expect Asia-Pacific sales and marketing expenses to increase as we continue to grow our business; however, as a percentage of revenues, we expect them to decrease.

General and Administrative Expenses. Our general and administrative expenses for the three months ended March 31, 2009 and 2008 were split among the following geographic regions (dollars in thousands):

                              Three months ended March 31,               Change
                             2009        %         2008      %         $          %
           U.S.           $   24,841      71 %   $ 22,427    65 %   $  2,414      11 %
           Europe              6,598      19 %      7,968    23 %     (1,370 )   (17 %)
           Asia-Pacific        3,711      10 %      3,981    12 %       (270 )    (7 %)

           Total          $   35,150     100 %   $ 34,376   100 %   $    774       2 %

                                                                 Three months ended
                                                                      March 31,
                                                                2009             2008
General and administrative expenses as a percentage of
revenues:
U.S.                                                                20 %             23 %
Europe                                                              14 %             20 %
Asia-Pacific                                                        14 %             22 %
Total                                                               18 %             22 %

U.S. General and Administrative Expenses. Our U.S. general and administrative expenses for the three months ended March 31, 2009 and 2008 included $6.3 million and $6.9 million, respectively, of stock-based compensation expense. The increase in U.S. general and administrative expenses was primarily due to $2.3 million of higher compensation costs, including increases in general salary, bonuses and headcount growth (278 U.S. general and administrative employees as of March 31, 2009 versus 226 as of March 31, 2008). Going forward, although we are carefully monitoring our spending given the current economic environment, we expect U.S. general and administrative expenses to increase as we continue to scale our operations to support our growth; however, as a percentage of revenues, we expect them to decrease.

Europe General and Administrative Expenses. Our Europe general and administrative expenses for the three months ended March 31, 2009 and 2008 included $1.1 million and $1.5 million, respectively, of stock-based compensation expense. Additionally, the resignation of two senior officers in Europe during the three months ended June 30, 2008 has further contributed to the decrease in Europe general and administrative expenses. Going forward, although we are carefully monitoring our spending given the current economic environment, we expect our Europe general and administrative expenses to increase in future periods as we continue to scale our operations to support our growth and in connection with various ongoing integration initiatives related to investments in systems and internal control compliance; however, as a percentage of revenues, we expect them to decrease.

Asia-Pacific General and Administrative Expenses. Our Asia-Pacific general and administrative expenses did not change significantly. Going forward, although we are carefully monitoring our spending given the current economic environment, we expect Asia-Pacific general and administrative expenses to increase as we continue to scale our operations to support our growth; however, as a percentage of revenues, we expect them to decrease.

Restructuring Charges. During the three months ended March 31, 2009, we recorded a reversal of a restructuring charge accrual of $5.8 million for our excess space in the Los Angeles metro area as a result of our decision to utilize this space to expand our original Los Angeles IBX center. Our excess space lease in the New York metro area remains abandoned and continues to carry a restructuring charge. During the three months ended March 31, 2008 no restructuring charge was recorded.

Interest Income. Interest income decreased to $916,000 for the three months ended March 31, 2009 from $3.4 million for the three months ended March 31, 2008. Interest income decreased primarily due to lower yields on invested balances and lower average cash balances. The average yield for the three months ended March 31, 2009 was 0.87% versus 2.90% for the three months ended March 31, 2008. We expect our interest income to decrease for the foreseeable future due primarily to lower yields on our investment portfolio and lower average cash balances.

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