Iron Mountain Raises Dividend 15% as Data Center Revenue Jumps 34%

Iron Mountain (NYSE: IRM) raised its quarterly dividend 15% on November 5, 2026, lifting the payout from $0.864 to $0.993 per share. The increase rests squarely on data centers: the company has signed 137 megawatts of new data center leases year to date, and a business built on storing paper boxes now pays its dividend raises with server halls.

"Based on our strong 2026 growth and continued positive outlook, we are pleased to increase the dividend by 15%," CEO William Meaney said.

What does the data center segment actually deliver?

In the third quarter, Global Data Center revenue rose 34.0% to $273.6 million. Legacy Global RIM (records and information management) grew 7.0%. Data center adjusted EBITDA (a cash-earnings measure) margin expanded to 56.3% from 52.6%, and renewal pricing rose 10% on a cash basis. Quarterly leasing totaled 102.5 MW, including 51 MW in Mumbai. Growth businesses supplied 11 of the 16 percentage points of 2026 consolidated growth.

"It won't be that many years before it's 50% of the company," Meaney said of the growth portfolio.

Records storage still funds the expansion. That segment is tracking toward its 38th consecutive year of organic storage rental growth at a 44% segment margin.

Does AFFO cover the raise?

Yes, with room to spare. Q3 AFFO (adjusted funds from operations, a REIT cash-flow metric) hit $1.53 per share. Management targets a payout ratio in the low 60s percent.

"In light of our performance in 2026 and outlook for AFFO, our Board increased our quarterly dividend by 15% to $0.993 per share," CFO Barry Hytinen said.

The new payout equals about 63% of Q4 guided AFFO of $1.57 per share. Full-year AFFO guidance of $5.94-$6.00 per share implies roughly 15% growth — matching the raise. Year-to-date free cash flow improved by nearly $400 million. At $109.02, the forward yield sits near 3.6%.

How do the pure-play peers compare?

Iron Mountain is outpacing dedicated data center operators on payout growth. Digital Realty (NYSE: DLR) held its dividend flat at $1.22 per quarter from Q1 2025 through Q1 2026, despite signing a 200-megawatt AI inference lease. Its cash renewal spread was 5.0%. Equinix (NASDAQ: EQIX) last raised its dividend 10% and has guided long-term AFFO per share growth of 9-12% on $5-$6 billion of 2026 capex.

"Customer demand is broad-based and growing," Equinix CEO Adaire Fox-Martin said.

Iron Mountain's hybrid model pairs a smaller data center base with faster percentage growth, while record cash flow supports build costs. The same AI expansion is lifting power, cooling and networking suppliers across the sector.

What's the risk?

Leverage. Net lease-adjusted leverage of 4.8x is the lowest since the 2014 REIT conversion. But the current portion of long-term debt jumped to $1,232.9 million from $216.1 million, and shareholders' equity stands at negative $1.06 billion. Capacity under construction requires $3.468 billion in total investment. Investors noticed: shares fell 6.57% over the past week, though they remain up 34.42% year to date.

Over the next 24 months, roughly 325 megawatts should come online. AFFO fully covers the dividend and is growing as fast as the payout. For income investors, the story now hinges on leasing momentum and debt refinancing — with the late-February earnings report and the early March investor day as the next checkpoints.