American Tower (AMT) Q2 2026: CoreSite Leasing Surges, Driving 15% Data Center Revenue Outlook
CoreSite, AMT’s data center platform, delivered record leasing and fueled a raised 15% revenue growth outlook, offsetting tower churn and macro headwinds. Exiting APAC sharpened portfolio quality and capital flexibility, with new capital focused on developed market towers and data centers. Management signals a multi-year demand inflection, underpinned by 5G densification, spectrum deployment, and AI-driven network needs, positioning AMT for accelerated growth into 2027 and beyond.
Summary
- CoreSite Leasing Sets Pace: Data center growth outpaces towers, underpinning guidance raise and future capital allocation.
- Portfolio Quality Improves: Divestiture of APAC assets boosts earnings stability and balance sheet strength.
- Secular Demand Tailwinds: 5G, new spectrum, and AI workloads drive durable, multi-year infrastructure demand.
Business Overview
American Tower is a leading global provider of digital infrastructure, operating a portfolio of wireless towers and data centers. Its business model generates recurring revenue by leasing space on its communications towers to wireless carriers and providing data center capacity through CoreSite, its cloud and enterprise-focused platform. Major segments include U.S. and international towers and the rapidly growing data center business, each contributing to long-term contracted cash flows.
Performance Analysis
AMT’s Q2 2026 results highlight the durability of its core leasing model, with consolidated property revenue up over 5% year-over-year (YoY) on an FX-neutral basis, even as one-time churn from Dish and APAC divestitures masked underlying strength. Excluding these impacts, organic tenant billings growth reached approximately 4%, led by robust demand in Africa and steady mid-single-digit growth in the U.S. and Canada. CoreSite delivered another record quarter, with data center cash revenue up 12% YoY and leasing surpassing all of 2021 in just one quarter, marking five straight quarters of double-digit growth.
Margins remained resilient, with cash-adjusted EBITDA margins expanding 30 basis points excluding churn, and attributable FFO per share rising over 5% FX-neutral, despite higher interest expense. Data center outperformance, FX tailwinds, and cost discipline drove a 1% guidance increase across key metrics, while the exit from the Philippines and Bangladesh sharpened the portfolio’s earnings quality. Latin America saw continued churn, particularly in Brazil, but management expects market repair and organic growth acceleration in 2027.
- Data Center Momentum: CoreSite’s record leasing and broad-based demand from hyperscalers, enterprises, and AI firms are now the main growth engine.
- Churn and Regional Variance: U.S. and Canada towers grew nearly 5% (excluding Dish), Africa and APAC delivered 11%, while Latin America declined 2% due to Brazil churn.
- Balance Sheet Flexibility: Leverage at 4.9x is within target, enabling $200M in share buybacks and over $1.9B in growth capex, mostly in developed markets.
Overall, AMT’s execution and portfolio repositioning set up a return to mid-to-high single-digit AFFO growth in 2027 as macro and refinancing headwinds abate.
Executive Commentary
"CoreSite continues to differentiate itself as a premier digital infrastructure platform at the convergence of network connectivity, cloud ecosystems, enterprise workloads and AI-driven demand. CoreSite remains the fastest growing segment of our business, and this quarter delivered another record leasing performance, reinforcing our conviction that 2026 has the potential to be another record year for the business."
Steve Vondran, President and CEO
"We are raising guidance across all of our key consolidated financial metrics, primarily driven by consistent growth across our global tower portfolio, data center outperformance, operating expense benefits, and FX tailwinds."
Rod Smith, CFO
Strategic Positioning
1. CoreSite as Growth Catalyst
CoreSite, AMT’s data center platform, has become the company’s fastest-growing segment, with nine of the top 10 AI companies and three of the top five NeoClouds now deployed in its facilities. This shift from traditional colocation to AI-driven, cloud-to-cloud connectivity is fundamentally expanding addressable demand and enabling AMT to underwrite mid-teens stabilized yields on new development.
2. Portfolio Rationalization and Capital Discipline
The completed exit from APAC (Philippines and Bangladesh) marks a strategic pivot to higher-quality, developed market assets, reducing exposure to currency and regulatory risk and improving earnings stability. AMT now targets 85% of discretionary capex toward developed markets, with a focus on U.S. and European towers and CoreSite expansion.
3. Multi-Year Demand Inflection
Management sees four overlapping catalysts—5G densification, new spectrum deployment, the 6G transition, and AI-driven traffic—creating a secular demand tailwind for both towers and data centers. The company expects these forces to drive network densification and new equipment installations, supporting multi-year leasing growth and incremental amendments.
4. Operational Efficiency and Margin Expansion
AMT continues to deliver cost discipline, expanding Tower Cash EBITDA margins by more than 300 basis points over three years and targeting another 200-300 basis points of expansion. Early-stage AI and automation initiatives are expected to drive further productivity gains.
5. Capital Allocation and Shareholder Returns
Dividend growth remains a core focus, with AMT targeting a 100% payout of pre-taxable income. The company maintains flexibility for M&A, share buybacks, and deleveraging, balancing internal investment with opportunistic external growth.
Key Considerations
This quarter’s results underscore a strategic transition for AMT, as the business leans into data center-led growth, streamlines its geographic footprint, and positions for a new wireless infrastructure investment cycle.
Key Considerations:
- Data Center Outperformance: CoreSite’s leasing and revenue trajectory are now the primary driver of upward guidance revisions and future capital allocation.
- Emerging Market Exit: Divestitures reduce risk and volatility, but also lower exposure to faster, albeit less predictable, international growth rates.
- Interest Rate Sensitivity: Higher debt refinancing costs remain a 150 basis point headwind to AFFO per share growth in 2026.
- Brazil Churn and LatAm Recovery: Latin America remains a drag, but management expects organic growth acceleration in 2027 as churn normalizes.
- AI and Spectrum Upside: AI-driven uplink demand and upcoming spectrum releases could accelerate network investment and leasing activity beyond current forecasts.
Risks
AMT faces ongoing churn risk in select regions (notably Brazil), and its growth remains partially exposed to carrier consolidation, macroeconomic volatility, and rising interest rates. While APAC divestitures reduce currency and regulatory risk, they also limit participation in higher-growth emerging markets. Execution risk persists around CoreSite’s development pipeline and the timing of 5G/AI-related network investments, which may be subject to carrier budgets and macro cycles.
Forward Outlook
For Q3 2026, AMT guided to:
- Continued mid-single-digit organic tenant billings growth (ex-Dish churn)
- Data center revenue growth of approximately 15% for the full year
For full-year 2026, management raised guidance:
- Property revenue up $110 million at midpoint (4% YoY, ex-FX and straight-line)
- Adjusted EBITDA up $45 million (2% YoY, ex-FX)
- AFFO per share up 1% (nearly 6% FX-neutral, ex-churn and refinancing costs)
Management highlighted:
- “2026 represents a trough for attributable AFFO per share growth, with a return to mid-to-high single-digit growth expected in 2027.”
- “85% of capex remains targeted at developed markets, with CoreSite and European towers as primary investment priorities.”
Takeaways
AMT’s Q2 results reinforce a strategic pivot toward higher-quality, developed market assets and a data center-led growth model, underpinned by secular wireless and AI demand. Execution on cost discipline and capital allocation sets up a return to accelerating AFFO growth as refinancing and churn headwinds ease.
- Data Center Growth Engine: CoreSite’s record leasing and revenue growth are now the main levers for upward revisions and long-term value creation.
- Portfolio Quality and Flexibility: Exiting APAC and prioritizing developed markets enhances earnings stability and capital deployment options.
- Demand Inflection Watch: Investors should monitor the pace of 5G densification, spectrum deployment, and AI-driven network upgrades for signs of upside to leasing and revenue growth.
Conclusion
American Tower’s Q2 2026 results mark a pivotal quarter, with CoreSite’s performance and a sharpened portfolio positioning the company for a new era of digital infrastructure growth. Execution on capital allocation and margin discipline underpins a credible path to accelerated AFFO growth into 2027 and beyond.
Industry Read-Through
AMT’s results and commentary signal a broad-based inflection for digital infrastructure, with data center and tower operators poised to benefit from AI, cloud, and 5G-driven demand. Record leasing at CoreSite and robust developed market tower growth suggest that secular tailwinds are accelerating, particularly for platforms with exposure to hyperscale and AI workloads. Operators with diversified, high-quality portfolios and balance sheet flexibility are best positioned to capture the next wave of network investment, while those concentrated in emerging markets may face heightened volatility. The emphasis on operational efficiency and disciplined capital allocation is likely to shape sector leadership as demand complexity increases.