[Merrill Lynch]
Second quarter data center results added to a strong 1Q20 with Coresite (COR), Digital Realty Trust (DLR), Equinix (EQIX) and QTS Realty Trust Inc (QTS) beating forecasts and increasing guidance, and CYRUSONE (CONE) beating and maintaining. Net leasing activity increased 15% Q/Q largely due to strong hyper-scale demand. Coresite was the only data center company in our coverage universe that missed our net leasing estimate, which we attribute to customer mix. Enterprise demand was broadly in-line with our expectations and didn't show signs of pull-back related to COVID-19 and economic uncertainty. However, commentary from Coresite and Amazon supports a more cautious view of this customer segment. Pricing continues to stabilize in primary markets such as Northern Virginia. Demand in EMEA and APAC has shown no signs of abating as cloud providers ramp efforts to build out data center regions. Development delays, to the extent they existed, have lessened. Extended payment requests, which were 5% or less according to company commentary, have declined.