second quarter of 2026
Filed Aug 6, 2026Csquare Reports Record Second Quarter 2026 Results
Revenue, bookings and Adjusted EBITDA grew strongly, but the company reported a larger net loss driven by higher interest expense and one-time IPO-related expenses.
Key metrics
as reported| Metric | Value | q/q | y/y |
|---|---|---|---|
| Total revenueGAAP | $280.4 million | – | 14.5% |
| Revenue excluding metered powerother | $260.2 million | – | 12.3% |
| Colocation revenueGAAP | $210.6 million | – | 17.5% |
| Bookings (Annualized)other | $64.7 million | 13th consecutive quarter of sequential bookings growth | – |
| Net lossGAAP | $48.8 million | – | – |
| Adjusted EBITDAnon-GAAP | $120.3 million | – | 21.0% |
| Adjusted EBITDA marginnon-GAAP | 46.2% | – | increased 330 basis points |
| Funds from Operationsnon-GAAP | $40.8 million | – | 18.9% decline year-over-year |
| Contracted Power Capacityother | 410 MW | – | 44% year-over-year |
| Sellable Power Capacityother | 385 MW | – | – |
| Contracted Power Soldother | 107% | – | – |
| Net Revenue Churnother | 2.4% | – | – |
| Growth capital expendituresother | $128 million | – | – |
| Recurring capital expendituresother | $15 million | – | – |
Segments
| Segment | Revenue | q/q | y/y |
|---|---|---|---|
| ColocationSustained customer demand and deployment activity. | $210.6 million | – | 17.5% |
2026 Outlook outlook
- Revenue$1,130 – $1,170 million
- NoteAdjusted EBITDA $460 – $480 million
- NoteRecurring Capital Expenditures $55 - $65 million
- NoteNon-Recurring Growth Capital Expenditures $610 - $660 million*
- Note* - Includes two new large deals signed at end of Q2
What drove it
- Continued demand for the Company's colocation platform, customer deployments across existing and newly acquired facilities, and expansion of recurring infrastructure services drove revenue growth.
- Bookings demand was broad-based across enterprise customers, cloud and network providers, and large-scale infrastructure deployments.
- Adjusted EBITDA margin expansion reflected revenue growth, disciplined operating execution, and operating leverage in the highly recurring business model.
- Contracted power capacity growth was supported by strategic acquisitions and continued customer deployments.
- The company divested two underperforming leased data centers as part of portfolio optimization initiatives.
Concerns
- Net loss increased to $48.8 million from a net loss of $13.9 million, primarily due to higher interest expense and one-time expenses related to the initial public offering.
- Funds from Operations declined 18.9% year-over-year to $40.8 million, primarily due to the increase in net loss and higher interest expense.
- Contracted utilization reached 107%, indicating demand exceeds current sellable capacity and requires execution on the development pipeline and planned capacity expansions.
- The 2026 outlook includes non-recurring growth capital expenditures of $610 - $660 million, including two new large deals signed at end of Q2.
What to watch
- Conversion of record bookings of $64.7 million into future recurring revenue growth.
- Execution of the development pipeline and planned capacity expansions given contracted utilization of 107%.
- The expected reduction of approximately $63 million of annual interest expense following debt repayment with IPO proceeds.
- Delivery against the 2026 outlook for total revenue, Adjusted EBITDA, recurring capital expenditures and non-recurring growth capital expenditures.
- Customer retention following quarterly net revenue churn of 2.4%.
Balance sheet and cash flow
- The initial public offering generated approximately $1.16 billion in net proceeds, after underwriting discounts and commissions.
- The Company used the net proceeds to repay outstanding indebtedness.
- The debt repayment is expected to reduce the Company's annual interest expense by approximately $63 million.
- The Company completed its initial public offering of 50.0 million shares of common stock at a public offering price of $21.00 per share.
- On July 27, 2026, the underwriters exercised their option to purchase an additional 7,499,000 shares at the initial public offering price.
Analysis
Csquare reported second-quarter total revenue of $280.4 million, up 14.5% year-over-year, with revenue excluding metered power increasing 12.3% to $260.2 million. Colocation revenue rose 17.5% to $210.6 million. Management attributed growth to demand for its colocation platform, deployments in existing and newly acquired facilities, and expansion of recurring infrastructure services.
Commercial indicators remained strong. Annualized bookings reached a record $64.7 million, described as the 13th consecutive quarter of sequential bookings growth, with demand spanning enterprise, cloud and network providers, and large-scale infrastructure deployments. Contracted power capacity was 410 MW, up 44% year-over-year, while contracted power sold reached 107%. That utilization level points to demand exceeding current sellable capacity and makes development-pipeline execution central to accommodating future deployments.
Operating leverage was evident in non-GAAP results. Adjusted EBITDA rose 21.0% to $120.3 million and its margin expanded to 46.2% from 42.9%, which the company attributed to revenue growth and disciplined operating execution. In contrast, the GAAP net loss widened to $48.8 million from $13.9 million, and Funds from Operations fell 18.9% to $40.8 million. The company identified higher interest expense and one-time IPO-related expenses as the principal causes of the loss increase.
Capital allocation was focused on capacity expansion and the post-quarter-end balance-sheet reset. Csquare deployed $128 million of growth capital expenditures and $15 million of recurring capital expenditures during the quarter. Its July IPO generated approximately $1.16 billion in net proceeds and was used to repay outstanding indebtedness, which management expects to reduce annual interest expense by approximately $63 million. The 2026 outlook calls for $1,130 – $1,170 million of total revenue and $460 – $480 million of Adjusted EBITDA, alongside substantial non-recurring growth capital expenditures of $610 - $660 million that include two new large deals signed at end of Q2.
Management, verbatim
Our second quarter results demonstrate the disciplined execution by our team and the continued strength of Csquare's platform,
Spencer Mullee, Chief Executive Officer of Csquare
Not in the filing
stated, not guessed- GAAP gross profit and gross margin
- GAAP operating income or loss
- GAAP diluted EPS and basic EPS
- Non-GAAP EPS
- Operating cash flow
- Free cash flow
- Cash balance
- Debt balance before or after the IPO debt repayment
- Debt repayment amount
- Share repurchases
- Dividends
- Total revenue prior-quarter comparison
- Colocation revenue prior-year amount
- Segment revenue beyond colocation
- Prior guidance for comparison
- Forward gross-margin guidance
- Forward operating-expense guidance
- Forward tax-rate guidance
- Reconciliation tables for Adjusted EBITDA and Funds from Operations referenced in the release but not included in the supplied filing text
AlphaAI analysis generated from the company’s SEC earnings filing (Form 8-K Item 2.02, or Form 6-K for a foreign private issuer). Every figure was cross-checked against the filing text; consensus estimates, price targets and share-price reactions are not shown because they are not in the filing. AI-generated research, not investment advice.