Iron Mountain data center growth boosts results

The company’s latest filings show how quickly the business mix is changing. Second-quarter revenue rose 18.5% to $2.03 billion, while its global data center unit posted storage rental revenue of $258.9 million, up 37.5% from a year earlier. Service revenue in that segment jumped more than threefold to $4 million. That is the kind of growth profile investors usually associate with infrastructure winners, not a mature industrial-style REIT.

The stock has already noticed. Iron Mountain shares were last around $114.22 after climbing sharply from below $81 in November, a move that reflects both earnings momentum and the market’s growing willingness to value the company as a digital infrastructure asset. Even after the rally, the broader story is that the re-rating may only be halfway done if the data center buildout keeps accelerating.

What makes the thesis attractive is the second-order effect. AI capex does not just reward chipmakers and cloud platforms; it also lifts the landlords, operators and capacity owners that can deliver secure space, power and interconnection. That is why investors have been willing to pay up for peers such as Equinix and Digital Realty, even as their stocks have been more volatile. Iron Mountain is trying to force its way into that same conversation with a differentiated portfolio and a business that still throws off cash from its legacy operation.

The setup is also supported by the technical picture. IRM recently pulled back from a sharp run-up, with its relative strength index easing from overbought levels and the share price still holding well above the 200-day moving average. In plain terms, the trend has not broken; it has merely cooled after a powerful advance. That is the kind of reset long-term buyers often want before the next leg higher.

The market may be underestimating how long this investment cycle can last. Data center demand is not a one-quarter story. It is tied to multi-year spending on AI training, inference, storage, enterprise migration and sovereign digital capacity. As power, land and financing constraints tighten, the owners of existing infrastructure should gain leverage, not lose it.

For investors, the takeaway is straightforward: Iron Mountain is no longer just a defensive storage name. It is an emerging AI infrastructure compounder with a hidden growth engine, and that makes the stock one of the more interesting asymmetric plays in the digital infrastructure space. If the company keeps converting data center demand into profit, the valuation could continue to close the gap with better-known peers.