Key Takeaways
- • Prologis reported Q3 2026 total revenue of $2.388 billion, up 7.8% from $2.214 billion a year earlier, while Core FFO per diluted share rose 7.4% to $1.60 from $1.49.
- • Cash same-store NOI growth reached 5.9%, with net effective rent change of 38.0% and cash rent change of 23.4% on new and renewed leases.
- • Interest expense rose 11.1% to $287.0 million and total expenses grew 9.8%, outpacing revenue growth; operating income before real estate gains rose only 4.9%.
- • The company narrowed 2026 Core FFO guidance to $6.25-$6.29 per diluted share but lowered its GAAP EPS range to $4.05-$4.15 and cut strategic capital revenue guidance to $650M-$660M.
- • Prologis raised development start, stabilization and acquisition guidance, while shareholders approved the proposed SEGRO transaction, which is still subject to closing conditions.
Summary
Prolgis (NYSE: PLD) reported third-quarter 2026 results showing growth in revenue, Core FFO and same-store NOI, according to the company's earnings release as reported by TradingKey. Total revenue rose 7.8% to $2.388 billion, with rental revenue up 7.4% to $2.205 billion and strategic capital revenue up 9.3% to $164.3 million. Core FFO increased 8.3% to $1.545 billion, or $1.60 per diluted share, while AFFO rose 13.5% to $1.207 billion and Adjusted EBITDA rose 11.4% to $2.081 billion.
Real estate operations remained the main earnings driver. Real estate Core FFO per share increased to $1.54 from $1.43, while strategic capital Core FFO per share was flat at $0.06 despite higher strategic capital revenue. Average occupancy was 95.1% and period-end occupancy 95.6%, with retention at 75.9%. Management pointed to lease repricing as a key support for property income, citing a 38.0% net effective rent change and a 23.4% cash rent change. Prologis started $964 million of developments at an estimated 6.6% stabilized yield, completed $401 million of stabilizations, and acquired $702 million of assets at a weighted-average stabilized cap rate of 4.2%.
GAAP profitability showed a narrower picture. Total expenses rose 9.8%, ahead of revenue, with general and administrative expense up 15.3% to $127.6 million, depreciation and amortization up 9.6% to $710.3 million, and interest expense up 11.1% to $287.0 million. Operating income before real estate gains grew 4.9% to $936.7 million. Gains on dispositions rose to roughly $108.0 million from $47.7 million, and earnings from unconsolidated entities increased to $155.4 million from $92.8 million, helping net earnings attributable to common stockholders rise 6.9% to $815.7 million. The article cautions that disposition gains can vary substantially between quarters.
Prologis ended the quarter with approximately $8.8 billion of available liquidity and $2.27 billion of cash. Total debt rose to $36.83 billion from $36.44 billion, with debt-to-Adjusted EBITDA at 4.5 times and debt at 23.9% of total market capitalization. During the quarter, the company and its co-investment ventures closed $1.3 billion of debt at a 4.0% weighted-average rate, above the 3.3% average on its existing debt.
For 2026, Prologis narrowed its Core FFO range to $6.25-$6.29 per diluted share, with a slightly higher midpoint than the prior $6.22-$6.30 range. The GAAP EPS range was lowered to $4.05-$4.15 from $4.40-$4.55. Cash same-store NOI growth guidance was raised to 7.00%-7.50%, and development starts, stabilizations and acquisitions were all raised. Strategic capital revenue guidance, excluding promote revenue, was lowered to $650M-$660M from $660M-$680M, and the upper end of the occupancy range was reduced. CEO Daniel Letter said customers are operating with lean inventories and that excess logistics capacity has largely cleared, citing e-commerce, advanced manufacturing and data-center supply chain development as demand drivers. CFO Timothy Arndt said operating performance and balance-sheet capacity allow continued investment despite higher rates. Shareholders approved the proposed SEGRO transaction, which would expand Prologis' European platform, subject to closing and integration conditions.
Real estate operations remained the main earnings driver. Real estate Core FFO per share increased to $1.54 from $1.43, while strategic capital Core FFO per share was flat at $0.06 despite higher strategic capital revenue. Average occupancy was 95.1% and period-end occupancy 95.6%, with retention at 75.9%. Management pointed to lease repricing as a key support for property income, citing a 38.0% net effective rent change and a 23.4% cash rent change. Prologis started $964 million of developments at an estimated 6.6% stabilized yield, completed $401 million of stabilizations, and acquired $702 million of assets at a weighted-average stabilized cap rate of 4.2%.
GAAP profitability showed a narrower picture. Total expenses rose 9.8%, ahead of revenue, with general and administrative expense up 15.3% to $127.6 million, depreciation and amortization up 9.6% to $710.3 million, and interest expense up 11.1% to $287.0 million. Operating income before real estate gains grew 4.9% to $936.7 million. Gains on dispositions rose to roughly $108.0 million from $47.7 million, and earnings from unconsolidated entities increased to $155.4 million from $92.8 million, helping net earnings attributable to common stockholders rise 6.9% to $815.7 million. The article cautions that disposition gains can vary substantially between quarters.
Prologis ended the quarter with approximately $8.8 billion of available liquidity and $2.27 billion of cash. Total debt rose to $36.83 billion from $36.44 billion, with debt-to-Adjusted EBITDA at 4.5 times and debt at 23.9% of total market capitalization. During the quarter, the company and its co-investment ventures closed $1.3 billion of debt at a 4.0% weighted-average rate, above the 3.3% average on its existing debt.
For 2026, Prologis narrowed its Core FFO range to $6.25-$6.29 per diluted share, with a slightly higher midpoint than the prior $6.22-$6.30 range. The GAAP EPS range was lowered to $4.05-$4.15 from $4.40-$4.55. Cash same-store NOI growth guidance was raised to 7.00%-7.50%, and development starts, stabilizations and acquisitions were all raised. Strategic capital revenue guidance, excluding promote revenue, was lowered to $650M-$660M from $660M-$680M, and the upper end of the occupancy range was reduced. CEO Daniel Letter said customers are operating with lean inventories and that excess logistics capacity has largely cleared, citing e-commerce, advanced manufacturing and data-center supply chain development as demand drivers. CFO Timothy Arndt said operating performance and balance-sheet capacity allow continued investment despite higher rates. Shareholders approved the proposed SEGRO transaction, which would expand Prologis' European platform, subject to closing and integration conditions.
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