Iron Mountain Eyes 20% Growth as Data Centers, Digital Solutions Drive Cross-Sell

Key Points

• Iron Mountain expects its growth portfolio to expand more than 20% over the long term, driven by data centers, asset lifecycle management (ALM) and digital solutions that can be cross-sold to its 245,000 business customers.
• The data center business is scaling rapidly, with more than $1 billion in expected revenue this year, 110 megawatts leased through July and 325 megawatts scheduled for energization over the next 18–24 months. AI inference demand is increasing requirements for high-density, liquid-cooled facilities.
• Iron Mountain’s legacy records business remains cash-generative, while ALM revenue is projected to reach about $1 billion and digital solutions already exceed $600 million annually. Rising AFFO is expected to support increased discretionary cash flow and continued dividend growth under a low-60% payout target.

Iron Mountain NYSE: IRM is positioning its records management customer base as a foundation for cross-selling into data centers, asset lifecycle management and digital solutions, CFO Barry Hytinen said during Goldman Sachs’ 2026 Communacopia + Technology Conference.

Hytinen said the company serves 245,000 business-to-business clients and counts more than 95% of the Fortune 1000 among its customers. Many of those companies initially standardized on Iron Mountain for records management, creating an opportunity to expand relationships into adjacent services.

Cross-Selling Across Growth Businesses

In asset lifecycle management, or ALM, Iron Mountain operates both an enterprise business focused on corporate IT equipment and a hyperscale data center decommissioning business. Hytinen said corporate customers often use multiple smaller vendors for IT asset disposition, while Iron Mountain is building a global offering centered on chain of custody, consistent processes, data security and secure data wiping.

“We think there’s huge cross-sell opportunity there,” Hytinen said, describing the enterprise ALM model as one in which the company can initially win a portion of a customer’s business and expand into additional regions or business lines.

Digital solutions also build on the core records business, he said. Digitization projects can begin with physical materials Iron Mountain already stores for customers, then extend to the company’s DXP platform. Hytinen said digital solutions have become increasingly recurring and software-as-a-service oriented, with the business growing 20% in the most recent quarter.

Meanwhile, the data center business overlaps with hyperscale ALM through a shared customer base. Hytinen said the company aims to become a partner that can develop, build, operate and decommission data center infrastructure for hyperscale customers globally.

Growth Portfolio and Data Center Pipeline

Hytinen said Iron Mountain expects its combined growth portfolio to expand by more than 20% over the long term. The company expects to generate a little more than $1 billion in data center revenue this year, and it has already signed contracts for facilities that would add roughly 40% to the business once built and energized, he said.

The company had leased 110 megawatts year to date through July and expects to exceed its initial target of 100 megawatts by a meaningful amount. Hytinen said Iron Mountain had 325 megawatts scheduled to energize over the next 18 to 24 months, all of which remained unleased at the time of the discussion.

Those planned facilities are primarily in Tier 1 markets including Virginia, Europe and India. Iron Mountain signed a 51-megawatt lease in Mumbai in July, Hytinen said, and has multiple prospective customers interested in each of its planned buildings.

The company generally begins construction after securing a pre-lease, with large hyperscale agreements typically running 10 to 15 years. Customers generally lease capacity 12 to 18 months before delivery, while Iron Mountain can typically build a data center in nine to 10 months in most geographies, according to Hytinen.

AI inference demand is becoming a greater part of the leasing pipeline, he said. Such deployments generally require higher density and greater liquid-cooling capability, increasing both construction costs per megawatt and lease pricing.

ALM Opportunity, Records Stability and Digital Contract

Iron Mountain’s ALM business is projected to reach approximately $1 billion in revenue this year, compared with about $30 million in 2021, Hytinen said. He estimated the total addressable market at $35 billion, with roughly 75% tied to corporate customers. The enterprise ALM business is expected to be the larger long-term growth contributor, he said.

In hyperscale decommissioning, memory pricing and equipment mix can affect results. Hytinen said certain memory product categories had risen by as much as 30% in recent periods, while others had declined. He expects memory pricing to remain generally stable to slightly higher for the rest of the year from second-quarter levels.

The legacy physical records operation remains a cash-generative business, with organic physical-volume growth expected to remain modestly positive, in a range of roughly 20 to 40 basis points annually, alongside strong pricing. Hytinen said the company realized about 6% pricing benefit last year and this year, while markets such as India offer outsourcing opportunities.

Digital solutions now generate more than $600 million in annual revenue, Hytinen said, up from less than $200 million five or six years ago. Iron Mountain expects its Treasury Department contract to produce more than the approximately $45 million initially anticipated this year, following better-than-expected revenue in the first two quarters. The company expects at least $100 million of annual revenue from the contract in future years, though the ultimate amount will depend on outsourcing volumes and the government’s use of multiple vendors.

Margins, Cash Flow and Capital Allocation

Hytinen acknowledged that ALM is lower margin than some other Iron Mountain operations, particularly in hyperscale decommissioning, where revenue-sharing arrangements can result in low-double-digit to high-teens margins. Enterprise ALM margins can range from the mid-20% area to 30%, he said.

Data centers, by comparison, generate EBITDA margins in the low-50% range, according to Hytinen. He said each of Iron Mountain’s businesses has opportunities to improve its own margin over the next several years, even as faster growth in ALM can weigh on consolidated margins.

Looking ahead, Hytinen said cash available for discretionary uses should increase by hundreds of millions of dollars annually over the next several years. The company targets leverage slightly below five times and intends to maintain a dividend payout ratio in the low-60% range of adjusted funds from operations. As AFFO grows, he said investors should expect the dividend to continue rising.

About Iron Mountain (NYSE:IRM)

Iron Mountain Incorporated NYSE: IRM is a global information management and data storage company. Founded in 1951, the company helps organizations protect, manage and preserve physical and digital information throughout its lifecycle.

Its services include records storage, document management, secure shredding and destruction, information governance, data backup and recovery, and digital transformation. Iron Mountain also operates data centers that support colocation, cloud connectivity and other infrastructure needs for businesses and public-sector organizations.

The company serves customers across a range of industries, including financial services, healthcare, government, legal services and entertainment.

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