First look at Prologis Q3: Better than expected

Logistics real estate investment trust Prologis beat expectations for the third quarter on Wednesday, reporting core funds from operations (FFO) of $1.43 per share, 5 cents above the consensus estimate. Revenue rose 6% to more than $2 billion, although some key metrics declined during the period.

Prologis (NYSE: PLD) saw its total portfolio utilization decline 120 basis points year-over-year (down 20 basis points from the second quarter) to 95.9%. The net effective rent change over the entire rental period fell by more than 16% year-on-year to 67.8%. That’s 610 bps worse sequentially. However, the total number of leases completed was more than 50 million square feet, up 10% year-over-year.

The company raised the low end of its full-year 2024 FFO guidance range by 3 cents to $5.42 per share and lowered the high end by 1 cent to $5.46.

“The bottoming process is underway as our customers navigate an uncertain environment,” Hamid Moghadam, co-founder and CEO of Prologis, said in a press release. “Looking forward, the supply situation is improving and the long-term demand drivers for our business remain strong.”