Executive Summary
Extra Space Storage Inc (0IJV.L) delivered a solid QQ2 2025 performance characterized by steady revenue growth and exceptionally strong cash flow generation for a REIT focused on self-storage. Revenue reached $841.6 million, up 1.65% year over year and 0.20% quarter over quarter, while EBITDA remained robust at $609.5 million, supported by an EBITDAR margin of approximately 72.4%. Net income rose to $249.7 million and earnings per share (EPS) was $1.18, up about 34% year over year, underscoring the company’s ability to translate topline stability into meaningful bottom-line improvements. Operating income stood at $374.0 million with a 44.4% operating margin, reflecting efficient cost discipline and a favorable operating environment for self-storage assets.
Cash flow remained exceptionally strong. Net cash provided by operating activities was $543.9 million, with free cash flow (FCF) of $539.7 million. The company generated meaningful discretionary cash flow despite capital returns (dividends paid of $343.9 million and net investing activity reflecting acquisitions of $189.1 million). The balance sheet shows a disciplined financial posture, with total debt of $13.65 billion, net debt of $13.52 billion, and a debt-to-capitalization ratio of roughly 0.50. At the same time, leverage remains a consideration for investors given the payout policy (dividend payout ratio around 1.38x GAAP earnings) and the sizable dividend obligation relative to cash flow, though the FCF coverage supports the distribution profile.
Overall, the QQ2 2025 results reinforce Extra Space Storage’s status as a large, high-margin, cash-generative operator in the U.S. self-storage space. The key questions for investors revolve around the durability of same-store NOI growth, the cadence of acquisitions and capex, and the company’s ability to manage debt as rates and cap rates evolve. Absent explicit management guidance in the provided data, the health of the cash flows and the strength of the balance sheet suggest a stable-but-pricing-sensitive investment profile, with upside potential if the company can continue to scale through accretive acquisitions and favorable occupancy/rent dynamics.
Key Performance Indicators
Key Insights
Revenue: $841.618 million; YoY growth +1.65%; QoQ growth +0.20%.
Gross Profit: $597.052 million; YoY decline -2.34%; QoQ decline -2.82%; Gross Margin ~70.94%.
Operating Income: $373.970 million; YoY growth +22.71%; QoQ change -3.80%.
EBITDA: $609.518 million; EBITDARatio ~0.724.
Net Income: $249.731 million; YoY growth +34.36%; QoQ change -7.81%; Net Margin ~29.67%.
EPS (Diluted): $1.18; YoY growth +34.09%; QoQ change -7.81%.
Cash Flows: Operating cash flow $543.861 million; Free cash flow $539....
Financial Highlights
Revenue: $841.618 million; YoY growth +1.65%; QoQ growth +0.20%.
Gross Profit: $597.052 million; YoY decline -2.34%; QoQ decline -2.82%; Gross Margin ~70.94%.
Operating Income: $373.970 million; YoY growth +22.71%; QoQ change -3.80%.
EBITDA: $609.518 million; EBITDARatio ~0.724.
Net Income: $249.731 million; YoY growth +34.36%; QoQ change -7.81%; Net Margin ~29.67%.
EPS (Diluted): $1.18; YoY growth +34.09%; QoQ change -7.81%.
Cash Flows: Operating cash flow $543.861 million; Free cash flow $539.728 million.
Investing: Acquisitions Net $189.112 million; Capital expenditure $4.133 million; Other investing activities -$457.196 million; Net investing cash flow -$272.217 million.
Financing: Dividends paid -$343.882 million; Debt repayments -$101.867 million; Net financing cash flow -$266.004 million.
Liquidity & Balance Sheet: Cash and cash equivalents $125.045 million; Total assets $29.368 billion; Total liabilities $14.691 billion; Total equity $13.791 billion; Short-term debt $706.0 million; Long-term debt $12.941 billion; Net debt $13.523 billion; Current ratio 1.56; Debt to capitalization ~0.50; Interest coverage ~2.37.
Valuation & Efficiency: Payout ratio ~1.38x GAAP earnings; Price-to-book ~2.27; Price-to-sales ~37.12; Price-to-earnings ~31.28; Dividend yield ~1.1%.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
841.62M |
1.65% |
0.20% |
| Gross Profit |
597.05M |
-2.34% |
-2.82% |
| Operating Income |
373.97M |
22.71% |
-3.80% |
| Net Income |
249.73M |
34.36% |
-7.81% |
| EPS |
1.18 |
34.09% |
-7.81% |
Key Financial Ratios
operatingProfitMargin
44.4%
operatingCashFlowPerShare
$2.57
freeCashFlowPerShare
$2.55
dividendPayoutRatio
137.7%
Management Commentary
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Forward Guidance
Management commentary or forward-looking guidance for QQ2 2025 is not included in the provided data. Nonetheless, the company’s quarterly cash flow strength, sizable acquisition activity (net acquisitions of $189.1 million in QQ2 2025), and stable NOI potential imply a continued emphasis on accretive growth through disciplined acquisitions, selective capex, and cost control. Investors should monitor: (i) same-store NOI growth trends and occupancy levels across major markets, (ii) the cadence and returns of acquisitions and capex, (iii) debt maturities and interest rate exposure, (iv) dividend sustainability relative to FCF, and (v) any shifts in cap rates that could impact valuation and financing terms. Given the current leverage profile (debt-to-capitalization ~0.50) and cash generation, the potential for stable or modest upside remains tied to operational efficiency and value creation from acquisitions while remaining sensitive to financing costs and market-rate movements.