QTS - CyrusOne: Scale Matters But Sales Strategy Too

• CyrusOne leasing results for the third quarter was bad for the hyperscale segment.
• Still, the better pricing obtained in the enterprise IT segment enabled the company to more than offset the revenue shortfalls.
• This said, the datacenter's supplier competitive landscape has become distorted with the hyperscalers having more bargaining power.
• In this case, smaller players like CONE have to tread a fine line between targeting the appropriate customer segment and effecting enough capital allocations in order to benefit from adequate returns.
• The company is amid a restructuring process and more updates are awaited during the fourth quarter.

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