AMT Signals 2026 Capital Allocation Priorities and Data Center Upside Drivers

AMT 2026 Capital Allocation Priorities and What’s Driving Data Center Upside

1) “Leverage back in the target range and APAC exited”: what that implies for 2026 opportunities

AMT frames its current posture as being on “better strategic footing” after delevering and exiting APAC, and it explicitly asks/answers what the next investment opportunities are now that leverage is in the target band. This context is reinforced by the company’s leverage ratio being 4.9x, which is within its 3x–5x target range and supported by its “highest credit rating among our peer group.” ¹²

The 2026 “best investment opportunities” AMT is prioritizing

Based on management’s discussion, AMT’s next best uses of capital in 2026 cluster into two operational investment buckets and a capital-return / selective M&A bucket:

1. Domestic + developed-market towers first (organic build-to-suits and investment where returns clear criteria)
   Management says the “top priorities are domestic and developed market towers and data centers,” and that towers are positioned for “another good growth cycle” tied to network evolution catalysts. ³⁴
   They also say they have had opportunities to invest in Europe via build-to-suits with “good day 1 yields,” while they “haven’t been able to invest as much in the U.S.” only because opportunities have not met financial criteria—however, they would invest if actionable opportunities appear. ⁴

2. CoreSite / data centers as a capital acceleration area (targeting mid-to-high returns on incremental investments)
   AMT states it is investing more in CoreSite, describing it as a “rapidly growing segment,” and says it can “underwrite mid-teens or better stabilized yields” on incremental new investments. ³
   It further quantifies the 2026 discretionary capital emphasis on data centers within developed markets: ~85% of discretionary capital to developed markets, including over $700 million to develop more capacity in the data center portfolio. ²

3. Share repurchases (buybacks) and scanning for M&A after organic/internal CapEx
   Management explicitly states that after internal CapEx, AMT looks to “M&A opportunities” and “always scan[s] the market there.” ⁵
   They also provide an explicit capital-return signal: “over $200 million to share repurchases” year-to-date. ²

4. Potential domestic M&A: the direction is “scan the market,” but deal specificity is not provided in the excerpts
   When asked specifically about “buybacks or potential domestic M&A,” management’s response is not a deal announcement; it reiterates priorities (towers first in domestic/developed markets; CoreSite growth; disciplined allocation; then M&A scanning). ¹⁵
   So, the investable “opportunity” is real in principle (they scan), but the excerpts do not name targets or quantify expected domestic M&A size for 2026. ⁵

How much is AMT planning to spend (and where)

For 2026, management reiterates that the growth capital plan remains consistent and provides a detailed allocation framework for “approximately 85%” of discretionary capital into developed markets, including:

• Over $700 million to develop more capacity in the data center portfolio ²
• ~$370 million to construct new towers globally ²
• ~$210 million to purchase land beneath towers ² Additionally, they report year-to-date actions:
• Over $230 million allocated to acquisitions of towers and data center land ²
• Over $200 million to share repurchases ²

Finally, management emphasizes the business objective is not to just get “bigger in terms of assets,” but to grow AFFO and AFFO per share and deliver total shareholder return. ⁶

2) Driver of data center upside: lease rate expansion vs occupancy gains

What management says about the nature of CoreSite outperformance

When the question asks whether data center upside is “more from lease rate expansion or improvements in occupancy,” management answers by pointing to broad-based performance tailwinds rather than reducing the story to one variable:

• In Q2, CoreSite had “another record quarter,” and management attributes it to:
  • “strong sales in both traditional customers and retail customers”
  • “hybrid multi-cloud installation”
  • “AI use cases”
  • “very strong trends in mark-to-market”
  • “an inflection in interconnection activity” ⁷

This directly implies the upside is supported by pricing and leasing monetization dynamics (mark-to-market is an indicator of re-underwriting and/or improved economics) and demand-driven activity (sales/new business, interconnection inflection), not a pure occupancy-only story. ⁷

2026 demand outlook: new business and organic growth drivers

Management gives more quantification around carrier demand translating into revenue growth for U.S. organic tenant billings:

• For 2026, they “expect the carrier network investments” to drive “revenue growth… from new business… about 250 basis points,” consistent with prior-year experience “on an ex DISH basis.” ⁸
• They then stack additional contributors:
  • +3% from escalators
  • churn “running 1% to 2%” (lower end ex DISH/experts cited) ⁹
• Combining factors yields an organic growth estimate “mid-single digits, maybe 4.5% for 2026.” ⁹

This framing supports that the upside is driven largely by incremental leasing/new business and renewals economics (new business contribution + escalators + low churn), rather than primarily occupancy gains alone. ⁸⁹

A more explicit “capacity” vs “occupancy” mechanism for CoreSite

Management repeatedly describes CoreSite’s advantage as interconnection-enabled demand and emphasizes expansion of capacity:

• They say they expanded CoreSite’s capacity by 1.5x since acquisition and have a “good runway to triple that going forward,” and they will continue to expand further. ¹⁰
• They also state they are “not interested in… undifferentiated colo” without interconnection systems; instead they target a connected ecosystem, and “the biggest learning” from their Raleigh edge test bed is “demand out there for capacity,” including interest in equipment placement. ¹¹

Taken together, the excerpts indicate a two-part engine:

1. Demand generation (AI, cloud/multi-cloud, interconnection inflection) ⁷¹²
2. Capacity growth that enables monetization (capacity expansion runway; increased lease-able/interconnection-enabled footprint) ¹⁰

Bottom line: lease rate expansion vs occupancy gains

From the excerpted evidence, AMT’s data center upside narrative is not presented as occupancy improvements alone. Instead, management attributes CoreSite’s strong leasing and growth to a mix that includes:

• economic/lease-related dynamics such as “mark-to-market” strength ⁷
• new leasing velocity and customer breadth (strong sales across traditional/retail; hybrid multi-cloud; AI use cases) ⁷
• interconnection activity inflection, indicating demand for highly interconnected capacity ⁷¹²
• organic growth contributors that emphasize new business and escalators with low churn ⁸⁹

Therefore, based strictly on what AMT highlights in these excerpts, the most defensible characterization is that the upside driver is primarily monetization of leasing demand and economics (including mark-to-market), supported by interconnection-driven activity and capacity-enabled leasing, rather than a simplistic “occupancy gains only” story. ⁷¹⁰¹²

3) Synthesis: the “next best opportunities for 2026” AMT is signaling

Putting capital allocation and data center mechanics together:

• Primary opportunity set: invest in domestic and developed-market towers where returns meet financial criteria, with towers expected to benefit from 5G dempification, additional spectrum (starting 2027), AI-driven traffic, and the 6G cycle. ⁴
• High-priority growth vehicle: CoreSite/data centers, where management says incremental investments can underwrite “mid-teens or better stabilized yields,” and AMT plans >$700M of developed-market discretionary investment into data center capacity development. ³²
• Capital return + optionality: continue share repurchases (already >$200M YTD) and maintain a market scan for M&A after internal CapEx (no specific domestic deal size is provided in the excerpts). ²⁵
• Data center upside driver: broadly-based leasing demand and leasing economics (including “mark-to-market”), interconnection activity inflection, and new business contributions—with occupancy improvements not denied but not the sole emphasized driver. ⁷¹²⁸⁹