Prologis Narrows 2026 Core FFO and Occupancy Forecasts

Prologis Inc. (NYSE: PLD) shares fell in Thursday trading after the warehouse-focused real estate investment trust posted mixed third-quarter results and tightened its full-year outlook. Third-quarter rental and other revenue was $2.224 billion, below the $2.285 billion Wall Street estimate. Total expenses increased to $1.45 billion from $1.32 billion a year earlier, while operating income rose to $1.04 billion from $940 million.

Core funds from operations (FFO) advanced to $1.60 per share from $1.49 a year earlier, topping the $1.56 consensus estimate. Average occupancy across Prologis' owned and managed properties was 95.1%, and its share of average occupancy was also 95.1%. The company's share of same-store property net operating income increased 5.9% year over year on a cash basis. Prologis ended September with $2.27 billion in cash and cash equivalents.

CEO Daniel S. Letter said the company signed leases covering 60 million square feet and announced nearly $2.3 billion in transactions during the quarter. Letter noted that customers Customers continue to keep inventories lean, and excess capacity across distribution networks has largely been absorbed. Demand for warehouse space remains supported by e-commerce, advanced manufacturing and data center supply chains.

The CEO also pointed to shareholder approval of the SEGRO transaction, which would expand Prologis' presence in Europe. Prologis narrowed its fiscal 2026 core FFO guidance to 6.25 to 6.29 per share, from its earlier forecast of 6.22 to 6.30. The updated range compares with Wall Street's consensus estimate of 6.25 per share. The company also tightened its average occupancy outlook to 95.25% to 95.50%, versus the previous range of 95.25% to 95.75%.

CEO Daniel S. Letter said Prologis signed 60 million square feet of leases and announced nearly 2.3 billion in transactions during the quarter. He said customers are continuing to keep inventories lean and that excess capacity across their networks has largely eased. Demand remains healthy, supported by e-commerce, advanced manufacturing and the expansion of data center supply chains.

Letter also highlighted Prologis said shareholder approval of the SEGRO transaction was a key milestone. The company said the deal would broaden its European presence and strengthen its ability to serve customers across the region. CFO Timothy D. Arndt said strong operating results and disciplined capital allocation supported the quarter’s financial performance.

He said the company’s solid balance sheet provides flexibility to pursue growth investments despite elevated interest rates. Prologis shares were down 1.86% at $128.03 on Thursday at the time of publication, according to Pro data.