CubeSmart (NYSE: CUBE) reported fourth‑quarter and full‑year 2025 results that fell short of analyst expectations. Net income attributable to common shareholders declined to $78.7 million from $101.9 million a year earlier, and full‑year net income dropped to $333.8 million from $391.2 million in 2024. Diluted earnings per share fell to $0.34 in the quarter and to $1.46 for the year, compared with $0.45 and $1.72, respectively, in the prior year. Adjusted funds from operations (FFO) were $147.3 million for the quarter, down 5.9% from $155.4 million, and $593.3 million for the year, a 1.9% decline from $600.8 million in 2024.
The miss in earnings and FFO is largely attributable to higher operating and interest expenses. Interest expense on loans rose to $114.1 million from $90.8 million in 2024, reflecting a higher weighted‑average effective interest rate. Property operating expenses also increased, squeezing margins. The company’s same‑store revenue in the quarter slipped 0.1% versus the same period in 2024, but overall revenue grew to $282.7 million, driven by acquisitions that added new units to the portfolio.
Revenue for the quarter was $282.7 million, slightly below the consensus estimate of $283.4 million—a miss of about 0.2%. The modest shortfall is offset by a 15.0 million increase in total revenue compared with Q4 2024, largely due to the addition of new properties. The same‑store revenue decline indicates that organic growth in existing locations remains modest, while the company’s acquisition strategy continues to expand its footprint.
CubeSmart raised its 2026 outlook, guiding for diluted EPS of $1.55–$1.63 and adjusted FFO of $2.52–$2.60 per diluted share for the full year. For the first quarter of 2026, the company projected EPS of $0.610–$0.630, well above the consensus estimate of $0.480. The company also declared a quarterly dividend of $0.53 per share, underscoring its commitment to returning value to shareholders.
"Recent results reinforce our view that we have reached an inflection point as strengthening operating fundamentals are starting to flow through to our key financial metrics," said Christopher P. Marr, President and CEO. "We are increasingly optimistic that 2026 will build on this momentum, driving improving topline growth across most of our key markets, supported by strategic execution and our continued focus on operational excellence."
Investors responded cautiously to the results. While the company’s guidance signals confidence in future performance, the earnings miss and margin compression tempered enthusiasm, leading to a mixed market reaction.
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