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Realty Income, a San Diego-based real estate investment trust (REIT), has revised its full-year adjusted funds from operations (AFFO) outlook for 2025 to a narrower range of USD 4.25-4.27 per share, compared with its earlier projection of USD 4.24-4.28. The company reported third-quarter same-store rental revenue of USD 1.16 billion, up 1.3% year-on-year, while total revenue rose to USD 1.47 billion, surpassing analysts' estimates of USD 1.38 billion. Adjusted FFO for the quarter stood at USD 1.08 per share, slightly above expectations, though shares edged lower in after-hours trading.
Realty Income Corporation, headquartered in San Diego, California, has revised its full-year adjusted funds from operations (AFFO) forecast as it navigates a cautious economic environment. The real estate investment trust (REIT), known for its diversified portfolio of over 15,500 commercial properties across the United States and Europe, leases space primarily to well-established retail tenants including Walgreens and Dollar General. Advertisement
The company now expects 2025 AFFO between USD 4.25 and USD 4.27 per share, compared to its previous range of USD 4.24-4.28 per share. This minor adjustment reflects a more precise estimate as Realty Income continues to balance portfolio expansion with economic headwinds such as higher borrowing costs and inflationary pressures.
For the third quarter, same-store rental revenue grew 1.3% to USD 1.16 billion, up from USD 1.15 billion during the same period last year. Total revenue increased to USD 1.47 billion, surpassing analysts' average projection of USD 1.38 billion, based on data compiled by LSEG. The REIT posted adjusted FFO of USD 1.08 per share, marginally exceeding analysts' expectation of USD 1.07 per share.
Realty Income continues to emphasize stable rent collection and long-term tenant relationships as key drivers of its performance. The company's tenant base remains diversified, reducing dependence on any single industry segment. Over recent years, the REIT has expanded through strategic acquisitions and international exposure, focusing on income-producing commercial assets backed by investment-grade tenants.
Despite the strong operational results, Realty Income's shares declined slightly in after-hours trading following the update. Analysts viewed the narrower forecast as a sign of management's cautious outlook amid persistent macroeconomic uncertainty. Market observers noted that while the company continues to post steady revenue growth, factors such as rising interest rates and cautious consumer sentiment could impact property valuations and leasing activity in the coming quarters.
The modest tightening of the forecast aligns with Realty Income's consistent approach to maintaining stable guidance while ensuring predictable shareholder returns.
Source Reuters
5th Jun, 2025
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