Electrical engineering: ABB records record orders thanks to data center boom
Driven by strong demand, ABB recorded an order intake record in the third quarter. The Swiss group is also announcing a joint venture with Mitsubishi Electric.
Zurich - Artificial Intelligence (AI) boom is driving business for electrical engineering giant ABB, with the company recording record orders in the third quarter. ABB reported a record order intake in its third quarter, driven by demand for data center equipment, according to the company's announcement on Tuesday. At the same time, ABB announced a new joint venture with Japanese firm Mitsubishi Electric.
ABB's share price fell due to doubts about the sustainability of the global AI boom and lower-than-expected profit. From July to September, ABB's order intake rose by 40 percent to $12.1 billion. In the most profitable segment, the power supply equipment for data centers, orders shot up by 70 percent. The data center segment showed a triple-digit increase.
"Data centers were exceptional," said ABB CEO Morten Wierod. There were no signs of declining demand or reluctance from customers on investments. Group revenue rose by 14 percent to $9.7 billion, while operating profit margin (EBITA) improved to 20.8 percent. ABB raised its earnings outlook slightly and now forecasts similar revenue growth in the low single-digit percentage range.
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