The French industrial group Schneider Electric reported on Thursday that its core earnings outperformed expectations, driven by robust data center demand. Despite pressure from a weaker U.S. dollar, the company maintained its 2026 performance outlook.
The group's pure data center business unit achieved triple-digit year-over-year growth. Quarterly revenue saw organic growth of 10.7%, reaching €11.10 billion ($13.12 billion). Full-year adjusted earnings before interest, taxes, and amortization (EBITA) totaled €7.52 billion.
Analysts surveyed by the company had on average anticipated fourth-quarter revenue of €10.90 billion and full-year adjusted EBITA of €7.48 billion.
Schneider Electric's Chief Financial Officer, Hilary Maxson, stated to media that the United States was the primary driver of growth in the data center business, while demand was also recovering in Nordic countries and France.
"We are beginning to see a gradual opening up of data center construction in parts of Europe, where approvals have been completed, power connections are available, and there is government impetus," Maxson said.
Once known primarily for industrial components such as fuses and circuit breakers, Schneider has become a core supplier of data center infrastructure, offering products including cooling equipment, server racks, and critical power distribution systems. Data centers and networks account for approximately 30% of its total order intake.
Following optimistic outlooks from chip giant NVIDIA and French electrical and digital building infrastructure group Legrand, Schneider is the latest company to express a positive outlook for AI-related demand this year.
Data Centers Support Growth Schneider anticipates:
- Organic revenue growth of 7%–10% in 2026 - An increase in adjusted EBITA margin of 50 to 80 basis points
These projections align with the long-term targets the company announced in December last year:
- Average annual organic revenue growth of 7%–10% between 2026 and 2030 - A cumulative improvement in adjusted EBITA margin of approximately 250 basis points over the same period
More than one-third of the group's revenue comes from North America. Currency fluctuations, driven by the depreciation of the U.S. dollar, Indian rupee, and Chinese renminbi, reduced fourth-quarter revenue by €701 million. The company expects a negative currency impact on 2026 revenue of between €850 million and €950 million.
Maxson noted that the impact of import tariffs, including those in the United States, would be "roughly half" the €160 million incremental impact disclosed for 2025.
Schneider announced that Maxson will step down on April 5, with Nathan Fast, the head of investor relations, set to succeed her.