LS Electric posted record first-quarter results, boosted by expanding demand for power infrastructure in North America and rising data center investment.
LS Electric said on Apr. 21 that, on a consolidation basis, first-quarter sales rose 33% on-year to 1.3766 trillion won and operating profit increased 45% to 126.6 billion won. Both sales and operating profit were the highest ever for a first quarter.
The strong results were driven by global big tech corporations' expanded investment in artificial intelligence (AI) data centers and the resulting increase in demand for power infrastructure. Facility investment in key industries such as semiconductors and the spread of renewable energy also contributed to the improvement.
North America in particular led the growth. First-quarter North American sales were about 300 billion won, up about 80% from a year earlier, marking a quarterly record. The increase stemmed from more orders for direct current (DC) power products for data center microgrids.
By product, the ultra-high-voltage transformer business stood out. First-quarter sales of ultra-high-voltage transformers rose 83% from a year earlier. The operation of the second ultra-high-voltage transformer production building at the Busan business site increased production capacity from 200 billion won to 600 billion won, which was reflected in the results. Subsidiary LS Power Solution's sales rose 24% on-year.
Growth continued in ASEAN as well. While maintaining the No. 1 position in Vietnam's low-voltage power equipment market, the local subsidiary's sales increased 45% on-year. Indonesian power equipment subsidiary Simpos also contributed, with sales up 75%.
The energy storage system (ESS) business is also expanding rapidly. First-quarter ESS sales tripled from a year earlier and increased 50% from the previous quarter. By expanding both power equipment supply and system integration (SI), the company is strengthening its business base.
LS Electric is accelerating the expansion of its direct current solutions business, which can improve data center power efficiency. DC-based power grids such as high-voltage direct current (HVDC) and low-voltage direct current (LVDC) can reduce losses by cutting power conversion stages and are drawing attention as an alternative in data center environments with rising power demands.
The order backlog continued to grow. As of the end of the first quarter, the order backlog was 5.6 trillion won, up about 600 billion won from the end of last year. Of this, ultra-high-voltage transformer orders accounted for 3.1 trillion won.
A LS Electric official said, "As data center investment by global big tech corporations surges, along with the construction of microgrids for data centers' own power supply, the broadening demand for power infrastructure is feeding into results," adding, "We will pursue both order growth and profitability improvement by focusing on core businesses that will lead the future power market, including data centers, DC solutions, and ESS."