Schneider electric boosts outlook again after data-center demand lifts sales

Schneider Electric lifted its annual targets for the second time this year after data-center orders kept flowing in, boosting sales for the third quarter.A Schneider Electric production line. Data-center related orders boosted the company’s third-quarter sales.The French engineering group said Friday that it is targeting organic growth in adjusted earnings before interest, taxes and amortization to range from 18% to 21% this year, up from a previous goal—which had been upgraded in July—of between 14% and 19%.Schneider raised its full-year expectations for both organic revenue growth—now projected at 12% to 14%—and profitability. It forecast an expansion in its adjusted Ebita margin of between one percentage point and 120 basis points on an organic basis.The company anticipates data-center demand to remain strong in the fourth quarter, with continuing pricing momentum offsetting the hit of raw-material inflation and tariffs for the year as a whole.Like other electrical-equipment suppliers, Schneider has been riding a wave of demand for products in data centers sparked by artificial intelligence, and has moved to redeploy the windfall to dealmaking. It struck a $22.6 billion deal to buy U.S. industrial-software maker PTC earlier this month, launched a $1.35 billion takeover bid for smart-device maker Shelly Group last month, and agreed to acquire AI software provider Cognite Holding for $3.1 billion in June.Data-center demand more than doubled last quarter and helped drive Schneider’s revenue to what the company called a record high for any quarter.The company said third-quarter revenue was 11.46 billion euros ($12.86 billion), up 18% compared with the year-earlier period. On an organic basis, revenue grew 17%, it said.The results exceeded analysts’ expectations of 11.13 billion euros in revenue and organic growth of 14%, according to consensus estimates provided by the company.“As expected, data centers remained a key growth driver as we continue to execute on our backlog while seeing triple-digit demand growth in the quarter, providing increasing visibility into 2027 and 2028,” Schneider Chief Executive Olivier Blum said. “More broadly, demand remained healthy across all four end-markets, supporting another record backlog at quarter-end.”Write to Adrià Calatayud at adria.calatayud@wsj.com