ABB lifts 2026 sales outlook after data centre demand boosts quarterly results

[ZURICH] ABB raised its full-year sales outlook on Wednesday (Apr 22), as booming demand from data centres and other parts of its electrification business offset heightened uncertainties linked to the Iran war.

The Swiss engineering company said it was also observing strong investments from utilities wanting to improve electrical grids, as well as electrical upgrades for land transport and automation at port terminals and cruise ships.

ABB said it now expected its 2026 sales to increase by a high single-digit to low double-digit percentage, up slightly from its previous view of comparable annual revenue growth of 6 to 9 per cent.

The company’s shares were indicated 5.9 per cent higher in pre-market activity on the Swiss stock exchange after the upgrade in sales outlook.

Caution about global economic growth

The optimism, buoyed by ABB’s record quarterly order intake, stood in contrast to increased caution surrounding the global economy, with the International Monetary Fund recently cutting its growth forecast due to soaring energy prices because of the Middle East conflict.

Its CEO Morten Wierod said that demand had remained robust at the start of the year, with the company experiencing no material effect from the war.

“Admittedly, this conflict adds uncertainty to the global trading climate, although to date, demand for our electrification and automation offerings has remained overall resilient and supportive to our raised ambitions for 2026,” he added.

ABB raised its outlook after posting first-quarter results ahead of forecasts, supported by very strong demand from data centres used to process artificial intelligence.

The Zurich-based company, which makes industrial automation and electrical distribution equipment, said that its sales rose 18 per cent to US$8.7 billion in the January-to-March quarter.

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The figure beat forecast of US$8.4 billion in a company-gathered consensus of analysts.

Its operational earnings before interest, taxes and amortisation (Ebitda) rose to US$2.1 billion, ahead of analysts’ forecasts of US$2 billion, supported by higher profit margins.

Analysts pointed to the strong order uptake, which rose by 32 per cent to US$11.3 billion.

“The strength in order intake will be seen as the key positive, with not only data centre orders up triple-digit percentages, but strength across the board with record order levels in both electrification and motion,” said Citigroup analysts in a note. REUTERS