nVent Electric Reports Record Quarter on AI Data Center Boom, Raises Guidance Again
The UK-listed electrical connections firm posted 53% sales growth and 69% EPS growth in Q2, driven by surging demand for liquid cooling infrastructure.
Record Performance Fueled by Infrastructure Boom
nVent Electric plc delivered exceptional second-quarter results, posting sales of $1.471 billion, up 53% year-over-year, with organic growth of 47% (earnings call, 2026-07-31). The UK-domiciled electrical connections and protection company reported adjusted earnings per share of $1.45, representing 69% growth compared to the prior year.
The outperformance was "primarily driven by the infrastructure vertical, led by data centers, along with stronger demand in our short-cycle business," according to Chair and CEO Beth Wozniak (earnings call, 2026-07-31). This marked the company's fourth consecutive quarter exceeding $1 billion in sales, and the first time its Systems Protection segment surpassed the $1 billion threshold.
Data Center Business Drives Growth
Infrastructure revenue more than doubled organically in the quarter, with data centers representing the largest contributor. The company reported "outstanding growth in liquid cooling, cable management and engineered buildings" across customers ranging from hyperscalers to multi-tenant facilities (earnings call, 2026-07-31).
New products contributed over 30 percentage points to sales growth, with 14 product launches during the quarter. The company's backlog remained robust at $2.5 billion, providing visibility into 2027.
CFO Gary Corona noted that adjusted operating income reached $323 million, up 61%, with return on sales of 21.9% despite absorbing more than $50 million in inflation costs, including over $30 million in tariff impacts (earnings call, 2026-07-31).
Third Capacity Expansion Announced
To meet accelerating demand, nVent announced a third facility expansion for liquid cooling production in Minnesota, dubbed "Blaine 2." The new site, similar in size to an expansion opened earlier this year, is expected to begin operations in the first half of 2027 (earnings call, 2026-07-31).
Wozniak noted the company has been "working on liquid cooling in data centers for over a decade" and executed its first significant expansion three years ago. The Blaine facility opened earlier this year "within approximately 100 working days from when we signed the lease" and is "progressing ahead of our expectations" (earnings call, 2026-07-31).
The company expects total data center sales "to be more than $2 billion in 2026 and more than double last year's sales" (earnings call, 2026-07-31).
Guidance Significantly Raised
nVent substantially increased its full-year outlook, now forecasting reported sales growth of 37% to 39%, up from prior guidance of 26% to 28%. Organic sales growth guidance was raised to 32% to 34% from 21% to 23% previously (earnings call, 2026-07-31).
Adjusted EPS guidance was lifted to a range of $5.00 to $5.10, representing 50% growth at the midpoint, compared to original guidance of $4.45 to $4.55. For the third quarter, the company expects sales growth of 32% to 35% and adjusted EPS between $1.35 and $1.38 (earnings call, 2026-07-31).
The company generated free cash flow of $167 million in the quarter, up 125% year-over-year, and maintained a net leverage ratio of 1.2x, well below its target range of 2 to 2.5x (earnings call, 2026-07-31).
MarginX data shows recent insider activity included tax withholding transactions, with Diane Leopold withholding 222 shares and Nitin Jain withholding 283 shares while receiving an award of 1,594 shares.
This article was generated by MarginX from the earnings call on 2026-07-31. It is not investment advice.