According to Utility Dive, Schneider Electric’s Energy Management segment grew 10% year-over-year in the third quarter, with North America specifically jumping 17% as hyperscalers could spend nearly $200 billion on data center investments this year. The Paris-based electrical equipment company reached 10 billion euros ($11.5 billion) in total revenue, representing 9% organic growth across all four end-markets. CFO Hilary Maxson noted particularly strong pipeline and order trends in North America and China, driven by both traditional hyperscalers and new AI-related players. The company’s software business grew 8% and accounted for 19% of group revenues, while AVEVA—acquired in 2023—saw 12% recurring revenue growth. Schneider also announced it has surpassed its 2025 Zero Carbon project target ahead of schedule, with top suppliers reducing operational carbon emissions by 53% since 2020.
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The Data Center and AI Boom
Here’s the thing—Schneider is perfectly positioned for exactly where the market is heading. Data centers aren’t just growing; they’re transforming into power-hungry AI factories that need sophisticated energy management and cooling solutions. That 17% North America growth number tells you everything. Basically, when hyperscalers are potentially spending $200 billion this year alone, companies like Schneider that provide the foundational infrastructure are going to ride that wave.
And they’re not just sitting back waiting for orders. The Motivair acquisition last year and those NVIDIA co-developed reference designs show they’re actively building the capabilities for what’s coming next. We’re talking about integrated cooling and power management systems that can actually reduce deployment timelines. In an AI arms race where speed to market matters, that’s becoming increasingly valuable.
Beyond Data Centers
Now, the residential weakness in China and North America might worry some people, but Maxson was quick to point out it’s a relatively small part of their buildings business. What’s more interesting is the strength in “technical buildings” like retail and hotels. That suggests their energy management solutions are finding traction across commercial real estate, not just the obvious data center vertical.
The whole “energy technology partner” positioning they’re planning to discuss at their December Capital Markets Day feels like the right move. Companies across industries are trying to electrify, automate, and digitize—and they need partners who can handle the complexity. Schneider’s acquisition strategy, particularly with AVEVA, gives them that platform-agnostic software capability that makes them more than just a hardware supplier.
The Challenges Ahead
But it’s not all smooth sailing. The tariff situation is clearly causing some headaches, especially in Mexico where they called out “ongoing macroeconomic environment” issues. The fact that they don’t expect to fully offset tariff and inflation impacts with pricing in 2025 suggests they’re facing some real margin pressure.
Still, that 53% reduction in supplier carbon emissions since 2020 is genuinely impressive. In an era where Scope 3 emissions are becoming increasingly important to investors and customers, having concrete progress like that matters. It’s not just ESG window dressing—it’s becoming a competitive advantage as large enterprises look for suppliers who can help them meet their own sustainability targets.
What Comes Next
So where does this leave Schneider? They’re hitting all the right notes—data center growth, software expansion, sustainability leadership. The December Capital Markets Day should give us more clarity on how they plan to leverage this “energy technology partner” positioning across industries.
The real question is whether they can maintain this momentum as the AI infrastructure build-out potentially slows or shifts direction. But with their broad portfolio and the ongoing digitization of everything from factories to commercial buildings, they seem well-positioned for whatever comes next. You can see their full Q3 revenue presentation here for the complete picture.
