Key Takeaways
- Adjusted operating profit rose 11.5% to €524.7 million, beating consensus.
- US sales surged 29.1%, driven by investment in AI and data centers.
- The company confirmed its full-year outlook despite a 5.8% currency headwind.
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Legrand Q1 profit grows 11.5% on surging US data center demand
French electrical group Legrand reported a first-quarter adjusted operating profit of €524.7 million, an 11.5% increase that surpassed analyst expectations as booming U.S. demand for data centers offset European weakness.
"Since the start of the year, we have announced four acquisitions, all in the data centre and energy transition sectors, representing a combined annual turnover of approximately 275 million euros," Legrand CEO Benoit Coquart said in a call with reporters.
The results highlight a strategic pivot toward higher-growth sectors, with data center-related activity expected to comprise 30% of Legrand's sales in 2026. The 29.1% sales explosion in the U.S. underscores the impact of AI-driven capital spending, which for now is compensating for declines in key European construction markets like France and Spain.
Legrand's total sales grew 11.4% in the first quarter, almost entirely powered by its U.S. operations. In contrast, sales in Europe, which make up 36.3% of the company's business, were sluggish as growth in Germany and Italy failed to offset declines in France, Spain, and Britain amid continued weakness in construction and renovation.
The company is actively pursuing growth in the data center space. The four acquisitions announced this year are set to add around €275 million in annual revenue. CEO Benoit Coquart noted that data centers grew to 26% of sales last year and are on track to hit approximately 30% this year, making Legrand a key supplier for the infrastructure underpinning the artificial intelligence boom.
Despite the strong start, Legrand faces headwinds. The company absorbed a 5.8% negative impact from foreign exchange on sales and confirmed it expects a 2% currency drag for the full year. While Coquart acknowledged the first quarter was "difficult" in Europe, he noted that most experts predict an improvement by year-end, barring wider impacts from the crisis in the Middle East, which currently accounts for 2% of sales.
The strong earnings beat and confirmed guidance suggest management is confident that the high-margin data center business can continue to power growth and offset both currency headwinds and European market softness. Investors will be closely watching the company's ability to integrate its new acquisitions and maintain momentum in the U.S. through the rest of 2026.
This article is for informational purposes only and does not constitute investment advice.
