Hubbell's Data Center Sales Rose 80%. Capacity Spending Doubles in 2027.

Hubbell reported third-quarter results on Oct. 27 and said data center sales grew more than 80% on an organic basis, the fastest-moving demand line in a quarter that lifted consolidated net sales to $1.87 billion. The Shelton, Connecticut, manufacturer also told investors that the amount of new factory capacity it brings online each quarter will roughly double next year.

Consolidated net sales of $1,872.5 million rose 25% from a year earlier, with organic growth of 11% and roughly 13 points contributed by acquisitions. The Electrical Solutions segment, which supplies wiring devices, connectors and enclosures to commercial and industrial jobs, posted $844.7 million in net sales, up 51%, including 22% organic growth. Utility Solutions reported $1,027.8 million, up 9%, with organic growth near 5%. Adjusted diluted earnings came to $5.91 a share, up 14%. Hubbell raised its full-year outlook to adjusted diluted earnings of $20.40 to $20.60 per share and now expects sales growth of 18% to 19%, with Electrical Solutions organic growth of 17% to 18%. NSI Industries, a wiring and connector business counted among this year's acquisitions, is included in the segment results and is tracking ahead of the company's initial expectations.

Chairman, President and Chief Executive Gerben Bakker put a figure on the capacity build. About $25 million a quarter of added capacity is coming online this year, he said on the earnings call, and the company anticipates roughly $50 million a quarter in 2027. The first move is installing machines inside existing plants, he said, followed by "adding more roof line, adding more square footage around those existing factories." Capital expenditures through nine months reached $119.8 million, up from $96.4 million a year earlier.

The products behind the data center figure are ones commercial electricians handle on every rough-in. Chief Financial Officer Joe Capozzoli said wiring device and pin and sleeve product lines "have driven accelerated data center penetration," and that data centers now account for about 15% of Electrical Solutions revenue. Pin and sleeve devices are the keyed, sealed plug-and-receptacle sets specified where equipment has to be disconnected and reconnected rather than hard-wired. Capacity at the component end of the supply chain is what decides whether device trim and terminations hold their place in a schedule or wait on material.

The utility half of the business points toward substation work. Bakker said backlog built by more than $500 million year to date, about 30% above where it stood at the start of the year, and that the pipeline for 765-kilovolt products "is growing." Grid Infrastructure grew 8% organically in the quarter while Grid Automation declined about 4%. Substation hardware, connectors and control houses are installed by the same commercial and industrial contractors staffing data center campuses, and a backlog built that fast is a forward read on how long that substation and interconnection work runs.

Capozzoli said Hubbell will give more detailed data center guidance in January.