Eaton sees 2025 profit above estimates on AI-led data center demand

(Reuters) - Eaton Corporation on Friday forecast 2025 adjusted profit above Wall Street estimates, expecting demand for electrical equipment to remain strong due to an artificial intelligence-related data center boom.

Global appetite for data centers has increased as companies race to develop and adopt artificial intelligence, benefiting electrical equipment makers like Eaton.

Shares of the company were up 2.7% in premarket trading.

In the fourth quarter, sales for the electrical business in the Americas were up 9% while sales in the global electrical segment rose 4%.

However, the industry's growth could face challenges from Chinese start-up DeepSeek's new AI model, which is cheaper and consumes less electricity than OpenAI's ChatGPT, stoking concerns that newer technologies could have smaller power requirements, Reuters reported earlier this month.

Excluding items, the Ireland-based company expects 2025 profit between $11.80 and $12.20 per share, with the mid-point higher than analysts' estimates of $11.95 per share, according to data compiled by LSEG.

Net sales for quarter ended Dec. 31 were $6.24 billion, up from $5.97 billion a year earlier. Analysts, on average, were expecting $6.33 billion.

(Reporting by Aishwarya Jain in Bengaluru; Editing by Leroy Leo)

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