Delta Electronics Projects Revenue Growth Amid AI Infrastructure Surge

Power Electronics Demand Accelerates

Delta Electronics anticipates revenue will exceed NT$183.26 billion ($5.65 billion) this quarter, propelled by sustained orders for power and thermal management systems tied to artificial intelligence infrastructure expansion. The Taiwanese manufacturer disclosed the outlook during an earnings briefing in Taipei, where chairman Ping Cheng outlined expectations for the second half to outpace the first six months of the year.

AI-related products are projected to account for more than 25 percent of the company's annual revenue, according to Delta. Power electronics products represented 53 percent of last quarter's sales, while infrastructure offerings captured 34 percent, automation devices 8 percent, and mobility applications 5 percent.

The forecast comes as Delta reported record quarterly net profit of NT$25.14 billion, up 80.2 percent year-on-year and 22.3 percent sequentially. Earnings per share climbed to NT$9.68 from NT$7.91 the previous quarter and NT$5.37 a year earlier.

Hyperscaler Spending Holds Steady

Vice president Lanford Liu dismissed concerns about a potential pullback in AI investment, noting that major cloud providers continue aggressive data center construction despite broader market anxiety over return on capital. Hyperscalers' revenue performance has largely met projections, and demand for AI services shows no signs of abating, Liu explained.

The company has not observed meaningful deceleration in data center buildout activity. Several large-scale operators are planning to increase capital expenditure in the coming year, sustaining the pipeline for Delta's power distribution and cooling technologies.

Gross margin contracted to 35.64 percent from 37 percent in the prior quarter due to shifts in product mix. Delta expects margins to stabilize around 35 percent through the remainder of the year, according to Cheng.

Manufacturing Footprint Expands

Capital expenditure reached NT$27.5 billion in the first half, and Delta projects full-year spending will hit NT$70 billion, a substantial increase from NT$46.6 billion last year. The company is reconstructing its Bangpoo 1 facility in Thailand to add production capacity, with three additional factories scheduled for completion next year.

Capacity expansion is also underway across Taiwan, China, and the United States. Cheng confirmed Delta is in discussions to establish another overseas manufacturing base but declined to provide specifics on location or timeline.

Next-Generation Power Architectures

Delta is advancing high-voltage direct current solutions for upcoming server platforms, with ±400-volt and 800-volt HVDC products entering mass production this quarter. Revenue contribution from these systems is expected to materialize next year.

The 800-volt HVDC architecture is being developed in parallel with Nvidia's next-generation AI platforms, positioning Delta to supply power systems for the latest accelerated computing hardware.

Liquid cooling solutions represented 10 percent of revenue last year and are forecast to reach at least 12 percent this year. While the transition to liquid-to-liquid cooling has progressed more slowly than anticipated, Liu emphasized the company remains committed to the technology as thermal challenges intensify with denser chip designs.

Delta's production ramp aligns with a broader wave of investment across Asia's tech manufacturing sector, as suppliers race to meet infrastructure demands from generative AI workloads. The company's revenue trajectory will hinge on hyperscaler capital discipline and the pace at which next-generation cooling and power systems gain traction in live deployments.