French power and cooling company Schneider Electric saw revenues increase thanks to continued data center spending.

However, the company noted that unfavorable foreign exchange dynamics hit its margins, while tariffs and materials inflation cut into profits.

Across the multinational, revenues were up 8.3 percent organically to €10.01 billion ($11.43bn). Its energy management group, which includes its data centers and networks business, grew 10.5 percent to €8bn ($9.2bn).

“We see a double-digit growth opportunity for Schneider Electric,” CEO Olivier Blum said of the data center segment. “We are fairly confident that with all the actions that have been taken roughly 12, 18 months ago, we are in a good position to capture the growth opportunity in data center, short term, midterm across all the parts of our portfolio.”

In particular, Blum said that he expected Motivair to contribute to the company’s growth. Schneider acquired the liquid cooling company earlier this year for $850 million, with the business primarily focused on US customers. “Now we are getting ready for the international market,” Blum said.

Data center demand was strong around the world, Schneider said. North America energy management revenues grew 15 percent, Asia Pacific was up 11 percent, China was up “mid-single digit,” and ‘Rest of the World’ was up 11 percent.

Western Europe, which had seen sluggish sales, “was back to growth driven by execution of Data Center projects in Spain, Italy and France,” CFO Hilary Maxson said. While it only grew three percent, Maxson said the company “continues to see a strong pipeline, and we are starting to see some small signs of better momentum towards execution in a few countries as governments look for accelerated routes to grant access to land and grid connections.”

CEO Blum added: “We’ve started some pickup in Q2, but it’s too early to confirm a massive acceleration of growth in Europe in particular. I would stay [we’re] relatively cautious, because there are a lot of those new investments that we see that are probably good news for the midterm, but Europe will continue to be a very challenging environment in H2.”

Also a challenge was the global tariff war pushed by US President Donald Trump, which has seen tariffs levied against most of the world – with amounts and timings changing rapidly.

Blum said that Schneider had “strong pricing power” around the world, except in China, which allowed it to increase prices to offset the costs. Those price increases were still working their way through the sales pipeline, the company said.

“We’ve already increased list prices in our major jurisdictions, including the US, and we would expect to see a step-up in pricing on products in H2,” Maxson said.

“We’re a company with demonstrated pricing power, so we do expect to fully offset the impacts of tariffs and of inflation over the next quarters.”