LS ELECTRIC has signed a long-term supply agreement (LTA) with a US big tech company to provide power distribution solutions for North American data centers, the company announced on October 19.

The contract is valued at approximately USD 126.75 million and covers a two-year period from 2027 to 2028. The contract amount announced represents the volume scheduled for supply in 2027, with the 2028 scale to be decided through additional discussions with the big tech company.

High-voltage switchgear for AI data centers

The products to be supplied under the agreement are 38kV-class high-voltage switchgear, which serves as core power infrastructure for data centers by distributing high-voltage power stably to each facility and protecting equipment in the event of a power anomaly.

Because AI data centers require stable, round-the-clock delivery of large volumes of electricity, the products must meet high standards of reliability and quality, according to the company.

Big tech shift toward long-term supply contracts

LS ELECTRIC noted that major global big tech companies increasingly favor long-term supply agreements to secure stable access to power solutions deemed essential to AI data center construction.

Although some concerns about an artificial intelligence bubble have been raised, the company expects competition among global big tech firms to secure data centers to grow further, accelerating a shift in power solution procurement toward long-term supply contracts.

Additional premium equipment supply under discussion

Following this high-voltage switchgear supply, LS ELECTRIC said it is also in discussions to supply additional data center-tailored premium power equipment, including low-voltage switchgear, distribution-class transformers, and RMUs (Ring Main Units, high-voltage gas load break switches).

Local value chain cited as a key factor

The company attributed the contract outcome to its ability to meet customers' demanding quality standards, rapid delivery response, and close customer management through localization.

LS ELECTRIC said it has built a customer-tailored response system spanning design, production, delivery, and commissioning and has strengthened its stable supply capabilities.

Centered on LS ELECTRIC Utah in Cedar City, Utah, and the Baytown Campus in Texas, the company has established a locally complete value chain covering sales, design, production, and service to actively respond to local customer demand.

Company outlook

An LS ELECTRIC official said that world-class data center solution technology and the trust built through executing customer-tailored data center projects led to the signing of the long-term supply agreement.

The official added that the company will expand its supply of high value-added products for data centers to secure a stable revenue base and maximize profitability.

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