A multi-billion dollar infrastructure buildout has kicked into full swing due to the AI boom’s colossal demand for data centers and the energy to power them.

AI hyperscalers have made a collective spending commitment of roughly $650 billion in this year alone. Meanwhile, data center energy demand is expected to reach nearly 76 gigawatts this year (“GW”) and further expand to 134 GW by 2030.

This demand is estimated to require an investment of roughly $1.4 trillion in AI data center electrification.

SPX Technologies (SPXC), a firm specializing in HVAC solutions—a crucial aspect of data center design and construction—has benefited and is poised to continue benefiting from these tailwinds.

Despite this, as-reported metrics makes this company look like a below-average business.

Investor Essentials Daily:
Wednesday News-based Update
Powered by Valens Research

America is in the midst of a data center and energy infrastructure buildout due to the AI boom.

In 2026 alone, Big Tech firms are expected to spend roughly $650 billion on new data centers and other related equipment as they compete amongst each other in securing dominance in the AI arms race.

Meanwhile, energy infrastructure spending is expected to rise further in the coming years due to the AI boom’s massive need for power.

Data centers require colossal amounts of energy, with demand expected to reach nearly 76 gigawatts this year (“GW”) and further expand to 134 GW by 2030.

Meeting this demand will require an investment of roughly $1.4 trillion in AI data center electrification. While AI electrification efforts are already under way, these initiatives will take years to complete. That’s why for now, the focus has shifted to efficiency.

Data centers not only perform trillions of calculations each day, but they also generate tremendous amounts of heat due to these calculations. At any given moment, large hyperscale data centers produce enough heat to warm around 35,000 homes through the winter months.

This is why around 30% to 50% of all electricity consumed by these facilities is put toward cooling alone. Even as chips become more advanced and efficient, heating, ventilation, and air conditioning (“HVAC”) will continue to serve a crucial role in data center design and construction.

And this puts SPX Technologies (SPXC), in a favorable position.

SPX Technologies derives its revenues from two major business units: HVAC and Detection and Measurement.

The company’s HVAC segment has a portfolio of brands like Ingenia, Marley, Weil-McLain, and others that provides cooling towers, refrigeration products, air movement solutions, heating systems, and boilers for both residential and commercial customers.

Meanwhile, the Detection and Measurement segment offers customers with specialized underground location and inspection equipment, navigation aids, fare collection systems, and communication technologies products.

Data centers require advanced cooling solutions to manage heat generated by high-density server racks supporting AI workloads. SPX Technologies’ HVAC segment, through its Marley brand, provides data center operators with the advanced cooling solutions needed for thermal management.

As data center construction continues to ramp up, the company’s HVAC segment is poised to keep benefitting from this tailwind.

During its 2025 fiscal year, the company posted full-year revenues of $2.2 billion, up 14% year-over-year. The HVAC segment generated the bulk of revenues, delivering $1.5 billion. Meanwhile, Detection and Measurement brought $747 billion in revenue.

Despite the company’s recent growth and importance to the AI data center buildout, investors continue to doubt this company’s profitability.

While SPX Technologies’ as-reported return on assets (“ROA”) has grown steadily since 2017, it only delivered 8% returns in 2024, below the 12% corporate average.

On the other hand, Uniform Accounting highlights just how profitable this company truly is.

SPX Technologies’ Uniform ROA climbed from 5% in 2017 to 15% in 2022. And as the AI data center investments ramped up, the company’s returns more than doubled, rising to 32% in 2024.