ABB shares slide on AI fears despite record Q3 orders

ABB raised its full-year guidance on Tuesday after reporting record third-quarter orders, but its shares fell sharply as investors fretted over the sustainability of the artificial-intelligence data-centre boom, Reuters reported.

The Zurich-based engineering group said orders rose 40 per cent year on year to a record $12.055bn, while revenue climbed 14 per cent to $9.70bn — just below the $9.74bn company-gathered consensus. Operational EBITA rose 24 per cent to $2.03bn, lifting the margin to 20.8 per cent from 19.2 per cent a year earlier, ahead of the roughly $2.0bn consensus. Net profit eased to $1.18bn from $1.21bn.

ABB said data-centre orders more than doubled during the quarter. For the full year, the company now expects comparable revenue growth in the “low teens” and an operational EBITA margin improvement of at least 270 basis points, although the fourth-quarter margin would soften sequentially, according to the company’s Q3 statement.

The numbers did little to calm markets. ABB shares were down around 5.5 to 6 per cent in European morning trade. Traders on South Korea’s stock market sold heavily on Tuesday as concern mounted over rising costs, ad-hoc reported.

“Operationally ABB remains strong, but waning AI enthusiasm is creating headwinds,” said Marco Estermann, an analyst at Luzerner Kantonalbank.

Separately, ABB announced it would take a controlling 51 per cent stake in a joint venture with Mitsubishi Electric’s low-voltage power distribution business.