Rexel Raises 2026 Forecast as US Data Centres Drive Electrical Sales

Data-centre demand drives another forecast upgrade

French electrical distributor Rexel reported third-quarter sales of about €5.45 billion on October 22 and raised its full-year outlook for the second time in 2026. Its official statement showed 11.4% growth on a constant, same-day basis, with US data-centre activity a major contributor. The company now expects roughly 7% same-day sales growth for the year, up from an earlier forecast near 5%, and an adjusted EBITA margin of at least 6.4%. These are company targets rather than guaranteed results. The report is a useful indicator of demand for the electrical equipment behind cloud computing, artificial intelligence and the broader move to electrify buildings and industry.

Why data centres need so much electrical infrastructure

A data centre is more than a room full of servers. It needs reliable power distribution, switchgear, cables, cooling systems, backup arrangements and monitoring equipment. As computing density rises, electrical design becomes more demanding. Even when a technology company announces a large investment, a project cannot operate until power connections and supporting equipment are ready. Rexel supplies customers in this ecosystem rather than building AI models itself. That position means it can benefit from construction and upgrading across many different technology operators. However, the timing of sales depends on project schedules, contractor inventories and local grid connections. A postponed data-centre build can delay equipment demand even if long-term computing needs remain substantial.

The numbers behind the growth

Rexel's official third-quarter release reported €5,452.9 million in sales, up 14.6% on a reported basis. The 11.4% constant and same-day measure adjusts for factors that can distort comparison between periods. For the first nine months, the company reported €15.44 billion in revenue and 7.3% constant same-day growth. These measures should not be mixed casually: reported growth, organic growth and sales adjusted for trading days answer different questions. The company also identified volume gains and price increases as contributors. Investors assessing whether growth is sustainable should look at the volume component, customer mix and the extent to which pricing reflects input costs rather than stronger end demand.

Why electrification matters in Europe

Rexel's business is not limited to American technology campuses. Its European operations supply equipment used in heating, cooling, renewable energy and electrical upgrades. Heat pumps, solar installations, electric-vehicle charging and building renovation can each require new distribution components. The pace of those markets depends on energy prices, regulation, financing and consumer confidence. A favourable long-term trend can still experience weak quarters if subsidies change or construction slows. Rexel said Europe maintained positive momentum, although the US was the principal growth engine. That distinction matters because different customers may be buying for different reasons: one for AI computing capacity, another to reduce building emissions or replace ageing infrastructure.

Expansion through acquisitions

The company also highlighted its agreement to acquire GCG in the United States, a significant addition to its North American business. Rexel said it expects the transaction to close by year-end and has supported financing with a €500 million capital increase. An acquisition can expand product range, customer relationships and regional reach, but integration introduces costs and execution risk. Management must retain customers, combine systems and ensure that promised commercial benefits are achieved. The value of a large transaction cannot be judged solely from projected sales. Investors should watch integration milestones, working capital and whether the acquired business contributes to profitability at the expected rate. Pending completion, projected contributions remain conditional.

What a higher margin target implies

Adjusted EBITA measures operating performance before certain items and is widely used by distributors, but it is not identical to cash generation. Rexel's raised margin guidance suggests management expects its sales mix, pricing and operating discipline to support profitability. The company also reiterated a free-cash-flow conversion objective above 65%. Cash conversion matters because distributors must buy inventory, extend credit to customers and pay suppliers before every sale is collected. Rapid growth can consume working capital if stock levels rise too quickly. A strong sales quarter is therefore most convincing when accompanied by healthy collections and disciplined inventory management. Investors should compare the company's adjusted metrics with statutory results and cash statements.

Risks behind the upbeat outlook

Data-centre construction faces power availability, permitting and local opposition in several markets. High interest rates can make projects more expensive, while technology spending may shift if customers revise AI capacity plans. Supply-chain bottlenecks can also prevent electrical equipment from reaching a site when needed. Rexel has opportunities to sell into upgrades and maintenance even after construction, but not every announced campus will be built on the original timetable. In Europe, a slowdown in construction or changes to electrification incentives could affect demand. The company has raised guidance based on current evidence; the risk assessment should still include scenarios in which one or more growth drivers cools.

What to watch next

Future updates should show whether US data-centre orders remain strong, whether European electrification continues to support volumes and how the GCG acquisition progresses. Analysts will also monitor margins and cash conversion rather than treating revenue growth as the only measure of success. The broader story is that digital infrastructure has a large physical footprint. Every server needs electricity, every facility needs protection and distribution equipment, and upgrades can generate demand across multiple industrial suppliers. Rexel's results provide a concrete example of that connection, while leaving open how long the present investment cycle will last and how evenly its benefits will spread.