Growth in Commercial Energy and Utility Demand for Energy Efficiency Programs
Revenues from commercial energy increased 27% year-on-year, driven by demand for energy efficiency, electrification, flexible load management, and grid resilience.
ICF is a market leader in residential energy efficiency programs, expanding into commercial energy efficiency, funded by surcharges on ratepayers in over 30 states.
Anticipated growth due to construction of data centers and increased electricity demand, with early signs of expansion in states like New York, Georgia, and Illinois.
Data Center Revenue Growth Driven by AI and Hyperscale Demand
Second quarter data center revenue increased nearly 50% sequentially and almost doubled year-over-year, driven by hyperscale design wins and increased demand.
Management expects demand to remain at or above Q2 levels for the rest of 2025, supporting over 80% revenue growth in data center segment.
New designs for next-generation AI applications are scheduled to ramp in 2026, with strong customer investment in capacity expansion.
The high power density and efficiency of products are ideal for AI applications, with multiple next-generation programs won for 2026.
The company is actively expanding manufacturing capacity in the Philippines and Mexico to support these opportunities.
Customer forecasts and design win momentum underpin the confidence in sustained growth in this market.
Portfolio Transformation and Focus on High-Growth Infrastructure Vertical
The company has divested the Thermal Management business and acquired Trachte and EPG, reshaping its portfolio to focus on high-growth infrastructure verticals such as power utilities, data centers, and renewables.
Infrastructure now accounts for over 40% of sales, with data centers and power utilities each approximately 20%.
The transformation aims to balance short-cycle and long-cycle businesses, positioning the company for accelerated growth and value creation.
Dafinchi