GF Flows into the AI Era: Semiconductors and Data Centers Propel Growth

Order intake surges 15%, guidance raised as GF doubles down on mission-critical flow solutions for the AI buildout.

GF.SW · Earnings Call · 2026-07-17

A Flow Solutions Leader Rides the AI Wave

GF may be a century-old Swiss industrial, but its mid-year results make clear it is now a prime beneficiary of the most modern of trends. In H1 2026, the company delivered 5.7% organic sales growth for its flow solutions division, and order intake jumped 15.1% organically — a pace that led management to raise its full-year sales outlook from low-single-digit to mid-single-digit organic growth. The star performers were the semiconductor and data center verticals, where GF’s mission-critical polymer piping and valves are becoming essential infrastructure for the AI buildout. Andreas Müller, CEO, underscored the momentum: “Order intake was exceptionally strong. Based on secured projects in Asia, we are confident this business will deliver its full potential over the coming quarters and years.” — Andreas Müller · 2026-07-17 That order intake — more than double year-over-year in semiconductors — is already translating into revenue, and management is now guiding to a comparable EBITDA margin of 14–16% for the year, unchanged but with a decidedly more optimistic tilt.

Semiconductors and Data Centers: The New Growth Engines

GF’s data center AI thesis is not a side bet; it is central to the company’s midterm sales target of CHF 300 million for this segment. The global opportunity is staggering: “Surging AI demand is driving a wave of investment with global data center CapEx expected to reach $1.7 trillion over the next five years, and computing demand to more than double by 2030, exceeding 200 GW.” — Andreas Müller · 2026-07-17 For GF, each 100 MW liquid-cooled data center represents roughly CHF 15 million of addressable revenue — and the company has already logged successful proof-of-concept installations of its new multi-control valve, with first sales expected by year-end.

The semiconductor industry is gearing up for a strong new cycle. Fab investments until 2030 are expected to exceed $1 trillion. GF is well-positioned for this upcycle as a leading innovation partner to the industry.
Andreas Müller · 2026-07-17

The semiconductor story is equally compelling. The introduction of SYGEF Ultra, a next-generation ultra-pure water conveyance system that cuts rinse time in refurbishments by 80%, has secured record committed orders across more than 50 projects globally. This aligns with the broader market tape, where themes like high bandwidth memory and data center interconnect are among the top advancers over the past year. GF’s positioned as a niche but critical player in the same ecosystem.

Financial Discipline and Transformation

The AI-driven growth story sits atop a deliberate transformation. GF is on track to close the Precicast divestment by year-end, which is expected to generate a book gain of CHF 30–40 million and materially reduce net debt. CFO Mads Jørgensen confirmed leverage should drop from 4.0x to 2.4–2.8x by year-end. Simultaneously, the Fit for Growth program has been expanded from CHF 40 million to CHF 60 million in annual savings, with reinvestments funneled into the high-growth areas of semiconductors and data centers. This operational discipline is also visible in working capital management, where supply chain initiatives aim to reduce inventory and boost free cash flow — a priority for a company that saw free cash flow before M&A of just CHF 35 million in H1, including CHF 70 million from a property sale.

Risks and the Path Forward

No story is without its clouds. The ongoing Middle East conflict is driving volatile raw material prices, which CEO Müller acknowledged as the biggest near-term impact: “The biggest impact of the Middle East war most likely is in the range of volatile raw material prices.” — Andreas Müller · 2026-07-17 Negative FX movements reduced sales by CHF 88 million in H1, and the Chinese infrastructure market remains weak. Still, with a record order book and secular tailwinds, GF’s pivot toward high-tech end markets looks both timely and well-executed.