Modine Manufacturing Company (MOD) Oppenheimer 21st Annual Industrial Growth Virtual Conference summary

Data center growth and capacity planning

• Capacity expansions in the U.S. are designed to meet FY28 targets, with flexibility for further growth as new products and technologies emerge.

• Annual capital investments have increased significantly, with current levels five to seven times higher than historical norms.

• A 20% capacity buffer is maintained to manage order spikes and project timeline shifts, supporting large, project-based sales.

• Strong relationships with hyperscalers and cloud providers provide 3–5 year visibility, guiding regional manufacturing strategies.

• Capacity allocation decisions balance long-term agreements with diversification, prioritizing top-tier customers aligned with technology roadmaps.

Technology innovation and product strategy

• Focus on modular and hybrid cooling solutions, with ongoing partnerships to develop next-generation, energy-efficient data centers.

• Modular data center offerings are expanding, with multiple generations deployed and further development underway.

• Full system integration of products enhances efficiency and value, with efforts to educate customers on benefits beyond standalone components.

• TAM per megawatt is rising, moving from $600,000 to $700,000 as more products and services are added.

Financial performance and margin outlook

• Data center segment EBITDA margins are expected to climb steadily as capacity ramps, with a focus on maximizing earnings growth during hypergrowth.

• Revenue guidance implies $2 billion over the next few years, with margin improvement tied to increased capacity utilization.