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11 min ago 2 min read
In its latest earnings call, industrial gas major Air Products reported a project backlog worth $9bn, much of which is bolstered by its fast-growing Electronics segment.
Of the $9bn, roughly $2.5bn sits in its core traditional industrial gas backlog, much of it tied to electronics. The remainder largely comprises longer-dated or still-developing projects such as NEOM and other large-scale investments.
“We are currently executing approximately $1bn in air separation units and hydrogen projects serving semiconductor and memory customers,” said CEO Eduardo Menezes.
The company expects to add another $1.5bn to $2bn to its backlog in the next six months, including a project with Samsung in South Korea.
“[The project] is the largest investment we have ever made in the electronics side,” said Menezes. “[And] it is probably the largest site for electronics in the world today.”
The company said its backlog is already contributing to earnings, with project execution supporting stable cash flow and margin expansion as new assets come online.
Growth in on-site volumes, particularly tied to new facilities in Asia, has been a key driver of recent performance.
Demand from semiconductor and memory customers is being underpinned by what Air Products described as a “historical super cycle” in investment to support artificial intelligence applications.
The company said it is working closely with major electronics customers on long-term supply agreements, with volumes expected to ramp significantly over the coming years.
Air Products added that it is prioritising projects that meet its return thresholds, while reviewing more complex investments.
“We have set a high bar for moving forward where we require reliable capital cost estimates and construction agreements that meet our project risk-adjusted return requirements,” said Menezes.
