Samsung SDS and LG CNS: AI and Cloud Drive Earnings, "AX Market Outlook Bright"

LG CNS Reports 19.4% Rise in Q1 Operating Profit
AI and Cloud Businesses Account for 58% of Revenue
Expansion in AX and AI Data Center DBO Operations

Samsung SDS Also Sees Strong Cloud Growth
10 Trillion Won Investment Planned for AI Infrastructure

Following strong performances in their cloud businesses in the first quarter of this year, Samsung SDS and LG CNS have identified future growth engines in artificial intelligence (AI) businesses, including AI transformation (AX) and AI data centers (AIDC).

On April 30, LG CNS announced that its consolidated revenue for the first quarter of this year reached 1.315 trillion won, up 8.6% from the same period last year, while operating profit increased by 19.4% to 94.2 billion won, based on provisional figures. First-quarter revenue from its AI and cloud businesses rose by 6.7% to 765.4 billion won, accounting for 58% of total revenue. Smart engineering business revenue increased by 10.4% to 227.8 billion won, and digital business services revenue grew by 11.9% to 321.9 billion won.

LG CNS provides AI services across various sectors, including public sector and defense, finance, and manufacturing. The company supports enterprise AX based on agentic AI, and has recently been expanding partnerships with global cloud giants such as AWS, Microsoft, and Google Cloud, as well as big tech firms like OpenAI and Palantir, to further grow its AI business.

The company is also strengthening its data center design, build, and operate (DBO) business. Recently, LG CNS secured a contract worth over 1 trillion won for the Samsong Data Center. By introducing a new modular AI data center that can be built within six months, the company is diversifying its DBO revenue model through new business initiatives. LG CNS is also accelerating its global expansion in the AI data center business. The Indonesian AIDC project, the first overseas contract won by a Korean company, is scheduled for completion by the end of this year.

Among all its business units, the growth of the cloud segment at Samsung SDS is particularly notable. Samsung SDS provisionally reported an operating profit of 78.3 billion won for the first quarter, representing a 70.8% decline due to a one-time recognition of retirement benefit-related expenses during the period. Revenue for the same period decreased by 3.9% to 3.3529 trillion won.

Samsung SDS’s first-quarter revenue from the cloud segment reached 690.9 billion won, reflecting a 5.8% increase. Notably, the Samsung Cloud Platform (SCP)-based cloud service provider (CSP) business grew by 12%, driven by increased demand for GPU-as-a-Service (GPUaaS) in the public sector AX market and the expansion of cloud network services.

Samsung SDS plans to invest 10 trillion won by 2031 in AI infrastructure and new mergers and acquisitions (M&A). This includes 5 trillion won for AI infrastructure such as the Gumi AI data center and the National AI Computing Center, 1 trillion won to strengthen competitiveness in AX and AI services and AI platform businesses, and 4 trillion won for strategic M&A.

This content was produced with the assistance of AI translation services.