Gaon Cable's US Unit Invests $50M to Double AI Data Center Cable Production, Citing $200M Backlog

Gaon Cable's US subsidiary will invest $50 million to double its production capacity for high-demand AI data center power cables.

This expansion is driven by the AI boom, which has shifted the industry bottleneck from GPUs to power infrastructure like cables and transformers.

The decision is backed by strong demand, including a long-term contract worth over ₩4 trillion and an existing order backlog of approximately $200 million.

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Gaon Cable's US subsidiary, LSCUS, is investing $50 million to double its production of power cables for AI data centers, a direct response to a massive surge in demand.

This move highlights a critical shift in the AI industry. For the past few years, the biggest challenge was securing enough GPUs. Now, the bottleneck has moved to the physical infrastructure needed to power them. Data centers require enormous amounts of electricity, and the US power grid, along with components like transformers and high-capacity cables, is struggling to keep up. This is where LSCUS comes in, producing the exact components that have become so scarce.

So, what's driving this decision? It's a classic case of following guaranteed demand. First, the AI boom has led hyperscalers (like Google, Amazon, and Microsoft) to plan data center investments in the hundreds of billions of dollars. This creates a predictable, multi-year demand for power equipment. Second, LSCUS recently secured a massive five-year supply agreement with a major US tech company, valued at over ₩4 trillion. This single contract provides a strong foundation of guaranteed orders, making the expansion a calculated, low-risk investment.

Essentially, LSCUS already has customers lined up for its new capacity before the production lines are even built. The company reported a ~$200 million order backlog, and much of the new output is already reserved. By localizing production in the US, where the data center construction is happening, Gaon can better serve its key clients and navigate the supply chain shortages that are delaying many projects.

This strategic expansion, backed by confirmed orders and a clear market need, positions Gaon Cable to capitalize on the second wave of the AI revolution—the build-out of its essential power infrastructure.

Hyperscaler: Refers to a massive-scale cloud computing provider that offers services like computing and storage. Examples include Amazon Web Services (AWS), Google Cloud, and Microsoft Azure.
Bus Duct: A system used to distribute large amounts of electricity. It is an alternative to large power cables, often used in data centers for its efficiency and scalability.
CCV (Catenary Continuous Vulcanization) Line: A manufacturing process line used to produce high-quality, durable insulation for medium and high-voltage power cables.