HD Korea Shipbuilding is weighing HiMSEN engine capacity expansion as AI data center power demand rises, while second-quarter earnings and orders underscore strong momentum across shipbuilding and engines.
HD Hyundai Heavy Industries posted its first quarterly operating profit above 1 trillion won as an independent company since the launch of HD Korea Shipbuilding & Offshore Engineering, while the parent group said it is reviewing an expansion of HiMSEN medium-speed engine production to capture rising power demand from AI and data centers. HD Korea Shipbuilding said current annual HiMSEN capacity is about 3 gigawatts and that expansion is clearly necessary based on orders and customer inquiries, with output to be increased sequentially as market conditions and orders evolve. The push comes as bottlenecks in global gas turbine supply have increased interest in medium-speed engines that can start quickly and run continuously. In April, HD Hyundai Heavy Industries signed a contract to supply 33 units of 20-megawatt HiMSEN engines for data center power to U.S. energy infrastructure developer Aperion Energy Group. The dual-fuel engines can use diesel and liquefied natural gas. The company is also advancing offshore data centers as a future business, initially using HiMSEN engines as the main power source and later aiming for a carbon-free model combining offshore wind and small modular reactors. Lee Tae-won, Senior Vice President of Offshore Energy Sales at HD Hyundai Heavy Industries, said the company is in detailed discussions with several companies on offshore data centers and is working toward tangible results. In the SMR business, HD Hyundai Heavy Industries signed a memorandum of understanding with TerraPower in May for the fabrication and supply of core SMR reactor equipment, securing preferred bidder status. The strategic push is backed by strong earnings. HD Korea Shipbuilding reported second-quarter consolidated revenue of 8.93 trillion won and operating profit of 1.65 trillion won, up 20.2% and 72.5% from a year earlier, while HD Hyundai Heavy Industries posted revenue of 6.33 trillion won and operating profit of 1.04 trillion won, up 52.7% and 120.6%. Engine and machinery profit at the parent rose 33.6% to 268.6 billion won, helped by sales of dual-fuel engines and land-based power-generation HiMSEN engines. First-half shipbuilding orders at group affiliates reached $16.38 billion, or 96.2% of the annual target, and the company said it will keep a selective ordering strategy focused on high-value gas carriers.