OVHcloud launches new unit to meet demand from European militaries

By Leo Marchandon

April 9 (Reuters) - ‌France's OVHcloud is ​creating ​a dedicated defence unit after several European defence ministries approached it to support their military digital transformation, the datacentre operator said ‌on Thursday.

Their needs include AI-augmented command, drone orchestration and communication interoperability ⁠across armed forces alongside strict requirements on technological independence from non-European providers, OVH said ‌in a half-year earnings statement.

OVH, ‌Europe's leading native cloud provider, has long positioned strategic autonomy as a differentiator against U.S. peers and has been pushing for a pan-European cloud ​and artificial intelligence strategy.

The company reported 5.5% organic revenue growth to 555 million euros ($648 million) in the six months through February, driven by ⁠increased spending among its existing clients. It also confirmed the annual guidance for organic revenue growth of ​between 5% and 7%.

Half-year earnings before interest, taxes, depreciation and amortization grew 8.3% organically to 227 million euros.

OVH has purposely ​stockpiled hardware to shield itself from rising ‌global costs, which drove first-half capital spending to 43% of revenue, from 33% a year earlier, finance chief Stéphanie Besnier ⁠told analysts. This strategy is expected to bring 25 million euros in savings over the full year, she added.

The company has also locked in 50 million euros ⁠worth of memory components for 2027 that will be paid for by "dedicated exceptional financing" and ​counted as levered cash flow in this year's accounting, it said.

OVH has already passed price increases on to some customers, effective April 1, CEO Octave Klaba said. It ‌is not raising prices across the board, focusing instead on new customers and products where demand is less sensitive ‌to pricing, he added.

"We will continue to monitor the evolution of the price ⁠to be ready to react and ‌to engage in potential ​new price increases if needed," Klaba said during the conference call.

($1 = 0.8570 euros)

(Reporting by Leo Marchandon in Gdansk, editing by ‌Milla Nissi-Prussak)

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