[Edaily Reporter Shin Yeong-bin ] LG CNS (#LGCNES) is set to fully launch its Physical AI business, starting with the construction of a “Robot Data Factory” for LGELECTRONICS(066570). The company plans to secure proof-of-concept (PoC) projects and reference cases in manufacturing and logistics sites this year, and expand the supply of its robot platform and AI infrastructure to customers outside the LG Group starting next year.

During its second-quarter 2026 earnings conference call on the 31st, LG CNS announced that it will build the “Robot Data Factory”—Korea’s first large-scale intelligent robot training infrastructure—in collaboration with LGELECTRONICS. LG CNS plans to supply its proprietary Physical AI platform, “PhysicalWorks,” and GPU-based AI infrastructure.

LG Corp. plans to supply its proprietary physical AI platform, “PhysicalWorks,” and graphics processing unit (GPU)-based AI infrastructure.

The Robot Data Factory is an infrastructure that collects and processes the video and motion data necessary for real robots to learn tasks, and uses this data to train AI models. LG Corp. plans to expand its business scope from building AI infrastructure and platforms for robot training to on-site system integration and operations.

Shin Jae-hoon, Senior Vice President of the Smart Factory Business Division at LG CNS, said, “Securing AI infrastructure, including GPUs, is essential for introducing Physical AI into industrial settings,” adding, “We will use the LGELECTRONICS Robot Data Factory as a flagship case study to expand our business into various industries, such as manufacturing and logistics.”

Field Validation with LGELECTRONICS and Kurly… Expansion of Robot Conversion Business Next Year

The company is also conducting technical validation in logistics settings. LG Corp. has completed its first Proof of Concept (PoC) at the Kurly logistics center and plans to launch a follow-up project by year-end to enhance functionality and expand the scope of application.

The company is also accumulating field experience by conducting projects related to logistics automation at its research institute and autonomous mobile robots (AMRs) designed to navigate narrow aisles.

LG Corp. plans to secure best practices and project execution capabilities through PoCs and field validation by the end of this year, and then begin a full-scale expansion of its Robot Transformation (RX) business starting next year, focusing on manufacturing and logistics customers. The company is also pursuing projects to build an intelligent robot learning system, including a robot data factory.

Executive Vice President Shin stated, “This year, we will focus on securing best practices and project execution capabilities through PoCs and field validation,” adding, “Based on this, we will expand our RX business starting next year, focusing on manufacturing and logistics clients.”

The company is also accelerating the overseas expansion of its smart factory business. LG Corp. assessed that the domestic smart factory market has moved beyond the stage of collecting and visualizing data and has entered a mature phase where AI is used to optimize production.

The company has designated North America as its top priority region and is laying the groundwork for market entry by participating in local trade shows and collaborating with global technology firms. In Southeast Asia, LG Corp. is expanding its factory operations and control services based on its production hubs, while in the Middle East, it is pursuing analytics and automation projects centered on the energy industry.

With the spread of AI driving increased demand for power infrastructure and batteries, the company forecasts growing demand for the transformation of new North American factories and rechargeable battery production facilities into AI factories.

Executive Vice President Shin explained, “Investments in smart factories and robots are not merely short-term expansions of production capacity, but strategic investments to address rising labor costs, labor shortages, and stricter quality and safety standards,” adding, “A company’s competitiveness will hinge on how effectively it applies the physical layer and agentic AI to manufacturing sites.”

GPU Subscriptions and AI Cost Management… Advancing AI and Cloud Businesses

The AI and cloud businesses also continued their growth momentum. LG CNS’s second-quarter revenue from its AI and cloud businesses reached 906 billion won, a 3.9% increase compared to the same period last year. Revenue growth was driven by demand for AI platforms, data infrastructure projects, cloud managed services (MSP), and GPU infrastructure deployment and maintenance.

LG Corp. plans to launch “XpuWorks,” a subscription-based service providing AI computing resources, enabling customers to use AI infrastructure—such as GPUs—on an as-needed basis without requiring large upfront investments.

The company is also accelerating efforts to acquire new customers and enhance the capabilities of “AgenticWorks,” its agentic AI platform launched in the first quarter, during the second half of the year.

As AI adoption spreads among enterprises, the company also views businesses focused on optimizing usage and costs as a new opportunity. Agentik Works provides a dashboard that allows organizations and users to monitor the usage and costs of AI services such as ChatGPT, Claude, and Gemini.

The company is also enhancing its intelligent routing feature, which manages both performance and costs by connecting the appropriate AI models based on task characteristics and security requirements.

Regarding the improving performance of Chinese large language models (LLMs), the company forecasts that rather than migrating an entire corporate system to a single model, the practice of combining multiple models based on specific use cases will become more widespread. This approach involves using cost-effective models for high-volume tasks such as customer service, search, and document processing, while applying high-performance frontier models for complex inference and critical decision-making.

Jin Yo-han, Executive Vice President and Head of the AI Center at LG Corp., said, “In the future, it will become standard practice to optimally deploy U.S. frontier models, Chinese lightweight models, and domestic on-premises models according to the characteristics of each task.”

Growth in

Next-Generation Financial Systems and Data Centers… Expectations for Improved Second-Half Earnings

The next-generation financial systems business is expected to make a significant contribution to revenue starting in the second half of the year. The next-generation systems for MIRAE ASSET Life Insurance CO., Ltd. and Shinhan Investment & Securities, for which orders were secured last year, have entered full-scale development this year, and projects with NH Nonghyup Bank and KB Kookmin Bank, which began this year, are also expected to be reflected in revenue sequentially.

LG CNS anticipates that its contribution to revenue will increase as the second half of the year progresses, since revenue from next-generation financial projects is typically recognized in earnest approximately six months after project commencement; next year, revenue contributions are expected to grow even further as project progress accelerates. The company plans to secure a base for recurring revenue by linking operations and maintenance following the implementation of next-generation systems with its AI platform and Agent AI businesses.

In the data center design, build, and operations (DBO) business, the company is pursuing expansion that exceeds the market growth rate. LG CNS forecasts that the global data center market will grow at an average annual rate of approximately 9%, while the Asia-Pacific and domestic markets will grow by 15–20%. Building on its experience in proactively introducing the DBO model in Korea in 2019, the company plans to target demand for hyperscale data centers.

LG CNS’s second-quarter consolidated revenue totaled 1.5208 trillion won, a 4.2% increase year-over-year. Operating profit decreased by 9.2% to 127.9 billion won. This was due to increased investments in a new AI platform, physical AI R&D, and the recruitment of key talent, as well as the postponement of contract schedules for some affiliate projects to the second half of the year.

Song Kwang-yoon, Chief Financial Officer (CFO) of LG CNS, stated, “The decline in operating profit is not due to structural issues resulting from weakened business competitiveness, but rather stems from proactive investments for future growth and the impact of temporary project schedule adjustments.” He added, “We expect these deferred projects to contribute to improved performance once they proceed in full swing in the second half of the year.”