[Edaily Reporter Shin Yeong-bin ] LG CNS (#LGCNES) is expanding its robot learning and operation platform, “PhysicalWorks,” to the group’s manufacturing sites and plans to drive full-scale growth in its Robot Transformation (RX) business starting next year. In its AI infrastructure business, the company will use its Jakarta data center as a springboard for overseas expansion and pursue entry into the North American and European markets.

Lee Jun-ho, Executive Vice President and Head of the Smart Logistics & City Business Division at LG Corp., stated during the third-quarter earnings conference call held on the 30th, “We expect the RX business to grow rapidly starting in 2027, centered on securing the infrastructure for on-site robot deployment and the training and operation data platform business, which will enable the full-scale utilization of Physical AI across various industrial sectors.”

LG CNS’s third-quarter operating profit this year was 138.2 billion won, and revenue was 1.6643 trillion won, representing year-over-year increases of 15.0% and 9.3%, respectively. Growth was driven by AI and cloud services, as well as projects to build next-generation financial systems.

Executive Vice President Lee explained that the company has introduced PhysicalWorks to LGELECTRONICS’ Data Factory to provide the functions and systems necessary for robot training. While supporting pre-training for robots, the company is also jointly developing robot-based business initiatives with LGELECTRONICS and advancing autonomous factory projects with manufacturing affiliates.

He said, “We plan to continue expanding PhysicalWorks as the Group’s standard platform for physical AI training and operations, applying it not only to domestic factories but also to overseas sites.”

The robotics business is focused on converting proof-of-concept (PoC) projects into actual contracts. Executive Vice President Lee stated, “We are expanding our win rate for full-scale projects through PoCs at logistics and manufacturing sites,” adding, “We are currently engaged in commercialization discussions with internal and external clients to broaden the scope of our robotics business to include patrol, hospitality, and safety applications.”

PhysicalWorks is strengthening its capabilities to connect robots from different manufacturers and of various types and to manage their operations. Through this, the company plans to support the adoption of robots by customers in the manufacturing, distribution, and defense sectors, while also advancing its subscription-based software-as-a-service (SaaS) business model.

The company also intends to cultivate the facility management sector as a separate growth business. Building on its experience operating patrol, cargo-handling, and barista robot services at the Busan Smart City pilot complex, the company plans to expand its scope of application to factories, industrial complexes, and data centers. Executive Vice President Lee said, “We also plan to develop additional solutions for special-purpose buildings, such as data centers, and foster them as independent growth businesses.”

Regarding the growth timeline for the smart engineering business, he explained, “While this year is focused on laying the groundwork for growth, starting next year, we expect to see tangible results from external and global operations, leading to growth in both business scale and profitability within the next two to three years.” In particular, he forecasted that business opportunities for logistics automation and production operation solutions would increase in the defense and shipbuilding sectors, where automation levels are relatively low.

In the data center business, the company has finalized its overseas expansion plans. Yoo Ki-woong, Senior Vice President in charge of the Cloud Infrastructure Business, stated, “The Jakarta data center is scheduled for completion in early November, and we have secured tenants for the entire facility prior to completion, thereby establishing a stable revenue base from the outset of operations.”

Follow-up projects will be pursued in three directions: additional construction in Indonesia, expansion into the Asia-Pacific market, and entry into North America and Europe. The company plans to reduce construction time and respond to customer demand by utilizing prefabricated modular data centers, in which modules are manufactured in advance at a factory and assembled on-site.

Executive Vice President Yoo said, “We are pursuing collaboration with our U.S. subsidiary and local partners,” adding, “Based on our capabilities in prefabricated modular data centers powered by NVIDIA’s Vera Rubin and our supply chain, we plan to begin full-scale expansion into the North American and European markets.”

The GPU-as-a-Service (GPUaaS) business, which involves leasing GPUs, will be expanded in phases as demand and the potential for return on investment are confirmed. Last September, LG Corp. decided to invest 381.4 billion won to secure GPUs and related equipment.

Song Gwang-yoon, Executive Vice President and Chief Financial Officer (CFO), stated, “Given that GPU infrastructure requires significant initial investment and technology evolves rapidly, we plan to proceed cautiously, focusing on projects with proven business viability after comprehensively considering customer demand, contract terms, and the potential for return on investment.” He explained that the company may also consider joint investments with financial institutions or business partners should large-scale investment opportunities arise.

The company views the AI business in the financial sector as a factor driving increased demand for the construction of existing systems. Kim Hong-geun, Executive Vice President and Head of the Digital Business Division, said, “We currently view AI investment as having a greater effect in supplementing and enhancing existing system integration (SI) rather than replacing it.”

He explained that there is a growing trend of major banks commissioning Agent AI agents as separate projects or adding Agent AI functions to ongoing system development projects. Insurance companies are also pushing forward with initiatives such as the automatic generation of policy proposals, task support based on policy terms and operational documents, and the transition to agent-based processes for insurance claim review and calculation.

However, Vice President Kim noted, “Across the financial sector as a whole, there are still many projects focused on proof of concept and pilot testing,” adding, “Since these projects are still in the early stages in terms of scale and profitability, it is difficult to directly compare them with existing large-scale SI projects.”

In the digital assets business, the company is securing the technology and partnership foundations necessary to prepare for the implementation of relevant regulations. It has signed business agreements with five global companies and foundations, including Circle, Securitize, the Canton Foundation, Chainalysis, and Chainlink. Vice President Kim said, “Based on this, we plan to support financial institutions so they can launch services as soon as the regulations take effect.”

The company forecasts continued annual growth, driven primarily by its AI, cloud, and financial services businesses. Executive Director Song stated, “We expect this year’s annual revenue to grow at a high single-digit rate compared to last year,” adding, “We will focus on maintaining a stable operating profit margin by continuing to prioritize profitability-driven business operations and cost efficiency.”