May 2 (Reuters) - Southern Co's ( SO ) electricity sales

to data centers and other commercial customers, as well as a

growing pool of customers in the U.S. South, helped drive a

first-quarter profit beat, company executives said on Thursday.

Electricity sales to data centers were up 12% in the first

three months of 2024, compared with the same period last year,

with about a quarter of the growth coming from new developments

versus existing centers ramping up, Southern Co ( SO ) executives said

on an earnings call.

Southern Co ( SO ), based in Atlanta, said its business was

also boosted by a fast-growing population in its territories in

Georgia and other Southern states. The company said it added

more than 13,000 residential electric customers and over 7,000

residential gas customers in the first quarter. Industrial

sales, led by lumber and paper industries, also showed some

signs of rebounding after a weak first quarter last year,

executives said.

Utilities are betting on benefiting on a boom in electricity

demand driven by data centers used for powering technologies

such as generative AI, which has led to revisions in capital

expenditure plans and demand forecasts for many utilities at the

start of the year.

Analysts, however, have questioned whether regulated

utilities will be able to cash in on some of the projected

demand, with concerns including data center businesses

developing their own power generation or withdrawing proposed

projects to chase better deals in other localities or states.

Southern Co ( SO ) executives said they have worked to

"de-risk" the company's growth outlook by excluding data center

developments that seemed particularly unlikely.

The Atlanta-based company posted adjusted profit of $1.03

per share in the quarter, compared with analysts' average

estimate of 90 cents per share, according to LSEG data.

Southern Co ( SO ), which serves 9 million customers across the

Southeast, reaffirmed its full-year adjusted profit forecast in

the range of $3.95 to $4.05 per share.

This week, Southern Co ( SO ) announced that its long-delayed

Vogtle unit 4 nuclear reactor in Georgia entered service, and

could, among other uses, serve data center demand, executives

said.