GE Vernova Tops Q2 Expectations, Raises Outlook as Power and Electrification Segments Surge

GE Vernova (GEV), a standout among alt-energy plays tied to booming data center demand, delivered strong second-quarter earnings, comfortably beating Wall Street expectations on revenue, profit, and EBITDA. The energy company—spun out from General Electric in 2024—continued to benefit from global electrification trends, a surge in gas power orders, and robust grid infrastructure demand. While its wind segment remains a drag, GEV raised full-year guidance and reaffirmed its central role in the future of power delivery amid the AI-driven energy transition.

WATCH: Bob Elliott: Markets Are Delusional — And Credit Knows It

For Q2, GE Vernova posted revenue of $9.11 billion, ahead of the $8.80 billion consensus, and up 12% year-over-year. Adjusted EBITDA rose over 25% to $770 million, while EPS came in at $1.86, beating consensus estimates of $1.67. Free cash flow totaled $200 million. Orders rose 4% from a year ago to $12.4 billion, driving a favorable book-to-bill ratio of 1.5x in both the Power and Electrification segments—an encouraging signal for future revenue visibility.

By segment, Power was a standout, supported by 9 gigawatts of new gas equipment contracts and strong pricing trends in services. The company raised Power segment guidance, now expecting 6%–7% organic revenue growth and EBITDA margins of 14%–15%. Electrification also saw accelerating momentum, aided by a $2 billion backlog increase—especially in Europe—and higher demand for grid hardware. Segment guidance was raised to 20% organic growth with EBITDA margins in the 13%–15% range, underscoring structural tailwinds from decarbonization and AI infrastructure.

The wind segment remained the weakest link, posting a $165 million loss and guiding revenue to fall mid-single digits for the year. However, management sees a temporary boost in U.S. activity due to developers front-running the phase-out of tax credits from the July 4 “One Big Beautiful Bill” Act. Longer-term uncertainty remains, particularly around 2027–2028 deliveries, though cost reduction initiatives and investment in automation are ongoing.

The company lifted its 2025 free cash flow forecast by $1 billion to a range of $3–$3.5 billion and now expects revenue toward the high end of its $36–$37 billion guidance range. EBITDA margin is projected between 8% and 9%, with recent performance already trending above expectations. CEO Scott Strazik noted that current bookings in gas turbines effectively sell out capacity through 2028, with customers now ordering into 2029—suggesting durable demand.

Analysts probed GEV’s pricing power, capacity expansion, and wind outlook during the earnings call. Management emphasized stable pricing in electrification despite slight deceleration, while noting upward pricing momentum in gas power services. The team reiterated its 20 GW run-rate capacity target in gas, and highlighted early-stage automation initiatives aimed at factory efficiency and wind servicing.

GE Vernova continues to be a favored way for investors to express conviction in the AI-era electrification buildout. Shares, already up nearly 70% year-to-date, rose another 4% premarket following the report. With order trends solid, margins expanding, and management signaling upward revisions to long-term targets by year-end, the company appears well-positioned for sustained growth—despite turbulence in wind.

The stock’s performance reflects a broader shift in market sentiment toward energy infrastructure tied to compute, power density, and industrial resilience. “Wall Street has fallen in love with GE Vernova because of its ability to be a titan of the next generation of energy and the AI-boosted infrastructure spending boom,” said Zack’s strategist Ben Rains.

Looking ahead, key areas to watch include execution on gas turbine and grid backlog, tariff and tax policy impacts, potential automation investments, and wind segment stabilization. Management’s promise to update 2028 margin and growth targets later this year could serve as a catalyst—especially if current strength in Power and Electrification persists. For now, GEV remains a cornerstone in the evolving energy infrastructure trade.