GE Vernova reports $176 billion equipment backlog and 22% year-over-year revenue growth in power generation

GE Vernova delivered a paradoxical second quarter: strong operational performance undermined by profit misses that triggered an immediate 9% stock selloff.

Revenue climbed 22% year-over-year to $11.1 billion, comfortably beating analyst expectations of $10.8 billion and signaling robust demand across the company's core energy businesses. The company's backlog expanded by $13 billion during the quarter, reaching a record $176 billion and reflecting sustained customer commitments well into the coming years.

Yet profitability disappointed on multiple fronts. Adjusted earnings per share of $2.47 fell well short of the $3.18 analysts had projected. Quarterly EBITDA of $1.25 billion also missed analyst projections of $1.28 billion, adding to investor frustration that operational strength had not translated to expected bottom-line performance.

GE Vernova's wind-power division compounded the concern. The division's negative EBITDA widened to a loss of $275 million, accompanied by a 10% revenue decline and a steep 39% drop in orders. Management further unsettled investors by warning that tariffs could add $100 million to $200 million to full-year costs.

The company raised its full-year revenue guidance to $44.5 billion to $45.5 billion, though the adjustment represented a tightening from the prior range of $45.5 billion to $46.5 billion rather than a dramatic upgrade. Valuation concerns were evident heading into the release: GEV shares traded at roughly 35 times this year's projected earnings of $30.76 per share, leaving little room for any shortfall without triggering a sell reaction.

The natural gas power turbine business remains the company's most dynamic growth engine, driven by artificial intelligence data center operators increasingly seeking to generate their own power rather than rely solely on utility grids. PwC expects United States data-center-driven demand for natural gas to more than quintuple between 2025 and 2035, positioning GE Vernova's turbine division as a direct and significant beneficiary of this trajectory.

Much of the post-earnings decline has since been reclaimed. Analysts maintain a 12-month consensus price target of $1,238.78, representing more than 20% upside from current levels, with the majority of the analyst community rating GEV as a strong buy.