GEV Q4 Deep Dive: Strong Power and Electrification Momentum, Wind Delays Persist

Energy transition company GE Vernova (NYSE:GEV) reported Q4 CY2025 results beating Wall Street’s revenue expectations, with sales up 3.8% year on year to $10.96 billion. The company’s full-year revenue guidance of $44.5 billion at the midpoint came in 6.3% above analysts’ estimates. Its GAAP profit of $13.37 per share was significantly above analysts’ consensus estimates.

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StockStory’s Take

GE Vernova’s fourth quarter was marked by solid top-line growth, with revenue and GAAP profit both surpassing Wall Street expectations. Management pointed to robust new gas contracts and record Electrification orders as core drivers, while acknowledging challenges related to the U.S. government’s halt of offshore wind activity. CEO Scott Strazik highlighted a 25% increase in total backlog, driven by strong demand in Power and Electrification segments, and emphasized the company’s progress in expanding high-margin service agreements. However, the abrupt stop-work order on the Vineyard Wind project required the company to accrue additional costs, impacting segment profitability.

Looking ahead, GE Vernova’s updated guidance reflects expectations for accelerated growth in Power and Electrification, supported by the integration of the Prolec GE acquisition and ongoing investments in automation and production capacity. Management believes that continued pricing strength in gas turbines, expanding data center demand for grid equipment, and advancements in automation and AI will drive margin expansion over the coming years. CFO Ken Parks noted, “Our growing backlog and healthy margin provide an excellent foundation for continued improvement in our financial performance moving forward,” while cautioning that the timing of new nuclear and wind projects could introduce variability in segment results.

Key Insights from Management’s Remarks

Management attributed the quarter’s performance to strong demand and pricing in gas power and grid equipment, significant backlog growth, and the impact of external policy on wind operations.

• Gas contracts drive growth: Management reported signing 24 gigawatts of new gas power contracts in the quarter, with slot reservation agreements carrying 10–20% higher pricing than prior backlog, supporting both revenue and margin expansion.
• Electrification order momentum: The Electrification segment achieved its largest order quarter, fueled by data center demand and major grid resilience contracts in regions such as Saudi Arabia, Australia, and Germany. Over $2 billion of orders were linked to data center infrastructure, more than tripling the prior year's total.
• Backlog quality improves: The company’s equipment and services backlog in Power and Electrification reached $64 billion and $86 billion, respectively, with management emphasizing the higher-margin profile of these new orders compared to previous years.
• Wind segment pressured by policy: The U.S. government’s halt of offshore wind activities, particularly the Vineyard Wind project, led to incremental cost accruals and negatively affected wind profitability. The segment faced persistent softness in U.S. onshore orders due to permitting delays and tariff uncertainty.
• Productivity and automation investments: GE Vernova continued significant investments in factory automation, robotics, and AI, aiming to boost output and efficiency. The company added over 1,000 production workers and 200 machines in the year, preparing for a substantial increase in gas turbine output in the next few quarters.

Drivers of Future Performance

Management expects momentum in Power and Electrification to continue, with data center demand, pricing strength, and operational investments shaping next year’s performance.

• Data center and grid demand: Electrification’s growth is projected to be driven by elevated demand for grid equipment supporting data centers and grid modernization, particularly in North America and the Middle East. Management sees this segment maintaining high-teens organic growth, with additional upside from integrating Prolec GE’s transformer business.
• Margin expansion through pricing and productivity: The company anticipates continued margin improvement in Power and Electrification, supported by favorable pricing trends in gas turbines, productivity gains from automation, and scale efficiencies from ramped-up production capacity. These operational improvements are expected to offset inflation and incremental spending on AI and R&D.
• Wind recovery remains uncertain: While onshore wind services are expected to improve profitability in the second half of the year, management flagged ongoing risks from permitting delays and tariffs, as well as the potential for further revenue impact if offshore wind project work remains stalled.

Catalysts in Upcoming Quarters

In the coming quarters, the StockStory team will be watching (1) execution on expanded gas turbine production and delivery schedules, (2) the pace of Electrification’s growth in data center and grid markets including the successful integration of Prolec GE, and (3) signs of stabilization or improvement in wind segment profitability as offshore project delays are resolved. Continued progress in automation, AI-driven efficiency, and new product launches will also be critical markers for sustained margin expansion.

GE Vernova currently trades at $710.25, up from $692.70 just before the earnings. Is there an opportunity in the stock?See for yourself in our full research report (it’s free).

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