GE Vernova’s Quarter Gets Blown Off Course

GE Vernova powered through another quarter of extraordinary demand, but its margin outlook tripped the breaker. The energy-equipment company reported second-quarter revenue of $11.10 billion, up 22% from a year earlier, while adjusted EBITDA surged 62% to $1.25 billion and net income increased 32% to $649 million, or $2.47 per share. Revenue topped the roughly $10.79 billion analysts expected, but adjusted EBITDA landed just below the approximately $1.28 billion consensus. Shares closed down 8.7% Wednesday at $985.03, their lowest point of the session, as investors looked past booming demand and focused on the profit miss and an annual margin target that did not move.

Demand was strong enough to make the electrical grid look undersupplied. Orders climbed 88% to $24.2 billion, lifting backlog by $13 billion sequentially to $176 billion. Power orders jumped 135% as GE Vernova signed 20 gigawatts of new gas-equipment contracts and slot reservations, taking its combined gas-equipment backlog and reservations to 116 gigawatts from 100. Power revenue increased 14% and its segment EBITDA margin improved to 18.8% from 16.4%. Electrification revenue surged 68%, or 29% organically, while its margin expanded to 18.4%. Data-center orders surpassed $5 billion during the first half, more than double the total for all of 2025, showing that AI’s growing appetite for electricity is already filling GE Vernova’s order book.

Unfortunately, the quarter’s biggest headwind came from the business designed to harness it. Wind orders fell 39% and revenue declined 10%, as soft earlier orders reduced current onshore equipment deliveries and higher offshore project costs ate into profitability. The segment’s EBITDA loss widened to $275 million from $165 million, while its margin deteriorated to negative 13.6%. GE Vernova still expects Wind to lose approximately $400 million for the full year, even though it has already lost $657 million during the first half, leaving the business dependent on a pronounced second-half recovery. Management expects it to reach roughly breakeven in the third quarter.

The company nevertheless raised its annual revenue outlook to $45.5 billion to $46.5 billion from $44.5 billion to $45.5 billion and increased its free-cash-flow forecast to $11.5 billion to $12.5 billion from $6.5 billion to $7.5 billion. Much of the cash surge comes from customer down payments — working capital contributed $6.4 billion during the quarter as buyers reserved Power capacity and ordered Electrification equipment. Those deposits validate demand and give GE Vernova more money to fund expansion, although they arrive before the company completes the underlying work. Its adjusted EBITDA margin forecast remained 12% to 14%, which still implies more profit dollars on the higher revenue base. GE Vernova’s order book may be overflowing, but Wednesday showed that even $176 billion of backlog cannot keep an unchanged margin target from blowing the stock off course.

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