Key Points
GE Vernova's gas turbine orders and backlog are surging due to AI-driven power demand.
Slot reservation agreements for gas turbine equipment signal robust future demand and customer commitment.
Management expects earnings to double from 2026 to 2028.
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No company typifies the change in sentiment over the clean energy transition and the surge in power demand driven by the AI application boom more than GE Vernova (NYSE: GEV). The positive changes were confirmed in the company's latest results, and it's making a strong start to 2026 with no sign of any slowdown.
GE Vernova is an under-the-radar AI stock
The stock rose 11.1% in January, according to data provided by S&P Global Market Intelligence ,and is currently up 12.9% in 2026 and more than 100% over the last year. It's a remarkable turnaround from the days when it was the problematic part of the former General Electric. At the end of the 2010s, there was a real fear that the clean energy transition would result in a structural shift to solar and wind power, leaving GE Vernova's core gas turbine equipment and services (where the real money is made) facing mediocre growth prospects.
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Fast forward a few years, and the realization that renewable energy's intermittency, soaring costs, and significant logistical difficulties (moving massive blades around, for example), combined with soaring demand for power to support AI-led data center demand, has rejuvenated the company. That much is evident in its growing gas turbine orders, measured in gigawatts (GW).
|
Power Segment |
2022 |
2023 |
2024 |
2025 |
|---|---|---|---|---|
|
Gas Turbine Orders (GW) |
9.8 |
9.5 |
20.2 |
29.8 |
Data source: GE Vernova presentations.
The surge in orders has led to a growing backlog of gas power equipment, rising from 33 GW at the end of 2024 to 40 GW at the end of 2025. However, that's only part of the story because demand for gas turbines has been so strong that customers are now willing to sign slot reservation agreements (SRAs). They are agreements whereby customers pay upfront to secure production slots for future gas turbine equipment. SRAs totalled 29 GW at the end of 2024 and grew to 43GW at the end of 2025.
Moreover, CEO Scott Strazik gave a bullish outlook for 2026 on the earnings call: "We expect to reach approximately 100 GW under contract in 2026, under the assumption we'll ship high teens in gigawatts this year, with new contracts north of 30 GW."
Image source: Getty Images.
Where next for GE Vernova
Soaring gas turbine equipment orders are one thing, but the story gets even better when considering that the massive increase in the installed base, notably heavy-duty gas turbines, will result in a step change in high-margin services revenue in the future.
The growth in the power segment is more than matched by burgeoning demand in its electrification segment, not least as new sources of energy (whether from gas turbines or renewable energy) need to be connected to the grid, utilities need to upgrade electricity infrastructure, and hyperscaler customers need switchgear and transformers to power data centers.
Finally, the third segment, the wind power business, has an opportunity to return to profitability as it winds down loss-making offshore contracts, while continuing to transition to profitable onshore wind power contracts.
A combination of these factors gives management the confidence to give implied guidance for earnings before interest, taxation, depreciation, and amortization to more than double from $5.3 billion in 2026 to $11.2 billion by 2028. That outlook is why the stock continues soaring.
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Lee Samaha has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Ge Vernova. The Motley Fool has a disclosure policy.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
