GE Vernova Falls as Outlook Collides With ‘Too High’ AI Hopes

Skip to Content News Archives Economy Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions Saved Articles My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials This advertisement has not loaded yet, but your article continues below.HomePMN BusinessGE Vernova Falls as Outlook Collides With 'Too High' AI HopesGE Vernova Inc.’s shares slid after a higher revenue outlook failed to impress investors, a sign that it’s getting harder for companies that sell equipment to data centers to meet the market’s sky-high hopes.Author of the article:Emily Forgash and Matthew Griffin You can save this article by registering for free here. Or sign-in if you have an account.(Bloomberg) — GE Vernova Inc.’s shares slid after a higher revenue outlook failed to impress investors, a sign that it’s getting harder for companies that sell equipment to data centers to meet the market’s sky-high hopes.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountThe power equipment company now expects full-year revenue of $45.5 billion to $46.5 billion, an increase of $1 billion. It left unchanged a margin forecast for adjusted earnings before interest, taxes, depreciation and amortization when it reported second-quarter earnings on Wednesday. The shares fell as much as 6.2% at the beginning of trading in New York, the biggest one-day drop in two weeks. The stock had rallied 65% this year through Tuesday, after nearly doubling last year, as a boom in artificial intelligence data centers fueled orders for GE Vernova’s natural gas turbines.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againTraders’ reaction Wednesday is consistent with a theme in chipmakers and data center equipment companies, “whereby ostensibly bullish numbers are met with stock slumps, underscoring how expectations are too high for the industry,” Vital Knowledge’s Adam Crisafulli wrote in a note.At Citi, Andrew Kaplowitz said investors’ expectations were high before the report. The “relatively modest” increase to the revenue outlook and the unchanged margin forecast could limit upside for the stock in the near term, even though the company’s orders and backlog show demand is still strong, the analyst wrote in a note to clients.Shares of natural gas turbine maker Siemens Energy AG tumbled as much as 8.9% in Frankfurt after the report.GE Vernova’s adjusted Ebitda was narrowly below what analysts expected in the second quarter. An Ebitda loss in its wind business widened to $275 million in the quarter, from a $165 million loss in the year-ago period. The Cambridge, Massachusetts-based company blamed the weakness in the wind category on lower equipment volumes for onshore wind and higher costs for offshore projects. The company won’t be bidding on new offshore wind projects, and will instead focus on servicing existing ones, Chief Executive Officer Scott Strazik said in a Wednesday interview.“We talk about controlling what we can control, and we’re positioning ourselves for a better market when that inflection point comes,” Strazik said. “We do feel the world needs more wind. We continue to invest in our wind business, but our new bidding activity is focused on onshore wind.”The company’s electrification and power segments beat some estimates, led by strength in gas turbines. The company continues to expand its gas power equipment backlog, which grew from 100 gigawatts to 116 gigawatts, with a forecast for 125 gigawatts by the end of the year. GE Vernova will also expand its business in Venezuela as soon as this year, Strazik said, after the company and Venezuela’s electricity utility Corpoelec signed an agreement last month to ramp up work to strengthen the country’s grid.This advertisement has not loaded yet.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.