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Happy Friday.

Welcome to this month’s stock deep-dive. This energy technology company is up +168% over the last year, but it still feels like nobody is talking about it.

As a reminder, this specific deep-dive is written by the GRIT team and is not the work of Head Analyst Austin Hankwitz.

Stock Deep Dive: GE Vernova Inc. (GEV-US, $127.5B)

In April 2024, GE Vernova stepped onto the stage as an independent company, spun off from General Electric with a singular mission: to electrify and decarbonize the world’s energy systems.

This debut comes at a pivotal moment.

Globally, demand for electricity is surging – the U.S. alone projects a 50% jump in power demand over the next 20 years (!!) – fueled by trends from electric vehicles to industrial electrification.

Even the rise of artificial intelligence is playing a part: energy-hungry AI data centers are popping up everywhere, adding strain to aging grids and calling for massive new power capacity.

Governments are responding with historic investments in infrastructure and clean energy (the U.S. infrastructure law devotes $65+ billion to grid upgrades, and the Inflation Reduction Act pours hundreds of billions into clean power incentives).

The world is at the onset of an electricity investment “supercycle”.

At the center of this supercycle is grid modernization – replacing and digitizing decades-old electrical infrastructure – and a rapid build-out of renewable generation.

GE Vernova emerges as a purpose-built player in this arena at exactly the right time.

• Overview 👉 What Does GE Vernova Do?

• Macro Trends 👉 Electrification, Decarbonization, and Grid Upgrades

• Product Suite 👉 Gas Turbines, Wind Turbines, Grid Technology

• AI + Energy 👉 Smart Grids, Predictive Maintenance, and the Role of GE Vernova

• How Do They Make Money? 👉 Business Model Breakdown

• By The Numbers 👉 Key Metrics

• Risks 👉 Potential Pitfalls

Overview 👉 What Does GE Vernova Do?

As a standalone entity, GE Vernova is one of the largest pure-play energy technology companies on the market, boasting approximately 75,000 employees across 100+ countries.

Its technologies help generate roughly a quarter of the world’s electricity by some estimates. With an installed base of around 7,000 gas turbines (the world’s largest fleet) and ~57,000 wind turbines producing over 120 GW, GE Vernova’s equipment is deeply embedded in global power networks. Now trading on the NYSE under ticker GEV, the company carries forward 130+ years of GE’s energy heritage – from Thomas Edison’s era to today – but with a focused mandate. The Company operates in the following segments: Power, Wind, Electrification, and Accelerators (more on these below!)

By spanning generation, transmission, and digital optimization, GE Vernova positions itself as a critical partner for utilities confronting rising electricity demand, renewable intermittency, and grid-resilience challenges—from the power plant to the plug.

Macro Trends 👉 Electrification, Decarbonization, and Grid Upgrades

Several converging macro-trends are creating a fertile landscape for GE Vernova. First, the world is entering an “electrification supercycle.” As transportation, heating, and industry swap hydrocarbons for electrons, electricity demand is set to soar—U.S. consumption alone could rise roughly 50 percent by 2045, while global generation capacity may more than double by 2040. GE Vernova already serves an addressable market estimated at $265 billion, a figure the company believes could swell to $435 billion by the end of the decade, leaving few peers as directly levered to this multi-decade build-out.

Decarbonization policies add another powerful tailwind. Government mandates and incentive packages—most notably the U.S. Inflation Reduction Act—are accelerating investment in wind, solar, storage, advanced nuclear, and carbon-capture projects. GE Vernova straddles every leg of that stool: it is one of the few non-Chinese original-equipment makers for wind turbines, leads in high-efficiency (and hydrogen-ready) gas turbines that replace coal, and partners on next-generation small modular reactors, positioning it at the heart of the low-carbon transition.

At the same time, decades-old transmission networks are straining under renewable intermittency and rising loads, driving a global push for grid modernization and resilience. The U.S. Infrastructure Law alone directs $65 billion to upgrade lines, substations, and control systems. GE Vernova’s Electrification segment—featuring HVDC links, smart substations, and its new AI-driven GridBeats software—directly targets these needs, while extreme weather and wildfire risks further underscore the urgency of hardening the grid.

A surprise catalyst has emerged in the explosive growth of hyperscale data centers that power cloud computing and artificial-intelligence workloads. Utilities are snapping up GE’s heavy-duty, hydrogen-ready gas turbines to meet this fresh demand: orders doubled in 2024 to roughly 20 gigawatts, with another 9 gigawatts in reserved slots, prompting GE Vernova to boost annual turbine output from 48 to 70–80 units by 2026.

Taken together, electrification, climate policy, grid upgrades, and AI-driven load growth provide mutually reinforcing, long-duration tailwinds. By supplying reliable generation and smart-grid hardware and software, GE Vernova is positioning itself as a crucial enabler of the “energy trilemma,” delivering power that is reliable, affordable, and sustainable for the coming electric age.

Product Suite 👉 Gas Turbines, Wind Turbines, Grid Technology

GE Vernova’s portfolio spans generation, grid hardware, software, and long-tail services, making it a one-stop shop for the energy transition.

Its Power segment leads in high-efficiency HA-class gas turbines—now hydrogen-capable—as well as steam turbines, generators, and turnkey plant engineering. Much of the profit comes from long-term service and upgrade contracts on its vast installed base, and 2024 orders for new gas units doubled (≈20 GW) as utilities sought flexible, fast-ramping capacity; the company is also advancing small modular reactors with Hitachi and integrating carbon-capture projects such as the UK’s Net Zero Teesside.

In Wind, GE dominates U.S. onshore installations with 2–5 MW platforms and owns blade maker LM Wind Power; a restructuring lifted onshore EBITDA to high single digits in 2024. Offshore remains loss-making but strategic: the 12–14 MW Haliade-X powers marquee projects like Dogger Bank, and pricing discipline plus next-gen designs aim to restore profitability as global offshore build-outs accelerate. Every turbine sale seeds decades of maintenance revenue across an installed fleet of roughly 57 000 units.

The Electrification segment supplies grid “plumbing”—transformers, switchgear, FACTS devices, and full HVDC systems—alongside digital control suites such as GridBeats, GridOS, and ADMS. These AI-driven tools create autonomous grid zones, run asset digital twins, and balance renewables, meeting soaring demand as governments pour billions into resilient, high-capacity networks. Europe and North America drove record 2024 orders and backlog.

Finally, services, consulting, and project finance underpin the model: recurring maintenance, retrofit, and software contracts represent about two-thirds of GE Vernova’s $119 billion backlog, while advisory and financing capabilities help customers fund and optimize large-scale projects. Together, these integrated offerings position GE Vernova to capture a sizeable share of the multi-trillion-dollar electrification and grid-modernization spend over coming decades—supplying the machinery, intelligence, and upkeep that keep cleaner power flowing.

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AI + Energy 👉 Smart Grids, Predictive Maintenance, and the Role of GE Vernova

GE Vernova is fusing AI with its heavy-industrial roots to create intelligent, self-optimizing energy systems. On the grid, the 2024 GridBeats suite uses machine learning to split networks into autonomous zones that reroute power around faults, while EnergyAPM pairs real-time sensor feeds with physics-based digital twins to predict transformer or breaker failures days in advance—dramatically cutting outage risk as renewables and two-way power flows add complexity.

The same predictive analytics underpin the company’s generation fleet. SmartSignal learns the vibration-and-temperature “fingerprint” of each gas or wind turbine, flagging subtle anomalies before they cascade; GE says these models have already prevented about $1.6 billion in customer losses. Because every turbine sold streams data to GE’s remote monitoring centers, each new installation enlarges the dataset, improving the algorithms and reinforcing sticky, high-margin service contracts that make up most of the firm’s backlog.

AI also boosts Vernova’s own operations: computer-vision inspections catch blade defects on the factory floor, generative design software accelerates aerodynamic tweaks, and cloud-based forecasting blends weather data with plant models so utilities know exactly when to dispatch peaker units or charge batteries. Partnerships with hyperscale cloud providers ensure these apps scale globally, while a Cambridge, MA tech hub helps recruit data scientists who once defaulted to Silicon Valley.

By doubling its AI budget for 2025, GE Vernova signals that future competitiveness rests as much on code as on turbines and transformers. Smarter grids, self-diagnosing plants, and AI-assisted engineering widen revenue streams, deepen customer lock-in, and position the company as a tech-enabled linchpin of a reliable, low-carbon power system.

How Do They Make Money? 👉 Business Model Breakdown

GE Vernova blends large-ticket equipment sales with high-margin, long-tail services. Up front, it sells gas turbines, wind turbines, hydro units, and grid hardware—sometimes as turnkey power-plant or grid-expansion contracts worth millions to billions. Margins on original equipment are slim (often low single digits) because OEMs price aggressively to secure the lucrative follow-on work; GE now rejects “bad volume” orders that don’t meet margin hurdles. The real profit engine is aftermarket: multi-year maintenance, spare-parts, monitoring, and performance-upgrade agreements that typically carry 15–30% margins and account for roughly 65% of the company’s $119 billion backlog. Each turbine sale therefore seeds two decades of recurring cash flow, making the model akin to “razor-and-blade.”

Additional income comes from project EPC work, grid and asset-performance software subscriptions (a small but fast-growing, high-gross-margin slice), and financing solutions that help customers fund equipment purchases or energy-as-a-service arrangements. Consulting fees—though modest—cement client relationships and often pull through hardware or software deals. Cost control hinges on materials, manufacturing efficiency, and smarter pricing; Lean programs, localized supply chains, and redesigned components have already lifted wind-unit margins despite lower volumes in 2024. In essence, GE Vernova’s economics revolve around lifetime value: win the hardware order, lock in decades of premium service revenue, and continually upsell digital upgrades—turning a low-margin sale into a high-margin annuity.

By The Numbers 👉 Key Metrics

Growth & Backlog: Pro-forma 2024 revenue reached $34.9B (+5% YoY) on orders of $44B, keeping book-to-bill comfortably above 1. In Q1-25, revenue accelerated to $8.0B (+11% reported, +15% organic) while orders rose to $10.2B (+8% organic). Record backlog hit $123B, with recent wins booked at richer margins—fuel for future profit expansion.

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