GE Vernova — 2026Q3 earnings
reported 2026-07-22
EPS $2.47 vs $3.18 est — miss
next session +4.7% (close 2026-07-22 → 2026-07-23)
Source
8-K filing ↗Summary
GE Vernova's June quarter reads less like a results print than like a forward-contracting update. Orders of $24.2 billion (+88% organically) and a backlog of $176 billion are the operative facts; revenue and margin are the lagging consequence of an order book already signed years forward. The cash figure is the one to read carefully — $5.1 billion of free cash flow came primarily from a $6.4 billion working-capital benefit funded by down payments on gas slot reservations, which is why management raised full-year free cash flow to $11.5-$12.5 billion and in the same breath warned that the first half will be substantially higher than the second. Guidance moved on revenue and cash but not on the 12%-14% adjusted EBITDA margin band. For the AI supply chain specifically, the salient number is $2.7 billion of Electrification data center orders in the quarter, over $5 billion for the half and more than double full-year ’25, with the solid-state-transformer and MV-UPS scope still ahead of the order book. Wind remains the offsetting drag, with orders down (40)% organically.
Earnings call
Earnings call webcast ↗Review
From the report
The order book and the cash statement, not the income statement, carried this quarter: orders of $24.2 billion grew +88% organically, free cash flow of $5.1 billion came in $4.9 billion above last year, and GE Vernova raised both its revenue and free-cash-flow guidance while leaving the adjusted EBITDA margin band untouched. Gas Power gigawatts under contract stepped from 100 to 116 with a year-end target of at least 125. Wind was the one segment moving the other way.
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Demand, not deliveries, is the story of the quarter — orders grew +88% organically to $24.2 billion, with equipment strength in Power and Electrification and services growth in every segment. show quote
“In the quarter, orders of $24.2 billion increased +88% organically, with robust equipment growth in Power and Electrification, and services growth in all segments.”
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The gas franchise is being sold years forward: contracted gigawatts (backlog plus slot reservation agreements) moved from 100 to 116 GW in the quarter, and the company now points at a minimum of 125 GW by the end of 2026. show quote
“Gas Power equipment backlog and slot reservation agreements grew from 100 to 116 GW; now anticipate reaching at least 125 GW by year-end 2026”
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Free cash flow of $5.1 billion was up $4.9 billion year over year, and the company names working capital ahead of earnings as its driver — so read the cash line as order-funded, not purely profit-funded. show quote
“Free cash flow* of $5.1 billion increased $4.9 billion, primarily due to higher positive benefits from working capital and stronger adjusted EBITDA*.”
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The guidance raise is lopsided by design: revenue and free cash flow both moved up — the free-cash-flow range lifting from $6.5-$7.5 billion to $11.5-$12.5 billion — while the adjusted EBITDA margin band of 12%-14% was left exactly where it was. show quote
“GE Vernova is raising its 2026 financial guidance and now expects revenue of $45.5-$46.5 billion, up from $44.5-$45.5 billion, and free cash flow* of $11.5-$12.5 billion, up from $6.5-$7.5 billion; adjusted EBITDA margin* guidance remains 12%-14%.”
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Wind is the counterweight to an otherwise accelerating company: orders fell (40)% organically and revenue (10)%, traced back to soft Onshore orders a year earlier rather than to anything that happened this quarter. show quote
“Orders of $1.2 billion decreased (40)% organically due to lower equipment at Onshore Wind. Revenues of $2.0 billion decreased (10)%, (11)% organically*, primarily driven by equipment at Onshore Wind as a result of soft orders in the first half of 2025.”
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From the call
Management's framing was capacity plus contracting: a $176 billion backlog on a path to $200 billion in 2027, gas output stepping to 30 gigawatts a year in ’30 inside the existing factory footprint, and Electrification's data center orders already over $5 billion for the half. The CFO supplied the counterweight — the quarter's cash came from a $6.4 billion working-capital benefit built on order down payments, and first-half free cash flow will be substantially higher than the second half.
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Strazik anchored the whole thesis on backlog rather than the quarter, putting it at $176 billion and on a track to $200 billion in 2027. show quote
“Our total backlog has reached $176 billion with improving margins. This is up $13 billion from last quarter and is on track to reach $200 billion in 2027.”
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The new capacity number is 30 gigawatts of annual gas output in ’30 — and management stressed it comes from lean and incremental machinery inside the existing factory footprint, funded by customer down payments, not from new plants. show quote
“In Gas Power, given that we’ve now reached our 20-gigawatt annualized run rate and are on track for 24 gigawatts in ’28, we now see further opportunity to serve this growing demand with 30 gigawatts of annual output in ’30 in a capital-efficient manner, utilizing lean and incremental machinery in our existing factory footprint, and have already secured significant supply chain capacity, all funded by customer down payments.”
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Parks made the mechanics of the cash quarter explicit: a $6.4 billion working-capital benefit, driven by down payments on orders and slot reservations, is what produced the $5.1 billion of free cash flow. show quote
“The strong adjusted EBITDA and working capital management drove $5.1 billion of free cash flow in the second quarter. Working capital was a $6.4 billion cash benefit, driven primarily by higher down payments on increased orders and slot reservations at Power, as well as higher orders at Electrification.”
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The caveat that keeps the cash beat honest — the CFO told investors not to annualize it, because the year's free cash flow is front-loaded as slot reservations convert into orders. show quote
“As a result, and as our guidance implies, we expect our free cash flow in the first half of the year to be substantially higher than the second half, as many of these slot reservations convert to orders.”
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The AI-datacenter pull is now large enough to size directly: $2.7 billion of data center orders in Electrification in the quarter, taking the half to over $5 billion — more than double full-year ’25. show quote
“In 2Q, we booked $2.7 billion of data center orders in Electrification, bringing total segment data center orders to over $5 billion in the first half of 2026, more than double full-year ’25.”
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as of 2026-08-30