GE Vernova (GEV): Strong Demand, Weaker Earnings
GE Vernova delivered another quarter driven by heavy demand for power generation and AI infrastructure. The stock came in with a high bar. It was up more than 50% year to date and more than 90% year over year. On the day of the report it pulled back, even though it beat on one metric and demand stayed strong.
Revenue climbed 22% to more than $11 billion, a beat. Earnings missed: EPS came in at $2.47 per share against the $3.13 the market expected. The company raised its full-year revenue and free cash flow guidance for the second quarter in a row. Orders surged 88% organically. Backlog hit a record $176 billion. It now expects 2026 revenue between $45.5 billion and $46.5 billion, roughly a billion higher than its prior outlook. It sharply raised its free cash flow forecast to $11 to $12 billion, up from a previous $6.5 to $7.5 billion.
Power and electrification carried the quarter, generating more than $1 billion in core profit, up more than 31% year over year. Electrification nearly doubled. Management points to accelerating electric demand from AI compute, data centers, grid upgrades, and broader electrification.
Wind was the weak spot, as expected. Revenue in that division fell about 10%. Tariffs are a real headwind. Management now expects global tariffs to add $100 to $200 million in costs next year, with some cost mitigation and cost recovery efforts underway.
CoreWeave (CRWV): Upgraded Despite a Lower Target
Truist upgraded CoreWeave to buy from hold while trimming its price target to $126. That target still implies more than 50% upside from the prior day's close. The reasoning: demand for AI compute should keep rising as companies move toward open models and sovereign AI.
The stock had fallen over the past three months and sat about 50% below its 52-week high. Investors worried about CoreWeave's debt load. Another headwind was Meta's plan to sell excess AI compute capacity, which raised fears about CoreWeave's position. Truist argues the sell-off went too far. It sees AI demand broadening, a compelling valuation after the pullback, and room for margins to improve. Shares rose almost 3.5% in early trading.
Rocket Lab (RKLB): $266 Million Defense Contract
Rocket Lab climbed more than 3% after winning a $266 million Department of Defense contract. The deal covers a dozen suborbital rocket launches, with an option for six more if exercised. The missions launch from Alaska and run through the end of 2028.
Suborbital launches travel briefly into space before returning to Earth. They test hypersonic technologies, missile defense systems, and other military efforts. These are high-speed test flights. The win shows Rocket Lab expanding beyond commercial satellites. The stock had been a strong performer this year before pulling back nearly 52 to 53% from its highs.
