Stuck at the “AI power supply bottleneck”! “Gas turbine giant” GE Vernova’s stock price hits a record high, up over 500% since the beginning of 2024

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As AI data centers push up electricity demand, gas turbines have become critical bottleneck equipment. The production capacity crisis of gas turbine manufacturer GE Vernova has evolved into a "battle for orders," with customers needing to pay non-refundable deposits four years in advance for deliveries scheduled for 2030. Gas turbine manufacturing is entering a rare boom cycle.

The company's stock hit a new high on Monday, with its cumulative increase since its spin-off from GE Aerospace at the beginning of 2024 exceeding 500%.

On Monday, Canadian power producer Maxim Power announced the signing of a sales reservation agreement with GE Vernova to "reserve a production slot for one 7HA.02 gas turbine and generator set." According to the agreement, Maxim must pay a non-refundable deposit in 2026, while the specific price of the turbine will be negotiated later.

This model of paying deposits in advance to secure slots and negotiating prices later reflects the supplier's strong position in the market.

GE Vernova CEO Scott Strazik said on January 28 that he expects the company’s backlog to reach 100 GW by the end of the year, with production capacity for 2029 and 2030 basically sold out by then.

The supply-demand imbalance is directly reflected in stock performance. GE Vernova’s stock rose 2.9% on Monday to close at $801.54, hitting a 52-week high during the session. Surging power demand has also prompted Wall Street to sharply raise its profit expectations, with analysts now expecting the company's EBITDA in 2030 to approach $17 billion, compared with about $9 billion a year ago.

Capacity Shortage: Backlogged Orders Near Production Limit

GE Vernova's capacity crunch has reached unprecedented levels. By the end of 2025, its gas power generation backlog will hit 83 GW, while this year’s annual capacity is only rising to 20 GW. By this calculation, the existing orders will fully occupy the production lines for more than the next four years.

The reservation and deposit model has been GE Vernova’s standard business practice, but the company is selling out its late-decade capacity at an unexpectedly fast pace. Going from 83 GW to the anticipated 100 GW by year-end means new orders of about 17 GW in 2026, close to the company's annual capacity.

Earlier this month, Xcel signed a "milestone strategic alliance" with GE Vernova that includes the purchase of five F-class power turbines. It’s notable that these turbines aren’t included in the 83 GW backlogged orders announced on January 28, showing that new orders continue to pour in.

AI Data Centers Drive Demand

The rapid growth in electricity demand comes from energy-hungry AI data centers. These facilities’ needs for stable, large-scale power supply are fueling a wave of expansion in traditional power infrastructure.

Gas turbines, with their ability to provide stable baseload power, have become key equipment supporting AI infrastructure. Unlike renewables, which are intermittent, gas power generation can supply electricity continuously around the clock—crucial for data center operations.

Market tightness is everywhere. Power company Maxim Power’s willingness to lock in capacity four years in advance and pay a deposit reflects producers’ concerns about future supply shortages. Customers are shifting from passively waiting to actively securing production slots.

Profit Expectations Soar

The supply-demand imbalance is turning into pricing power advantage. Higher demand may bring higher prices, boosting profitability. Wall Street's expectations for GE Vernova's profits have doubled in the past year; its EBITDA in 2030 is expected to reach about $17 billion, a substantial increase from the previous estimate of about $9 billion.

Stock performance confirms market confidence. At Monday’s close, GE Vernova rose 2.87% for the day and is up 102% over the past 12 months. The S&P 500 rose 0.5% on the same day, and the Dow Jones Industrial Average was flat.

As a dual beneficiary of energy transition and AI infrastructure construction, GE Vernova is undergoing a rare boom cycle. When customers need to pay deposits in advance for deliveries five years out, the supplier’s position in the industry chain is clear.

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