Oracle (ORCL) received a jolt yesterday after one of its most critical partners, ChatGPT-maker OpenAI, missed revenue and user targets. However, shares of fuel cell-focused energy provider Bloom Energy (BE) rallied by more than 12% after market hours and are spiking over 20% today. How are they related?
Well, Bloom is one of the key energy partners of Oracle. And the latter recently revealed that its Project Jupiter AI data center campus in New Mexico will fully utilize up to 2.45 GW of Bloom's installed fuel cell capacity to fulfill its energy needs in the form of a microgrid.
Oracle, whose Executive Chairman Larry Ellison has developed close ties with the White House, will not want President Trump's attention on this for sure. Sounding skeptical and dismissive of hydrogen, Trump had once remarked that, "You’re going to build electric cars and you’re going to build all kinds of cars except hydrogen. There will be no hydrogen. They tend to blow up. And once they blow up, you are not recognizable anymore."
Multiple Benefits for Oracle
However, the proposition that Bloom Energy offers is too challenging to ignore. Notably, the Bloom's microgrid will reduce harmful nitrogen oxide emissions by 92% compared to gas turbines. Moreover, AI data centers are notoriously water-hungry; Bloom’s technology uses negligible amounts of water for power generation, helping Oracle meet local community environmental standards.
Further, by using a "behind-the-meter" microgrid, Oracle can bypass the increasingly congested public utility grids, which are struggling to meet the high-density power demands of AI chips.
Aside from these environmental benefits, Bloom proved to Oracle last year that it can deliver a functional and stable energy system in almost half the time of traditional upgrades. Notably, Bloom delivered an operational system to Oracle in just 55 days, significantly faster than the usual 90-day schedule or the multi-year waits often associated with traditional grid upgrades.
For these reasons and its efficient technology, Oracle had expanded its partnership with Bloom earlier this month.
Blooming Financials (With Not-So-Blooming Valuations)
Bloom Energy delivered a strong finish to 2025, reporting record revenues, a robust backlog, and solid earnings growth. In the fourth quarter, total revenue reached $777.7 million, marking a 36% increase from the same period a year earlier. The product segment, which forms the core of the business, grew 35% to $638.5 million, with the company ending the year with a substantial backlog of $20 billion.
Diluted EPS came in at $0.45, nearly unchanged from $0.43 in the prior year quarter. Still, the result comfortably surpassed the consensus estimate of $0.31 per share.
Meanwhile, net cash provided by operating activities totaled $418.1 million, a modest decrease from $484.2 million in the year-ago period, partly reflecting the impact of lower net profits on cash generation. Overall, Bloom Energy closed the quarter with a healthy cash balance of $2.45 billion.
However, despite the impressive financial performance and recent share price gains, BE stock now carries elevated valuations. The forward P/E ratio stands at 167.82 times, the forward P/S ratio at 20.68 times, and the forward P/CF multiple at 301 times. All three metrics sit well above their respective sector medians.
Overall, BE stock is up an impressive 22% in early trading today and an equally impressive 220% year-to-date (YTD).
Analyst Opinion on BE Stock
Thus, analysts remain cautiously optimistic about BE stock, assigning to it an overall rating of “Moderate Buy,” with a mean target price that has already been surpassed. Shares have recently rocketed past even the high target price of $251. Out of 25 analysts covering the stock, nine have a “Strong Buy” rating, two have a “Moderate Buy” rating, 12 analysts have a “Hold” rating, one has a “Moderate Sell” rating, and one has a “Strong Sell” rating.
On the date of publication, Pathikrit Bose did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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