GE Vernova CEO Scott Strzyk said he has had numerous discussions with OpenAI CEO Sam Altman over the past few weeks as power shortages continue to be a challenge and opportunity for hypescalers.
“I’ve met with Sam a number of times over the past few weeks, and our relationship continues to evolve,” Strzyk told CNBC in a phone interview Wednesday after the company’s third-quarter earnings release. “I have spent the past 72 hours with his team, and it is clear that OpenAI is a key part of this growth trajectory with great ambitions.”
Strzyk said the talks focused on OpenAI’s power needs, “both the generation of electricity and the electrical equipment needed to do so.”
GE Vernova shares fell about 6% on Wednesday. The company’s third-quarter results exceeded expectations, helped by a 55% increase in power equipment orders. However, the company did not raise its 2025 outlook, disappointing some investors. Onshore wind power also remained weak, but analysts said this was about as expected given continued regulatory hurdles.
Melius Research analyst Rob Wertheimer told CNBC there was nothing negative in the report.
“The bar was set high,” he said, noting that GE Bellnova’s stock has doubled in the past year.
Wall Street remains optimistic that GE Vernova will capitalize on rising demand from big technology companies. According to LSEG, the average analyst price target is $658, about 20% higher than the current share price.
GE Vernova stock price from the beginning of the year to the present
The company will soon launch OpenAI, oracle, Nvidia, googleXAI, according to a person familiar with the matter.
Strazik said orders for electrical equipment from hyperscalers have totaled $900 million since the beginning of the year, with orders for all of 2024 at $600 million.
“If you add in the fourth quarter orders, our electrical equipment orders will be double those (hyperscalers),” Strzyk said.
Analysts say some of the key challenges currently facing GE Bellnova are capacity constraints, evolving pricing policies and regulations that are slowing orders for onshore wind turbines.
Most of GE Vernova’s generation capacity will be sold out by 2028, Strzyk said.
The company expects to spend between $300 million and $400 million in tariff-related costs this year. Strazik is expected to provide more detailed forward-looking numbers at the company’s investor day in early November.
The company also has $8 billion in cash and no debt, which means it’s on the lookout for opportunities, Strzyk said.
GE Vernova announced Tuesday that it will buy the 50% it doesn’t already own in transformer maker Prorec GE for more than $5 billion. Transformers are the key to increasing power supply voltage to accelerate power transport.
