GE Vernova Raises Cash-Flow Guidance as Power Backlog Swells
GE Vernova posted 88% organic order growth and lifted its 2026 free-cash-flow target to $11.5-$12.5 billion, nearly double the range it set at the start of the year.
GE Vernova (GEV) reported orders that grew 88% organically to $24.2 billion in the second quarter, extending an acceleration that has now run for three straight quarters, from 65% growth in the fourth quarter of 2025 to 71% in the first quarter of 2026. Revenue rose 22%, or 12% organically, to $11.1 billion, also building on gains of 16% and 7% organic in the prior quarter.
The energy-equipment maker's improvement is showing up in margins as much as in top-line growth. Adjusted EBITDA margin reached 11.3%, up 280 basis points from a year earlier and the fourth consecutive quarter of sequential expansion, climbing from 8.1% in the third quarter of 2025 through 10.6% and 9.6% in the two quarters that followed. Free cash flow reached $5.1 billion in the quarter, up from $0.2 billion a year earlier and $4.8 billion in the first quarter, pushing year-to-date cash generation past the company's full 2025 total of $3.7 billion.
Net income margin fell to 5.8% from 50.9% in the first quarter, but the prior period's figure had been inflated by a $4.5 billion pretax gain tied to the Prolec GE transaction that did not recur. Stripped of one-time items, underlying net income margin was still up 40 basis points from a year earlier.
Power, GE Vernova's largest segment, was the standout. Equipment backlog and slot reservation agreements grew to 116 gigawatts from 100 gigawatts in the prior quarter, and the company raised its year-end 2026 target to at least 125 gigawatts, up from the 110-gigawatt target it had set just three months earlier. Segment EBITDA margin expanded 320 basis points organically to a GAAP figure of 18.8%, the third straight quarter of gains, following a 500-basis-point improvement in the first quarter.
Electrification orders growth reaccelerated to 66% organic after two quarters of deceleration from a 102% peak in the third quarter of 2025. Segment revenue rose 68% on a GAAP basis, though 29% organically, with the acquired Prolec GE business contributing $860 million of revenue absent from the prior-year base. Electrification equipment backlog rose to $40.6 billion, up 69% from a year earlier, including $5 billion tied to Prolec GE.
Wind remained the outlier. Orders fell 40% organically after rising 85% in the first quarter, and segment EBITDA margin dropped to negative 13.6%, down 630 basis points from a year earlier and a steeper deterioration than the 50-basis-point decline the segment posted for all of 2025.
GE Vernova raised its 2026 revenue guidance to a range of $45.5 billion to $46.5 billion from $44.5 billion to $45.5 billion, and lifted its free-cash-flow guidance to $11.5 billion to $12.5 billion from $6.5 billion to $7.5 billion. Adjusted EBITDA margin guidance held at 12% to 14%. Power segment organic revenue growth guidance rose to 18% to 20% from 16% to 18%.
The company continued returning capital to shareholders, repurchasing $2.3 billion of stock in the quarter alone, bringing year-to-date buybacks to 4.3 million shares at an average price of $854, up from $1.4 billion returned through the first quarter. Cash on hand rose to $13.1 billion, up $4.3 billion since the start of the year. GE Vernova also disclosed a voluntary $0.5 billion contribution to the GE Energy Pension Plan, the monetization of its remaining China XD Electric stake for roughly $0.6 billion in pretax proceeds, and the July close of its Robotech Automation acquisition, expanding its robotics and automation capabilities.