Bloom Energy (BE +1.22%) jumped nearly 20% in Tuesday's trading session. What's going on? On Monday, the company announced an expansion of its agreement to supply power to artificial intelligence (AI) data centers run by tech giant Oracle.
Bloom makes solid oxide fuel cells that create electricity through electrochemical reactions. The company's modular energy units are extremely useful for powering new data centers because they can be deployed and installed quickly and don't require connection to traditional energy grids.
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Under the expanded agreement with Oracle, Bloom will provide up to 2.8 gigawatts of its fuel cells for Oracle facilities. One gigawatt is enough to power 750,000 households at once.
The announcement sent Bloom's share price from about $176 to more than $210 in a single trading day. The company's stock is up 143% so far in 2026 (compare that to the S&P 500 index, which has risen less than 2% this year).
Is it too late to buy the stock? Or is there an opportunity for investors?
The massive AI build-out has massive power needs
Oracle plans to spend $50 billion this year to increase cloud and AI compute capacity. It's not alone. Four other so-called "hyperscalers" -- Alphabet, Amazon, Meta Platforms, and Microsoft -- plan to spend at least $625 billion on AI infrastructure this year.
That ongoing AI infrastructure build-out is extremely positive for companies like Bloom that can deliver power sources quickly and scale them. Bloom previously delivered a fully operational power system to Oracle in 55 days, more than a month ahead of the deployment schedule.
AI data centers require massive amounts of electricity. So much so that Microsoft has contracted with power provider Constellation Energy for 20 years of electricity to run its own data centers. That power will come from Constellation's Clean Energy Center, the Pennsylvania nuclear plant formerly known as Three Mile Island.
NYSE: BE
Key Data Points
As a result, many power companies are seeing improved results. Last year, Bloom's revenue rose 37% year over year, reaching $2 billion. Analysts see that rising 56% this year to almost $3.2 billion. Earnings per share this year are expected to climb 83% to $1.39 (the company's guidance is $1.33 to $1.48 per share).
Bloom also has a healthy pipeline of business. Its product backlog is currently $6 billion, and its service backlog is $14 billion.
Bloom and many other power providers are well positioned to profit from the expansion of AI infrastructure. Savvy investors will look to invest in these pick-and-shovel firms as the build-out continues.
