GE Vernova Inc. (GEV) delivered a tale of two metrics on Wednesday, with fourth-quarter results that showcased the company's ongoing transformation even as the headline numbers left investors wanting more.

Shares traded lower following the earnings release, a reminder that missing earnings targets tends to matter, even when the broader story looks pretty solid. Revenue came in at $10.956 billion, up 4% from $10.559 billion a year earlier and comfortably ahead of the $10.213 billion analyst estimate. The problem? Earnings per share of $2.79 fell short of the $3.18 consensus, despite diluted GAAP EPS jumping to $13.39 from $1.73.

Net income hit $3.670 billion, producing a 33.5% margin that included a massive $2.9 billion tax benefit from a U.S. valuation allowance release. Strip out the accounting wizardry, and adjusted EBITDA was $1.158 billion with a 10.6% margin.

The real story, though, lives in the order book. Fourth-quarter orders totaled $22.2 billion, up 65% organically, pushing backlog higher by $15.0 billion sequentially. That's the kind of momentum that matters when you're trying to prove your business has staying power.

Power Flexes, Wind Struggles

The segment results reveal where GE Vernova is winning and where it's still fighting headwinds. Power had a strong quarter, with revenue climbing 6% to $5.749 billion and segment EBITDA margin expanding to 16.9% from 14.9%. Orders reached $11.693 billion as the company signed 24 GW of new gas equipment contracts, converted 8 GW of existing slot reservations to firm orders, and shipped 3 GW of equipment. Gas Power equipment backlog and slot reservations jumped from 62 GW to 83 GW.

Wind, meanwhile, continues to be the problem child. Revenue dropped 24% to $2.368 billion, and segment EBITDA swung to a $225 million loss from a $19 million profit last year, with margins falling to negative 9.5%.

Electrification provided the bright spot, with revenue surging 36% to $2.960 billion and segment EBITDA margin expanding to 17.1% from 13.0%. Orders in the segment hit $7.424 billion.

Cash generation remained healthy, with operating cash flow of $2.480 billion in the quarter and free cash flow of $1.809 billion.

Full-Year Performance

For the full year, revenue rose 9% to $38.068 billion, and diluted GAAP EPS increased to $17.69 from $5.58. Net income was $4.879 billion with a 12.8% margin. Adjusted EBITDA reached $3.196 billion with an 8.4% margin.

Operating cash flow for 2025 totaled $4.987 billion, and free cash flow came in at $3.710 billion. The company ended the year with $8.848 billion in cash, cash equivalents, and restricted cash.

Full-year orders climbed 34% organically to $59.3 billion, and total backlog now stands at $150 billion—up $31.2 billion year-over-year. Management noted it grew equipment margin in backlog by $8 billion with 6 percentage points of accretion, which is finance-speak for "we're getting better prices on future business."

"We delivered strong financial performance in 2025 with continued momentum in Power and Electrification while focusing on what we can control in Wind," CEO Scott Strazik said. "We increased our backlog to $150 billion, with better equipment margins, and are entering 2026 with significant momentum."

Capital Allocation Gets Aggressive

GE Vernova returned $3.6 billion to shareholders in 2025 and repurchased roughly 1.9 million shares for $1.1 billion in the fourth quarter alone. The board raised the share repurchase authorization to $10 billion from $6 billion, signaling confidence in the stock.

The company also doubled its quarterly dividend to 50 cents per share, payable February 2, 2026. Both S&P and Fitch upgraded its investment-grade credit ratings in December, providing additional validation of the turnaround.

In M&A news, the company plans to acquire the remaining 50% stake in Prolec GE for $5.275 billion, with closing expected on February 2, 2026.

Outlook

Looking ahead, GE Vernova raised its 2026 revenue outlook to $44 billion to $45 billion and increased free cash flow guidance to $5.0 billion to $5.5 billion. The company now expects 2028 revenue to hit $56 billion, suggesting management sees plenty of runway for growth.

GEV Price Action: GE Vernova shares were down 1.04% at $685.50 during premarket trading on Wednesday.