GE Vernova Resumes Offshore Wind Turbine Installations

Investing.com — GE Vernova LLC (NYSE:GEV) announced on Tuesday that it has resumed turbine installations at two offshore wind farms that faced equipment failures earlier this year. However, CEO Scott Strazik expressed caution about the obstacles facing the offshore wind sector.

During an investor presentation in New York, Strazik mentioned that the company is not accepting new orders for offshore wind turbines and anticipates ongoing losses in its wind division by 2025.

> "We aren't going to chase bad deals," he underscored, pointing out that onshore wind is also expected to see limited growth over the next three years.

GE Vernova shares declined over 2% in premarket trading on Wednesday, while Siemens Energy AG (ETR:ENR1n) saw a loss of more than 1% in European trading.

The wind division has encountered significant financial hurdles in 2023, with delays at major offshore projects in the US and the UK attributed to turbine-related incidents. These complications have resulted in substantial losses amounting to hundreds of millions of dollars.

Since becoming an independent company after General Electric (NYSE:GE)'s three-way split earlier this year, GE Vernova has been focusing on cost-cutting and enhancing profitability, as noted by Strazik.

The company forecasts a mid-single-digit revenue decline for 2025, compared to flat revenue expectations for 2024, as stated in a release prior to the New York investor meeting.

Despite the challenges in its wind segment, GE Vernova has experienced strong demand for its gas turbines and electrical grid equipment, spurred by the increasing energy requirements of data centers.

> "I can't think of a time that the gas business has had more fun than they're having right now," remarked Strazik.

The company expects gas equipment orders to reach 20 gigawatts this year, up from 11 GW in 2022. By 2027, GE Vernova plans to increase production to 80 gas turbines annually, compared to 55 currently in operation.

For next year, GE Vernova projects revenue between $36 billion and $37 billion, surpassing the $34 billion to $35 billion forecast for 2024. Additionally, free cash flow is anticipated to rise to $2 billion to $2.5 billion in 2025, up from the projected $1.3 billion to $1.7 billion for this year.