Bloom Energy shares BE rose over 6% on Wednesday after SpaceX CEO Elon Musk said power generation and cooling infrastructure, rather than semiconductor availability, were emerging as the main constraints on the expansion of artificial intelligence computing capacity.

“I think people are starting to realize the constraint on deployment of superintelligence is more in power and cooling and infrastructure than it is in chips,” Musk said on the SpaceX earnings call.

Musk said SpaceX would aim to add 20 gigawatts of power and cooling infrastructure next year to ensure electricity availability does not limit its deployment of graphics processing units (GPUs), which are widely used to train and run AI models.

He added that the “highly proprietary” plan to reach 20 GW of power and cooling by the end of 2027 would include “many different sources of power, not just gas turbines.”

Beyond renewables such as solar and wind, Musk said the company would explore “every other source of power that we can obtain.”

Bloom Energy benefits from AI power demand

Bloom Energy has emerged as a key beneficiary of the rapid expansion in artificial intelligence infrastructure, with its shares gaining more than 138% this year.

The California-based company generates electricity using solid oxide fuel cells (SOFCs), which produce power through an electrochemical process rather than conventional combustion.

The technology has attracted interest from cloud providers, AI developers and hyperscale data centre operators seeking reliable on-site electricity as power requirements increase.

Bloom has secured several high-profile customers in recent years, including Oracle, Nebius and Brookfield.

The company crossed $1 billion in quarterly revenue for the first time in the second quarter.

Revenue reached $1.065 billion, up 166% from a year earlier, while earnings per share increased to $0.78 from $0.10 in the corresponding period last year.

Bloom is scheduled to report its third-quarter results on Thursday, with investors looking for evidence that strong demand is translating into sustained revenue growth and improved profitability.

Wall Street analysts expect earnings of $0.71 per share, an increase of 373.3% from the same period last year.

Revenue is forecast at $1.07 billion, representing year-over-year growth of 106.3%.

Truist raises price target ahead of earnings

Truist expects Bloom to deliver a strong third quarter, supported by healthy year-over-year demand, continued commercial momentum and improving profitability.

The brokerage raised its price target to $240 from $218 while maintaining a Hold rating.

Truist said Bloom’s valuation already reflects much of its long-term growth opportunity.

The higher target reflects stronger near-term demand and expectations that increased equipment content per site will lift average selling prices.

The outlook suggests that investors may focus not only on headline earnings but also on the company’s ability to sustain growth and convert its expanding order pipeline into future revenue.

Oracle’s Project Jupiter in focus

One of the most closely watched developments will be any update on Project Jupiter, the data centre project being built by Oracle.

Oracle recently announced a force majeure on the project as it faces significant challenges, including issues involving the natural gas supply intended to power the facility.

Bloom has been selected as the service provider under a deal expected to be worth millions of dollars over time.

Any clarification on the project’s progress, power requirements, or potential impact on Bloom’s business could influence investor expectations for future growth.

Options markets are also signalling the possibility of sharp moves in the stock following the earnings announcement.

Barchart data shows Bloom’s implied volatility at 131%, well above its historical volatility of 83%.

The elevated reading suggests traders are positioning for a potentially large price swing as investors assess quarterly performance, project execution, and the longer-term opportunity created by rising AI-related electricity demand.

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