Bloom Energy Shares Face Pullback After Stellar Rally

Bloom Energy's stock is experiencing a period of correction following an extraordinary surge of more than 300% this year. Trading closed at €93.65 on Tuesday, marking a significant retreat from its November peak of €123.56. This pronounced volatility in the fuel cell manufacturer's equity raises questions about the underlying market forces.

With a current market capitalization of approximately $25.9 billion set against annual revenue of $1.8 billion, the company's valuation appears ambitious. While gross margins are nearing 30%, net profitability remains modest, prompting scrutiny over the sustainability of its share price. The recent weakness also mirrors broader sector anxieties. Competitors such as Plug Power are grappling with margin challenges, which has dampened sentiment across the entire fuel cell industry. Following such a steep ascent, it is likely that many investors are now securing profits.

Analyst perspectives are divided. Of 28 tracked assessments, 46% recommend a 'Buy', 39% advise 'Hold', and 14% suggest 'Sell'. The stock's high volatility, indicated by a beta of 3.0, further amplifies its movements during broader market fluctuations.

Strategic Partnership Fuels Initial Optimism

The primary catalyst for this year's dramatic price appreciation was a strategic agreement with infrastructure giant Brookfield Asset Management. Announced in October 2025, the $5 billion deal positions Bloom Energy as a key power provider for AI data centers.

Should investors sell immediately? Or is it worth buying Bloom Energy?

The rationale is clear: hyperscalers and colocation providers require rapidly deployable electricity capacity for their energy-intensive AI infrastructure, a demand that conventional grid connections often struggle to meet. Bloom Energy's solid oxide fuel cells offer a scalable on-site solution, representing a critical competitive edge.

Production Ramp-Up and Strong Financials

In response to escalating demand, the company has initiated an ambitious expansion program. It aims to double its annual production capacity to two gigawatts by December 2026. Currently, around 1.5 gigawatts of its fuel cell systems are operational globally across more than 1,200 installations.

The company's operational momentum was evident in its third-quarter 2025 results, which showed:

• Revenue of $519 million, a 57% increase year-over-year.
• A gross margin of 29.2%, representing an improvement of 5.4 percentage points.
• Operating income of $7.8 million, a positive swing from a loss of $9.7 million in the prior-year period.

This quarter marked the fourth consecutive period of record revenue and positive operating cash flow.