Only 20% of GE Vernova's Order Book Is Data Centers. Here's Why That's the Bull Case, Not the Risk.

It's often highlighted as one of the bigger beneficiaries of the artificial intelligence (AI) revolution. And to be fair, it does serve a decent-sized swath of the AI industry.

However, AI only makes up a minority of GE Vernova's (GEV -3.24%) total business. About 20% of its power-production arm's backlog (measured in gigawatts) is orders for its power-generating equipment to be installed at AI data centers (mostly natural gas turbines). The rest of its order book reflects demand from conventional customers like power utilities, oil refineries, and other high-power-consumption facilities that don't want utility-supplied electricity.

That's not a bad thing. Indeed, GE Vernova's lack of dependence on one single industry -- the AI industry, no less -- actually makes it even easier for investors to own.

The numbers that matter for GE Vernova

Don't misread the message. The company will gladly sell as much of its wares as any paying customer is willing to buy. And the swell of demand from the fast-growing AI industry has given GE Vernova some margin-widening pricing power to be sure.

Artificial intelligence isn't exactly a panacea for this outfit, however. As was noted, only about one-fifth of the power-generating capacity that's already been ordered but not yet delivered is equipment earmarked for data centers. Similarly, while the data center industry's 2026-to-date orders of GE Vernova's electrification solutions are more than double this arm's orders through the first half of 2025, at a total of $5 billion, these orders still only account for roughly one-third of its total new electrification orders received during the first two quarters of the fiscal year. And, electrification itself only accounts for about one-third of the company's current revenue mix.

In other words, GE Vernova's stock isn't quite the AI trade it's sometimes made out to be.

GE Vernova is plugged into something bigger and more reliable than AI data centers

At first blush, this reality check seems to dial back the bullishness that had been surrounding this ticker; maybe it undermines some of the premium valuation the market might have otherwise been willing to price in.

There's arguably more upside than downside, though, simply because GE Vernova doesn't face the risk of AI mania suddenly losing steam and bringing a quick end to its backlog's growth. The company is largely meeting the ever-growing power needs outside of the data center market, which may not be as flashy, but are certainly far more sustainable. For perspective, thanks to the ongoing proliferation of electric vehicles, the need for more air conditioning, and other needs beyond AI data centers, the International Energy Agency expects global demand for electricity to grow 3.6% this year, up from 2025's pace of only 3%, en route to 3.8% growth in 2027.

Admittedly, those numbers aren't very big. By worldwide power-production measures, though, they're huge. They're also just a glimpse of the longer-term demand that the planet isn't yet equipped to meet. To this end, Morningstar analysts' longer-term revenue outlook for a 2030 top line of $78.6 billion versus last year's sales of $38.1 billion is probably a pretty reliable projection.

Arguably more important to interested investors right now, this backdrop makes GEV's lethargy since mid-year a buying opportunity.