Bloom Energy shares fell this week ahead of its latest earnings report, then rebounded

Shares of hydrogen fuel cell manufacturer Bloom’s Energy (TO BE 6.46%) fell 10% for the week at market close today, just before the company released its second-quarter results. The only news from the company itself this week ahead of the quarterly report was an announcement about a new, more efficient fuel cell to help power the growing data center server market.

Energy demand is rising as data centers are built to house servers used for artificial intelligence (AI) calculations. But that market is not yet contributing to Bloom Energy’s bottom line.

Are data centers a new market niche for Bloom?

Bloom’s new, high-performance fuel cell offering combines much of what data center operators are looking for. While highly efficient and emission-free, using 100% hydrogen, it also offers the ability to run on natural gas and hydrogen blends.

But markets have been in risk-off mode for much of this week, with aggressive growth stocks like Bloom Energy caught in the sell-off. But Bloom has already seen some business powering data centers, and there could be more to come.

In its second-quarter report, the company announced thatrevenue of $335.8 million, up 11.5% year over year. CFO Dan Berenbaum said, “We delivered record non-GAAP revenue and profitability in the second quarter and strengthened our balance sheet with the issuance of our 3% convertible green bonds. We are confident in our commercial pipeline and reaffirm our prior fiscal 2024 financial guidance.”

The company also recently announced a deal with privately held AI data center company CoreWeave to provide power to its Illinois data center. The company will also supply fuel cells to power the Amazon Web Services (AWS) data centers in California.

Investors initially cheered Bloom’s latest quarterly report. Shares are rebounding after hours in response to the results. That makes sense, given record second-quarter revenue combined with rising profitability in the form of rising gross margins. Given the continued growth in electricity demand, Bloom seems to be in a good position, especially in the niche data center market.