Bloom Energy’s management team beat both revenue and adjusted EPS estimates in the current quarter and raised the full year guide. It was the kind of beat that makes you do a double take. Revenue came in at $751.1 million in Q1 compared to $540 million expected, representing a beat of 39.1%. The beat was carried into the full year guide, plus some, with the full year guide now at $3.6 billion at the midpoint, up from the previous guide of $3.2 billion at the midpoint. The Q1 adjusted EPS beat was even stronger at 242.1% and management also raised the full year adjusted EPS guidance growth to 169.7% at the midpoint, up from the previous 84.9% growth.
Equally important, operating margin expanded 15.4 points on a year-over-year basis although decreased on a QoQ basis. Adjusted gross margin held steady at 31.5%, which was flat on a QoQ basis, with management stating they expect to see full year adjusted gross margin of 34%, up from the previous guide of 32%. Adjusted EBITDA was $143 million, up from $25.2 million last year with adjusted EBITDA margin expanding 11.3 points to 19%. All around, Bloom is illustrating operating leverage and a different margin profile from years’ past.
The new deal with Oracle has sent Bloom’s stock soaring on a 1-month basis (on top of strong 1-year returns). We’ve discussed in-depth the product market fit for the stock as being “time to power,” yet the company’s product-market fit has actually improved since last quarter as the Jupiter deal serves as an important proof of concept for the company. My understanding is the Jupiter deal will mark the first time an AI data center will be powered entirely by Boom Energy’s solutions – an easy data point to miss, but is actually, quite an important moment in BE’s history.
Another data point that would be easy to miss is that I cannot recall the CEO discussing hyperscaler customers and neoclouds in the previous earnings call. AEP and Brookfield are well-known customers yet don’t fit the description in the following statement, as it was explicitly stated that looking beyond Oracle “more than half of our current data center backlog comes from other hyperscalers, neo clouds and colocation providers.”
Combined, these are important clues of what’s to come.
Oracle’s Newly Announced Project Jupiter
This month, Bloom Energy announced an expansion with Oracle for a total of 2.8GW of fuel cell capacity with 1.2GWs shipping now. We’ve covered previously that Bloom delivered a fuel cell system to Oracle in 55 days, standing out among the longer to deploy solutions in the market.
Following the capacity announcement, Oracle announced Project Jupiter yesterday stating the company will utilize up to 2.45GWs “to fully power the AI data center campus” located in New Mexico. This is an important development as it means the AI data center will not use gas turbines and the diesel generators as originally planned. According to the press release, nitrous oxide emissions will be cut by 92% compared to the previous gas turbine plan.
The following was stated about the new deal: “It will be 100% bloom. When completed, it will be one of the largest islanded microgrid power facilities in the world. Oracle pivoted to Bloom only solution for 2 main reasons: first, be a responsible corporate citizen and partner by being responsive to resident concerns about air quality, water use, noise and increasing electricity rates.
Second, to stand up their grid independent and clean AI factory with even greater reliability and speed. Bloom is the cleanest commercially available on-site power generation option for such data centers and the most water efficient. Even Blooms community-friendly attributes, Oracle should be able to energize the campus materially faster than any other available alternative solution in the market.”
What's Next for Bloom Energy
I’d like to spend a moment on future catalysts for Bloom Energy.
AI Inference will Require more Gigawatts
The inference market will require more gigawatts than training, but the bigger constraint is location (or geography). Inference sits at the edge, close to users for latency, which means demand will be coming from dense metros instead of less populated areas, such as where training data centers are located (rural areas). Competing energy solutions not only take a very long time but result in poor air quality or require a lot of water.
Bloom could see more demand from the inference market compared to training as it offers a combination of low emissions, minimal water use and a small footprint.
Also, interesting to note, the newly appointed CFO was the former CEO of Groq, the AI inference leader.
Native DC Output
We've covered this point closely in the past, stating last quarter that: “The incoming transition to 800-volt DC power architectures represents a structural shift in how AI data centers are designed and powered. As rack densities climb and facilities scale toward gigawatt levels, traditional AC and lower-voltage DC systems become inefficient.
By standardizing on 800-volt DC, data center operators can future-proof new deployments for higher power loads while improving total cost of ownership, making this shift a foundational enabler of next-generation AI infrastructure.
Bloom Energy’s solutions fit naturally into the transition toward 800-volt DC architectures because the company was designed around DC-native, on-site power generation, rather than retrofitting legacy AC systems.”
This is an important catalyst to watch between 2027-2028.
Services Opportunity
Looking more medium-term, an opportunity for Bloom is its Service contracts, which have a 100% attach rate and improving margins.
Per the CEO: “[…] we have a 100% attach rate between our product sales and our service. That's the first place to start. There is not a single deal that we do without an attach rate to our service. Even with the data center opportunities, on average, it's 10 to 15 years, somewhere in that range. And so it's a tremendous source of annuity revenue that we see. And you can see us executing on the margin targets that we have provided. So it's going to be a phenomenally great business for us going forward, along with our product business.”
The Brass Tacks (Risks):
Bloom Energy deploys quickly and that can be a substantial advantage for 2026-2029. However, industry-wise, solutions that move quicker than construction could become constrained by how quickly new data centers can be built. You will often hear Bloom’s management team state they are not capacity constrained, yet the company can become constrained by construction schedules in the medium-term.
Additionally, for Bloom to grow 10X from here, the company would have to raise significant capital. Typically, Bloom’s business model incurs costs well before revenue is recognized. There are expensive raw materials and a months-long manufacturing process. As Bloom scales to 5GWs of annual deployment (let’s say), the working capital required is quite high compared to Bloom’s cash flows.
However, there is increasing evidence that the upfront costs will be offset by prepayments, with the CFO stating: “As K.R. mentioned earlier, we are rapidly expanding capacity through our innovative manufacturing model, which allows us to scale in months, not years. That growth requires upfront working capital to support higher production and deliveries. Even with those investments, cash flow from operating activities was an inflow of $73.6 million, positive for the first time in the first quarter of the year, which is typically a seasonally weaker period. This was driven by a step change in profitability, strong collections and customer prepayments to reserve capacity.”
Financials
By Royston Roche
Q1 Revenue Surges 130% YoY — Strongest Growth in Company History
Bloom Energy delivered a historic Q1 2026, reporting revenue of $751.1 million, up 130.4% YoY and beating estimates by a remarkable 39.1%. The quarter did moderate slightly on a sequential basis, declining (3.4%) QoQ from $777.7 million in Q4 2025 — a natural giveback following Q4's outsized 49.8% QoQ ramp — but on a year-over-year basis this represents the company's strongest growth in its public history, a strong acceleration from 38.6% YoY in Q1 2025 and 35.9% YoY in Q4 2025. While the management usually does not provide the next quarter's guidance. Due to the strong visibility, they said in the earnings call, “After a strong start to the year, and anticipating that Q2 revenue should be at least as good as Q1.”
The acceleration was driven by a surge in Product revenue, which reached $653.4 million in Q1 2026, up 208.4% YoY, reflecting the meaningful materialization of its large-scale AI data center contracts. Product revenue alone now represents ~87% of total revenue, underscoring just how central Bloom's SOFC hardware business has become its growth story. Service revenue was $61.9 million, up 15.6% YoY.
Looking ahead, forward estimates have been revised sharply higher over recent months. Q2 2026 revenue estimates currently stand at $703.5 million, up 75.3% YoY and Q3 2026 at $855.6 million, up 64.8% YoY. Management raised its full-year 2026 guidance meaningfully, now targeting $3.4 billion–$3.8 billion in revenue, implying 77.9% YoY growth at the midpoint, up from the $3.1 billion–$3.3 billion range provided at the time of Q4 2025 results.
Margins Continue to Expand Meaningfully YoY
Bloom Energy's margin trajectory has been one of the most compelling turnaround stories in the clean energy space, and Q1 2026 continued that trend. GAAP gross margin came in at 30% in Q1 2026, up from 27.2% in Q1 2025, a YoY improvement of 280 basis points. Adjusted gross margin was 31.5%, compared to 28.7% in Q1 2025 and 31.9% in Q4 2025.
For context, Bloom's gross margin was only 12.4% in FY2022 and 14.9% in FY2023. The company has executed a sustained cost reduction and manufacturing efficiency campaign. Management has also increased its full-year 2026 adjusted gross margin guidance to 34%, up from the prior 32%.
Operating margins also inflected positively YoY in Q1 2026. GAAP operating margin was 9.6%, up from (5.8%) in Q1 2025 and down from 11.3% in Q4 2025. GAAP operating income was $72.2 million vs. an operating loss of ($19.1 million) in Q1 2025. Adjusted operating margin came in at 17.3%, a substantial improvement from 4% in Q1 2025, primarily driven by operating leverage. For FY2026, management raised its adjusted operating income guidance to $675 million at the midpoint, up from the prior $450 million — a substantial upward revision reflecting the scale of commercial momentum.
Adj. EBITDA was $143 million in Q1 2026 or 19% of revenue, up from $25.2 million in Q1 2025 or 7.7% of revenue.
Q1 Adjusted EPS beat of 242%
Bloom reported Q1 2026 adjusted EPS of $0.44, crushing estimates of $0.13 by an extraordinary 242.4%. This compares to $0.03 in Q1 2025 and $0.45 in Q4 2025. GAAP EPS was $0.23, coming in well above estimates of ($0.02). The magnitude of the beat signals that both revenue and margin leverage are tracking significantly ahead of the Street's model.
Looking forward, consensus Q2 2026 adjusted EPS stands at $0.25, up 153.6% YoY and Q3 2026 at $0.40, up 163.5% YoY. For full-year 2026, management raised its adjusted EPS guidance to $2.05 at the midpoint, implying 169.7% YoY growth and up sharply from the prior guidance of $1.405 or 84.9% growth.
Cash Flow and Balance Sheet
The company’s cash flows improved YoY primarily driven by higher profits, strong collections, and customer prepayments to reserve capacity. Bloom also reported the first positive Q1 operating cash flow in the company’s history.
- Q1 operating cash flow was $73.6 million or 9.8% of revenue compared to operating cash outflow of ($110.8 million) or (34%) of revenue in the same period last year.
- Q1 free cash flow was $47.4 million or 6.3% of revenue compared to a free cash outflow of ($125.9 million) or (38.3%) of revenue in the same period last year.
- The company had cash of $2.49 billion and debt of $2.60 billion at the end of Q1 2026.
- The cash flows are improving, which is a positive trend and Bloom Energy had also announced a $5 Billion Strategic AI Infrastructure Partnership with Brookfield in October 2025 that will also help to fund its expansion to support the strong expected future growth.
Conclusion:
Bloom has performed exceptionally well over the past year, yet we are always hunting for future catalysts to make sure the growth can sustain. Following the results, the market may be focused on the headline numbers yet arguably some of the most important moments in BE’s history were buried in the report: the first AI data center to be entirely powered by Bloom and the hyperscaler/neocloud list is diversifying beyond Oracle.
It is quite challenging to hold a high allocation in a stock for two years in a row, as the market tends to rotate. However, that is our intention with Bloom.
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Please note: The I/O Fund conducts research and draws conclusions for the company’s portfolio. We then share that information with our readers and offer real-time trade notifications. This is not a guarantee of a stock’s performance and it is not financial advice. Please consult your personal financial advisor before buying any stock in the companies mentioned in this analysis. Beth Kindig and the I/O Fund own shares in BE at the time of writing and may own stocks pictured in the charts.
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