GE Vernova Inc.

Thank you for holding. Your conference will begin in five minutes. Thank you for your patience. Thank you. Thank you for holding. Your conference is about to begin. Thank you for your patience. Thank you. Thank you. Good day, ladies and gentlemen, and welcome to GE Vernova's fourth quarter and full year 2025 earnings conference call. At this time, all participants are in a listen-only mode. My name is Liz, and I will be your conference coordinator today. If you experience issues with the webcast slides refreshing or there appears to be delays in the slide advancement, please hit F5 on your keyboard to refresh. As a reminder, this conference is being recorded. I'd now like to turn the program over to your host for today's conference, Michael Lapidus, Vice President of Investor Relations. Please proceed.

Welcome to GEBernova's fourth quarter 2025 earnings call. I'm joined today by our CEO, Scott Strasik, and CFO, Ken Parks. Our conference call remarks will include both GAAP and non-GAAP financial results. Reconciliations between GAAP and non-GAAP measures can be found in today's press release and presentation slides, both of which are available on our website. Please note that our year-over-year commentary or variances on orders, revenue, adjusted and segment EBITDA, and margin discussed during our prepared remarks are on an organic basis, unless otherwise specified. In addition, our 2026 guidance and our by 2028 outlook being presented today include the ProLect GE acquisition. We will make forward-looking statements about our performance. These statements are based on how we see things today. While we may elect to update these forward-looking statements at some point in the future, we do not undertake any obligation to do so. As described in our SEC filings, actual results may differ materially due to risks and uncertainties. With that, I'll hand it over to Scott. Thanks, Michael.

Good morning, everyone, and welcome to our fourth quarter earnings call. We have been busy since our December 9th investor update, and I thought I'd start with progress since the event. First on the positive, we continue to see very strong new gas contracts with an incremental 6 gigawatt sign in the last three weeks of December for a total of 24 gigawatts of new contracts in 4Q25 alone. We also ended the year with strong orders in both electrification and wind. Electrification had its largest order quarter in its history, and wind had its largest order quarter of 25. On the negative, we have been impacted by the U.S. government's halting of all offshore wind activity on December 22nd, which led to us booking an incremental accrual in 4Q for costs associated with the delay on the Vineyard Wind Project. Ken will talk more about this in his section. I'm pleased that our ProLite GE acquisition has received rapid approval from all required jurisdictions. This will allow us to close the acquisition on Monday, February 2nd. Taking all this into consideration, we are raising our full year 26 financial guidance, which now includes GE Vernova's full ownership and operation of Prolac for 11 months in 26. Taken in totality, the last three weeks of December since our last update were a reasonable proxy for our 25 performance in total, strong growth in our largest, most profitable businesses, with momentum continuing. Challenges and wins that we are continuing to combat with a creative capital allocation with the approvals required to close our first sizable acquisition as a standalone public company. 25 sets us up for substantially more profitable growth moving forward. In 25, we increased our total backlog by over 25%, or $31 billion to $150 billion, with robust growth. profitable order growth in power and electrification, further underscoring our momentum as we kick off 26. In power, we continue to see accelerating demand and favorable pricing trends for both equipment and services as customers invest in new units and existing assets. In 4Q, gas power equipment backlog in slot reservations increased from 62 to 83 gigawatts sequentially, primarily due to strong U.S. demand, but also with agreements in the Middle East, Vietnam, and Taiwan, with backlog increasing from 33 to 40 gigawatts and SRAs increasing from 29 to 43 gigawatts. We expect to reach approximately 100 gigawatts under contract in 26, under the assumption we'll ship high teens and gigawatts this year, with new contracts north of 30 gigawatts. In 4Q, we grew our power services backlog to $70 billion, up $5 billion sequentially and $9 billion year over year. This increase was mainly driven by strength in gas, with customers investing in fleets and signing new long-term service agreements at favorable pricing, which drove strong high-margin services backlog growth. In electrification, customers are working to keep pace with growing electricity demand, grid stability needs, and national security interests. In 4Q, we grew the segment's total backlog to $35 billion, up $4 billion sequentially and $11 billion year over year, representing electrification's largest growth quarter on a dollar basis in 25. Importantly, we are seeing demand across the segment for grid and data center equipment, both with traditional customers globally and hyperscalers primarily in the U.S. Of note, over 2 billion of electrification's orders were signed directly for data centers in 25, more than triple the 24 total. We also signed large deals for providing grid resilience and reliability solutions in Saudi Arabia and Australia, an HVDC contract in Germany, and a large grid equipment contract in Iraq in the year. In wind, We received approximately 3 billion of orders in 4Q, the largest of the year for the segment. And onshore, we continue to receive tech selects for repowering and new units as customers utilize safe harbor and initiate physical work for approximately 10 gigawatts of repowering opportunities in the U.S. The team is focused on what we can control. Taken together, our pathway to substantially more profitable growth is right in front of us. I'll talk about this more on page five with the growth of margin in our equipment backlog, including $8 billion of incremental margin added to our equipment backlog in 25. I'm also pleased with the returns that our 25 investments are yielding. On the CapEx side, we remain on track to see a substantial step up in gas turbine output in 3Q26. we installed over 200 new machines in our factories while adding nearly 1,000 new production workers in 2025. We plan on adding an incremental 200 machines and over 500 production workers in 2026. Electrification is on track with its growth, delivering more than 25% revenue growth in 2025 with a clear pathway to deliver 13.5% to $14 billion in revenue, representing 20% organic growth, plus approximately $3 billion from Prolec GE in 26. Our investments in automation and robotics are advancing at scale, and AI is starting to gain momentum in our engineering organizations and back office functions. Our Advanced Research Center is progressing future businesses for us. This includes direct air capture, We already have a facility up and running, real momentum in our solid state transformer program, and a good technical progress on our fuel cell program in Malta, New York. We are making all of these investments from a position of financial strength, and in a year with almost $9 billion in cash. In 2025, we are able to return $3.6 billion to our shareholders while repurchasing our more than $8 million of our shares. We continue to see substantial opportunity to create value, including through incremental investments with strong returns. A few more comments on our financial performance on page four. We booked $59 billion of orders, up 34% year over year. We also grew our revenue by 9% year-over-year to $38 billion, with growth in both equipment and services, while increasing our adjusted EBITDA margin by 210 basis points year-over-year. We generated $3.7 billion in free cash flow, more than double our prior year, while investing more than $2 billion in R&D and CapEx. We are increasing our 26 guidance and by 28 outlook, which now includes ProLect GE. Ken will speak to this more in a moment. And as announced, we are doubling our dividend in 26 versus 25 and have increased our stock buyback authorization to $10 billion from the previously approved $6 billion program. One of the primary drivers of our conviction on our path forward is the significant growth and margin expansion in our equipment backlog again in 25, which I will touch on in the next page. On page 5, we show the growth of margin in our equipment backlog consistent with our practice from last January. We started 25 with the expectation to increase our margin dollars in equipment backlog above our run rate in the prior two years. We achieved that expectation, adding $8 billion in equipment backlog margin dollars in 25, more than the prior two years combined. We ended 25 with $64 billion in equipment backlog, an increase of approximately 50% year-over-year, with an incremental six points in equipment margin expansion. This included 11 points of growth in power, mainly driven by our gas power business. We expect significant growth again in power and electrification backlog in 26 at better margins as we convert higher-priced gas slot reservation agreements into orders and benefit from strong demand and pricing for grid equipment. These businesses' longer equipment cycles mean that we will not begin delivering on the majority of the higher margin orders placed in 24 and 25 until 27 and beyond. In wind, we expect relatively stable margins this year and for backlog to decrease as we execute on the remaining unprofitable offshore wind backlogs and project a smaller onshore wind backlog given the recent softness in U.S. orders. As we noted in December, we see incremental opportunity for the teams to expand margins that are not projected in our backlog today. This includes our operating teams delivering our backlog with variable cost productivity versus known cost today, accelerating capacity additions, leveraging lean to sell incremental slots, and a recovery in U.S. onshore wind orders. In summary, good progress in 2025, and we are excited about what's ahead. With continued strong demand in pricing and gas, the strong demand environment across multiple products and electrification, and my expectation for the team to drive variable cost productivity not embedded in our backlog margins today, we expect to add at least as much equipment margin dollars in backlog in 26 as in 25, setting us up for even more profitable growth over the long term. Said differently, in totality, the equipment margin in backlog from 23 to 26, those four years will add at least $22 billion in equipment margin, driving future profitable growth. With that, I will turn the call over to Ken for more details on our full year and fourth quarter performance, as well as our financial outlook.