We appear set for a summer of IPOs. A series of high-profile initial public offerings are hitting the stock market, with many of them sitting at the intersection of artificial intelligence. Both semiconductor maker Cerebras Systems (CBRS) and data center trust Blackstone Digital Infrastructure (BXDC) are enticing targets to support the build-out of AI.
Another entry into this mix is Fervo Energy (FRVO), a geothermal company that went public last week. Fervo supplies another way to play growth in AI infrastructure, as data center operators need access to scalable electricity.
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Fervo’s solution is to use Earth’s heat for power by drilling deep into the planet to tap hot rock. Steam from the heat is brought back to the surface to spin turbines and generate electricity. By using techniques from the oil and gas industry, Fervo employs directional drilling to reach deeper into the earth and provide a steady source of heat.
Fervo’s IPO is the largest clean energy IPO in history, sending the company’s valuation to more than $10 billion. Shares jumped 33% on the first day of trading, but have already given back most of those gains.
www.barchart.com Will this pick-and-shovel infrastructure stock support a long-term investing thesis? Let’s take a closer look.
About Fervo Energy Stock
Fervo is a geothermal company headquartered in Houston. The company aims to make geothermal power scalable and part of the global energy network.
“Fervo’s innovative approach to geothermal well design, reservoir engineering management, and advanced data analytics allows us to access a massive resource base that other operators are unable to exploit,” the company says on its website.
Fervo raised $1.89 billion in its IPO as the company upsized its offering several times, citing demand for shares. The company sold an extra 14.6 million shares, lifting the price range two times, and launched the company at $27 per share.
The company is developing a power plant in Utah that is expected to begin operation this year. When the first phase of construction is complete in three years, management expects the plant to generate 500 megawatts of power. Management believes the Utah station has enough heat to generate up to 4 gigawatts of power.
The company is also developing a power plant in Nevada from which Alphabet (GOOG) (GOOGL) is buying 115 megawatts of power.
Fervo Isn’t the Only Power IPO Right Now
As mentioned, data center operators are already on the hunt for power sources to power servers and AI workloads, while also operating cooling systems that keep the equipment from overheating. The International Energy Agency projects that electricity consumption from data centers will grow 15% annually through 2030, or four times faster than the growth of all other sectors. And electricity use in accelerated servers, which is primarily for AI adoption, is expected to grow by 30% per year.
Another energy company, the nuclear startup X-Energy (XE), raised $1 billion in its recent IPO. X-Energy had $109.1 million in revenue in 2025, with much of that coming from grants and government contracts, but posted a net loss of $389.9 million. Fervo, meanwhile, had only $140,000 in revenue for 2025 and a net loss of $57.8 million.
But Fervo is much more likely to generate a profit before X-Energy. Its Utah plant, called Cape Station, is coming online later this year, while X-Energy doesn’t expect to have its small modular reactors (SMRs) ready until after 2030.
Should You Invest in Fervo Energy?
IPOs are notoriously volatile. Fervo jumped 33% in its first day but has already given most of those gains back – the stock trades only 5% higher than its IPO price now.
While I believe that AI infrastructure stocks are the best way to invest in the AI buildout, investors should have some patience with Fervo Energy. It could be a big winner down the road – but those results will take time.
On the date of publication, Patrick Sanders did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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