Bloom Energy Stock Sinks Despite Record Earnings and Outstanding Outlook. Is it time to buy?

Flowering Energy (NYSE:BE) delivered another explosive quarter, beating estimates and growing earnings faster than sales. Still, its stock plunged after earnings and was down more than 12% as of midday Friday.

The company sells solid oxide fuel cell servers that convert natural gas into electricity directly at the customer’s site. Artificial intelligence (AI) data centers desperately need this, as the existing network needs several years to develop additional capacity.

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Bloom Energy can bypass the grid and quickly deliver clean, reliable power, 24/7, to hyperscalers and data center operators. It delivered a complete fuel cell system to Oracle (NYSE: ORCL) in 55 days last year. The tech giant was so impressed that it expanded its partnership to 2.8 gigawatts (GW) earlier this year.

So what’s going on with Bloom Energy stock? Why is it falling like a rock – down 30% in a month, as of this writing?

Image source: Getty Images.

An exceptional quarter and outlook for 2027

Revenue soared 138% year over year to a record $1.2 billion in the third quarter. Sales of the product, the fuel cell systems that Bloom Energy ships to its customers, exceeded $1 billion in sales in a single quarter for the first time.

Profits grew even faster. Adjusted operating margin increased from 8.9% to 23.1%, with revenue more than doubling while operating expenses increased only 26%. Chief financial officer Simon Edwards added that operating profit in this quarter alone exceeded what Bloom earned in all of 2025.

Management then raised its full-year revenue forecast for the third time this year. It now projects revenue of $4.5 billion for 2026, a growth of about 122%.

Here’s the twist: Earlier in the year, Bloom Energy forecast a “humble” 60% revenue growth for the year. It has more than doubled its trajectory in just a few quarters.

So what’s hurting the stock? The only metric I could find that might have upset investors is cash burn. Bloom Energy reported negative free cash flow of $181 million in the third quarter.

Should investors be concerned? Hardly, because context is everything.

Is Bloom Energy stock a buy?

With demand exploding, Bloom Energy spent $153 million last quarter to increase capacity as quickly as possible. Data centers are built in phases, and Bloom is ready with its servers in each phase so operators don’t have to wait.

This speed is essential for data centers.

Any data center would follow this. At a recent conference, Nvidia(NASDAQ: NVDA) CEO Jensen Huang explained that a 1 GW facility costs $50 billion, and that just a three-month delay in building a center could result in a $10 billion loss in revenue.

Whether it’s a 150 kilowatt system for a retail store or a massive 1 GW deployment, Bloom Energy has the capacity. This is precisely why the global asset management giant Brookfield Asset Management (NYSE: BAM) recently expanded its financing agreement with Bloom Energy from $5 billion to $25 billion.

Management says the order backlog is growing even faster than revenue. Do the math: We already know how quickly incomes are growing.

I expect Bloom Energy to hit it out of the park next quarter when management discloses the backlog count and releases its forecast for 2027. Because, as CEO KR Sridhar says, the company provides “power where it’s needed, when it’s needed, clean and always available.”

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Néha Chamaria has no position in any of the stocks mentioned. The Motley Fool holds positions and recommends Bloom Energy, Brookfield Asset Management, Nvidia and Oracle. The Motley Fool has a disclosure policy.

Bloom Energy Stock Sinks Despite Record Earnings and Outstanding Outlook. Is it time to buy? was originally published by The Motley Fool