Vertiv's stock rallies as data-center AI deployments fuel earnings beat
By Steve Gelsi
Company cites 'acceleration of AI-driven demand' for sparking new orders
Vertiv Holdings Co.'s stock rallied Wednesday after the data-center provider's revenue and adjusted profit topped Wall Street analysts' expectations on stronger-than-expected orders fueled by artificial-intelligence demand.
Vertiv (VRT) jumped 9.5% in afternoon trades.
The company reported a first-quarter loss of $5.9 million, or 2 cents a share. In the year-ago quarter, Vertiv earned $50.3 million, or 12 cents a share.
Vertiv's adjusted profit of 43 cents a share in the latest quarter beat the FactSet consensus estimate of 35 cents a share.
Revenue rose 8% to $1.64 billion from $1.52 billion, ahead of the $1.62 billion analyst estimate.
First-quarter earnings were fueled by a 60% increase in orders, which exceeded expectations.
"Though still in its early stages, AI is quickly becoming a pervasive theme across our end markets," Vertiv Chief Executive Gioradano Albertazzi said in a statement.
Backlog stood at a record high of $6.3 billion at the end of the first quarter.
Looking ahead, Vertiv expects second-quarter adjusted earnings of 53 cents to 57 cents a share, against the FactSet consensus estimate of 55 cents a share.
For the full year, Vertiv expects adjusted earnings of $2.29 a share to $2.35 a share, while analysts are currently looking for earnings of $2.30 a share.
As a technology provider for digital infrastructure, the company is seeing more demand for products that contain elements of artificial intelligence.
Advances in graphics-processing units, which handle complex computations, have been getting upgraded with more AI elements.
Products containing AI, "are necessitating changes and upgrades to the critical digital infrastructure," the company said.
Earlier, Vertiv's stock was one of the most active issues in pre-market trading.
Also read: Goldman CEO expects AI to create financing boom due to demand for infrastructure
-Steve Gelsi
This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.
(END) Dow Jones Newswires
04-24-24 1359ET
Copyright (c) 2024 Dow Jones & Company, Inc.-
September Jobs Report Forecasts Show Moderate Hiring Gains
-
Port Strike a Headache for Shippers but a Potential Tailwind for Certain US Transport Stocks
-
13 Charts on Q3′s Roller-Coaster Rally for Stocks and Bonds
-
5 Stocks to Buy Instead of Overpriced US Equities
-
Q4 Stock Market Outlook: Where We See Opportunities for Investors
-
Markets Brief: Non-Farm Payrolls in the Spotlight Again
-
6 Top-Performing Large-Growth Funds
-
What’s the Difference Between the CPI and PCE Indexes?
-
This Cheap Stock Is Still a Buy Even After 50% Rally
-
10 Top-Performing Dividend Stocks of Q3 2024
-
33 Undervalued Stocks
-
Communication Services: Cable’s Broadband Dominance Isn’t as Strong as It Once Was
-
Technology: Strength Continues, With Software Presenting the Best Buying Opportunities
-
Best- and Worst-Performing Stocks of Q3 2024
-
Top Stocks to Own From the Best Fund Managers
-
2 Cheap Stocks Top Managers Have Been Buying