Bloom Energy's $20 Billion Backlog Growth Masks Execution Risks and High Valuation Concerns

What happened

Bloom Energy's stock surged 285% in 2025, fueled by market hype around its on-site power solutions for AI data centers. A new article highlights that Bloom's backlog has grown to $20 billion, emphasizing its role in alleviating grid demand. However, DeepValue's analysis reveals this backlog is fraught with risks, including high customer concentration and dependency on financing and permitting timelines. Recent profitability gains are largely tied to specific hyperscaler projects rather than broad-based, repeatable economics, as noted in SEC filings. At a current price of $155, the stock prices in perfect execution, but filings warn of potential delays and service cost escalations that could derail growth.

Implication

The $20 billion backlog signals strong demand but must convert to revenue without the financing and permitting delays explicitly cited in SEC filings. High customer concentration, with the top account representing 43% of 2025 revenue, increases volatility and risk from project-specific setbacks. Service margins are under pressure from an aging fleet, with potential performance guarantee costs up to $480.7 million that could erode profitability. Insider sales clustered at elevated prices in late 2025 suggest internal concerns about sustainability, adding to the overvaluation narrative. Given the 'WAIT' rating and attractive entry at $110, it's prudent to monitor quarterly results for adherence to FY2026 guidance of $3.1B-$3.3B revenue and ~32% gross margin before considering investment.

Thesis delta

The new article confirms backlog expansion, reinforcing the bullish AI data-center demand narrative. However, it does not address the execution risks highlighted in the DeepValue report, so the core thesis of waiting for operational validation remains unchanged. If anything, the stock's surge increases the urgency for proof to justify current valuations, with no material shift in the investment call.