Vertiv's stock rallies as data-center AI deployments fuel earnings beat

Dow Jones04-24

MW 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 in premarket trade on 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 16.2% on volume of about 1.1 million shares as one of the most heavily traded stocks in premarket trading.

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.

-Steve Gelsi

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(END) Dow Jones Newswires

April 24, 2024 08:54 ET (12:54 GMT)

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Vertiv's stock rallies as data-center AI deployments fuel earnings beat

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