Fervo Energy stock jumps after Nvidia AI partnership

Shares of Houston-based Fervo Energy climbed roughly 15% on Monday after the company announced an agreement with Nvidia and the Pacific Northwest National Laboratory to develop a digital platform called EGS-Twin, even as Fervo reported a wider-than-expected quarterly loss.

Under the collaboration, PNNL researchers will use operational data supplied by Fervo to train AI models on Nvidia’s computing infrastructure. The models will be incorporated into Nvidia Omniverse libraries and combined with live field measurements and physics-based simulations to create forecasting and analysis tools for geothermal operations.

Fervo reported a first-quarter loss of $3.72 per share, compared with a loss of $1.02 per share a year earlier. The result was well below Wall Street expectations for a loss of about $0.05 per share. Revenue for the quarter totaled $61,000, short of analysts’ estimates near $340,000. Investors emphasized the company’s strategic partnership and growth plans rather than the near-term financials.

The EGS-Twin platform is intended to help operators plan and drill more efficiently to reach steam reservoirs used to generate electricity. The platform will pair real-time field data with AI forecasting and simulation tools to model subsurface conditions and support drilling decisions.

Fervo, which is backed by Bill Gates, completed its initial public offering on May 13. The company sold 70 million shares in an upsized IPO, raising $1.9 billion; shares were offered at $27 and opened at $36 on the Nasdaq.

Two brokerages initiated coverage of Fervo this month. Bernstein initiated coverage with an outperform rating and a $47 price target, citing the company’s use of Enhanced Geothermal Systems technology, its project pipeline and customer relationships. Baird also started coverage with an outperform rating and a $47 target, pointing to the firm’s technology platform and project prospects.

Enhanced Geothermal Systems adapt drilling and completion techniques from shale oil and gas to create underground exchange systems that cycle steam to produce baseload electricity. Fervo plans to build surface facilities in 50-megawatt geoblocks to standardize construction and provide redundancy for partnerships with large data-center operators. Construction on Phase II of the Cape Station project is underway, and the company expects to begin generating its first revenue later this year.

Analysts project revenue growth of about 49% in fiscal 2026. The company is not expected to be profitable this year as it continues investing in scaling its operations.