Bloom Energy's stock is one of the S&P 500's biggest losers amid fears of data-center delays

By Claudia Assis

The fallout from midterm elections is hitting the AI-grid trade

Bloom Energy has pegged its future to on-site power generation, and data centers are among its top customers.

Bloom Energy shares got swept up in the technology sector's sharp selloff Thursday, as investors fretted that the data-center buildout was at risk of stalling in the aftermath of the U.S. midterm elections.

Bloom's stock (BE) was among the 10 worst performers in the S&P 500 index SPX, ending the session down 16%. The stock closed at its lowest since July 29, and suffered its worst one-day percentage decline since June 26, when it fell more than 18%.

The prospect of a data-center slowdown looks particularly tricky for Bloom, which has staked its future in providing on-site power generation through fuel cells and other means. Data centers are among its top customers, and optimism about the artificial-intelligence buildout had fueled Bloom's year-to-date gains of more than 90%.

"Shares are selling off on growing concerns that data-center development and associated power-generation demand could be stalled as new state leadership pursues campaign promises to push back on data-center development," said Christopher Dendrinos with RBC Capital.

Bloom is most heavily exposed to data-center end markets and could be more heavily impacted, Dendrinos said. Investors likely are most concerned with the changing politics in Texas, which is a top U.S. data-center host, he added.

The company is only just shipping its first fuel cells to Texas, where it has been underexposed as developers in the state favor natural-gas combustion technology, Dendrinos said. In addition, in New Mexico, there is growing concern that one of Bloom's largest developments could see additional delays, he said.

Texas and New Mexico elected Democratic governors on Tuesday, part of the party's widespread victories in the midterm elections that also included Democrats' sweep of Congress.

Markets appear to be rethinking yesterday's view that Bloom wins from the Democratic sweep, Bloomberg Intelligence analyst Alessio Mastrandrea said.

On Wednesday, investors bought the idea that on-site fuel cells let data centers sidestep a slower, more politicized grid, Mastrandrea said.

"Today the worry has flipped to whether fewer data centers get built at all," and Bloom is a more volatile name in the broad AI-infrastructure selloff, he added.

Bloom Energy's demand pipeline in the next couple of years is likely still protected, since so much of that demand is tied to projects that are already underway, the analyst said. Bloom's efficiency and emissions profile should also help it get through tighter scrutiny better than natural-gas fired alternatives, he said.

Bloom's fuel cells give hyperscalers and data-center developers a faster on-site option amid grid delays and backlogs in the production of natural-gas turbines.

"Over the long run, the bigger risk to its speed-to-power edge is still gas turbines becoming easier to get, not Congress," Mastrandrea said.

Bloom reported better-than-expected third-quarter earnings last month, although investors eyed its spending and negative cash flow. Bloom also raised its 2026 outlook.

The latest 2026 forecast now implies a 122% sales growth, versus the projection for about 60% growth given in February, the Bloomberg Intelligence analysts said.

-Claudia Assis

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11-05-26 1626ET