Fervo Rides Data Center Energy Boom With 35% IPO Pop

Fervo FRVO, a next-generation geothermal startup aiming to help power data centers as part of its mission, closed its first day of trading on the Nasdaq at $36.54 per share, a 35% pop from its IPO price.

The strong showing for Fervo’s debut underscored investors’ enthusiasm for data center energy providers: the company raised $1.89 billion in the upsized listing. By comparison, the 22 climate-tech IPOs in 2025 raised a combined total of $14.2 billion, according to PitchBook data.

Fervo issued 70 million shares of its Class A common stock at $27 each. The IPO consisted entirely of shares issued by the company, with no existing shareholders selling into the offering.

Fervo’s listing confirms a sentiment shared by late-stage climate-tech companies and investors: The alpha in 2026 for the climate-tech sector lies in answers to the AI boom’s energy crunch.

“Everyone who’s running a data center is in a scramble to get more capacity online,” said Piva Capital managing partner Mark Gudiksen, who is not an investor in Fervo. “This is really a perfect storm moment.”

Fervo’s financials, at first glance, resemble those of a company in R&D mode rather than one ready for the public markets. It reported a $57.8 million loss on just $138,000 in revenue in 2025. Due to fees related to geothermal production rights at a site in Nevada, its revenue actually dropped by 31% from the previous fiscal year, from $199,000.

Investors’ rationale for Fervo’s billion-dollar market cap lies not in its current P&L, but in its contracted revenue backlog. As of December 2025, that backlog was approximately $7.2 billion. On top of that, Fervo has a 3-gigawatt framework agreement with Alphabet GOOGL for power offtake for Google’s data centers, as well as power purchase agreements for a $421 million geothermal energy plant in Utah.

As the AI infrastructure buildout puts growing pressure on the energy grid, hyperscalers and utilities are seeking out companies that can meet their accelerating energy demands. Even nuclear fusion, a scientific hypothesis that’s yet to be successfully proven, is generating investor interest at record valuations.

Fervo has the added advantage of a market that has bipartisan support and contributes to American energy independence. Powering the data center boom with domestic energy production has become a particularly salient topic since the Iran conflict began in February.

Fervo’s roadshow itself leaned into investor bullishness for energy solutions to the AI buildout.

“There is no AI revolution without power for data centers,” CEO Tim Latimer wrote in the opening paragraph of his letter to shareholders.

Fervo was backed by Bill Gate’s Breakthrough Energy Ventures, along with Capricorn Investment Group, DCVC and others.