Babcock & Wilcox received final approval for a $2.4 billion deal to supply power equipment for a 1.2-gigawatt project by Base Electron, which was formed to power Applied Digital's AI campuses. The company's shares surged nearly 23% on the news, and it separately reported quarterly revenue that exceeded analyst estimates.
The deal highlights surging U.S. power demand, driven by data center expansion for AI and technology, with Babcock noting a pipeline of over $12 billion in similar opportunities. The specific project will involve Babcock supplying natural gas-fired boiler and turbine systems, with a potential future option for an additional 1.2 GW of capacity.
Main Topics: A major power equipment deal for AI data centers; surging U.S. electricity demand; Babcock & Wilcox's financial performance and business pipeline.
Babcock & Wilcox said on Wednesday an Applied Digital-backed company has given a go-ahead to their $2.4 billion deal to deliver equipment that would power the technology firm's artificial intelligence campuses.
Shares of Babcock surged nearly â23% in â premarket â trading after Base Electron gave the final notice for the 1.2-gigawatt power project.
U.S. power demand reached record highs in 2025 and is projected to acceleratethis year as major tech companies rapidly expand data centers, some of which use as much electricity as an entire city at a single location.
Applied â Digital had âformed Base Electron to produce power for the technology firm's AI campuses under separate agreements. The power â producer in turn hired Babcock to design, procure and construct the facility.
Under their agreement, Babcock âwill supply four 300-megawatt natural gas-fired boilers and steam turbine generator systems.
Applied Digital CEO Wes Cummins said the company is also evaluating an option with Base Electron to deliver another 1.2 GW of generation capacity in the âfuture, according to Babcock & Wilcox.
Separately, Babcock posted a revenue of $161.0 million in the fourth quarter, beating âanalysts' average âestimate of $155.60 million, â according to data compiled by LSEG.
Babcock CEO Kenneth Young said they are in discussions on other data center opportunities reflected âin its current pipeline of more than $12 billion.
"We are also seeing increased coal utilization and opportunities to deliver coal technologies that provide reliable and secure power to our utility customers in North America," Young added.
Shares of Babcock surged nearly â23% in â premarket â trading after Base Electron gave the final notice for the 1.2-gigawatt power project.
U.S. power demand reached record highs in 2025 and is projected to acceleratethis year as major tech companies rapidly expand data centers, some of which use as much electricity as an entire city at a single location.
Applied â Digital had âformed Base Electron to produce power for the technology firm's AI campuses under separate agreements. The power â producer in turn hired Babcock to design, procure and construct the facility.
Under their agreement, Babcock âwill supply four 300-megawatt natural gas-fired boilers and steam turbine generator systems.
Applied Digital CEO Wes Cummins said the company is also evaluating an option with Base Electron to deliver another 1.2 GW of generation capacity in the âfuture, according to Babcock & Wilcox.
Separately, Babcock posted a revenue of $161.0 million in the fourth quarter, beating âanalysts' average âestimate of $155.60 million, â according to data compiled by LSEG.
Babcock CEO Kenneth Young said they are in discussions on other data center opportunities reflected âin its current pipeline of more than $12 billion.
"We are also seeing increased coal utilization and opportunities to deliver coal technologies that provide reliable and secure power to our utility customers in North America," Young added.
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