Geothermal startup Fervo Energy surges 33% in IPO debut as AI data centers drive demand
Fervo Energy, a geothermal startup, saw its stock price jump 33% in its first day of trading. The company's IPO was upsized multiple times after investors questioned why it wasn't raising more capital.
Fervo Energy went public today, and its shares popped 33% in the initial public offering. The enhanced geothermal startup raised more money than originally planned after potential investors pushed for a larger offering.
The company uses advanced drilling techniques to create geothermal reservoirs where natural heat isn't easily accessible. By injecting water into hot rock formations, they generate steam to produce electricity around the clock.
A typical scenario: Fervo drills horizontal wells into hot granite, then circulates water through the network to capture heat. The resulting steam drives turbines, providing a steady power source without relying on weather conditions.
This approach is gaining attention because AI data centers need reliable, carbon-free energy. Unlike solar or wind, geothermal can run 24/7, making it an attractive option for tech giants.
Fervo's technology was first deployed at a pilot project in Nevada. The company has since signed contracts with several utilities and plans to expand into other regions.
The stock closed at $33 per share, giving the company a market valuation of around $4 billion. The IPO was upsized from an initial $200 million target to $300 million after strong investor demand.