Geothermal startup Fervo Energy pops 33% in IPO debut fueled by AI data center demand | TechCrunch

"Fervo Energy, the geothermal energy startup, saw its market valuation surpass $10 billion in its public market debut, an increase driven by demand for AI data centers - and the energy that can power them."

"Fervo had raised $1.89 billion in an upsized initial public offering on Wednesday, which initially valued the company at around $7.6 billion. Demand for Fervo stock was so great that the company and its bankers upsized the offering several times, selling an additional 14.6 million shares while lifting the price range twice, ultimately settling on $27 per share."

"Like many other energy companies, Fervo has been buoyed by surging demand from data centers and AI companies, which have been desperate to secure electricity to power their facilities. It's the second energy stock offering to receive a warm welcome in the last few weeks, with nuclear startup X-energy raising $1 billion in its own upsized IPO."

"The basic concept of geothermal energy - using the Earth's heat for power - has been around for decades, but Fervo is part of a new class of startups developing enhanced geothermal, which drills deeper to tap into hotter rocks. To make the most out of an attractive geothermal field, Fervo uses directional drilling techniques pioneered by the oil and gas industry."

Fervo Energy’s public market debut pushed its valuation past $10 billion after an upsized initial public offering. The company raised $1.89 billion, initially valuing it around $7.6 billion, then increasing the offering size and price range multiple times due to strong demand. Shares began trading on the Nasdaq under FRVO and rose about 33% on the first day. Demand was driven by data centers and AI companies seeking reliable electricity. Fervo operates in enhanced geothermal, drilling deeper into hotter rocks, and uses directional drilling techniques adapted from oil and gas. The IPO generated about $500 million more than expected, providing additional cash for growth.

Read at TechCrunch