Vertiv just posted the kind of quarter that makes the "AI bubble" crowd go quiet. Orders up 252% year-over-year. Backlog at $15 billion. A book-to-bill ratio of 2.9x — meaning for every dollar they ship, nearly three more are waiting in line. $VRT jumped 20% in a week. And somehow, the stock might still be cheap.
The Numbers That Matter
Everyone talks about Mag-7 capex. Vertiv is the company that actually builds the stuff those billions buy — the cooling systems, the power distribution, the racks that keep AI chips from melting. And business is exploding.
| Metric | Q4 2025 | Q4 2024 | Change |
|---|---|---|---|
| Revenue | $2.88B | $2.35B | +23% |
| Adj. Operating Profit | $668M | $504M | +33% |
| Adj. Operating Margin | 23.2% | 21.5% | +170 bps |
| Adj. EPS | $1.36 | — | Beat by 5.4% |
| Orders Growth (Organic) | — | — | +252% YoY |
| Backlog | $15.0B | $7.2B | +109% |
| Book-to-Bill | 2.9x | — | — |
| Adj. Free Cash Flow | $910M | $362M | +151% |
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Full-year 2025 wasn't a fluke either: organic sales grew 26%, adjusted EPS rose 47%, and free cash flow hit $1.9 billion — up 66% from the prior year. Net leverage dropped to roughly 0.5x. This company is swimming in cash.
What's Actually Happening
The AI capex supercycle has a plumbing problem. Every hyperscaler on the planet is racing to build GPU clusters, and those clusters need power and cooling infrastructure that didn't exist at this scale two years ago. Vertiv sits at the center of that bottleneck.
Over 80% of Vertiv's revenue comes from data center infrastructure. When Amazon spends $200 billion on capex, when Microsoft signs a $9.7 billion deal with IREN for power, when Meta builds out AI factories across three states — Vertiv gets a cut of all of it. They're selling shovels in a gold rush, except these shovels have 23% operating margins and a $15 billion order queue.
The 252% order growth wasn't a one-region spike. Management called it "broad-based across regions, technologies and customers." Americas led, hyperscale and colocation were the primary drivers, but enterprise is picking up too. Trailing twelve-month organic orders grew 81%. This is sustained acceleration, not a blip.
2026 Guidance: They Raised the Bar Again
This is where it gets interesting. Vertiv is guiding for $13.25–13.75 billion in 2026 revenue — that's 27–29% organic growth on top of the 26% they just delivered. Adjusted EPS of $5.97–6.07 implies 42–45% growth. Free cash flow guidance of $2.1–2.3 billion gives them serious firepower after already deploying $1 billion on acquisitions in Q4.
| 2026 Guidance | Range |
|---|---|
| Revenue | $13.25B – $13.75B |
| Organic Growth | 27% – 29% |
| Adj. EPS | $5.97 – $6.07 |
| Adj. EPS Growth | 42% – 45% |
| Adj. Free Cash Flow | $2.1B – $2.3B |
At Friday's close of $234.63, the stock trades at roughly 39x forward earnings. That's expensive for an industrial company. But Vertiv isn't a normal industrial company anymore. It's growing revenue at 27%+ with expanding margins and a backlog that provides visibility through 2027. The trailing P/E of 69x looks scary until you realize earnings are about to jump 43%.
The Bull and Bear Case
Bulls point to the obvious: AI infrastructure spending is accelerating, not peaking. Every major cloud provider is guiding capex higher. Vertiv's backlog provides multi-year revenue visibility. Margins are expanding. And the company is using its cash flow to acquire competitors and expand capacity — the kind of offensive capital allocation you want to see.
Bears worry about the multiple. At 39x forward earnings, any hiccup in execution or a slowdown in hyperscaler spending could send the stock back to earth fast. There's also concentration risk — when 80%+ of your revenue depends on data center buildout, you're making a massive bet that AI capex doesn't hit a wall. And some of those 252% order growth numbers benefit from unusually low Q4 2024 comps.
Both sides have a point. But here's what the bears keep getting wrong: they've been calling this a bubble since Vertiv was at $80. The orders keep growing. The backlog keeps building. And the customers — Amazon, Microsoft, Google, Meta — keep raising their spend.
Bottom Line
Vertiv is the clearest proof point that AI infrastructure spending is real, growing, and far from done. A $15 billion backlog and 2.9x book-to-bill don't lie. The stock isn't cheap, but the growth isn't priced in yet either. If you believe AI capex has another two to three years of runway, $VRT is one of the best ways to play it.
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