China Merchants Securities released a research report stating that on January 8, American Electric Power (AEP) announced it exercised an option to purchase up to 1 GW (100 MW initial + 900 MW option) of solid oxide fuel cells (SOFC) from Bloom Energy Corp (BE.US), with a total transaction value of approximately $2.65 billion. Based on prior cooperation information between AEP and BE, the project is expected to serve third-party large-scale data center clients, marking that the application of SOFCs in data center scenarios has officially transitioned from the "validation phase" into the "large-scale volume expansion phase." SOFCs are a critical solution for AI-related power shortages; against the backdrop of limited short-term grid-side expansion capacity, SOFCs already possess strong "essential demand" attributes. The main views of China Merchants Securities are as follows.

The landing of the GW-scale order signifies that the commercial closed-loop for SOFCs powering AI data centers is now fully established. Following the initial 100 MW order, AEP's full exercise of the 900 MW option is another landmark event, subsequent to BE's $5 billion strategic cooperation with Brookfield in Q3 2025. Based on the prior cooperation information between AEP and BE, the project is expected to serve third-party large-scale data center clients. This indicates that the application of SOFCs in data center scenarios has officially moved from the "validation phase" into the "large-scale volume expansion phase." The order not only secures BE's future revenue certainty but also thoroughly validates, at an industrial level, the commercial logic of SOFCs as a core power supply solution for AI data centers.

BE has a substantial order backlog, and its financial inflection point has emerged. Reviewing BE's Q3 2025 performance, revenue reached a record $519 million, Non-GAAP gross margin exceeded 30%, and Non-GAAP operating income surged over four times year-over-year. With the confirmation of the large AEP order, the company's cumulative orders now approach 2 GW. Capacity utilization is expected to increase significantly, thereby diluting unit manufacturing costs. The company's revenue and cash flow are projected to see further explosive growth in 2026, with profitability expected to continue climbing due to economies of scale.

SOFCs are a critical solution for AI-related power shortages. The North American power grid currently faces severe interconnection queue backlogs, transformer shortages, long power transmission and distribution expansion cycles, and lengthy gas turbine delivery times. These issues have become the primary physical bottlenecks hindering the deployment of AI computing power. SOFCs, leveraging advantages such as rapid modular deployment, small footprint, support for off-grid operation, and high power generation efficiency of up to 60%, have become a key solution for enabling rapid power deployment for data centers. Given the difficulty of short-term grid-side expansion, SOFCs already possess strong "essential demand" attributes.

Some companies have entered the global supply chain, and domestic demonstration projects are rapidly catching up with overseas leaders. With BE's orders surging, companies in China that have entered its global supply chain system will see clear incremental earnings growth. Sinocera Intelligent Corporation: As a global leader in electronic ceramics, the company supplies separator plates and electrolyte sheets, which are core consumables for SOFC stacks with high technical barriers and deep integration with BE. Chunhui Intelligent Control: Its equity-accounted company, Chunhui Instruments (planned for 100% acquisition), has deep expertise in heating and sensing and has collaborated with BE for a long time, supplying temperature sensors (with an approximate market share of 70%). Furthermore, domestic SOFC demonstration projects are also advancing rapidly. Recommended stock focuses include: Chunhui Intelligent Control (300943.SZ), Sinocera Intelligent Corporation (300408.SZ), One Stone Group (688733.SH), Vision Group (002733.SZ), Weichai Power (000338.SZ), Sunlord Electronics (002138.SZ), Foran Energy Group (002911.SZ), Dongmu Materials (600114.SH), and ENN Natural Gas (600803.SH).

Risks include downstream demand falling short of expectations, product cost reductions not meeting expectations, and technological progress lagging behind forecasts.