FY 2024-12-31 (earlier)
Item 1A. "Risk Factors."
Our worldwide operations are affected by regional and global factors impacting energy demand, including industry trends like
decarbonization, an increasing demand for r enewable energy alternatives, and changes in broader economic and geopolitical conditions .
These trends, along with the growing focus on the digitization and sustainability of the electricity infrastructure, drive growth across each of
our business segments. We believe that our industry-defining technologies and commitment to innovation position us well to capitalize on
these long-term trends:
• Demand growth for electricity generation – Significant investment, infrastructure, and supply diversity will be essential to help meet
forecasted energy demand growth arising from population and global economic growth.
• Decarbonization – The urgency to combat climate change is fueling technology advancements that improve the economic viability and
efficiency of r enewable energy alternatives and facilitate the transition to a more sustainable power sector.
• Evolving generation mix – The power industry is shifting from coal generation to more electricity generated from zero- or low-carbon
energy sources, and an evolving balance of generation sources will be necessary to maintain a reliable, resilient and affordable
system.
• Energy resilience & security – Threats and challenges from extreme weather events, cyber-attacks, and geopolitical tensions have
increased focus on the strength and resilience of power generation and transmission and reinforced the need for a diversified mix of
energy sources.
• Grid modernization and investment – Increased demand and the integration of advanced generation and storage solutions drive the
need to update aging infrastructure with new grid integration and automation solutions.
• Regulatory and policy changes – Government policies and regulations, such as carbon pricing, renewable energy mandates, and
subsidies for renewable energy technologies, can significantly impact the power generation landscape. Staying ahead of regulatory
changes and adapting to new compliance requirements is crucial for maintaining a competitive advantage.
• Financial and investment dynamics – Access to capital and investment trends in the energy sector can influence the development and
deployment of new power generation projects. Understanding market dynamics and securing funding are key to progressing strategic
initiatives.
TRANSITION TO STAND-ALONE CO MPANY
Financial Presentation Under GE Ownership. We completed our separation from General Electric Company (GE) , which now operates
as GE Aerospace, on April 2, 2024 (the Spin-Off). In connection with the Spin-Off, GE distrib ute d all of the shares of our common stock to
its stockholders and we became an independent company. Historically, as a business of GE, we relied on GE to manage certain of our
operations and provide certain services, the costs of which were either allocated or directly billed to us. Accordingly, our historical costs for
such services may not necessarily reflect the actual expenses we would have incurred, or will incur, as an independent company and may
not reflect our results of operations, financial position, and cash flows had we been a separate, stand-alone company during the historical
periods presented. See Note 1 in the Notes to the consolidated and combined financial statements for further information .
Stand-Alone Company Expenses. As a result of the Spin-Off, we are subject to the requirements of the federal and state securities laws
and stock exchange requirements. We have established additional procedures and practices as a stand-alone public company. As a result,
we are incurring additional costs related to external reporting, internal audit, treasury, investor relations, corporate governance, and stock
administration.
Production Tax Credit Investments. Our Financial Services business offers a wide range of financial solutions to customers and projects
that utilize our Power and Wind products and services. These solutions historically included making minority investments in projects, often
through common or preferred equity investments where we generally seek to exit as soon as practicable once a project achieves
commercial operation. Many such investments are in renewable energy U.S. tax equity vehicles that generate various tax credits, including
production tax credits (PTCs), which can be used to offset an equity partner’s tax liabilities in the U.S. and support the overall target return
on investment. In connection with the Spin-Off, GE retained all renewable energy U.S. tax equity investments of $1.2 billion and any tax
attributes from historical tax equity investing activity. We manage these investments under the Framework Investment Agreement with GE.
Additionally, during the second quarter, in connection with GE retaining the renewable energy U.S. tax equity investments, we recognized a
$0.1 billion benefit, recorded in Cost of equipment, related to deferred intercompany profit from historical equipment sales to the related
investees. See Notes 11 , 21 and 23 in the Notes to the consolidated and combined financial statements for further information.
DISPOSITION ACTIVITY . During the second quarter of 2024, our Steam Power business completed the sale of part of its nuclear
activities to Electricité de France S.A. (EDF). In connection with the disposition, we received net cash proceeds of $0.6 billion , which is
s ubject to customary working capital and other post-closing adjustments . As a result, we recog nized a pre-tax gain of $1.0 billion recorded
in Other income (expense) – net in our Consolidated and Combined Statement of Income (Loss). See Not es 3 , 15 , 16 and 19 in the Notes
to the consolidated and combined financial statements for further information.
ARBITRATION REFUND . In June 2024, we received $306 million in cash, which represented the return of cash payments we
previously made relating to two partial withdrawal liability assessments issued by a multiemployer pension plan (Fund) to which we
contribute, plus interest on such amounts. We challenged the assessments in arbitration, but under ERISA, we were required to make
2024 FORM 10-K 36
monthly payments from May 2019 to September 2023 while the matter was arbitrated. In December 2023, an arbitrator ruled that we were
exempt from the alleged liability, a decision that was appealed in January 2024 in a U.S. district court. That court upheld the arbitration
ruling in February 2025. The appeal period for that court's ruling has not expired. The arbitration ruling triggered a legal obligation for the
Fund to return the payments to us with interest, which it did in June 2024. During the second quarter, $254 million of cash, constituting the
payments previously made to the Fund, was recorded in Selling, general, and administrative expenses and $52 million of cash, constituting
interest on such amounts, was recorded in Interest and other financial charges – net in our Consolidated and Combined Statement of
Income (Loss). As this dispute is not yet resolved, we cannot predict its ultimate resolution, including whether we will retain the funds
following all final appeals, whether we are entitled to additional interest, or whether the Fund may contend it is owed interest if it prevails.
OFFSH ORE WIND. On July 13, 2024, a wind turbine blade event occurred, related to a manufacturing deviation, at the Vineyard Wind
offshore wind farm where we are the manufacturer and supplier of our newly developed Haliade-X 220m wind turbines (Haliade-X). On July
15, 2024, BSEE issued a suspension order to cease power production and the installation of new wind turbines at the project site. On
August 10, 2024, BSEE issued a superseding order allowing us to resume the installation of towers and nacelles, subject to certain
conditions. On October 22, 2024, BSEE issued another superseding order allowing us to resume the installation of new blades, subject to
certain conditions. In December, the first new blade set was installed, and commercial power production by that turbine commenced. On
January 17, 2025, BSEE terminated its suspension order. Going forward, the installation of new blades and the production of power are
subject to specified conditions and we will be required to remove blades previously installed. In addition to the blade event at the Vineyard
Wind offshore wind farm, there have been blade events in prior quarters related to commissioning and installation at the Dogger Bank
offshore wind farm.
As we work through these issues, we are gaining experience across our Haliade-X backlog related to installation timelines, including vessel
availability, manufacturing and quality control processes, and various other project activities. Based on this experience, we are developing
and implementing our remediation plans, which includes updates to our project timelines to account for the slower pace of execution.
As a result of the above, we recorded incremental contract losses of approximately $0.9 billion in the third and fourth quarters for both
projects which include the estimated impact of changes in execution timelines, project-related commercial liabilities, costs to remediate
quality issues including the removal of previously installed blades at the Vineyard Wind project, and additional project-related supply chain
and manufacturing costs. Additional changes or other developments could have an adverse effect on our cash collection timelines and
contract margins and could result in further losses, which could be material.
In addition, on September 12, 2024, we entered into a settlement agreement regarding a project that was previously canceled by a
customer resulting in a gain of approximately $0.3 billion in the third quarter, which was recorded as $0.5 billion in revenues and $0.2 billion
in cost of sales. The settlement included recovery of costs previously incurred on the canceled project.
RESULTS OF OPERATIONS
Summary of Results. RPO was $119.0 billion and $115.6 billion as of December 31, 2024 and 2023 , respectively. For the year ended
December 31, 2024 , total revenues were $34.9 billion , an increase of $1.7 billion for the year. Net income (loss) was $1.6 billion , an
in crease of $2.0 billion in net income for the year, and net income (loss) margin was 4.5% . Diluted earnings (loss) per share was $5.58 for
the year ended December 31, 2024 , an increase in diluted earnings per share of $7.18 for the year. Cash flows from (used for) operating
activities were $2.6 billion and $1.2 billion for the years ended December 31, 2024 and 2023 , respectively.
For the year ended December 31, 2024 , Adjusted EBITDA* was $2.0 billion , an increase of $1.2 billion . Free cash flow* was $1.7 billion
and $0.4 billion for the years ended December 31, 2024 and 2023 , respectively.
RPO, a measure of backlog, includes unfilled firm and unconditional customer orders for equipment and services, excluding any purchase
order that provides the customer with the ability to cancel or terminate without incurring a substantive penalty. Services RPO includes the
estimated life of contract sales related to long-term service agreements which remain unsatisfied at the end of the reporting period,
excluding contracts that are not yet active. Services RPO also includes the estimated amount of unsatisfied performance obligations for
time and material agreements, material services agreements, spare parts under purchase order, multi-year maintenance programs, and
other services agreements, excluding any order that provides the customer with the ability to cancel or terminate without incurring a
substantive penalty. See Note 9 in the Notes to the consolidated and combined financial statements for further information.
RPO December 31
2024
2023
2022
Equipment
$ 43,047
$ 40,478
$ 31,902
Services
75,976
75,120
72,997
Total RPO
$ 119,023
$ 115,598
$ 104,899
As of December 31, 2024 , RPO increase d $3.4 billion ( 3% ) from December 31, 2023 , primarily at Electrification by $7.1 billion from orders
outpacing revenues across all businesses; at Power, due to orders outpacing revenues for Gas Power equipment and services, partially
offset by a reduction of approximately $3.9 billion related to the sale of a portion of Steam Power nuclear activities to EDF; partially offset at
Wind, due to decreases at Offshore Wind as we continue to execute on our contracts and finalized the settlement of a previously canceled
project in the third quarter, and decreases at Onshore Wind due to revenues outpacing orders.
REVENUES
2024
2023
2022
Equipment revenues
$ 18,952
$ 18,258
$ 15,819
Services revenues
15,983
14,981
13,835
Total revenues
$ 34,935
$ 33,239
$ 29,654
*Non-GAAP Financial Measure
2024 FORM 10-K 37
For the year ended December 31, 2024 , total revenues increase d $1.7 billion ( 5% ). Services revenues increased in all segments,
primarily at Power due to growth in Gas Power and Steam Power from favorable price and volume. Equipment revenues increased at
Electrification, led by growth at Grid Solutions and Power Conversion; and at Power from Heavy-Duty Gas Turbine deliveries and project
commissioning; partially offset at Wind, from decreases at Offshore Wind, where revenue decreased as a result of slower execution which
was partially offset by revenue recorded on the settlement of a previously canceled project in the third quarter and increased revenues at
Onshore Wind.
Organic revenues* exclude the effects of acquisitions, dispositions, and foreign currency. Excluding these effects, organic revenues*
increase d $2.1 billion ( 7% ) , organic servic es revenues* increased $1.2 billion ( 8% ), and organic equipment revenues* increased $1.0 billion
( 5% ). Organic revenues * increased at Electrification and Power, partially offset by Wind.
EARNINGS (LOSS)
2024
2023
2022
Operating income (loss)
$ 471
$ (923)
$ (2,881)
Net income (loss)
1,559
(474)
(2,722)
Net income (loss) attributable to GE Vernova
1,552
(438)
(2,736)
Adjusted EBITDA*
2,035
807
(428)
Diluted earnings (loss) per share(a)
5.58
(1.60)
(10.00)
(a) The computation of earnings (loss) per share for all periods through April 1, 2024 was calculated using 274 million common shares that
were issued upon Spin-Off and excludes Net loss (income) attributable to noncontrolling interests. For periods prior to the Spin-Off, the
Company participated in various GE stock-based compensation plans. For periods prior to the Spin-Off, there were no dilutive equity
instruments as there were no equity awards of GE Vernova outstanding prior to Spin-Off.
For the year ended December 31, 2024 , operating income (loss) was $0.5 billion , a $1.4 billion increase, primarily due to: an increase in
segment results at Power of $0.5 billion , primarily attributable to Gas Power, where higher volume, favorable pricing, and increased
productivity more than offset the impact of inflation; at Electrification of $0.4 billion , primarily due to higher volume, price, and productivity;
at Wind of $0.4 billion , primarily at Onshore Wind as a result of improved pricing, market selectivity, and the impact of cost reduction
activities, and a gain recorded on the settlement of a previously canceled project at Offshore Wind, which was partially offset by
incremental contract losses at Offshore Wind; as well as $0.3 billion re ceived related to an arbitration refund and a $0.1 billion benefit
related to deferred intercompany profit that was recognized upon GE retaining the renewable energy U.S. tax equity investments in
connection with the Spin-Off in the second quarter; partially offset by higher corporate costs required to operate as a stand-alone public
company and separation costs.
Net income (loss) and Net income (loss) margin were $1.6 billion and 4.5% , respectively, for the year ended December 31, 2024 , an
increase of $2.0 billion and 5.9% , respectively, for the year, primarily due to an increase in operating income (loss) of $1.4 billion and an
increase in other income of $1.0 billion , driven by a $1.0 billion pre-tax gain from the sale of a portion of Steam Power nuclear activities to
EDF , partially offset by an increase in provision for income taxes of $0.6 billion .
Adjusted EBITDA* and Adjusted EBITDA margin* were $2.0 billion and 5.8% , respectively, for the year ended December 31, 2024 , an
increase of $1.2 billion and 3.4% , respectively, primarily driven by increases in segment results at Power, Wind, and Electrification.
SEGMENT OPERATIONS . Segment revenues include sales of equipment and services by our segments. Segment EBITDA is
determined based on performance measures used by our Ch ief Operating Decision Maker, who is our Chief Executive Officer (CEO), to
assess the performance of each business in a given period. In connection with that assessment, the CEO may exclude certain non-cash
charges, such as depreciation and amortization, impairments and other matters, major restructuring programs, and certain gains and
losses from purchases and sales of business interests. Certain corporate costs, including those related to shared services, employee
benefits and IT, are allocated to our segments based on usage or their relative net cost of operations.
SUMMARY OF REPORTABLE SEGMENTS
2024
2023
2022
Power
$ 18,127
$ 17,436
$ 16,124
Wind
9,701
9,826
8,905
Electrification
7,550
6,378
5,076
Eliminations and other
(442)
(401)
(451)
Total revenues
$ 34,935
$ 33,239
$ 29,654
Segment EBITDA
Power
$ 2,268
$ 1,722
$ 1,655
Wind
(588)
(1,033)
(1,710)
Electrification
679
234
(164)
Corporate and other(a)
(323)
(116)
(209)
Adjusted EBITDA*(b)
$ 2,035
$ 807
$ (428)
(a) Includes our Financial Services business and other general corporate expenses , including costs required to operate as a stand-alone
public company.
(b) See "—Non-GAAP Financial Measures" for additional information related to Adjusted EBITDA*. Adjusted EBITDA* includes interest and
other financial charges and the benefit for income taxes of Financial Services as this business is managed on an after-tax basis due to
its strategic investments in tax equity investments.
*Non-GAAP Financial Measure
2024 FORM 10-K 38
POWER
Orders in units
2024
2023
2022
Gas Turbines
112
93
92
Heavy-Duty Gas Turbines
68
41
30
HA-Turbines
25
8
9
Aeroderivatives
44
52
62
Gas Turbine Gigawatts
20.2
9.5
9.8
Sales in units
2024
2023
2022
Gas Turbines
75
91
101
Heavy-Duty Gas Turbines
48
58
53
HA-Turbines
15
14
11
Aeroderivatives
27
33
48
Gas Turbine Gigawatts
11.9
13.8
11.1
RPO December 31
2024
2023
2022
Equipment
$ 12,461
$ 13,636
$ 13,579
Services
60,890
59,338
57,355
Total RPO
$ 73,351
$ 72,974
$ 70,934
RPO as of December 31, 2024 increased $0.4 billion ( 1% ) from December 31, 2023 , primarily at Gas Power due to increases in services
and equipment, partially offset by a reduction of approximately $3.9 billion related to the sale of a portion of Steam Power nuclear activities
to EDF.
SEGMENT REVENUES AND EBITDA
2024
2023
2022
Gas Power
$ 14,465
$ 13,220
$ 12,079
Nuclear Power
819
827
699
Hydro Power
781
887
703
Steam Power
2,063
2,502
2,643
Total segment revenues
$ 18,127
$ 17,436
$ 16,124
Equipment
$ 5,708
$ 5,598
$ 4,896
Services
12,419
11,838
11,228
Total segment revenues
$ 18,127
$ 17,436
$ 16,124
Segment EBITDA
$ 2,268
$ 1,722
$ 1,655
Segment EBITDA margin
12.5
%
9.9
%
10.3
%
For the year ended December 31, 2024 , segment revenues were up $0.7 billion ( 4% ) and segment EBITDA was up $0.5 billion
( 32% ).
Segment revenues increased $1.2 billion ( 7% ) organically*, primarily at Gas Power equipment from Heavy-Duty Gas Turbine deliveries and
project commissioning, and an increase in Gas Power services from favorable price and volume in both contractual and non-contractual
services, as well as in Steam Power services.
Segment EBITDA increased $0.5 billion ( 24% ) organically*, primarily at Gas Power where higher volume, favorable pricing, and increased
productivity were partially offset by the impact of inflation, and increases in Steam Power primarily due to favorable impact of pricing and
productivity partially offset by the impact of inflation.
WIND
Onshore and Offshore Wind orders in units
2024
2023
2022
Wind Turbines
1,212
2,290
2,243
Repower Units
656
446
411
Wind Turbine and Repower Units Gigawatts
5.3
9.1
8.5
Onshore and Offshore Wind sales in units
2024
2023
2022
Wind Turbines
1,778
2,225
2,190
Repower Units
298
179
580
Wind Turbine and Repower Units Gigawatts
7.8
8.8
8.8
*Non-GAAP Financial Measure
2024 FORM 10-K 39
RPO December 31
2024
2023
2022
Equipment
$ 10,720
$ 13,709
$ 12,030
Services
11,962
13,240
13,595
Total RPO
$ 22,682
$ 26,949
$ 25,625
R PO as of December 31, 2024 decreased $4.3 billion ( 16% ) from December 31, 2023 primarily due to decreases at Offshore Wind as we
continue to execute on our contracts and have finalized the settlement of a previously canceled project in the third quarter, and decreases
at Onshore Wind as revenue outpaced new orders, specifically in the U.S. where a large order was booked in 2023 and the execution
began in 2024, and continued selectivity in our international markets.
SEGMENT REVENUES AND EBITDA
2024
2023
2022
Onshore Wind
$ 7,781
$ 7,761
$ 7,941
Offshore Wind
1,377
1,455
531
LM Wind Power
542
610
433
Total segment revenues
$ 9,701
$ 9,826
$ 8,905
Equipment
$ 8,047
$ 8,335
$ 7,600
Services
1,654
1,491
1,305
Total segment revenues
$ 9,701
$ 9,826
$ 8,905
Segment EBITDA
$ (588)
$ (1,033)
$ (1,710)
Segment EBITDA margin
(6.1)
%
(10.5)
%
(19.2)
%
For the year ended December 31, 2024 , segment revenues were down $0.1 billion ( 1% ) and segment EBITDA was up $0.4 billion
( 43% ).
Segment revenues decreased $0.1 billion ( 1% ) organically*, primarily at Offshore Wind due to slower execution, partially offset by revenues
recorded on the settlement of a previously canceled project in the third quarter, and less demand for blades from external customers at LM.
Onshore Wind revenues increased slightly due to improved pricing and delivery of more units in the U.S., partially offset by lower revenue
in the international market as we continue our selectivity resulting in fewer unit deliveries.
Segment EBITDA increased $0.4 billion ( 42% ) organically*, due to improved pricing, market selectivity, and cost reduction activities at
Onshore Wind, and a gain recorded on the settlement of a previously canceled project at Offshore Wind, partially offset by higher contract
losses at Offshore Wind compared to the prior year of $0 .6 billion.
ELECTRIFICATION
RPO December 31
2024
2023
2022
Equipment
$ 20,005
$ 13,233
$ 6,384
Services
3,448
3,109
2,587
Total RPO
$ 23,453
$ 16,342
$ 8,971
RPO as of December 31, 2024 increased $7.1 billion ( 44% ) from December 31, 2023 primarily due to orders outpacing revenues across all
businesses.
SEGMENT REVENUES AND EBITDA
2024
2023
2022
Grid Solutions
$ 4,957
$ 3,955
$ 3,133
Power Conversion
1,194
1,027
843
Electrification Software
917
874
804
Solar & Storage Solutions
482
522
296
Total segment revenues
$ 7,550
$ 6,378
$ 5,076
Equipment
$ 5,534
$ 4,532
$ 3,470
Services
2,015
1,846
1,606
Total segment revenues
$ 7,550
$ 6,378
$ 5,076
Segment EBITDA
$ 679
$ 234
$ (164)
Segment EBITDA margin
9.0
%
3.7
%
(3.2)
%
For the year ended December 31, 2024 , segment revenues were up $1.2 billion ( 18% ) and segment EBITDA was up $0.4 billion .
Segment revenues increased $1.2 billion ( 18% ) organically*, led by growth in equipment at Grid Solutions and Power Conversio n.
Segment EBITDA increased $0.4 billion organically*, primarily driven by higher volume, price, and productivity.
*Non-GAAP Financial Measure
2024 FORM 10-K 40
OTHER INFORMATION
Gross Profit and Gross Margin. Gross profit was $6.1 billion , $4.8 billion , and $3.5 billion and gross margin was 17.4% , 14.5% , and
11.7% for the years ended De cember 31, 2024, 2023, and 2022, respectively. The increase in gross profit in 2024 was due to an increase
at Power due to Gas Power Services driven from volume, mix, productivity, and price, which more than offset inflation; an increase at
Electrification due to higher volume, price, and cost productivity at Grid Solutions and Electrification Software ; and an increase at Wind, due
to Onshore Wind through improved pricing, volume, market selectivity, and the impact of cost reduction activities, and a gain recorded on
the settlement of a previously canceled project at Offshore Wind, partially offset by incremental contract losses at Offshore Wind.
Selling, General, and Administrative. S elling, general, and administrative costs were $4.6 billion , $4.8 billion , and $5.4 billion and
comprised 13.3% , 14.6% , and 18.1% of revenues for the years ended December 31, 2024, 2023, and 2022, respectively. The decrease in
costs in 2024 was primarily attributable to a $0.3 billion arbitration refund received in the second quarter of 2024 and cost reduction
initiatives, partially offset by higher corporate costs required to operate as a stand-alone public company and separation costs.
Restructuring and Other Charges. We continuously evaluate our cost structure and are implementing several restructuring and process
transformation actions considered necessary to simplify our organizational structure. In addition, in connection with the Spin-Off, we
incurred and will continue to incur certain one-time separation costs and recognized a benefit related to deferred intercompany profit upon
GE retaining the renewable energy U.S. tax equity investments. See Note 23 in the Notes to the consolidated and combined financial
statements for further information.
Research and Development (R&D). We conduct R&D activities to continually enhance our existing products and services, develop new
products and services to meet our customers’ changing needs and demands, and address new market opportunities. In addition to funding
R&D internally, we also receive funding externally from our customers, partners, and governments, which contributes to the overall R&D for
the Company.
GEV funded
Customer and Partner funded(a)
Total R&D
2024
2023
2022
2024
2023
2022
2024
2023
2022
Power
$ 391
$ 324
$ 308
$ 187
$ 113
$ 86
$ 578
$ 437
$ 394
Wind
222
248
368
8
18
19
230
266
387
Electrification
349
324
303
8
—
—
357
324
303
Other(b)
20
—
—
57
56
60
77
56
60
Total
$ 982
$ 896
$ 979
$ 260
$ 187
$ 165
$ 1,242
$ 1,083
$ 1,144
(a) Primarily related to funding in our Nuclear Power business.
(b) Includes Advanced Research.
Interest and Other Financial Charges – Net . Interest and other financial charges – net was a $0.1 billion benefit for the year ended
December 31, 2024 and a $0.1 billion and $0.2 billion charge for the years ended December 31, 2023 and 2022, respectively. The higher
income in 2024 was primarily due t o a higher average balance of invested funds and interest received from an arbitration refund. T he
primary components of net interest and other financial charges are fees on cash management activities, interest on borrowings, and
interest earned on cash balances and short-term investments.
Income Taxes. The effective tax rate and provision (benefit) for income taxes for the years ended December 31, 2024 , 2023 , and 2022
were as follows:
2024
2023
2022
Effective tax rate (ETR)
37.6 %
(264.1) %
(10.0) %
Provision (benefit) for income taxes
$ 939
$ 344
$ 248
The effective tax rate for year ended December 31, 2024 was impacted primarily by an increase in valuation allowances in the U.S. and in
certain foreign jurisdictions with losses providing no tax benefit, partially offset by a pre-tax gain with an insignificant tax impact from the
sale of a portion of Steam Power nuclear activities to EDF.
We recorded an income tax expense on a pre-tax loss in the years ended December 31, 2023 and 2022 due to taxes in profitable
jurisdictions and an increase in valuation allowances from losses providing no tax benefit in other jurisdictions.
See Note 15 in the Notes to the consolidated and combined financial statements for further information.
CAPIT AL RESOUR CES AND LIQUIDITY . Historically, we participated in cash pooling and other financing arrangements with GE to
manage liquidity and fund our operations. As a result of completing the Spin-Off, we no longer participate in these arrangements and our
C ash, cash equivalents, and restricted cash are held and used solely for our own operations. Our capital structure, long-term commitments,
and sources of liquidity have changed significantly from our historical practices. In connection with the Spin-Off, we received $0.8 billion of
cash from GE through a cash contribution of $0.5 billion to fund future GE Vernova operations and a cash transfer of $0.3 billion restricted
in connection with certain legal matters associated with legacy GE operations, such that our cash balance on the date of the completion of
the Spin-Off was approximately $4.2 billion . As of December 31, 2024 , our Cash, cash equivalents, and restricted cash was $8.2 billion ,
$0.4 billion of which was restricted use c ash . During the year ended December 31, 2024 , we received proceeds of $0.9 billion, net of
directly attributable taxes paid, from the sales of a portion of our equity interest in GE Vernova T&D India Ltd (formerly known as GE T&D
India Ltd) , proceeds of $0.2 billion from the sale of a portion of our investment in China XD Electric Co., Ltd., net cash proceeds of $0.6
billion from our Steam Power business sale of part of its nuclear activities to EDF, and a cash refund of $0.3 billion in connection with an
arbitration proceeding . In addition, we have access to a $3.0 billion committed revolving credit facility (Revolving Credit Facility). See “—
Capital Resources and Liquidity—Debt” for further information. We believe our unrestricted c ash, cash equivalents , future cash flows
2024 FORM 10-K 41
generated from operations, and committed credit facility will be responsive to the needs of our current and planned operations for at least
the next 12 months.
On December 10, 2024, the Board of Directors declared a $0.25 per share quarterly dividend on the outstanding common stock, which we
paid on January 28, 2025, to stockholders of record as of December 20, 2024. In addition, on December 10, 2024, we announced that the
Board of Directors had authorized up to $6 billion of common stock repurchases.
Consolidated and Combined Statement of Cash Flows. The most significant source of cash flows from operations is customer-related
activities, the largest of which is collecting cash resulting from equipment or services sales. The most significant operating uses of cash are
to pay our suppliers, employees, tax authorities, and postretirement plans. We measure ourselves on a free cash flow* basis. We believe
that free cash flow* provides management and investors with an important measure of our ability to generate cash on a normalized basis.
Free cash flow* also provides insight into our ability to produce cash subsequent to fulfilling our capital obligations; however, free cash flow*
does not delineate funds available for discretionary uses as it does not deduct the payments required for certain investing and financing
activities.
We typically invest in PP&E over multiple periods to support new product introductions and increases in manufacturing capacity and to
perform ongoing maintenance of our manufacturing operations. We believe that while PP&E expenditures will fluctuate period to period, we
will need to maintain a material level of net PP&E spend to maintain ongoing operations and growth of the business.
FREE CASH FLOW (NON-GAAP)
2024
2023
Cash from (used for) operating activities (GAAP)
$ 2,583
$ 1,186
Add: Gross additions to property, plant, and equipment and internal-use software
(883)
(744)
Free cash flow (Non-GAAP)
$ 1,701
$ 442
Cash from (used for) operating activities was $2.6 billion and $1.2 billion for the years ended December 31, 2024 and 2023 ,
respectively.
Cash from (used for) operating activities increased by $1.4 billion in 2024 compared to 2023 primarily driven by: higher net income (after
adjusting for depreciation of PP&E, amortization of intangible assets, and (gains) losses on purchases and sales of business interests) of
$1.3 billion , including the impact of a $0.3 billion cash refund we received in connection with an arbitration proceeding in the second quarter
of 2024; an increase of $1.7 billion in accounts payable and equipment project payables, primarily due to lower disbursements, including a
lower impact related to prepayments compared to the prior year, and higher purchases ; partially offset by a decrease in current contract
assets of $(0.5) billion, due to higher revenue recognition, partially offset by an unfavorable change in estimated profitability, in Gas Power;
a decrease in current receivables of $(0.5) billion, primarily due to higher billings, an increase in past dues, and increases in supplier
advances; a decrease in inventories of $(0.4) billion, primarily due to higher build in Power; and a decrease in due to related parties of
$(0.3) billion, primarily due to settlements of payables with GE prior to the Spin-Off in 2024.
Cash from operating activities of $2.6 billion for the year ended December 31, 2024 included a $1.1 billion inflow from changes in working
capital. The cash inflow from changes in working capital was primarily driven by: contract liabilities and current deferred income of $2.8
billion, driven by net collections at Power, and down payments and collections on several large projects in Grid Solutions at Electrification,
partially offset by liquidations and the settlement of a previously canceled project at Wind; accounts payable and equipment project
payables of $1.1 billion, due to material purchases outpacing disbursements, including an increase in prepayments as we more closely
align the timing of disbursements and collections ; current receivables of $(1.3) billion, driven by billings outpacing collections, an increase in
past dues, and increases in supplier advances in order to secure future volume, primarily in Power; inventories of $(0.6) billion, primarily in
Gas Power, to support fulfillment and deliveries expected in 2025, partially offset by liquidations in Wind; current contract assets of $(0.4)
billion, driven by revenue recognition exceeding billings on our equipment and other service agreements in Wind and Electrification, and on
our contractual service agreements in Gas Power, partially offset by an unfavorable change in estimated profitability; and changes in due to
related parties of $(0.4) billion, primarily due to settlements of payables with GE prior to the Spin-Off.
Cash from operating activities of $1.2 billion for the year ended December 31, 2023 included a $1.1 billion inflow from changes in working
capital. The cash inflow from changes in working capital was primarily driven by: contract liabilities and current deferred income of $2.8
billion as a result of project collections and down payments in Power, Wind and Electrification outpacing revenue recognition; partially offset
by current receivables of $(0.8) billion, driven by billings outpacing collections across our businesses; and accounts payable and equipment
project payables of $(0.7) billion, driven by higher disbursements, including prepayments of supply chain finance programs at Wind and
Power.
Cash from (used for) investing activities was less than $(0.1) billion and $(0.7) billion for the years ended December 31, 2024 and 2023 ,
respectively.
Cash from (used for) investing activities increased by $0.7 billion in 2024 compared to 2023 primarily driven by: net proceeds from principal
business dispositions of $0.8 billion, primarily as a result of our Steam Power business sale of part of its nuclear activities to EDF in our
Power segment; and the nonrecurrence of the net impact of our acquisition of Nexus Controls and other investment sales of $0.2 billion in
2023; partially offset by an increase in additions to PP&E and internal-use software of $0.1 billion. Net sales of and distributions from equity
method investments were flat, as t he sale of a 3% equity interest in China XD Electric Co., Ltd. in the fourth quarter of 202 4 was offset by
lower sales in our Financial Services business. Cash used for additions to PP&E and internal-use software, which is a component of free
cash flow*, was $0.9 billion and $0.7 billion fo r the years ended December 31, 2024 and 2023 , respectively.
*Non-GAAP Financial Measure
2024 FORM 10-K 42
Cash from (used for) financing activities was $3.7 billion and $(0.4) billion for the years ended December 31, 2024 and 2023 ,
respectively. Cash from financing activities increased by $4.1 billion in 2024 compared to 2023 primarily driven by: higher transfers from
parent of $3.3 billion; and proceeds from the sales of approximately 24% of our equity interest in GE Vernova T&D India Ltd, a power
transmission and distribution solution provider, of $0.9 billion in 2024, net of directly attributable taxes paid, which is reflected in All other
financing activities. After the sales, we continue to retain a controlling interest in GE Vernova T&D India Ltd.
Material Cash Requirements. In the normal course of business, we enter into contracts and commitments that oblige us to make
payments in the future. See Notes 7 and 22 in the Notes to the consolidated and combined financial statements for further information
regarding our obligations under lease and guarantee arrangements as well as our investment commitments. See Note 13 in the Notes to
the consolidated and combined financial statements for further information regarding material cash requirements related to our pension
obligations.
Debt. As o f both December 31, 2024 and 2023 , we had $0.1 billion of total debt, excluding finance leases. We have a $3.0 billion Revolving
Credit Facility to fund near-term intra-quarter working capital needs as they arise. In addition, we have a $3.0 billion committed trade
finance facility (Trade Finance Facility, and together with the Revolving Credit Facility, the Credit Facilities ). The Trade Finance Facility has
not been and is not expected to be utilized, and does not contribute to direct liquidity. We believe that our financing arrangements, future
cash from operations, and access to capital markets will provide adequate resources to fund our future cash flow needs. For more
information about the Credit Facilities, refer to our Current Report on Form 8-K, filed with the SEC on April 2, 2024, and see Note 22 in the
Notes to the consolidated and combined financial statements.
Credit Ratings and Conditions. We have access to the Revolving Credit Facility to fund operations, and we may rely on debt capital
markets in the future to further su pport our liquidity needs. The cost and availability of any debt financing is influenced by our credit ratings
and market conditions. Standard and Poor's Global Ratings (S&P) and Fitch Ratings (Fitch) have issued credit ratings for the Company.
Our credit ratings as of the date of this filing are set forth in the following table.
S&P
Fitch
Outlook
Stable
Stable
Long term
BBB-
BBB
We are disclosing our credit ratings to enhance understanding of our sources of liquidity and the effects of our ratings on our costs of funds
and access to credit. Our ratings may be subject to a revision or withdrawal at any time by the assigning rating organization, and each
rating should be evaluated independently of any other rating. S ee Item 1A. "Risk Factors — Risks Relating to Our Business and Our Industry
— Risks Relating to Operations and Supply Chain" and Item 1A. "Risk Factors — Risks Relating to Financial, Accounting, and Tax Matters"
for a description of some of the potential consequences of a reduction in our credit ratings.
If we are unable to maintain investment grade ratings, we could face significant challenges in being awarded new contracts, substantially
increasing financing and hedging costs, and refinancing risks as well as substantially decreasing the availability of credit. As of December
31, 2024 , we estimated an insignificant liquidity impact of a ratings downgrade below investment grade.
Parent Company Credit Support. Prior t o the Spin-Off, to support GE Vernova businesses in selling products and services globally, GE
often entered into contracts on behalf of GE Vernova or issued parent company guarantees or trade finance instruments supporting the
performance of its subsidiary legal entities transacting directly with customers, in addition to providing similar credit support for non-
customer related activities of GE Vernova (collectively, the GE credit support) . In connection with the Spin-Off, we are working to seek
novation or assignment of GE credit support, the majority of which relates to parent company guarantees, associated with GE Vernova
legal entities from GE to GE Vernova. For GE credit support that remained outstanding at the Spin-Off, GE Vernova is obligated to use
reasonable best efforts to terminate or replace, and obtain a full release of GE’s obligations and liabilities under, all such credit support.
B eginning in 2025, GE Vernova will pay a quarterly fee to GE based on amounts related to the GE credit support. GE Vernova is subject to
other contractual restrictions and requirements while GE continues to be obligated under such credit support on behalf of GE Vernova. In
addition, w hile GE will remain obligated under the contract or instrument, GE Vernova will be obligated to indemnify GE for credit support
related payments that GE is required to make and possible related costs .
As of December 31, 2024 , we estimated GE Vernova RPO and other obligations that relate to GE credit support to be approximately $17
billion , an over 74% reduction since December 31, 2023 and over 52% reduction since the Spin-Off. We expect approximately $10 billion of
the RPO related to GE credit support obligations to contractually mature within five years from December 31, 2024 . The underlying
obligations are predominantly customer contracts that GE Vernova performs in the normal course of its business. We have no known
instances historically where payments or performance from GE were required under parent company guarantees relating to GE Vernova
customer contracts.
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS . For a discussion of recently issued accounting standards, see Note 2
in the Notes to the consolidated and combined financial statements for further information.
CRITICAL ACCOUNTING ESTIMATES . To prepare our consolidated and combined financial statements in accordance with U.S.
GAAP, management makes estimates and assumptions that may affect the reported amounts of our assets and liabilities, including our
contingent liabilities, as of the date of our financial statements and the reported amounts of our revenues and expenses during the reporting
periods. Our actual results may differ from these estimates. We consider estimates to be critical (i) if we are required to make assumptions
about material matters that are uncertain at the time of estimation or (ii) if materially different estimates could have been made or it is
reasonably likely that the accounting estimate will change from period to period. The following are areas considered to be critical and
require management’s judgment: Allocations from GE, Revenue Recognition on Service Agreements, Revenue Recognition on Equipment
on an Over-Time Basis, Goodwill, Income Taxes, Postretirement Benefit Plans, Loss Contingencies, and Environmental and Asset
Retirement Obligations. See Note 2 in the Notes to the consolidated and combined financial statements for further information regarding
our significant accounting policies.
2024 FORM 10-K 43
Allocations From GE. The consolidated and combined financial statements include expense allocations prior to the Spin-Off for certain
corporate, infrastructure, and shared services expenses provided by GE on a centralized basis, including, but not limited to, finance, supply
chain, human resources, IT, insurance, employee benefits, and other expenses that are either specifically identifiable or clearly applicable
to GE Vernova. These expenses have been allocated to us on the basis of direct usage when identifiable, with the remainder allocated on a
pro rata basis using an applicable measure of headcount, revenue, or other allocation methodologies that are considered to be a
reasonable reflection of the utilization of services provided or the benefit received by GE Vernova during the periods presented.
Management considers that such allocations have been made on a reasonable basis; however, these allocations may not be indicative of
the actual expense that would have been incurred had we operated as an independent, stand-alone public entity.
Revenue Recognition on Service Agreements. We have long-term service agreements with our customers within our Power and Wind
segments that require us to maintain the customers’ assets over the contract terms, which generally range from 5 to 25 years.
Power. Within Power, these long-term service agreements, which we refer to as contractual service agreements, generally include
maintenance associated with major outage events and revenues are recognized as we perform under the arrangements using the
percentage of completion method, which is based on costs incurred relative to our estimate of total expected costs. This requires us to
make estimates of customer payments expected to be received over the contract term as well as the costs to perform required
maintenance services.
Customers generally pay us based on the utilization of the asset (per hour of usage for example) or upon the occurrence of a major
maintenance event within the contract. As a result, a significant estimate in determining expected revenues of a contract is estimating how
customers will utilize their assets over the term of the agreement. The estimate of utilization, which can change over the contract life,
impacts both the amount of customer payments we expect to receive and our estimate of future contract costs. Customers’ asset utilization
will influence the timing and extent of maintenance events over the life of the contract. We generally use historical utilization trends in
developing our revenue estimates. To develop our cost estimates, we consider the timing and extent of future maintenance events,
including the amount and cost of labor, spare parts and other resources required to perform the services.
We routinely review estimates under long-term service agreements and regularly revise them to adjust for changes in outlook. These
revisions are based on objectively verifiable information that is available at the time of the review. Contract modifications that change the
rights and obligations, as well as the nature, timing and extent of future cash flows, are evaluated for potential price concessions, contract
asset impairments and significant financing to determine if adjustments of earnings are required before effectively accounting for a modified
contract as a new contract.
We regularly assess expected billings adjustments and customer credit risk inherent in the carrying amounts of receivables and contract
assets, including the risk that contractual penalties may not be sufficient to offset our accumulated investment in the event of customer
termination. We gain insight into future utilization and cost trends, as well as credit risk, through our knowledge of the installed base of
equipment and close interaction with our customers that comes with supplying critical services and parts over extended periods. Revisions
may affect a long-term services agreement’s total estimated profitability resulting in an adjustment of earnings.
As of December 31, 2024, our net long-term service agreements balance of $3.5 billion represents approximately 5% of our total estimated
life of contract billings. Our contracts (on average) are approximately 29% complete based on costs incurred to date and our estimate of
future costs. Revisions to our estimates of future billings or costs that increase or decrease total estimated contract profitability by one
percentage point would increase or decrease the long-term service agreements contract assets balance by $0.2 billion. Billings on these
contracts were $5.0 billion during both the years ended December 31, 2024 and 2023. See Notes 2 and 9 in the Notes to the consolidated
and combined financial statements for further information.
Wind. The equipment within our Wind segment generally does not require major planned outages and revenues associated with service
agreements are recognized on a straight-line basis consistent with the nature, timing and extent of these arrangements, which generally
include planned and unplanned maintenance and may also include performance guarantees of the wind farm’s availability to operate under
adequate wind conditions. Availability is typically measured across the wind farm over a reference period of one year. Any forecasted
shortfalls that may result in a payment to a customer are recorded as a reduction of revenues, while additional revenues are recognized
when availability exceeds the contractual targets. During the years ended Decemb er 31, 2024, 2023, and 2022, t he reduction of revenues
from availability shortfalls was $0.3 billion, $0.3 billion and $0.1 billion, respectively. A further 1% reduction in availability across the entire
fleet would have resulted in an additional revenue reduction of less than $0.1 billion.
Revenue Recognition on Equipment on an Over-Time Basis. We have agreements for the sale of customized goods, including power
generation equipment such as gas and certain wind turbines. We recognize revenues as we perform under the arrangements using the
percentage of completion method, which is based on our costs incurred to date relative to our estimate of total expected costs. This
requires us to make estimates of customer payments expected to be received over the contract term as well as the costs to complete the
project. In addition, variable consideration is included in the transaction price if, in our judgment, it is expected that a significant future
reversal of cumulative revenue under the contract will not occur. Some of our contracts with customers for the sale of equipment contain
clauses for liquidated damages related to milestones established for on-time delivery or meeting certain product specifications. On an
ongoing basis, we evaluate the probability and magnitude of having to pay liquidated damages. This is factored into our estimate of variable
consideration using the expected value method taking into consideration progress towards meeting contractual milestones, specified
liquidated damages rates, if applicable, and history of paying liquidated damages to the customer or similar customers.
Our billing terms for these agreements are generally based on achieving specified milestones and include billing adjustments for project
delays and performance guarantees. As a result, a significant estimate in determining expected revenues of a contract is estimating project
execution timelines that may be adjusted due to internal and external supply chain adjustments, overall project execution, and product
performance. We generally use a combination of historical information as well as forward-looking information surrounding project execution
timelines and product performance in developing our revenue estimates. To develop our revenue estimates, we start with the contract price
and then make downward revisions based on historical trends. In addition, we also adjust as we become aware of new information.
2024 FORM 10-K 44
Our estimation of the total costs required to fulfill our promise to a customer is generally based on our history of manufacturing similar
assets for customers. This estimation of cost is critical to our revenue recognition process and is updated routinely to reflect changes in
quantity or cost of the inputs. In certain projects, the underlying technology or promise to the customer is unique to what we have
historically promised, and reliably estimating the total cost to fulfill the promise to the customer requires a significant level of judgment. The
estimation of costs is subject to increased subjectivity when we introduce new products and technologies, and actual costs may differ from
estimates more widely at this stage of development due to lack of historical experience.
We routinely review estimates and regularly revise them to adjust for changes in outlook. These revisions are based on objectively
verifiable information that is available at the time of the review.
Goodwill. We test goodwill for impairment at the reporting unit level annually in the fourth quarter of each year using October 1st as the
measurement date. We also test goodwill for impairment when an event occurs or circumstances change that would more likely than not
reduce the fair value of a reporting unit below its carrying value. An impairment charge is recognized if the carrying amount of a reporting
unit exceeds its fair value.
We determine fair value for each of the reporting units using the market approach, when available and appropriate, or the income
approach, or a combination of both. We assess the valuation methodology based upon the relevance and availability of the data at the time
we perform the valuation. If multiple valuation methodologies are used, the results are weighted appropriately.
Under the market approach fair value is derived from metrics of publicly traded companies or historically completed transactions of
comparable businesses, when available. The selection of comparable businesses is based on the markets in which the reporting units
operate giving consideration to risk profiles, size, geography, and diversity of products and services. A market approach is limited to
reporting units for which there are publicly traded companies that have characteristics similar to our businesses.
Under the income approach, fair value is determined based on the present value of estimated future cash flows, discounted at an
appropriate risk-adjusted rate. We use discount rates that are commensurate with the risks and uncertainty inherent in the respective
businesses and in our internally developed forecasts.
Based on the results of the impairment tests as of October 1, 2024, the fair values of our reporting units substantially exceeded their
carrying values. Estimating the fair value of reporting units involves the use of significant judgments that are based on a number of factors
including actual operating results, internal forecasts, such as forecasts of costs, margins, investments and capital expenditures, market
observable pricing multiples of similar businesses and comparable transactions, possible control premiums, determining the appropriate
discount rate and long-term growth rate assumptions, and, if multiple approaches are being used, determining the appropriate weighting
applied to each approach. It is reasonably possible that the judgments and estimates described above could change in future periods. See
Note 8 in the Notes to the consolidated and combined financial statements for further information.
Income Taxes. Prior to the Spin-Off, GE Vernova was included in the consolidated U.S. federal, state and foreign income tax returns of
GE, where eligible, through April 2, 2024. We have adopted the separate return method in preparing a provision for income taxes for the
periods prior to the Spin-off. The calculation of income taxes on a separate return basis requires considerable judgment and use of both
estimates and allocations. As a result, our provision for income taxes and deferred tax assets and liabilities reflected in our consolidated
and combined financial statements for the periods 2022, 2023, and the first quarter of 2024 have been estimated as if we were a separate
taxpayer. Following the Spin-off, GE Vernova will file tax returns independently and our provision for income taxes is prepared on a stand-
alone basis.
We only recognize the tax benefits from income tax positions that have a greater than 50 percent likelihood of being sustained upon
examination by the taxing authorities. A liability is recorded for uncertain tax positions when there is a 50 percent or less likelihood such tax
position would be sustained based on its technical merits. Significant judgement is required when evaluating tax positions for uncertainty.
We re-evaluate uncertain tax positions upon changes in facts and circumstances, changes in tax law or guidance, and upon effective
settlement of issues with tax authorities. Changes in the recognition or measurement of uncertain tax positions could result in material
increases or decreases in our provision (benefit) for income taxes in the period such determination is made.
We record deferred taxes on the future tax consequences of differences between the financial statement carrying value of our assets and
liabilities and their respective tax basis. The realization of deferred tax assets depends on sufficient sources of taxable income. Possible
sources of taxable income include taxable income in carry-back periods, the future reversal of existing taxable temporary differences
recorded as a deferred tax liability, tax-planning strategies that generate future income, and projected future taxable income. If, based upon
all available evidence, both positive and negative, it is more likely than not such deferred tax assets will not be realized, a valuation
allowance is recorded to adjust the deferred tax assets to the net amount which is more likely than not to be realized. Significant weight is
given to evidence that is objectively verifiable such as cumulative losses in recent years; however, some evidence may be based on
estimates and assumptions regarding potential sources of future taxable income. Changes in these estimates and assumptions may result
in a change in judgement regarding the realizability of deferred tax assets.
Based on our assessment of the realizability of our deferred tax assets as of December 31, 2024 , we continue to maintain valuation
allowances against our deferred tax assets in the U.S. and certain foreign jurisdictions, primarily due to cumulative losses in those
jurisdictions. Given the current year profit and anticipated future profitability in the U.S., it is reasonably possible that the continued
improvement in our U.S. operations could result in the positive evidence necessary to warrant the release of a significant portion of our U.S.
valuation allowance as early as the second half of 2025. A release of the valuation allowance would result in the recognition of certain U.S.
deferred tax assets and a corresponding benefit in our provision for income taxes in the period the release occurs. See Note 15 in the
Notes to the consolidated and combined financial statements for further information.
Postretirement Benefit Plans. We engage third-party actuaries to assist in the determination of pension obligations and related plan
costs. We develop significant long-term assumptions including discount rates and the expected rate of return on assets in connection with
2024 FORM 10-K 45
our pension accounting. We recognize differences between the expected long-term return on plan assets, the actual return, and net
actuarial gains and losses for the pension plan liabilities annually in the fourth quarter of each fiscal year and whenever a plan is
determined to qualify for a remeasurement within the Consolidated and Combined Statement of Comprehensive Income (Loss).
Accounting requirements necessitate the use of assumptions to reflect the uncertainties and the length of time over which the pension
obligations will be paid. The actual amount of future benefit payments will depend upon when participants retire, the amount of their benefit
at retirement, and how long they live. We discount the future payments using a rate that matches the time frame over which the payments
will be made. We also assume a long-term rate of return that will be earned on investments used to fund these payments.
We evaluate these assumptions annually. We periodically evaluate other assumptions, such as compensation, retirement age, mortality,
and turnover, and update them as necessary to reflect our actual experience and expectations for the future.
We determine the discount rate using the weighted-average yields on high-quality fixed-income securities that have maturities consistent
with the timing of benefit payments. Lower discount rates increase the size of the benefit obligations and generally increase pension
expense in the following year; higher discount rates reduce the size of the benefit obligation and generally reduce subsequent-year pension
expense.
The expected return on plan assets is the estimated long-term rate of return that will be earned on the investments used to fund the
pension obligations. To determine this rate, we consider the current and target composition of plan investments, our historical returns
earned, and our expectation about the future.
As of the measurement date of December 31, 2024 , net periodic benefit income for 2025 is estimated to be $0.5 billion. The components of
net periodic benefit costs, other than the service component, are included in Non-operating benefit income in our Consolidated and
Combined Statement of Income (Loss).
Fluctuations in discount rates can significantly impact pension costs and obligations. A 25 basis point decrease in the discount rate would
increase our principal pension plan cost in the following year by less than $0.1 billion and would also expect an increase in the principal
pension plan projected benefit obligation at year-end by approximately $0.2 billion. A 50 basis point decrease in the expected return on
assets would increase principal pension plan cost in the following year by approximately $0.1 billion. See Note 13 in the Notes to the
consolidated and combined financial statements for further information.
Loss Contingencies . Loss contingencies are existing conditions, situations or circumstances involving uncertainty as to possible loss that
will ultimately be resolved when future events occur or fail to occur. Such contingencies include, but are not limited to, warranties,
environmental obligations, litigation, regulatory investigations and proceedings, and losses resulting from other events and developments.
When a loss is considered probable and reasonably estimable, we record a liability in the amount of our best estimate for the ultimate loss.
We consider many factors in making these assessments, including historical experience and matter specifics. Estimates are developed in
consultation with legal counsel and are based on an analysis of potential results.
When there appears to be a range of possible costs with equal likelihood, liabilities are based on the low end of such range. However, the
likelihood of a loss with respect to a particular contingency is often difficult to predict and determining a meaningful estimate of the loss or a
range of loss may not be practicable based on the information available and the potential effect of future events and negotiations with or
decisions by third parties that will determine the ultimate resolution of the contingency. Moreover, it is not uncommon for such matters to be
resolved over many years, during which time relevant developments and new information must be continuously evaluated to determine
both the likelihood of potential loss and whether it is possible to reasonably estimate a range of possible loss. Disclosure is provided for
material loss contingencies when a loss is probable, but a reasonable estimate cannot be made, and when it is reasonably possible that a
loss will be incurred or the amount of a loss will exceed the recorded provision. We regularly review contingencies to determine whether the
likelihood of loss has changed and to assess whether a reasonable estimate of the loss or range of loss can be made. See Note 22 in the
Notes to the consolidated and combined financial statements for further information.
Environmental and Asset Retirement Obligations . Our operations involve the use, disposal, and cleanup of substances regulated under
environmental protection laws and nuclear decommissioning regulations. We have obligations for ongoing and future environmental
remediation activities and may incur additional liabilities in connection with previously remediated sites or as a result of any restructuring
actions taken in future periods. Additionally, like many other industrial companies, we and our subsidiaries are defendants in various
lawsuits related to alleged worker exposure to asbestos or other hazardous materials. Liabilities for environmental remediation, nuclear
decommissioning and worker exposure claims exclude possible insurance recoveries.
We record asset retirement obligations associated with the retirement of tangible long-lived assets as a liability in the period in which the
obligation is incurred and its fair value can be reasonably estimated. These obligations primarily represent legal obligations to return leased
premises to their initial state or dismantle and repair specific alterations for certain leased sites. The liability is measured at the present
value of the obligation when incurred and is adjusted in subsequent periods. Corresponding asset retirement costs are capitalized as part
of the carrying value of the related long-lived assets and depreciated over the asset’s useful life. See Note 22 i n the Notes to the
consolidated and combined financial statements for further information.
NON-GAAP FINANCIAL MEASURES . The non-GAAP financial measures presented in this Annual Report on Form 10-K are
supplemental measures of our performance and our liquidity that we believe help investors understand our financial condition and operating
results and assess our future prospects. We believe that presenting these non-GAAP financial measures, in addition to the corresponding
U.S. GAAP financial measures, are important supplemental measures that exclude non-cash or other items that may not be indicative of or
are unrelated to our core operating results and the overall health of the Company. We believe that these non-GAAP financial measures
provide investors greater transparency to the information used by management for its operational decision-making and allow investors to
see our results “through the eyes of management.” We further believe that providing this information assists our investors in understanding
our operating performance and the methodology used by management to evaluate and measure such performance. When read in
conjunction with our U.S. GAAP results, these non-GAAP financial measures provide a baseline for analyzing trends in our underlying
2024 FORM 10-K 46
businesses and can be used by management as one basis for financial, operational, and planning decisions. Finally, these measures are
often used by analysts and other interested parties to evaluate companies in our industry.
Management recognizes that these non-GAAP financial measures have limitations, including that they may be calculated differently by
other companies or may be used under different circumstances or for different purposes, thereby affecting their comparability from
company to company. In order to compensate for these and the other limitations discussed below, management does not consider these
measures in isolation from or as alternatives to the comparable financial measures determined in accordance with U.S. GAAP. Readers
should review the reconciliations below, and above with respect to free cash flow, and should not rely on any single financial measure to
evaluate our business. The reasons we use these non-GAAP financial measures and the reconciliations to their most directly comparable
U.S. GAAP financial measures follow.
We believe the organic measures presented below provide management and investors with a more complete understanding of underlying
operating results and trends of established, ongoing operations by excluding the effect of acquisitions, dispositions, and foreign currency,
which includes translational and transactional impacts, as these activities can obscure underlying trends.
ORGANIC REVENUES, EBITDA, AND EBITDA MARGIN BY SEGMENT (NON-GAAP)
Revenue(a)
Segment EBITDA
Segment EBITDA margin
2024
2023
V%
2024
2023
V%
2024
2023
V pts
Power (GAAP)
$ 18,127
$ 17,436
4 %
$ 2,268
$ 1,722
32 %
12.5 %
9.9 %
2.6pts
Less: Acquisitions
41
—
14
—
Less: Business dispositions
127
643
(21)
(19)
Less: Foreign currency effect
12
2
(35)
(118)
Power organic (Non-GAAP)
$ 17,947
$ 16,791
7 %
$ 2,310
$ 1,859
24 %
12.9 %
11.1 %
1.8pts
Wind (GAAP)
$ 9,701
$ 9,826
(1) %
$ (588)
$ (1,033)
43 %
(6.1) %
(10.5) %
4.4pts
Less: Acquisitions
—
—
—
—
Less: Business dispositions
—
—
—
—
Less: Foreign currency effect
(40)
(52)
(52)
(112)
Wind organic (Non-GAAP)
$ 9,741
$ 9,878
(1) %
$ (536)
$ (922)
42 %
(5.5) %
(9.3) %
3.8pts
Electrification (GAAP)
$ 7,550
$ 6,378
18 %
$ 679
$ 234
F
9.0 %
3.7 %
5.3pts
Less: Acquisitions
3
1
(3)
—
Less: Business dispositions
—
—
—
—
Less: Foreign currency effect
22
16
(16)
(27)
Electrification organic (Non-GAAP)
$ 7,525
$ 6,361
18 %
$ 698
$ 261
F
9.3 %
4.1 %
5.2pts
(a) Includes intersegment sales of $483 million and $414 million for the years ended December 31, 2024 and 2023 , respectively. See Note
25 in the Notes to the consolidated and combined financial state ments for further information.
ORGANIC REVENUES (NON-GAAP)
2024
2023
V%
Total revenues (GAAP)
$ 34,935
$ 33,239
5 %
Less: Acquisitions
44
1
Less: Business dispositions
127
643
Less: Foreign currency effect
(6)
(33)
Organic revenues (Non-GAAP)
$ 34,771
$ 32,630
7 %
EQUIPMENT AND SERVICES ORGANIC REVENUES (NON-GAAP)
2024
2023
V%
Total equipment revenues (GAAP)
$ 18,952
$ 18,258
4 %
Less: Acquisitions
20
—
Less: Business dispositions
66
382
Less: Foreign currency effect
(13)
(36)
Equipment organic revenues (Non-GAAP)
$ 18,880
$ 17,912
5 %
Total services revenues (GAAP)
$ 15,983
$ 14,981
7 %
Less: Acquisitions
24
1
Less: Business dispositions
61
260
Less: Foreign currency effect
8
3
Services organic revenues (Non-GAAP)
$ 15,890
$ 14,717
8 %
We believe that Adjusted EBITDA* and Adjusted EBITDA margin*, which are adjusted to exclude the effects of unique and/or non-cash
items that are not closely associated with ongoing operations, provide management and investors with meaningful measures of our
performance that increase the period-to-period comparability by highlighting the results from ongoing operations and the underlying
profitability factors. We believe Adjusted organic EBITDA* and Adjusted organic EBITDA margin* provide management and investors with,
when considered with Adjusted EBITDA* and Adjusted EBITDA margin*, a more complete understanding of underlying operating results
and trends of established, ongoing operations by further excluding the effect of acquisitions, dispositions, and foreign currency, which
includes translational and transactional impacts, as these activities can obscure underlying trends. We believe these measures provide
additional insight into how our businesses are performing on a normalized basis. However, Adjusted EBITDA*, Adjusted organic EBITDA*,
*Non-GAAP Financial Measure
2024 FORM 10-K 47
Adjusted EBITDA margin* and Adjusted organic EBITDA margin* should not be construed as inferring that our future results will be
unaffected by the items for which the measures adjust.
ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN (NON-GAAP)
2024
2023
V%
2022
Net income (loss) (GAAP)
$ 1,559
$ (474)
F
$ (2,722)
Add: Restructuring and other charges(a)
426
433
288
Add: Steam Power asset sale impairment
—
—
824
Add: Purchases and sales of business interests(b)
(1,024)
(92)
(55)
Add: Russia and Ukraine charges(c)
—
95
188
Add: Separation costs (benefits)(d)
(9)
—
—
Add: Arbitration refund(e)
(254)
—
—
Add: Non-operating benefit income(f)
(536)
(567)
(188)
Add: Depreciation and amortization(g)
1,008
847
893
Add: Interest and other financial charges – net(h)(i)
(130)
53
97
Add: Provision (benefit) for income taxes(i)
995
512
247
Adjusted EBITDA (Non-GAAP)
$ 2,035
$ 807
F
$ (428)
Net income (loss) margin (GAAP)
4.5 %
(1.4) %
5.9 pts
(9.2) %
Adjusted EBITDA margin (Non-GAAP)
5.8 %
2.4 %
3.4 pts
(1.4) %
(a) Consists of severance, facility closures, acquisition and disposition, and other charges associated with major restructuring programs.
(b) Consists of gains and losses resulting from the purchases and sales of business interests and assets.
(c) Related to recoverability of asset charges recorded in connection with the ongoing conflict between Russia and Ukraine and resulting
sanctions primarily related to our Power business.
(d) Costs incurred in the Spin-Off and separation from GE, including system implementations, advisory fees, one-time stock option grant,
and other one-time costs. I n addition, includes $136 million benefit related to deferred intercompany profit that was recognized upon
GE retaining the renewable energy U.S. tax equity in vestments at the time of the Spin-Off in the second quarter of 2024.
(e) Represents cash refund received in connection with an arbitration proceeding, constituting the payments previously made to a
multiemployer pension plan, and excludes $52 million related to the interest on such amounts that was recorded in Interest and other
financial charges – net in the second quarter of 2024.
(f) Primarily related to the expected return on plan assets, partially offset by interest cost.
(g) Excludes depreciation and amortization expense related to Restructuring and other charges. Includes amortization of basis differences
included in Equity method investment income (loss) which is part of Other income (expense) - net.
(h) Consists of interest and other financial charges, net of interest income, other than financial interest related to our normal business
operations primarily with customers.
(i) Excludes interest expense (income) of $10 million , $45 million , and $54 million and benefit (provision) for income taxes of $56 million ,
$168 million , and $(1) million for the years ended December 31, 2024 , 2023 , and 2022 , respectively, related to our Financial Services
business which, because of the nature of its investments, is measured on an after-tax basis due to its strategic investments in
renewable energy tax equity investments.
ADJUSTED ORGANIC EBITDA AND ADJUSTED ORGANIC EBITDA MARGIN
(NON-GAAP)
2024
2023
V%
Adjusted EBITDA (Non-GAAP)
$ 2,035
$ 807
F
Less: Acquisitions
11
—
Less: Business dispositions
(21)
(19)
Less: Foreign currency effect
(114)
(257)
Adjusted organic EBITDA (Non-GAAP)
$ 2,160
$ 1,084
99 %
Adjusted EBITDA margin (Non-GAAP)
5.8 %
2.4 %
3.4 pts
Adjusted organic EBITDA margin (Non-GAAP)
6.2 %
3.3 %
2.9 pts
See “ — Capital Resources and Liquidity” for discussion of free cash flow*.
ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. We are exposed to market risk
primarily from the effect of fluctuations in foreign currency exchange rates, interest rates, and commodity prices. These exposures are
managed and mitigated with the use of financial instruments, including derivatives contracts. We apply policies to manage these risks,
including prohibitions on speculative activities.
Foreign Exchange Risk. As a result of our global operations, we generate and incur a significant portion of our revenues and expenses in
currencies other than the U.S. dollar. Such principal currencies include the euro and British pound sterling. We are also exposed to the risk
of changes in foreign exchange rates due to our net investment in foreign operations. The effects from the foreign currency exchange rate
fluctuations on the translation of net amounts to the U.S. dollar, the reporting currency, are reflected in our equity position. See Note 2 in the
Notes to the consolidated and combined financial statements for further information regarding our net gains (losses) from foreign currency
transactions.
*Non-GAAP Financial Measure
2024 FORM 10-K 48
Foreign exchange rate risk is managed with a variety of techniques, including selective use of derivatives. It is our policy to minimize
currency exposures by conducting operations either within functional currencies or using the protection of hedging strategies. A 10%
increase in exchange rates against the U.S. dollar would have decreased our net income for the year ended December 31, 2024 by
approximately $0.1 billion. This analysis considered the net currency exposure of foreign currency denominated monetary items and
hedging instruments.
Interest Rate Risk. We are subject to interest rate risks in the ordinary course of our business. The level of our interest rate risk is
dependent on our debt exposure and capital structure and is sensitive to changes in the general level of interest rates. Historical
fluctuations in interest rates have not been significant for us; however, this may vary in the future as our capital structure changes.
Commodity Risk . Our operations require the use of various commodities . Fluctuations in the prices and availability of these commodities
can impact our cost of equipment sold and thus our profitability. To mitigate this risk, we have implemented various strategies, including
commercial actions, diversification of supplier base, and derivative instruments. We continuously monitor our exposure to commodity price
fluctuations and adjust our risk management strategies as necessary.
See Note 20 in the Notes to the consolidated and combined financial statements for further information regarding our risk exposures, our
use of derivatives, and the effects of this activity on our consolidated and combined financial statements.
2024 FORM 10-K 49
ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
AUDITOR'S REPORT
Report of Independent Registered Public Accounting Firm
To the stockholders and the Board of Directors of GE Vernova Inc.
Opinion on the Financial Statements
We have audited the accompanying consolidated and combined statements of financial position of GE Vernova Inc. and subsidiaries (the
"Company") as of December 31, 2024, and 2023, the related consolidated and combined statements of income (loss), comprehensive
income (loss), changes in equity, and cash flows for each of the three years in the period ended December 31, 2024, and the related notes
(collectively referred to as the “financial statements”). In our opinion, the financial statements present fairly, in all material respects, the
financial position of the Company as of December 31, 2024, and 2023, and the results of its operations and its cash flows for each of the
three years in the period ended December 31, 2024, in conformity with accounting principles generally accepted in the United States of
America.
Basis for Opinion
These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the
Company's financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting
Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with the U.S.
federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.
We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The
Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our
audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an
opinion on the effectiveness of the Company’s internal control over financial reporting. Accordingly, we express no such opinion.
Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or
fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the
amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant
estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits
provides a reasonable basis for our opinion.
Critical Audit Matter
The critical audit matter communicated below is a matter arising from the current-period audit of the financial statements that was
communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to
the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit
matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical
audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.
Sales of services - Revenue recognition on certain Power long-term service agreements - Refer to Note s 2 and 9 t o the financial
statements
Critical Audit Matter Description
The Company enters into long-term service agreements with customers within its Power segment. These agreements require the Company
to provide preventative and routine maintenance services, outage services, and stand-by “warranty-type” services, which generally range
from 5 to 25 years. Revenue for these agreements is recognized using the percentage of completion method, based on costs incurred
relative to total estimated costs over the contract term. As part of the revenue recognition process, the Company estimates both customer
payments that are expected to be received and costs to perform maintenance services over the contract term. Key assumptions within
those estimates that require significant judgment from management include: (a) how the customer will utilize the assets covered over the
contract term, (b) the expected timing and extent of future maintenance and outage services, (c) the future cost of materials, labor, and
other resources, and (d) forward looking information concerning market conditions.
Given the complexity involved with evaluating the estimates, which includes significant judgment necessary to estimate future costs,
auditing management’s key assumptions within the estimates required a high degree of auditor judgment and extensive audit effort,
including the involvement of professionals with specialized skills and industry knowledge.
How the Critical Audit Matter Was Addressed in the Audit
Our auditing procedures over the estimates and key assumptions described above related to the amount and timing of revenue recognition
of the long-term service agreements, within the Power segment, included the following, among others:
• We evaluated management’s risk assessment process through observation of key meetings, including inspection of
documentation, addressing contract status and current market conditions.
• We evaluated the appropriateness and consistency of management’s methods and key assumptions to develop cost estimates,
including expected timing and extent of future maintenance and outage services as well as the future cost of materials, labor and
other resources, all of which impact contract margin.
• We tested management’s utilization assumptions for timing and extent of future maintenance and overhaul services projected for
the contract term by comparing current estimates to historical information and forward-looking market conditions.
2024 FORM 10-K 50
• We tested management’s process for estimating the timing and amount of costs associated with maintenance, outage, and other
major events throughout the contract term, including comparing estimates to historical cost experience, performing a retrospective
review, performing analytical procedures, and utilizing specialists to evaluate engineering studies used by the Company to
estimate the useful life of capital parts of certain installed equipment.
/s/
DELOITTE & TOUCHE LLP
Boston, Massachusetts
February 6, 2025
We have served as the Company's auditor since 2022.
2024 FORM 10-K 51
CONSOLIDATED AND COMBINED STATEMENT OF INCOME (LOSS)
For the years ended December 31 (In millions, except per share amounts)
2024
2023
2022
Sales of equipment
$ 18,952
$ 18,258
$ 15,819
Sales of services
15,983
14,981
13,835
Total revenues
34,935
33,239
29,654
Cost of equipment
17,989
18,705
16,972
Cost of services
10,861
9,716
9,224
Gross profit
6,085
4,818
3,458
Selling, general, and administrative expenses
4,632
4,845
5,360
Research and development expenses
982
896
979
Operating income (loss)
471
( 923 )
( 2,881 )
Interest and other financial charges – net
120
( 98 )
( 151 )
Non-operating benefit income
536
567
188
Other income (expense) – net (Note 19 )
1,372
324
370
Income (loss) before income taxes
2,498
( 130 )
( 2,474 )
Provision (benefit) for income taxes (Note 15 )
939
344
248
Net income (loss)
1,559
( 474 )
( 2,722 )
Net loss (income) attributable to noncontrolling interests
( 7 )
36
( 14 )
Net income (loss) attributable to GE Vernova
$ 1,552
$ ( 438 )
$ ( 2,736 )
Earnings (loss) per share attributable to GE Vernova (Note 18 ):
Basic
$ 5.65
$ ( 1.60 )
$ ( 10.00 )
Diluted
$ 5.58
$ ( 1.60 )
$ ( 10.00 )
Weighted-average number of common shares outstanding:
Basic
275
274
274
Diluted
278
274
274
2024 FORM 10-K 52
CONSOLIDATED AND COMBINED STATEMENT OF FINANCIAL POSITION
December 31 (In millions, except share and per share amounts)
2024
2023
Cash, cash equivalents, and restricted cash
$ 8,205
$ 1,551
Current receivables – net (Note 4 )
8,174
7,409
Due from related parties (Note 24 )
4
80
Inventories, including deferred inventory costs (Note 5 )
8,587
8,253
Current contract assets (Note 9 )
8,621
8,339
All other current assets (Note 10 )
562
352
Assets of business held for sale (Note 3 )
—
1,444
Current assets
34,153
27,428
Property, plant, and equipment – net (Note 6 )
5,150
5,228
Goodwill (Note 8 )
4,263
4,437
Intangible assets – net (Note 8 )
813
1,042
Contract and other deferred assets (Note 9 )
555
621
Equity method investments (Note 11 )
2,149
3,555
Deferred income taxes (Note 15 )
1,639
1,582
All other assets (Note 10 )
2,763
2,228
Total assets
$ 51,485
$ 46,121
Accounts payable and equipment project payables (Note 12 )
$ 8,578
$ 7,900
Due to related parties (Note 24 )
24
532
Contract liabilities and deferred income (Note 9 )
17,587
15,074
All other current liabilities (Note 14 )
5,496
4,352
Liabilities of business held for sale (Note 3 )
—
1,448
Current liabilities
31,685
29,306
Deferred income taxes (Note 15 )
827
382
Non-current compensation and benefits
3,264
3,273
All other liabilities (Note 14 )
5,116
4,780
Total liabilities
40,892
37,741
Commitments and contingencies (Note 22 )
Common stock, par value $ 0.01 per share, 1,000,000,000 shares authorized, 275,880,314 shares
outstanding as of December 31, 2024
3
—
Additional paid-in capital
9,733
—
Retained earnings
1,611
—
Treasury common stock, 226,290 shares at cost
( 43 )
—
Net parent investment
—
8,051
Accumulated other comprehensive income (loss) – net attributable to GE Vernova (Note 16 )
( 1,759 )
( 635 )
Total equity attributable to GE Vernova
9,546
7,416
Noncontrolling interests
1,047
964
Total equity
10,593
8,380
Total liabilities and equity
$ 51,485
$ 46,121
2024 FORM 10-K 53
CONSOLIDATED AND COMBINED STATEMENT OF CASH FLOWS
For the years ended December 31 (In millions)
2024
2023
2022
Net income (loss)
$ 1,559
$ ( 474 )
$ ( 2,722 )
Adjustments to reconcile net income (loss) to cash from (used for) operating
activities
Depreciation and amortization of property, plant, and equipment (Note 6 )
895
724
779
Amortization of intangible assets (Note 8 )
277
240
1,018
(Gains) losses on purchases and sales of business interests
( 1,147 )
( 209 )
( 21 )
Principal pension plans – net (Note 13 )
( 376 )
( 405 )
—
Other postretirement benefit plans – net (Note 13 )
( 290 )
( 313 )
( 206 )
Provision (benefit) for income taxes (Note 15 )
939
344
248
Cash recovered (paid) during the year for income taxes
( 623 )
( 2 )
( 91 )
Changes in operating working capital:
Decrease (increase) in current receivables
( 1,289 )
( 837 )
( 870 )
Decrease (increase) in due from related parties
( 8 )
( 2 )
( 4 )
Decrease (increase) in inventories, including deferred inventory costs
( 641 )
( 240 )
( 949 )
Decrease (increase) in current contract assets
( 409 )
113
353
Increase (decrease) in accounts payable and equipment project payables
1,066
( 663 )
643
Increase (decrease) in due to related parties
( 398 )
( 53 )
124
Increase (decrease) in contract liabilities and current deferred income
2,799
2,812
1,282
All other operating activities
229
151
302
Cash from (used for) operating activities
2,583
1,186
( 114 )
Additions to property, plant, and equipment and internal-use software
( 883 )
( 744 )
( 513 )
Dispositions of property, plant, and equipment
25
60
53
Purchases of and contributions to equity method investments
( 114 )
( 83 )
( 393 )
Sales of and distributions from equity method investments
244
232
340
Proceeds from principal business dispositions
813
—
—
All other investing activities
( 122 )
( 199 )
191
Cash from (used for) investing activities
( 37 )
( 734 )
( 322 )
Net increase (decrease) in borrowings of maturities of 90 days or less
( 23 )
16
15
Transfers from (to) Parent
2,933
( 361 )
947
All other financing activities
742
( 63 )
( 151 )
Cash from (used for) financing activities
3,652
( 408 )
811
Effect of currency exchange rate changes on cash, cash equivalents, and
restricted cash
( 147 )
22
( 87 )
Increase (decrease) in cash, cash equivalents, and restricted cash ,
including cash classified within businesses held for sale
6,051
66
288
Less: Net increase (decrease) in cash classified within businesses held for sale
( 603 )
582
21
Increase (decrease) in cash, cash equivalents, and restricted cash
6,654
( 516 )
267
Cash, cash equivalents, and restricted cash at beginning of year
1,551
2,067
1,800
Cash, cash equivalents, and restricted cash as of December 31
$ 8,205
$ 1,551
$ 2,067
Supplemental disclosure of cash flows information
Cash paid during the year for interest
$ ( 74 )
$ ( 83 )
$ ( 77 )
2024 FORM 10-K 54
CONSOLIDATED AND COMBINED STATEMENT OF COMPREHENSIVE INCOME (LOSS)
For the years ended December 31 (In millions)
2024
2023
2022
Net income (loss) attributable to GE Vernova
$ 1,552
$ ( 438 )
$ ( 2,736 )
Net loss (income) attributable to noncontrolling interests
( 7 )
36
( 14 )
Net income (loss)
$ 1,559
$ ( 474 )
$ ( 2,722 )
Other comprehensive income (loss):
Currency translation adjustments – net of taxes
( 397 )
114
( 254 )
Benefit plans – net of taxes
( 730 )
640
78
Cash flow hedges – net of taxes
6
69
( 22 )
Other comprehensive income (loss)
$ ( 1,120 )
$ 823
$ ( 198 )
Comprehensive income (loss)
$ 439
$ 349
$ ( 2,920 )
Comprehensive loss (income) attributable to noncontrolling interests
( 11 )
34
( 16 )
Comprehensive income (loss) attributable to GE Vernova
$ 428
$ 383
$ ( 2,936 )
2024 FORM 10-K 55
CONSOLIDATED AND COMBINED STATEMENT OF CHANGES IN EQUITY
Common stock
(In millions)
Common
shares
outstanding
Par
value
Additional
paid-in
capital
Retained
earnings
Treasury
common
stock
Net parent
investment
Accumulated
other
comprehensive
income (loss) –
net
Equity
attributable to
noncontrolling
interests
Total
equity
Balances as of January 1, 2024
—
$ —
$ —
$ —
$ —
$ 8,051
$ ( 635 )
$ 964
$ 8,380
Transfers from (to) Parent, including
Spin-Off related adjustments
—
—
—
—
—
794
—
—
794
Issuance of common stock in
connection with the Spin-Off and
reclassification of net parent
investment
274
3
8,712
—
—
( 8,715 )
—
—
—
Issuance of shares in connection with
equity awards(a)
2
—
52
—
( 40 )
—
—
—
12
Share-based compensation expense
—
—
155
—
—
—
—
—
155
Dividends declared ( $ 0.25 per
common share)
—
—
—
( 70 )
—
—
—
—
( 70 )
Repurchase of common stock
—
—
—
—
( 3 )
—
—
—
( 3 )
Net income (loss)
—
—
—
1,682
—
( 130 )
—
7
1,559
Currency translation adjustments –
net of taxes
—
—
—
—
—
—
( 399 )
2
( 397 )
Benefit plans – net of taxes
—
—
—
—
—
—
( 732 )
2
( 730 )
Cash flow hedges – net of taxes
—
—
—
—
—
—
6
—
6
Changes in equity attributable to
noncontrolling interests(b)
—
—
814
—
—
—
—
72
886
Balances as of December 31, 2024
276
$ 3
$ 9,733
$ 1,611
$ ( 43 )
$ —
$ ( 1,759 )
$ 1,047
$ 10,593
Balances as of January 1, 2023
—
$ —
$ —
$ —
$ —
$ 12,106
$ ( 1,456 )
$ 957
$ 11,607
Net income (loss)
—
—
—
—
—
( 438 )
—
( 36 )
( 474 )
Currency translation adjustments –
net of taxes
—
—
—
—
—
—
110
4
114
Benefit plans – net of taxes
—
—
—
—
—
—
642
( 2 )
640
Cash flow hedges – net of taxes
—
—
—
—
—
—
69
—
69
Transfers from (to) Parent
—
—
—
—
—
( 3,617 )
—
—
( 3,617 )
Changes in equity attributable to
noncontrolling interests
—
—
—
—
—
—
—
41
41
Balances as of December 31, 2023
—
$ —
$ —
$ —
$ —
$ 8,051
$ ( 635 )
$ 964
$ 8,380
Balances as of January 1, 2022
—
$ —
$ —
$ —
$ —
$ 13,996
$ ( 1,256 )
$ 989
$ 13,729
Net income (loss)
—
—
—
—
—
( 2,736 )
—
14
( 2,722 )
Currency translation adjustments –
net of taxes
—
—
—
—
—
—
( 253 )
( 1 )
( 254 )
Benefit plans – net of taxes
—
—
—
—
—
—
75
3
78
Cash flow hedges – net of taxes
—
—
—
—
—
—
( 22 )
—
( 22 )
Transfers from (to) Parent
—
—
—
—
—
846
—
—
846
Changes in equity attributable to
noncontrolling interests
—
—
—
—
—
—
—
( 48 )
( 48 )
Balances as of December 31, 2022
—
$ —
$ —
$ —
$ —
$ 12,106
$ ( 1,456 )
$ 957
$ 11,607
(a) During the third quarter, restrictions lapsed on 435,719 shares of GE Vernova common stock in connection with the vesting of
performance shares originally awarded by General Electric Company, now operating as GE Aerospace. We withheld 218,290 shares of
GE Vernova common stock to satisfy tax withholding obligations, resulting in $ 40 million of Treasury common stock.
(b) Primarily relates to proceeds from the sales of an approximately 24 % equity interest in GE Vernova T&D India Ltd, a power transmission
and distribution solution provider, in the year ended December 31, 2024, net of directly attributable taxes of $ 245 million .
2024 FORM 10-K 56
NOTE 1 . ORGANIZATION AND BASIS OF PRESENTATION
Organization. On April 2, 2024, General Electric Company, which now operates as GE Aerospace (GE or Parent) completed the previously
announced spin-off (the Spin-Off) of GE Vernova Inc. (the Company, GE Vernova, our, we, or us). The Spin-Off was completed through a
distribution of all the Company's outstanding common stock to holders of record of GE's common stock as of the close of business on
March 19, 2024 (the Distribution), which resulted in the issuance of approximately 274 million shares of common stock. As a result of the
Distribution, the Company became an independent public company. Our common stock is listed under the symbol “GEV” on the New York
Stock Exchange. In connection with the Spin-Off, GE contributed cash of $ 515 million to GE Vernova to fund future operations and
transferred restricted cash of $ 325 million to us such that the Company’s cash balance upon completion of the Spin-Off was approximately
$ 4,200 million . See Note 22 for further information.
In connection with the Spin-Off, GE Vernova entered into several agreements with GE, including a separation and distribution agreement
that sets forth certain agreements with GE regarding the principal actions to be taken in connection with the Spin-Off, including the transfer
of assets and assumption of liabilities, and establishes certain rights and obligations between the Company and GE, including procedures
with respect to claims subject to indemnification and related matters. Other agreements we entered into that govern aspects of our
relationship with GE following the Spin-Off include:
• Transition Services Agreement – governs all matters relating to the provision of services between the Company and GE on a
transitional basis. The services the Company receives include support for digital technology, human resources, supply chain,
finance, and real estate services, among others, that are generally intended to be provided for a period no longer than two years
following the Spin-Off.
• Tax Matters Agreement – governs the respective rights, responsibilities, and obligations between the Company and GE with
respect to all tax matters (excluding employee-related taxes covered under the Employee Matters Agreement), in addition to
certain restrictions which generally prohibit us from taking or failing to take any action in the two -year period following the
Distribution that would prevent the Distribution from qualifying as tax-free for U.S. federal income tax purposes, including
limitations on our ability to pursue certain strategic transactions. The agreement specifies the portion of tax liability for which the
Company will bear contractual responsibility, and the Company and GE will each agree to indemnify each other against any
amounts for which such indemnified party is not responsible.
• Certain other agreements related to employee matters, trademark license, intellectual property, real estate matters, and framework
investments.
Unless the context otherwise requires, references to the Company, GE Vernova, our, we, and us, refer to (i) GE’s renewable energy, power,
and digital businesses prior to the Spin-Off and (ii) GE Vernova Inc. and its subsidiaries following the Spin-Off.
GE Vernova is a global leader in the electric power industry, with products and services that generate, transfer, orchestrate, convert, and
store electricity. We design, manufacture, deliver, and service technologies to create a more reliable and sustainable electric power system,
enabling electrification and decarbonization, underpinning the progress and prosperity of the communities we serve. We report our financial
results across three business segments:
• Our Power segment includes design, manufacture, and servicing of gas, nuclear, hydro, and steam technologies, providing a
critical foundation of dispatchable, flexible, stable, and reliable power.
• Our Wind segment includes our wind generation technologies, inclusive of onshore and offshore wind turbines and blades.
• Our Electrification segment includes grid solutions, power conversion, electrification software, and solar and storage solutions
technologies required for the transmission, distribution, conversion, storage, and orchestration of electricity from point of
generation to point of consumption.
Basis of Presentation . For periods prior to the Spin-Off, the combined financial statements have been derived from the consolidated
financial statements and accounting records of GE, including the historical cost basis of assets and liabilities comprising the Company, as
well as the historical revenues, direct costs, and allocations of indirect costs attributable to the operations of the Company, using the
historical accounting policies applied by GE. These combined financial statements do not purport to reflect what the results of operations,
comprehensive income, financial position, or cash flows would have been had the Company operated as a separate, stand-alone entity
during the periods prior to the Spin-Off .
The consolidated and combined financial statements have been prepared in accordance with U.S. generally accepted accounting principles
(U.S. GAAP) and present the historical results of operations, comprehensive income and losses, and cash flows for the years ended
December 31, 2024, 2023, and 2022 and the financial position as of December 31, 2024 and 2023. We have reclassified certain prior-year
amounts to conform to the current-year's presentation. The information in tables throughout the footnotes is presented in millions of U.S.
dollars unless otherwise stated. Certain columns and rows may not add due to the use of rounded numbers. Percentages presented are
calculated from the underlying numbers in millions.
All intercompany balances and transactions within the Company have been eliminated in the consolidated and combined financial
statements. As described in Note 24 , transactions between the Company and GE have been included in these consolidated and combined
financial statements. Certain financing transactions with GE are deemed to have been settled immediately through Net parent investment in
the Consolidated and Combined Statement of Financial Position and are accounted for as a financing activity in the Consolidated and
Combined Statement of Cash Flows as Transfers from (to) Parent.
For periods prior to the Spin-Off, the Consolidated and Combined Statement of Financial Position reflects all of the assets and liabilities of
GE that are specifically identifiable as being directly attributable to the Company, including Net parent investment as a component of equity.
Net parent investment represents GE’s historical investment in the Company and includes accumulated net income and losses attributable
to the Company, and the net effect of transactions with GE and its subsidiaries .
2024 FORM 10-K 57
For periods prior to the Spin-Off, GE used a centralized approach to cash management and financing of its operations. These
arrangements may not be reflective of the way the Company would have financed its operations had it been a separate, stand-alone entity
during the periods prior to the Spin-Off. The GE centralized cash management arrangements are excluded from the asset and liability
balances in the Consolidated and Combined Statement of Financial Position for periods prior to the Spin-Off. These amounts have instead
been included in Net parent investment as a component of equity. GE’s third-party debt and, unless specifically attributable, the related
interest expense, has not been attributed to the Company because the Company is not the legal obligor of the debt and the borrowings are
not specifically identifiable to the Company. See Note 24 for further information.
For periods prior to the Spin-Off, the Consolidated and Combined Statement of Income (Loss) includes expense allocations for certain
corporate, infrastructure, and shared services expenses provided by GE on a centralized basis (GE Corporate Costs), including, but not
limited to, finance, supply chain, human resources, IT, insurance, employee benefits, and other expenses that are either specifically
identifiable or clearly applicable to the Company. These expenses have been allocated to the Company on the basis of direct usage when
identifiable, with the remainder allocated on a pro rata basis using an applicable measure of headcount, revenue, or other allocation
methodologies that are considered to be a reasonable reflection of the utilization of services provided or the benefit received by GE
Vernova during the periods prior to the Spin-Off. However, the GE Corporate Costs allocations may not be indicative of the actual expense
that would have been incurred had the Company operated as an independent, stand-alone public entity. See Note 24 for further
information.
NOTE 2 . SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Estimates and Assumptions. The preparation of the consolidated and combined financial statements in conformity with U.S. GAAP
requires management to make estimates based on assumptions about current, and for some estimates, future, economic and market
conditions which affect reported amounts and related disclosures in the consolidated and combined financial statements. We believe these
assumptions to be reasonable under the circumstances and although our current estimates contemplate current and expected future
conditions, as applicable, it is reasonably possible that actual conditions could differ from our expectations, which could materially affect our
results of operations, financial position and cash flows.
Estimates are used for, but are not limited to, determining revenue from contracts with customers, recoverability of inventory, long-lived
assets and investments, valuation of goodwill and intangible assets, useful lives used in depreciation and amortization, income taxes and
related valuation allowances, accruals for contingencies including legal, product warranties and environmental, asset retirement obligations,
actuarial assumptions used to determine costs of pension and postretirement benefits, valuation and recoverability of receivables, valuation
of derivatives, and valuation of assets acquired, liabilities assumed, and contingent consideration as a result of acquisitions.
Revenues from the Sale of Equipment. Sales of equipment include the sales of gas turbines, wind turbines and repower units, and other
power generation equipment related to energy production as well as substation solutions, high-voltage direct current (HVDC) solutions,
transformers, and switchgears for the transmission and distribution of electricity.
Performance Obligations Satisfied Over Time. We recognize revenue on agreements for the sale of customized goods including power
generation equipment and long-term construction contracts on an over-time basis as we customize the customer’s equipment during the
manufacturing or integration process and obtain right to payment for work performed.
We recognize revenue as we perform under the arrangements using the percentage of completion method, which is based on our costs
incurred to date relative to our estimate of total expected costs and the transaction price to which we expect to be entitled. V ariable
consideration is included in the transaction price if, in our judgment, it is expected that a significant future reversal of cumulative revenue
under the contract will not occur. Some of our contracts with customers for the sale of equipment contain clauses for the payment of
liquidated damages related to milestones established for on-time delivery or meeting certain performance specifications. On an ongoing
basis, we evaluate the probability and magnitude of liquidated damages. This is factored into our estimate of variable consideration using
the expected value method taking into consideration progress towards meeting contractual milestones, specified liquidated damages rates,
if applicable, and history of paying liquidated damages to the customer or similar customers. Our estimate of costs to be incurred to fulfill
our promise to a customer is based on our history of manufacturing or constructing similar assets for customers and is updated routinely to
reflect changes in quantity or cost of the inputs. In certain projects, such as new product introductions, the underlying technology or
promise to the customer is unique to what we have historically promised and reliably estimating the total cost to fulfill the promise to the
customer requires a significant level of judgment. Where the profit from a contract cannot be estimated reliably, revenue is only recognized
equaling the cost incurred to the extent that it is probable that the costs will be recovered. We provide for a potential loss on these
agreements when it is expected that we will incur such loss.
During the years ended December 31, 2024 and 2023, primarily as a result of c hanges in product and project cost estimat es, we recorded
incremental contract losses for certain Offshore Wind contracts of $ 1,005 million and $ 379 million , respectively. The incremental contract
losses in 2024 primarily relate to the estimated impact of changes in execution timelines, project-related commercial liabilities, costs to
remediate quality issues including the removal of previously installed blades at the Vineyard Wind project, and additional project-related
supply chain and manufacturing costs. Further changes in our execution timelines or other adverse developments could result in further
losses beyond the amounts that we currently estimate .
Our billing terms for these over-time contracts are generally based on achieving specified milestones. The differences between the timing of
our revenue recognized (based on costs incurred) and customer billings (based on contractual terms) results in changes to our contract
asset or contract liability positions. See Note 9 for further information.
Performance Obligations Satisfied at a Point in Time . We recognize revenue on agreements for non-customized equipment and other
goods we manufacture on a standardized basis for sale to the market at the point in time that the customer obtains control of the product,
which is generally no earlier than when the customer has physical possession. We recognize revenue based on the transaction price to
which we expect to be entitled based on our history and estimates regarding variable consideration such as performance and delivery
2024 FORM 10-K 58
commitments. We use proof of delivery for certain large equipment with more complex logistics, whereas the delivery of other equipment is
estimated based on historical averages of in-transit periods (i.e., time between shipment and delivery).
Where arrangements include customer acceptance provisions based on seller or customer-specified objective criteria, we recognize
revenue when we have concluded that the customer has control of the equipment, and that acceptance is likely to occur. We do not
provide for anticipated losses on point-in-time transactions prior to transferring control of the equipment to the customer.
Our billing terms for these point-in-time equipment contracts generally coincide with delivery to the customer; however, we receive progress
collections from customers for large equipment purchases to generally reserve production slots.
Revenues from the Sale of Services . Sales of services include sales from contracts that include the sales of parts and labor associated
with servicing customers’ installed base in addition to software related offerings, extended warranties, equipment upgrades, and other
service-type activities. Consistent with the way we manage our businesses and interact with customers, we refer to sales under service
agreements, which includes both goods (such as spare parts and equipment upgrades) and related services (such as monitoring,
maintenance and repairs) as sales of “services,” which is an important part of our operations. See Note 9 for further information.
Performance Obligations Satisfied Over Time. We enter into long-term service agreements, which we refer to as contractual service
agreements, with our customers within our Power segment. These agreements require us to provide preventative and routine maintenance,
outage services, and standby “warranty type” services that include certain levels of assurance regarding asset performance and uptime
throughout the contract periods, which generally range from 5 to 25 years . We account for items that are integral to the maintenance of the
equipment as part of our performance obligation unless the customer has a substantive right to make a separate purchasing decision for
services such as equipment upgrades. When determined to be a separate performance obligation, revenue for equipment upgrades is
r ecognized over time as our performance enhances the customer’s asset.
We recognize revenue as we perform under these arrangements using the percentage of completion method, which is based on our costs
incurred to date relative to our estimate of total expected costs and the transaction price to which we expect to be entitled under the terms
of the contract. Throughout the life of a contract, this measure of progress captures the nature, timing and extent of our underlying
performance activities as our stand-ready services often fluctuate between routine inspections and maintenance, unscheduled service
events and major outages at predetermined usage intervals. We provide for a potential loss on these agreements when it is expected that
we will incur such loss.
Our billing terms for these arrangements are generally based on the customers’ utilization of the equipment (e.g., per hour of usage) and
upon the occurrence of a major maintenance event within the contract, such as an outage. The differences between the timing of our
revenue recognized (based on costs incurred) and customer billings (based on contractual terms) result in changes to our contract asset or
contract liability positions. See Note 9 for further information.
We also enter into long-term service agreements, which we refer to as flexible service agreements, in our Wind segment. Revenues are
recognized for these arrangements on a straight-line basis consistent with the nature, timing and extent of our services, which primarily
relate to routine maintenance and as needed equipment repairs. We generally invoice periodically as services are provided.
Performance Obligations Satisfied at a Point in Time. We sell certain tangible products, largely spare parts, through our services
businesses. We recognize revenues and bill our customers at the point in time that the customer obtains control of the good, which is at the
point in time we deliver the spare part to the customer .
Cash, Cash Equivalents and Restricted Cash . Short-term investments and money market instruments with original maturities of three
months or less are included in Cash, cash equivalents, and restricted cash. Restricted cash primarily relates to funds restricted in
connection with contractual and legal restrictions and amounted to $ 438 million and $ 50 million as of December 31, 2024 and 2023,
respectiv ely. See Note 22 for further information.
Customer Receivables. Amounts due from customers arising from the sales of equipment and services are recorded at the outstanding
amount, less allowance for losses. We regularly monitor the recoverability of our receivables. See Note 4 for further information.
Allowance for Credit Losses. When we record customer receivables, contract assets, and financing receivables, as well as financial
guarantees and certain commitments, we record an allowance for credit losses for the current expected credit losses inherent in the asset
over its expected life. The allowance for credit losses is a valuation account deducted from the amortized cost basis of the assets to
present the assets’ net carrying value at the amount expected to be collected. In each period, the allowance for credit losses is adjusted
through earnings to reflect expected credit losses over the remaining lives of the assets.
We estimate expected credit losses based on relevant information about past events, including historical experience, current conditions,
and reasonable and supportable forecasts that affect the collectability of the reported amount. When measuring expected credit losses, we
pool assets with similar country risk and credit risk characteristics. Changes in the relevant information may significantly affect the
estimates of expected credit losses.
Inventories . All inventories are stated at lower of cost or realizable values. Cost of inventories is primarily determined on a first-in, first-out
basis. Write-downs for excess, slow moving, and obsolete inventory are recorded as necessary. To determine these amounts, inventory
quantities on-hand are regularly reviewed and compared to historical utilization and estimates of future product demand, market conditions,
and technological developments. See Note 5 for further information.
Property, Plant, and Equipment. The cost of property, plant, and equipment is generally depreciated on a straight-line basis over its
estimated economic life. See Note 6 for further information.
2024 FORM 10-K 59
Leases . At lease commencement, we record a lease liability and corresponding right-of-use (ROU) asset, included in Property, plant, and
equipment. Options to extend the lease are included as part of the ROU asset and liability when it is reasonably certain the Company will
exercise the option. We have elected to include lease and non-lease components in determining our lease liability for all leased assets
except our vehicle leases. Non-lease components are generally services that the lessor performs for the Company associated with the
leased asset. As the Company’s leases typically do not provide an implicit rate, the present value of our lease liability is determined using
the Company ’s incremental collateralized borrowing rat e at lease commencement. For leases with an initial term of 12 months or less, an
ROU asset and lease liability are not recognized and lease expense is recognized on a straight-line basis over the lease term. Certain of
our leases include provisions for variable lease payments which are based on, but not limited to, maintenance, insurance, taxes, index
escalations, and usage based amounts. The Company recognizes variable lease payments not included in its lease liabilities in the period
in which the obligation for those payments is incurred. We test ROU assets whenever events or changes in circumstance indicate that the
asset may be impaired. See Notes 6 and 7 for further information.
Goodwill and Other Intangible Assets. We test goodwill for impairment at the reporting unit level annually in the fourth quarter of each
year using October 1st as the measurement date. We also test goodwill for impairment when an event occurs or circumstances change that
would more likely than not reduce the fair value of a reporting unit below its carrying value. We recognize an impairment charge if the
carrying amount of a reporting unit exceeds its fair value.
For other intangible assets, cost is generally amortized on a straight-line basis over the asset’s estimated economic life. Amortizable
intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that the related carrying amounts
may not be recoverable. In these circumstances, they are tested for impairment based on undiscounted cash flows and, if impaired, written
down to estimated fair value based on either discounted cash flows or appraised values. See Note 8 for further information.
Derivatives and Hedging. We use derivatives to reduce the earnings, equity, and cash flow volatility associated with risks related to
foreign currency and commodity prices. We use derivatives solely for managing risks and do not use derivatives for speculative purposes.
Accounting for derivatives as hedges requires that, at inception and over the term of the arrangement, the hedged item and related
derivative meet the requirements for hedge accounting. In evaluating whether a particular relationship qualifies for hedge accounting, we
test effectiveness at inception and each reporting period thereafter by determining whether changes in the fair value of the derivative
instrument offset, within a specified range, changes in the fair value of the hedged item. If fair value changes fail this test, we discontinue
the application of hedge accounting to that relationship prospectively. Fair value of both the derivative instrument and the hedged item are
calculated using internal valuation models incorporating market-based assumptions.
We use economic hedges when we have exposures to foreign exchange and commodity risk for which we are unable to meet the
requirements for hedge accounting. These derivatives are not designated as hedges from an accounting standpoint but otherwise serve the
same economic purpose as other hedging arrangements. Although derivatives may be effective economic hedges, there may be a net
effect on earnings in each period due to differences in the timing of earnings recognition between the derivatives and the hedged items.
See Note 20 for further information.
Equity Method Investments. Investments in which we have the ability to exercise significant influence, but do not control, are accounted
for under the equity method of accounting. While a voting percentage of 20% is generally presumed to demonstrate significant influence,
other indicators such as board representation or participation in policy-making processes are considered in determining whether significant
influence exists. Equity method investments are assessed for other-than-temporary impairment when events occur or circumstances
change that indicate it is more likely than not the fair value of the asset is below its carrying value . Our proportionate interest in any intra-
entity profits or losses of an equity method investment are eliminated until the related profit and losses are realized by the investee. Our
share of the results of equity method investments is recognized within Other (income) expense – net in the Consolidated and Combined
Statement of Income (Loss). See Note 11 for further information.
Variable Interest Entities. Arrangements in which voting or similar rights may not be indicative of control are reviewed under the guidance
for variable interest entities (VIEs). We consolidate VIEs for which we are the primary beneficiary, and if we are not the primary beneficiary
and an ownership interest is held, the VIE is generally accounted for under the equity method of accounting. When assessing the
determination of the primary beneficiary, we consider all relevant facts and circumstances, including our power to direct the activities of the
VIE that most significantly impact its economic performance and the obligation to absorb the expected losses and/or the right to receive the
expected returns of the VIE. See Note 21 for further information.
Income Taxes . Prior to the Spin-off, GE Vernova was included in the consolidated U.S. federal, state, and foreign income tax returns of
GE, where eligible, through April 2, 2024. The Company's provision for income taxes for the periods 2022, 2023, and the first quarter of
2024 was prepared using the separate return method. On a separate return basis, actual transactions included in the consolidated and
combined financial statements of GE may not be included in the GE Vernova consolidated and combined financial statements. Similarly,
the tax treatment of certain items reflected in the consolidated and combined financial statements of GE Vernova may not be reflected in
the consolidated and combined financial statements and tax returns of GE. Therefore, items such as tax loss carryforwards, tax credit
carryforwards, and valuation allowances may exist in the separate GE Vernova consolidated and combined financial statements that may
or may not exist in GE’s consolidated and combined financial statements. Following the Spin-off, GE Vernova will file tax returns
independently and the Company's provision for income taxes is prepared on a stand-alone basis. As a result, the deferred income taxes
and effective tax rate reported in 2024 may differ from those reported in the historical periods prior to the Spin-off.
We only recognize the tax benefits from income tax positions that have a greater than 50 percent likelihood of being sustained upon
examination by the taxing authorities. A liability is recorded for uncertain tax positions when there is a 50 percent or less likelihood such tax
position would be sustained based on its technical merits . We re-evaluate uncertain tax positions upon changes in facts and circumstances,
changes in tax law or guidance, and upon effective settlement of issues with tax authorities. We classify interest on tax deficiencies or
overpayments as interest expense or income in Interest and other financial charges – net and income tax penalties as a Provision (benefit)
for income taxes in the Consolidated and Combined Statement of Income (Loss).
2024 FORM 10-K 60
We record deferred taxes on the future tax consequences of differences between the financial statement carrying value of our assets and
liabilities and their respective tax basis. The realization of deferred tax assets depends on sufficient sources of taxable income. Possible
sources of taxable income include taxable income in carry-back periods, the future reversal of existing taxable temporary differences
recorded as a deferred tax liability, tax-planning strategies that generate future income, and projected future taxable income. If, based upon
all available evidence, both positive and negative, it is more likely than not such deferred tax assets will not be realized, a valuation
allowance is recorded to adjust the deferred tax assets to the net amount which is more likely than not to be realized.
See Note 15 for further information.
Postretirement Benefit Plans . Certain employees, former employees, and retirees of the Company participate in postretirement benefit
plans sponsored by the Company.
Management presents these plans sponsored by the Company in three categories: principal pension plans, other pension plans, and
principal retiree benefit plans. Plan assets are categorized for disclosure purposes in accordance with the fair value hierarchy. Benefits are
calculated using significant inputs to the actuarial models that measure benefit obligations and related effects on operations. The Company
evaluates critical assumptions, including discount rates and expected return on assets, at least annually on a plan and country-specific
basis. Actual results in any given year often will differ from actuarial assumptions because of economic and other factors.
Projected benefit obligations are measured as the present value of expected payments. We discount those cash payments using the
weighted average of market-observed yields for high-quality fixed-income securities with maturities that correspond to the expected timing
of benefit payments. Generally, lower discount rates increase present values and increase subsequent-year pension expense, while higher
discount rates decrease present values and decrease subsequent-year pension expense. The components of net periodic benefit costs,
other than the service cost component, are recognized within Non-operating benefit income in the Consolidated and Combined Statement
of Income (Loss). The Company delays recognition of gains and losses and subsequently amortizes these amounts into earnings over the
remaining average future service of active employees or the expected life of inactive participants, as applicable, who participate in the plan.
For the principal pension plans, gains and losses are amortized using a straight-line method with a separate layer for each year's gains and
losses. For most other pension plans and principal retiree benefit plans, gains and losses are amortized using a straight-line or a corridor
amortization method. See Note 13 for further information.
Loss Contingencies. Loss contingencies are existing conditions, situations or circumstances involving uncertainty as to possible loss that
will ultimately be resolved when future events occur or fail to occur. Such contingencies include, but are not limited to warranties,
environmental obligations, litigation, regulatory investigations and proceedings, and losses resulting from other events and developments.
When a loss is considered probable and reasonably estimable, we record a liability in the amount of our best estimate for the ultimate loss.
When there appears to be a range of possible costs with equal likelihood, liabilities are based on the low end of such range. Disclosure is
provided for material loss contingencies when a loss is probable but a reasonable estimate cannot be made, and when it is reasonably
possible that a loss will be incurred or the amount of a loss will exceed the recorded provision. We regularly review contingencies to
determine whether the likelihood of loss has changed and to assess whether a reasonable estimate of the loss or range of loss can be
made See Note 22 for further information.
Supply Chain Finance Programs. We evaluate supply chain finance programs to ensure where we use a third party intermediary to settle
our trade payables, their involvement does not change the nature, existence, amount, or timing of our trade payables and does not provide
the Company with any direct economic benefit. If any characteristics of the trade payables change or we receive a direct economic benefit,
we reclassify the trade payables as borrowings.
Accounts Payable and Equipment Project Payables . Accounts payable and equipment project payables include amounts due to
suppliers and liabilities for costs and expenses incurred or accrued for which invoices have not been received.
Fair Value Measurements. The following sections describe the valuation methodologies we use to measure financial and non-financial
instruments accounted for at fair value, including certain assets within our pension plans and retiree benefit plans. Observable inputs reflect
market data obtained from independent sources, while unobservable inputs reflect our market assumptions. These inputs establish a fair
value hierarchy:
Level 1 - Quoted prices for identical instruments in active markets;
Level 2 - Quoted prices for similar instruments in active markets; quoted prices for identical or similar instruments in markets that
are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable; and
Level 3 - Significant inputs to the valuation model are unobservable.
Recurring Fair Value Measurements. For financial assets and liabilities measured at fair value on a recurring basis, fair value is the price
we would receive to sell an asset or pay to transfer a liability in an orderly transaction with a market participant at the measurement date. In
the absence of active markets for the identical assets or liabilities, such measurements involve developing assumptions based on market
observable data and, in the absence of such data, internal information that is consistent with what market participants would use in a
hypothetical transaction that occurs at the measurement date.
Derivatives. Derivative assets and liabilities primarily represent foreign currency and commodity forward contracts. The majority of our
derivatives are valued using internal models. The models maximize the use of market observable inputs including interest rate curves and
both forward and spot prices for currencies and commodities and therefore are considered Level 2. See Note 20 for further information.
Nonrecurring Fair Value Measurements . Certain assets and liabilities are measured at fair value on a nonrecurring basis. These assets
and liabilities may include loans and long-lived assets reduced to fair value upon classification as held for sale, impaired equity method
investments, loans, and long-lived assets, assets acquired and liabilities assumed in connection with business combinations, and
remeasured retained investments in formerly combined subsidiaries upon a change in control that results in the deconsolidation of that
2024 FORM 10-K 61
subsidiary and retention of a noncontrolling stake in the entity. Assets written down to fair value when impaired and retained investments
are not subsequently adjusted to fair value unless further impairment occurs.
Equity Method Investments. Equity method investments are initially recorded at cost and are adjusted in each period for the Company’s
share of the investee’s income or loss and dividends paid. In instances of impairment, equity method investments are written down to fair
value using market observable data such as quoted prices when available. When market observable data is unavailable, investments are
valued using either a discounted cash flow model, comparative market multiples, third-party pricing sources or a combination of these
approaches, as appropriate. These investments are generally valued using Level 3 inputs.
Financing Receivables. When financing receivables are held for sale, we generally use market data, including pricing on recently closed
market transactions, to value financing receivables. Such financing receivables are valued using Level 2 inputs. When the data is
unobservable, we use valuation methodologies using current market interest rate data adjusted for inherent credit risk. Such financing
receivables are valued using Level 3 inputs.
Long-lived Assets. Fair values of long-lived assets are primarily derived internally and are corroborated by available external appraisal
information as applicable. These assets are generally valued using Level 3 inputs.
Restructuring Cost s. We record liabilities for costs associated with exit or disposal activities in the period in which the liability is incurred.
Employee termination costs are accrued when the restructuring actions are probable and estimable. Costs for one-time termination benefits
in which the employee is required to render service until termination in order to receive the benefits are recognized ratably over the future
service period. See Note 23 for further information.
Research and Developmen t. The Company conducts research and development (R&D) activities to continually enhance our existing
products and services, develop new products and services to meet our customers’ changing needs and requirements, and address new
market opportunities. This includes internal R&D expenses as well as expenses incurred for R&D s ervices from third parties. R&D costs are
expensed as incurred.
Government Assistance . We receive grants, incentives, and refundable tax credits from various federal, state, local, and foreign
governments in exchange for compliance with certain conditions relating to our activities in a specific jurisdiction which encourage
investment, job creation and retention, and environmental objectives including renewable energy production and emissions reductions. We
recognize government incentives as a reduction to the related expense or asset when there is reasonable assurance that the Company will
comply with the conditions of the incentive, the incentive is received or is probable of receipt, and the amount is determinable. Government
grants resulted in reductions of $ 52 million , $ 71 million , and $ 56 million to r esearch and development expenses for the years ended
December 31, 2024, 2023, and 2022, respectively . As a result of the advanced manufacturing credits provided by the Inflation Reduction
Act, which went into effect in 2023, our Wind business also recognized a $ 319 million and $ 234 million reduction to c ost of equipment for
the years ended December 31, 2024 and 2023, respectively, and recorded $ 301 million and $ 230 million as of December 31, 2024 and
2023, respectively, in Current receivables - net and All other assets in our Consolidated and Combined Statement of Financial Position.
Foreign Currency. We determine the functional currency of foreign subsidiaries based on their primary operations that generate and
expend cash. The functional currency for many of our international operations is the local currency, and for other international operations,
the functional currency is the U.S. d ollar. When the functional currency is not the U.S. dollar, asset and liability accounts are translated at
period-end exchange rates, and the Company translates functional currency income and expense amounts to their U.S. dollar equivalents
using average exchange rates for the period. The U.S. dollar effects that arise from changing translation rates from functional currencies
are recorded in Accumulated other comprehensive income (loss) – net attributable to GE Vernova (AOCI) in the Consolidated and
Combined Statement of Financial Position.
Gains and losses from foreign currency transactions, such as those resulting from the settlement of monetary items in the non-functional
currency and those resulting from remeasurements of monetary items, are included in Cost of equipment, Cost of services and Selling,
general, and administrative expenses depending on the underlying nature of the item. Net gains (losses) from foreign currency transactions
were $ 20 million , $ 80 million , and $ 57 million for the years ended December 31, 2024, 2023, and 2022, respectively.
Recently Issued Accounting Pronouncements . In November 2024, the Financial Accounting Standards Board (FASB) issued ASU No.
2024-03, Disaggregation of Income Statement Expenses ( DISE ) . The new standard requires disclosure about specific types of expenses
included in the expense captions presented on the face of the income statement as well as disclosure about selling expenses. The ASU is
effective for fiscal years beginning after December 15, 2026 and interim reporting periods beginning after December 15, 2027, with early
adoption permitted. We are currently evaluating the impact that this guidance will have on the disclosures within our consolidated and
combined financial statements.
In December 2023, the FASB issued ASU No. 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures . The
amendments require disclosure of specific categories in the rate reconciliation and provide additional information for reconciling items that
meet a quantitative threshold and further disaggregation of income taxes paid for individually significant jurisdictions. The ASU is effective
for fiscal years beginning after December 15, 2024, with early adoption permitted. We are currently evaluating the impact that this guidance
will have on the disclosures within our consolidated and combined financial statements.
NOTE 3 . DISPOSITIONS AND BUSINESSES HELD FOR SALE . During the second quarter of 2024, our Steam Power business
completed the sale of part of its nuclear activities to Electricité de France S.A. ( EDF). In connection with the disposition, we received net
cash proceeds of $ 639 million , s ubject to customary working capital and other post-close adjustments . As a res ult, we recognized a pre-tax
gain of $ 964 million (after-tax gain of $ 956 million ) , recorded in Other income (expense) – net in our Consolidated and Combined
Statement of Income (Loss) for the year ended December 31, 2024. See Notes 15 , 16 and 19 for further information.
The major components of assets and liabilities of the business held for sale in th e Company’s Consolidated and Combined Statement of
Financial Position are summarized as follows:
2024 FORM 10-K 62
ASSETS AND LIABILITIES OF BUSINESS HELD FOR SALE December 31
2024
2023
Cash and cash equivalents
$ —
$ 603
Current receivables, inventories, and contract assets
—
551
Property, plant, and equipment and intangibles – net
—
237
Other assets
—
53
Assets of business held for sale
$ —
$ 1,444
Contract liabilities and deferred income
$ —
$ 1,001
Accounts payable and equipment project payables
—
177
Other liabilities
—
270
Liabilities of business held for sale
$ —
$ 1,448
NOTE 4 . CURRENT AND LONG-TERM RECEIVABLES
CURRENT RECEIVABLES – NET December 31
2024
2023
Customer receivables
$ 6,310
$ 5,952
Non-income based tax receivables
814
1,048
Supplier advances and other receivables
1,514
924
Other receivables
$ 2,328
$ 1,972
Allowance for credit losses
( 464 )
( 515 )
Total current receivables – net
$ 8,174
$ 7,409
Activity in the allowance for credit losses related to current receivables for the years ended December 31, 2024 , 2023 , and 2022 consists of
the following:
ALLOWANCE FOR CREDIT LOSSES
2024
2023
2022
Balance as of January 1
$ 515
$ 674
$ 771
Net additions (releases) charged to costs and expenses
33
( 7 )
9
Write-offs, net
( 36 )
( 163 )
( 11 )
Foreign exchange and other (a)
( 48 )
11
( 95 )
Balance as of December 31
$ 464
$ 515
$ 674
(a) Includes a r eclassification of $ 73 million fr om current to long-term allowance due to a revised customer settlement schedule for the year
ended December 31, 2022.
Sales of customer receivables. From time to time, the Company sells current or long-term receivables to third parties in response to
customer-sponsored requests or programs, to facilitate sales, or for risk mitigation purposes. The Company sold current customer
receivables to third parties and subsequently collected $ 1,647 million , $ 1,590 million , and $ 1,624 million in the years ended December 31,
2024 , 2023 , and 2022, respectively. Within these programs, primarily related to our participation in customer-sponsored supply chain
finance programs in Wind, the Company has no continuing involvement, fees associated with the transferred receivables are covered by
the customer, and cash is received at the original invoice due date. Included in the sales of customer receivables in the year ended
December 31, 2023 was $ 82 million in our Gas Power business within our Power segment, primarily for risk mitigation purposes.
LONG-TERM RECEIVABLES – NET December 31
2024
2023
Long-term customer receivables
$ 282
$ 316
Supplier advances
285
243
Non-income based tax receivables
74
136
Other receivables
247
190
Allowance for credit losses
( 142 )
( 184 )
Total long-term receivables – net
$ 745
$ 701
NOTE 5 . INVENTORIES, INCLUDING DEFERRED INVENTORY COSTS
December 31
2024
2023
Raw materials and work in process
$ 5,328
$ 4,685
Finished goods
2,490
2,514
Deferred inventory costs(a)
769
1,054
Inventories, including deferred inventory costs
$ 8,587
$ 8,253
(a) Represents cost deferral for shipped goods (such as components for wind turbine assemblies in our Wind segment) and labor and
overhead costs on time and material service contracts (primarily originating in our Power segment) and other costs where the criteria for
revenue recognition have not yet been met.
2024 FORM 10-K 63
NOTE 6 . PROPERTY, PLANT, AND EQUIPMENT
Depreciable
lives
(in years)
Original Cost
Net Carrying Value
December 31
2024
2023
2024
2023
Land and improvements
8
$ 337
$ 352
$ 323
$ 341
Buildings, structures, and related equipment
8 - 40
3,171
3,278
1,339
1,494
Machinery and equipment(a)
4 - 20
7,938
7,763
2,284
2,399
Leasehold costs and manufacturing plant under construction
1 - 10
762
514
533
326
ROU operating lease assets(b)
671
668
Property, plant, and equipment – net
$ 12,207
$ 11,907
$ 5,150
$ 5,228
(a) Includes equipment we own that is leased to customers and is stated at cost less accumulated depreciation with a carrying value of
$ 374 million and $ 422 million as of December 31, 2024 and 2023, respectively.
(b) See Note 7 for further information.
Depreciation and a mortization related to property, plant, and equipment was $ 895 million , $ 724 million , and $ 779 million for the years
ended December 31, 2024, 2023, and 202 2, respectively.
In the third quarter of 2024, we recognized a non-cash pre-tax impairment charge of $ 108 million related to property, plant, and equipment
due to restructuring at our Hydro Power business, which is included in depreciation and amortization. This charge was recorded in Cost of
sales in our Consolidated and Combined Statement of Income (Loss). See Note 23 for further information.
In the first quarter of 2022, we signed a non-binding memorandum of understanding to sell part of the nuclear activities in our Steam Power
business to EDF , which resulted in a reclassificatio n of that busi ness to held for sale. As a result , we recognized a non-cash pre-tax
impairment charge of $ 59 million related to property, plant, and equipment at our remaining Steam Power business, of which $ 41 million is
included in depreciation and amortization . We determined the fair value of these assets using an income approach when testing for
impairment. This charge was recorded in Selling, general, and administrative expenses in our Consolidated and Combined Statement of
Income (Loss).
NOTE 7 . LEASES
Operating Lease Liabilities. The Company leases certain logistics, office, and manufacturing facilities, as well as vehicles and other
equipment. Certain of the Company’s leases may include options to extend. Our operating lease liabilities are included in All other current
liabilities and All other liabilities in our Consolidated and Combined Statement of Financial Position, as detailed below.
December 31
2024
2023
Current portion of operating lease liability
$ 163
$ 193
Noncurrent portion of operating lease liability
562
525
Total operating lease liability
$ 725
$ 718
OPERATING LEASE EXPENSE
2024
2023
2022
Long-term (fixed)
$ 194
$ 205
$ 225
Long-term (variable)
47
49
53
Short-term
25
63
62
Total operating lease expense
$ 265
$ 317
$ 340
MATURITY OF LEASE LIABILITIES
2025
2026
2027
2028
2029
Thereafter
Total
Undiscounted lease payments
$ 188
$ 146
$ 114
$ 86
$ 60
$ 256
$ 850
Less: Imputed interest
( 125 )
Total lease liability as of December 31, 2024
$ 725
SUPPLEMENTAL INFORMATION RELATED TO OPERATING LEASES
2024
2023
2022
Operating cash flows used for operating leases
$ 242
$ 214
$ 229
Right-of-use assets obtained in exchange for new lease liabilities
259
278
183
Weighted-average remaining lease term as of December 31
7.3 years
7.1 years
6.7 years
Weighted-average discount rate as of December 31
4.4 %
4.0 %
3.5 %
Finance Lease Liabilities. Our finance lease liabilities are included in All other current liabilities and All other liabilities in our Consolidated
and Combined Statement of Financial Position, as detailed below. Our finance leases have a weighted-average remaining lease term of
13.1 years and a weighted-average discount rate of 2.9 % as of December 31, 2024.
2024 FORM 10-K 64
December 31
2024
2023
Current portion of finance lease liability
$ 18
$ 27
Noncurrent portion of finance lease liability
248
284
Total finance lease liability
$ 266
$ 311
NOTE 8 . ACQUISITIONS, GOODWILL, AND OTHER INTANGIBLE ASSETS
Acquisitions . In the second quarter of 2023, our Gas Power business acquired Nexus Controls, a business specializing in aftermarket
control system upgrades and controls field services.
CHANGES IN GOODWILL BALANCES
Power
Wind
Electrification
Total
Balance at December 31, 2022
$ 144
$ 3,118
$ 902
$ 4,164
Acquisitions(a)
164
—
22
186
Currency exchange and other
—
86
1
87
Balance at December 31, 2023
$ 308
$ 3,204
$ 925
$ 4,437
Currency exchange and other
3
( 170 )
( 7 )
( 174 )
Balance at December 31, 2024
$ 310
$ 3,035
$ 918
$ 4,263
(a) Includes Gas Power's acquisition of Nexus Controls.
In the fourth quarter of 2024, we performed our annual impairment test. Based on the results of this test, the fair values of each of our
reporting units significantly exceeded their carrying values. Determining the fair values of reporting units requires the use of estimates and
significant judgments that are based on a number of factors including actual operating results. It is reasonably possible that estimates and
significant judgements could change in future periods.
INTANGIBLE ASSETS SUBJECT TO AMORTIZATION
2024
2023
December 31
Useful lives
(in years)
Gross
carrying
amount
Accumulated
amortization
Net
Gross
carrying
amount
Accumulated
amortization
Net
Customer-related
3 - 23
$ 2,292
$ ( 1,974 )
$ 318
$ 2,356
$ ( 1,953 )
$ 403
Patents and technology
5 - 15
2,869
( 2,587 )
283
2,924
( 2,558 )
366
Capitalized software
3 - 10
1,035
( 871 )
165
1,015
( 800 )
215
Trademarks & other
3 - 25
208
( 160 )
48
203
( 145 )
58
Total
$ 6,404
$ ( 5,592 )
$ 813
$ 6,498
$ ( 5,456 )
$ 1,042
All intangible assets are subject to amortization. Intangible assets decreased $ 230 million in 2024, primarily as a result of amortization.
Amortization expense was $ 277 million , $ 240 million , and $ 1,018 million for th e years ended December 31, 2024, 2023, and 2022,
respectively.
In the first quarter of 2022, we signed a non-binding memorandum of understanding to sell part of the nuclear activities in our Steam Power
business to EDF, which resulted in a reclassification of that business to held for sale. As a result, we recognized a non-cash pre-tax
impairment charge of $ 765 million related to intangible assets at our remaining Steam Powe r business , which is included in amortization.
We determined the fair value of these intangible assets using an income approach when testing for impairment. This charge was recorded
in Selling, general, and administrative expenses in our Consolidated and Combined Statement of Income (Loss). See Note 3 for further
information.
Estimated annual pre-tax amortization for intangible assets over the next five calendar years are as follows:
ESTIMATED 5 YEAR CONSOLIDATED AMORTIZATION
2025
2026
2027
2028
2029
Estimated annual pre-tax amortization
$ 236
$ 228
$ 175
$ 85
$ 21
NOTE 9 . CONTRACT AND OTHER DEFERRED ASSETS & CONTRACT LIABILITIES AND DEFERRED INCOME
Contract assets reflect revenue recognized on contracts in excess of billings based on contractual terms. Contract liabilities primarily
represent cash received from customers under ordinary commercial payment terms in advance of delivery of equipment orders or servicing
of customers’ installed base.
Contract and other deferred assets increase d $ 216 million in the year ended December 31, 2024 primarily due to the timing of revenue
recognition ahead of billing milestones on equipment and other service agreements. Contract liabilities and deferred income increase d
$ 2,497 million in the year ended December 31, 2024 primarily due to new collections received in excess of revenue recognition at Power
and Electrification, partially offset by revenue recognition and the settlement of a previously cancelled contract at Wind of $ 402 million . Net
contractual service agreements increase d primarily due to revenues recognized of $ 5,473 million , partially offset by billings of $ 5,021
million and net unfavorable changes in estimated profitability of $ 319 million due primarily to higher costs.
Revenue recognized related to the contract liabilities balance at the beginning of the year was approximately $ 9,933 million and $ 8,331
million for the years ended December 31, 2024 and 2023 , respectively.
2024 FORM 10-K 65
CONTRACT AND OTHER DEFERRED ASSETS
December 31, 2024
Power
Wind
Electrification
Total
Contractual service agreement assets
$ 5,321
$ —
$ —
$ 5,321
Equipment and other service agreement assets
1,622
538
1,139
3,300
Current contract assets
$ 6,944
$ 538
$ 1,139
$ 8,621
Non-current contract and other deferred assets(a)
536
8
11
555
Total contract and other deferred assets
$ 7,479
$ 546
$ 1,150
$ 9,176
December 31, 2023
Power
Wind
Electrification
Total
Contractual service agreement assets
$ 5,201
$ —
$ —
$ 5,201
Equipment and other service agreement assets
1,679
392
1,067
3,138
Current contract assets
$ 6,880
$ 392
$ 1,067
$ 8,339
Non-current contract and other deferred assets(a)
602
14
5
621
Total contract and other deferred assets
$ 7,482
$ 406
$ 1,072
$ 8,960
(a) Primarily represents amounts due from customers at Gas Power for the sale of services upgrades, which we collect through incremental
fixed or usage-based fees from servicing the equipment under contractual service agreements.
CONTRACT LIABILITIES AND DEFERRED INCOME
December 31, 2024
Power
Wind
Electrification
Total
Contractual service agreement liabilities
$ 1,789
$ —
$ —
$ 1,789
Equipment and other service agreement liabilities
7,879
3,684
3,946
15,511
Current deferred income
6
193
88
287
Contract liabilities and current deferred income
$ 9,674
$ 3,877
$ 4,034
$ 17,587
Non-current deferred income
29
112
16
157
Total contract liabilities and deferred income
$ 9,703
$ 3,989
$ 4,050
$ 17,744
December 31, 2023
Power
Wind
Electrification
Total
Contractual service agreement liabilities
$ 1,810
$ —
$ —
$ 1,810
Equipment and other service agreement liabilities
5,732
4,819
2,352
12,903
Current deferred income
20
228
113
361
Contract liabilities and current deferred income
$ 7,562
$ 5,047
$ 2,465
$ 15,074
Non-current deferred income
48
90
35
173
Total contract liabilities and deferred income
$ 7,610
$ 5,137
$ 2,500
$ 15,247
Remaining Performance Obligation (RPO) . As of December 31, 2024 , the aggregate amount of the contracted revenues allocated to our
unsatisfied (or partially unsatisfied) performance obligations were $ 119,023 million . We expect to recognize revenue as we satisfy our
remaining performance obligations as follows:
(1) Equipment-related RPO of $ 43,047 million of which 44 % , 69 % , and 93 % is expected to be recognized within 1 , 2 , and 5 years ,
respectively, and the remaining thereafter.
(2) Services-related RPO of $ 75,976 million of which 18 % , 53 % , 78 % , and 91 % is expected to be recognized within 1 , 5 , 10 , and 15
years , respectively, and the remaining thereafter.
Contract modifications could affect both the timing to complete as well as the amount to be received as we fulfill the related RPO.
NOTE 10 . CURRENT AND ALL OTH ER ASSETS
December 31
2024
2023
Derivative instruments (Note 20 )
$ 168
$ 76
Financing receivables – net
—
141
Prepaid taxes and deferred charges
297
128
Other
96
7
All other current assets
$ 562
$ 352
Long-term receivables – net (Note 4 )
$ 745
$ 701
Long-term financing receivables - net
32
—
Pension surplus (Note 13 )
890
748
Taxes receivable
364
213
Prepaid taxes and deferred charges
248
246
Derivative instruments (Note 20 )
158
118
Other
326
202
All other assets
$ 2,763
$ 2,228
2024 FORM 10-K 66
NOTE 11 . EQUITY METHOD INVESTMENTS
Ownership
percentage at
Equity method investment balance
Equity method income (loss)
December 31, 2024
December 31, 2024
December 31, 2023
2024
2023
2022
Renewable energy tax equity
investments(a)
—
$ —
$ 1,227
$ ( 38 )
$ ( 132 )
$ ( 93 )
China XD Electric(b)
12 %
402
485
23
8
7
Aero Alliance(c)
50 %
544
510
29
38
55
Hitachi-GE Nuclear Energy(d)
20 %
184
253
( 12 )
7
15
Prolec GE(e)
50 %
251
205
105
93
17
Other(f)
769
875
( 54 )
( 78 )
59
Total
$ 2,149
$ 3,555
$ 53
$ ( 64 )
$ 60
(a) In connection with the Spin-Off, GE retained renewable energy U.S. tax equity investments of $ 1,244 million in limited liability
companies, which generated renewable energy tax credits, and any tax attributes from historical tax equity investing activity. Tax
benefits related to these investments of $ 53 million were recognized in the first quarter of 2024 and $ 183 million and $ 164 million were
recognized during the years ended December 31, 2023 and 2022 , respectively, in Provision (benefit) for income taxes in our
Consolidated and Combined Statement of Income (Loss), for which we received cash o f $ 183 million from GE for these credits in
2023. In connection with GE retaining the renewable energy U.S. tax equity investments, we recognized a $ 136 million benefit related
to deferred intercompany profit from historical equipment sales to the related investees in Cost of equipment in our Consolidated and
Combined Statement of Income (Loss) during the second quarter of 2024. See Note 25 for further information.
(b) China XD Electric Co., Ltd . is publicly traded on the Shanghai Stock Exchange, and the market value was $ 640 million as of December
31, 2024 based on the quoted market value. While the Company holds a 12 % ownership interest, we account for the investment under
the equity method given our participation on the investee’s board of directors. In the fourth quarter of 2024, we sold a portion of our
shares decreasing our ownership percentage by 3 % . See Note 19 for further information.
(c) Aero Alliance is o ur 50 - 50 joint venture with Baker Hughes Company. See Note 24 for further information.
(d) Hitachi-GE Nuclear Energy is a non-consolidated joint venture that is part of the joint venture structu re with Hitachi, Ltd. that forms our
Nuclear Power business.
(e) Prolec GE refers to our joint venture with Xignux, which manufactures a wide range of transformers available for generation,
transmission and distribution applications and is focused on serving utilities, renewable and industrial customers.
(f) Primarily other investments made by our Financial Services business in commercial energy projects and investments with strategic
partners by our segments. For the years ended December 31, 2024 , 2023 , and 2022 , includes imp airment charges of $ 55 million ,
$ 108 million , and $ 43 million , respectively.
Equity method investment balance
Equity method income (loss)
December 31, 2024
December 31, 2023
2024
2023
2022
Power
$ 919
$ 1,003
$ ( 11 )
$ 78
$ 17
Wind
49
46
5
( 2 )
8
Electrification
743
788
123
77
24
Corporate(a)
438
1,718
( 64 )
( 217 )
11
Total
$ 2,149
$ 3,555
$ 53
$ ( 64 )
$ 60
(a) Includes the investments owned by our Financial Services business .
The following tables present summarized financial information of the Company’s equity method investments (for the period of the
Company’s investment):
SUMMARIZED EARNINGS INFORMATION
2024
2023
2022
Revenues
$ 9,811
$ 10,030
$ 8,931
Gross profit
2,010
1,945
1,699
Net income
610
581
431
SUMMARIZED ASSETS AND LIABILITIES December 31
2024
2023
Current
$ 10,647
$ 10,810
Noncurrent
9,294
15,819
Total assets
$ 19,941
$ 26,629
Current
$ 6,906
$ 7,203
Noncurrent
3,725
5,466
Total liabilities
$ 10,631
$ 12,669
Noncontrolling interests
$ 542
$ 381
2024 FORM 10-K 67
NOTE 12 . ACCOUNTS PAYABLE AND EQUIPMENT PROJECT PAYABLES
December 31
2024
2023
Trade payables
$ 4,942
$ 4,701
Supply chain finance programs
2,051
1,642
Equipment project payables
1,211
1,096
Non-income based tax payables
375
461
Accounts payable and equipment project payables
$ 8,578
$ 7,900
We facilitate voluntary supply chain finance programs with third parties, which provide participating suppliers the opportunity to sell their GE
Vernova receivables to third parties at the sole discretion of both the suppliers and the third parties. Total supplier invoices paid through
these third-party programs were $ 3,650 million and $ 5,442 million for the years ended December 31, 2024 and 2023 , respectively. Total
new supplier invoices entered into through these third party programs were $ 4,071 million and $ 4,521 million for the years ended
December 31, 2024 and 2023, respectively. Foreign exchange and other was not significant for both the years ended December 31, 2024
and 2023.
NOTE 13 . POSTRETIREMENT BEN EFIT PLANS
Pension Benefits and Retiree Health and Life Benefits Sponsored by GE, Allocated to GE Vernova in Connection with the Spin-
Off. On January 1, 2023, in advance of the Spin-Off, principal and other pension plans sponsored by GE, which were previously accounted
for as multiemployer plans, were legally split and allocated to GE Vernova beginning in 2023. Liabilities related to the retiree health and life
benefit plans sponsored by GE were allocated to GE Vernova as a participating employer and are accounted for as multiple employer plans
starting in 2023.
Prior to the separation of these plans, certain GE Vernova employees were covered under various pension and retiree health and life plans
sponsored by GE, including the GE Pension Plan and GE Supplementary Pension Plan, the retiree benefit plans, and other pension plans.
Relevant participation costs for certain GE-sponsored employee benefit plans were allocated to the Company and recognized in the
Combined Statement of Income (Loss) for the year ended December 31, 2022. These included service costs for active employees in the
GE Pension Plan, the GE Supplementary Pension Plan, the retiree benefit plans, and other pension plans. We did not record any assets or
liabilities associated with our participation in these plans in our Combined Statement of Financial Position as of December 31, 2022.
Expenses associated with our employees' participation in the principal pension plans and principal retiree benefit plans, which represent
the majority of related expense, were $ 61 million for the year ended December 31, 2022.
Defined Contribution Plan. Following the Spin-Off, GE Vernova now sponsors a defined contribution plan for its eligible U.S. employees
that is similar to the corresponding GE-sponsored defined contribution plan that was in effect prior to the Spin-Off. Expenses associated
with their participation in GE Vernova's plan for the year ended December 31, 2024 beginning on April 2, 2024 and in GE's plan through
April 1, 2024, and for the years ended December 31, 2023 and 2022, represent the employer contributions for GE Vernova employees, and
were $ 144 million , $ 130 million, and $ 135 million, respectively.
Pension Benefits and Retiree Health and Life Benefits Sponsored by GE Vernova, Including Those Allocated to GE Vernova in
Connection with the Spin-Off . GE Vernova sponsored plans, including those allocated to GE Vernova in connection with the Spin-Off, are
presented in three categories: principal pension plans, other pension plans, and principal retiree benefit plans. Certain of these pension
plans, including the principal pension plans, are closed to new participants. Smaller pension plans with pension assets or obligations that
have not reached $ 50 million and other retiree benefit plans are not presented. Information in this Note is as of a December 31
measurement date for these plans. Plans that were allocated to GE Vernova on January 1, 2023 are included in the plan disclosures below
beginning in 2023.
2024 FORM 10-K 68
DESCRIPTION OF OUR PLANS
Plan Category
Participants
Funding
Comments
Principal
Pension
Plans
GE Energy
Pension Plan
Covers U.S.
participants ~ 37,000
retirees and
beneficiaries, ~ 11,000
vested former
employees and ~ 5,500
active employees
Our funding policy is to contribute
amounts sufficient to meet
minimum funding requirements
under employee benefit and tax
laws. We may decide to
contribute additional amounts
beyond this level.
This plan is closed to new participants.
Benefits for employees with salaried benefits
are frozen. These employees receive
increased Company contributions in the
company sponsored defined contribution plan
in lieu of participation in a defined benefit
plan.
GE Energy
Supplementary
Pension Plan
Provides
supplementary benefits
to higher-level, longer-
service U.S.
employees
Unfunded. We pay benefits from
Company cash.
This plan is closed to new participants.
Annuity benefits for employees who became
executives before 2011 are frozen. All
participants accrue an installment benefit.
Other
Pension
Plans(a)
20
predominantly
non-U.S.
pension plans
with pension
assets or
obligations that
have reached
$ 50 million .
Covers ~ 31,800
retirees and
beneficiaries, ~ 16,000
vested former
employees and ~ 5,300
active employees
Our funding policy is to contribute
amounts sufficient to meet
minimum funding requirements
under employee benefit and tax
laws in each country. We may
decide to contribute additional
amounts beyond this level. We
pay benefits for some plans from
Company cash.
In certain countries, benefit accruals have
ceased and/or have been closed to new hires
as of various dates.
Principal
Retiree
Benefit Plans
Provides health
and life
insurance
benefits to
certain eligible
participants.
Covers U.S.
participants ~ 31,100
retirees and
dependents and
~ 5,200 active
employees
We fund retiree health benefit
plans on a pay-as-you-go basis.
Participants share in the cost of the
healthcare benefits.
(a) Disclosed plans that fall below $ 50 million are not removed from the presentation unless part of a disposition or plan termination.
Funding. The Employee Retirement Income Security Act ( ERISA ) determines minimum funding requirements in the U.S. No contributions
were required or made for the GE Energy Pension Plan during 2024 , and based on our current assumptions, we do not anticipate having to
make additional required contributions to the plan in the near future.
As of the measurement date of December 31, we would expect to pay approxima tely $ 33 million for benefit payments under our GE Energy
Supplementary Pension Plan and administrative expenses of our principal pension plans and would expect to contribute approximately $ 74
million to other pens ion plans in 2025 . We fund retiree benefit plans on a pay-as-you-go basis. As of the measurement date of December
31, we would expect to contribute approximately $ 77 million in 2025 to fund such benefits .
PLAN OBLIGATIONS IN EXCESS OF PLAN ASSETS
December 31
2024
2023
Principal
pension
Other pension
Principal
retiree benefit
Principal
pension
Other pension
Principal
retiree benefit
Projected/Accumulated postretirement benefit
obligation(a)
$ 10,274
$ 1,064
$ 752
$ 10,780
$ 1,048
$ 766
Fair value of plan assets
8,920
576
—
9,491
410
—
Funded status - surplus (deficit)
$ ( 1,354 )
$ ( 488 )
$ ( 752 )
$ ( 1,289 )
$ ( 638 )
$ ( 766 )
(a) Represents projected benefit obligation for pension plans and accumulated postretirement benefit obligation for principal retiree benefit
plans.
2024 FORM 10-K 69
COMPONENTS OF EXPENSE (INCOME)
2024
2023
2022
Principal
pension
Other
pension
Principal
retiree
benefit
Principal
pension
Other
pension
Principal
retiree
benefit
Other
pension
Service cost - operating(a)
$ 29
$ 32
$ 6
$ 24
$ 31
$ 6
$ 30
Interest cost
548
227
37
561
248
41
94
Expected return on plan assets
( 743 )
( 334 )
—
( 756 )
( 349 )
—
( 281 )
Amortization of net loss (gain)
( 183 )
34
( 42 )
( 210 )
4
( 45 )
9
Amortization of prior service cost (credit)
7
( 8 )
( 59 )
4
( 6 )
( 59 )
( 7 )
Curtailment / settlement loss (gain)
—
2
—
—
( 6 )
—
( 7 )
Non-operating benefit costs (income)
$ ( 372 )
$ ( 80 )
$ ( 65 )
$ ( 401 )
$ ( 109 )
$ ( 63 )
$ ( 192 )
Net periodic expense (income)
$ ( 344 )
$ ( 48 )
$ ( 59 )
$ ( 377 )
$ ( 78 )
$ ( 57 )
$ ( 162 )
Weighted-average benefit obligations assumptions
Discount rate
5.67 %
3.79 %
5.47 %
5.19 %
3.51 %
5.08 %
3.93 %
Compensation increases
3.38 %
2.22 %
3.35 %
3.85 %
2.12 %
3.24 %
1.88 %
Initial healthcare trend rate(b)
N/A
N/A
7.00 %
N/A
N/A
6.50 %
N/A
Weighted-average benefit cost assumptions
Discount rate
5.19 %
3.51 %
5.08 %
5.53 %
3.93 %
5.43 %
1.42 %
Expected rate of return on plan assets
7.00 %
5.07 %
— %
7.00 %
5.65 %
— %
4.70 %
(a) Service cost - operating is an operating expense included in Selling, general, and administrative expenses and Cost of equipment and
Cost of services in our Consolidated and Combined Statement of Income (Loss).
(b) For 2024 , ultimately declining to 5.00 % for 2034 and thereafter.
PLAN FUNDED STATUS
2024
2023
Principal
pension
Other
pension
Principal
retiree
benefit
Principal
pension
Other
pension
Principal
retiree
benefit
Change in Projected Benefit Obligations
Balance at January 1
$ 10,780
$ 6,712
$ 766
$ —
$ 4,756
$ —
Service cost
29
32
6
24
31
6
Interest cost
548
227
37
561
248
41
Participant contributions
2
18
9
3
19
10
Plan amendments
—
—
—
17
—
—
Actuarial loss (gain) – net(a)
( 451 )
( 312 )
18
300
438
( 5 )
Benefits paid
( 767 )
( 372 )
( 86 )
( 766 )
( 424 )
( 87 )
Curtailments/settlements
—
( 145 )
—
—
( 11 )
—
Transfers and other - net(b)
133
( 29 )
3
10,641
1,343
801
Exchange rate adjustments
—
( 210 )
—
—
312
—
Balance at December 31
$ 10,274
(c)
$ 5,921
$ 752
(d)
$ 10,780
(c)
$ 6,712
$ 766
(d)
Change in Plan Assets
Balance at January 1
$ 9,491
$ 6,851
$ —
$ —
$ 4,805
$ —
Actual gain (loss) on plan assets
40
74
—
602
437
—
Employer contributions
33
105
78
28
102
77
Participant contributions
2
18
9
3
19
10
Benefits paid
( 767 )
( 372 )
( 86 )
( 766 )
( 424 )
( 87 )
Curtailments/settlements
—
( 137 )
—
—
( 11 )
—
Transfers and other - net(b)
121
—
—
9,624
1,569
—
Exchange rate adjustments
—
( 210 )
—
—
354
—
Balance at December 31
$ 8,920
$ 6,329
$ —
$ 9,491
$ 6,851
$ —
Funded status - surplus (deficit)
$ ( 1,354 )
$ 409
$ ( 752 )
$ ( 1,289 )
$ 139
$ ( 766 )
(a) Primarily due to the impact of discount rates.
(b) Primarily relates to plans allocated to GE Vernova on January 1, 2023.
(c) The benefit obligation for the GE Energy Supplementary Pension Plan, which is an unfunded plan, was $ 533 million and $ 541 million at
December 31, 2024 and 2023, respectively.
(d) The benefit obligation for retiree health plan was $ 429 million and $ 447 million at December 31, 2024 and 2023, respectively.
2024 FORM 10-K 70
AMOUNTS RECORDED IN THE CONSOLIDATED AND COMBINED STATEMENT OF FINANCIAL POSITION
2024
2023
December 31
Principal
pension
Other
pension
Principal
retiree
benefit
Principal
pension
Other
pension
Principal
retiree
benefit
All other non-current assets
$ —
$ 896
$ —
$ —
$ 775
$ —
All other current liabilities
( 31 )
( 15 )
( 75 )
( 30 )
( 18 )
( 77 )
Non-current compensation and benefits liabilities
( 1,322 )
( 472 )
( 677 )
( 1,259 )
( 581 )
( 689 )
Current liabilities of business held for sale
—
—
—
—
( 37 )
—
Net amount recorded
$ ( 1,354 )
$ 409
$ ( 752 )
$ ( 1,289 )
$ 139
$ ( 766 )
AMOUNTS RECORDED IN AOCI
2024
2023
December 31
Principal
pension
Other
pension
Principal
retiree
benefit
Principal
pension
Other
pension
Principal
retiree
benefit
Prior service cost (credit)
$ 5
$ ( 22 )
$ ( 306 )
$ 12
$ ( 25 )
$ ( 366 )
Net loss (gain)
11
614
( 315 )
( 404 )
719
( 375 )
Total recorded in AOCI
$ 15
$ 592
$ ( 621 )
$ ( 392 )
$ 694
$ ( 741 )
Assumptions Used in Calculations . Our defined benefit pension plans are accounted for on an actuarial basis, which requires the
selection of various assumptions, including a discount rate, a compensation assumption, an expected return on assets, mortality rates of
participants and expectation of mortality improvement.
Projected benefit obligations are measured as the present value of expected benefit payments. We discount those cash payments using a
discount rate. We determine the discount rate using the weighted-average yields on high-quality fixed-income securities with maturities that
correspond to the payment of benefits. Lower discount rates increase present values and generally increase subsequent-year pension
expense; higher discount rates decrease present values and generally reduce subsequent-year pension expense.
The compensation assumption is used to estimate the annual rate at which pay of plan participants will grow. If the rate of growth assumed
increases, the size of the pension obligations will increase, as will the amount recorded in AOCI in our Statement of Financial Position and
amortized into earnings in subsequent periods.
The expected return on plan assets is the estimated long-term rate of return that will be earned on the investments used to fund the benefit
obligations. To determine the expected long-term rate of return on pension plan assets, we consider our asset allocation, as well as
historical and expected returns on various categories of plan assets. In developing future long-term return expectations for our principal
benefit plans’ assets, we formulate views on the future economic environment, both in the U.S. and abroad. We evaluate general market
trends and historical relationships among a number of key variables that impact asset class returns such as expected earnings growth,
inflation, valuations, yields and spreads, using both internal and external sources. We also take into account expected volatility by asset
class and diversification across classes to determine expected overall portfolio results given our asset allocation. B ased on our analysis, we
have assumed a 7.0 % long-term expected return on the GE Energy Pension Plan assets for cost recognition in 2024 and 2025 .
The healthcare trend assumptions primarily apply to our pre-65 retiree medical plans. Most participants in our post-65 retiree plan have a
fixed subsidy and therefore are not subject to healthcare inflation.
We evaluate these critical assumptions at least annually on a plan and country-specific basis. We periodically evaluate other assumptions
involving demographics factors such as retirement age and turnover, and update them to reflect our actual experience and expectations for
the future. Actual results in any given year will often differ from actuarial assumptions because of economic and other factors. Differences
between our actual results and what we assumed are recorded in AOCI each period and are amortized into earnings over the remaining
average future service of active participating employees or the expected life of inactive participants, as applicable .
2024 FORM 10-K 71
Composition of our Plan Assets . The fair value of our pension plans' investments is presented below. The inputs and valuation
techniques used to measure the fair value of these assets are described in Note 2 and have been applied consistently.
COMPOSITION OF PLAN ASSETS
2024
2023
December 31
Principal pension
Other pension
Principal pension
Other pension
Global equity securities
$ 2,524
$ 932
$ 634
$ 943
Debt securities(a)
4,383
3,182
4,598
2,759
Real estate
254
250
247
12
Other investments
159
46
197
161
Plan assets measured at fair value
$ 7,320
$ 4,410
$ 5,676
$ 3,875
Global equities
$ —
$ 163
$ 1,013
$ 391
Debt securities
—
1,050
609
1,554
Real estate
340
484
340
775
Other investments
1,260
222
1,853
256
Plan assets measured at net asset value
$ 1,600
$ 1,919
$ 3,815
2,976
Total plan assets
$ 8,920
$ 6,329
$ 9,491
$ 6,851
(a) GE Energy Pension Plan assets as of December 31, 2024 and 2023 include $ 1,299 million and $ 2,105 million , respectively, of U.S.
corporate debt securities, primarily made up of investment-grade bonds of U.S. issuers from diverse industries, and $ 1,646 million and
$ 1,932 million , respectively, of other debt securities, primarily made up of investments in residential and commercial mortgage-backed
securities, non-U.S. corporate and government bonds and U.S. government, federal agency, state, and municipal debt. Other pension
plan assets as of December 31, 2024 and 2023 include debt securities primarily made up of fixed income and cash investment funds.
Those investments that were measured at Net Asset Value (NAV) as a practical expedient were excluded from the fair value hierarchy.
GE Energy Pension Plan investments with a fair value of $ 399 million and $ 383 million at December 31, 2024 and 2023 , respectively, were
classified within Level 3 and primarily relate to private equities and real estate. The remaining investments were substantially all considered
Level 1 and 2. Investments with a fair value of $ 1,667 million and $ 1,272 million at December 31, 2024 and 2023 , respectively, were
classified within Level 1 and primarily relate to global equities and debt securities. Investments with a fair value of $ 5,254 million and
$ 4,050 million at December 31, 2024 and 2023 , respectively, were classified within Level 2 and primarily relate to debt securities.
Other pension plan investments with a fair value of $ 256 million and $ 18 million at December 31, 2024 and 2023 , respectively, were
classified within Level 3 and primarily relate to private equities and real estate. The increase in the Level 3 category during 2024 was
primarily due to hierarchy reassessment. The remaining investments were substantially all considered Level 1 and 2. Investments with a
fair value of $ 498 million and $ 757 million at December 31, 2024 and 2023 , respectively, were classified within Level 1 and primarily relate
to global equities and debt securities. Investments with a fair value of $ 3,656 million and $ 2,766 million at December 31, 2024 and 2023 ,
respectively, were classified within Level 2 and primarily relate to debt securities.
ASSET ALLOCATION OF PENSION PLANS
2024 Target allocation
2024 Actual allocation
Principal Pension
Other Pension
(weighted
average)
Principal Pension
Other Pension
(weighted
average)
Global equity securities
41
%
21
%
28
%
17
%
Debt securities (including cash equivalents)
40
61
49
67
Real estate
2
9
7
12
Other investments
17
9
16
4
Plan fiduciaries set investment policies and strategies for the assets held in the pension plans and oversee their investment allocations,
which includes selecting investment managers and setting long-term strategic targets.
GE secu rities represented 0.2 % of the GE Energy Pension Plan assets at December 31, 2023 .
EXPECTED FUTURE BENEFIT PAYMENTS OF OUR BENEFIT PLANS(a)
Principal pension
Other pension
Principal retiree
benefit
2025
$ 786
$ 417
$ 77
2026
789
386
77
2027
791
391
77
2028
792
385
76
2029
790
381
76
2030-2034
3,867
1,857
337
(a) As of the measurement date of December 31, 2024.
2024 FORM 10-K 72
PRE-TAX COST OF POSTRETIREMENT BENEFIT PLANS AND CHANGES IN OTHER COMPREHENSIVE INCOME
2024
2023
2022
Principal
pension
Other
pension
Principal
retiree
benefit
Principal
pension
Other
pension
Principal
retiree
benefit
Other
pension
Cost (income) of postretirement benefit plans
$ ( 344 )
$ ( 48 )
$ ( 59 )
$ ( 377 )
$ ( 78 )
$ ( 57 )
$ ( 162 )
Changes in other comprehensive loss (income)
Prior service cost (credit) – current year
—
—
—
17
—
—
—
Net loss (gain) - current year
252
( 76 )
18
454
355
( 5 )
( 28 )
Reclassifications out of AOCI
Transfers and other - net(a)
( 21 )
1
—
( 1,069 )
268
( 840 )
—
Curtailment/settlement gain (loss)
—
( 2 )
—
—
6
—
6
Amortization of net gain (loss)
183
( 34 )
42
210
( 4 )
45
( 9 )
Amortization of prior service credit (cost)
( 7 )
8
59
( 4 )
6
59
8
Total changes in other comprehensive loss
(income)
407
( 102 )
120
( 392 )
631
( 741 )
( 23 )
Cost (income) of postretirement benefit plans and
changes in other comprehensive loss (income)
$ 64
$ ( 151 )
$ 60
$ ( 769 )
$ 553
$ ( 798 )
$ ( 185 )
(a) Primarily relates to plans allocated to GE Vernova on January 1, 2023 .
NOTE 14 . CURRENT AND ALL OTHER LIABILITIES
December 31
2024
2023
Employee compensation and benefit liabilities
$ 1,824
$ 1,619
Equipment projects and other commercial liabilities
1,616
1,126
Product warranties (Note 22 )
553
629
Derivative instruments (Note 20 )
171
74
Operating lease liabilities (Note 7 )
163
193
Restructuring liabilities (Note 23 )
231
186
Short-term borrowings
60
145
Taxes payable
80
123
Other(a)
797
257
All other current liabilities
$ 5,496
$ 4,352
Equipment projects and other commercial liabilities
$ 362
$ 531
Legal liabilities (Note 22 )
459
604
Product warranties (Note 22 )
816
785
Operating lease liabilities (Note 7 )
562
525
Uncertain and other income taxes and related liabilities
1,170
803
Asset retirement obligations (Note 22 )
510
581
Environmental, health and safety liabilities (Note 22 )
138
127
Finance lease liabilities and other long-term borrowings
258
294
Deferred income (Note 9 )
157
173
Derivative instruments (Note 20 )
46
34
Other(b)
639
323
All other liabilities
$ 5,116
$ 4,780
(a) Primarily included liabilities related to business disposition activities, dividends payable, and asset retirement obligations.
(b) Primarily included indemnification liabilities in connection with agreements entered into with GE related to the Spin-Off. See Note 22 for
further information.
NOTE 15 . INCOME TAXE S
Components of Income Taxes. The components of income (loss) before income taxes and the provision (benefit) for income taxes,
excluding other comprehensive income (loss) and changes in equity attributable to noncontrolling interests recorded after-tax, for the years
ended December 31 were as follows:
INCOME (LOSS) BEFORE INCOME TAXES
2024
2023
2022
U.S.
$ 1,285
$ ( 357 )
$ ( 1,081 )
Non-U.S.
1,213
227
( 1,393 )
Total
$ 2,498
$ ( 130 )
$ ( 2,474 )
2024 FORM 10-K 73
PROVISION (BENEFIT) FOR INCOME TAXES
2024
2023
2022
Current
U.S. Federal
$ 272
$ ( 184 )
$ ( 2 )
U.S. State and Local
55
—
—
Non-U.S.
636
500
426
Deferred
U.S. Federal
( 10 )
—
—
U.S. State and Local
( 1 )
—
—
Non-U.S.
( 13 )
28
( 176 )
Total
$ 939
$ 344
$ 248
Effective Tax Rate Reconciliation. A reconciliation of the U.S. federal statutory income tax rate to the effective tax rate was as follows:
2024
2023
2022
Amount
Rate
Amount
Rate
Amount
Rate
U.S. federal statutory income tax rate
$ 525
21.0 %
$ ( 27 )
21.0 %
$ ( 520 )
21.0 %
State taxes, net of federal benefit
43
1.7
( 46 )
35.3
( 31 )
1.3
Tax on global activities including exports
80
3.2
( 83 )
64.0
( 24 )
1.0
Tax on undistributed foreign earnings
103
4.1
—
—
—
—
Share-based compensation
( 37 )
( 1.5 )
—
—
—
—
Uncertain tax positions
( 101 )
( 4.0 )
( 61 )
47.2
( 33 )
1.3
U.S. business credits and incentives(a)
( 126 )
( 5.0 )
( 208 )
160.0
( 187 )
7.6
Valuation allowances
647
25.9
774
( 594.5 )
951
( 38.5 )
Business disposition(b)
( 193 )
( 7.7 )
—
—
—
—
All other – net
( 2 )
( 0.1 )
( 5 )
2.9
92
( 3.7 )
Effective tax rate
$ 939
37.6 %
$ 344
( 264.1 ) %
$ 248
( 10.0 ) %
(a) U.S. business credits and incentives primarily includes the tax benefit of the advanced manufacturing credit, tax credits for energy
produced from renewable sources, and tax credits for research performed in the U.S. The Company uses the flow-through method to
account for investment tax credits. Under this method, the investment tax credits are recognized as a reduction to income tax expense.
(b) Business disposition resulted from a pre-tax gain with an insignificant tax impact from the sale of a portion of Steam Power nuclear
activities to EDF.
The Organization for Economic Co-operation and Development has proposed a global minimum tax of 15% of reported profits (Pillar Two)
that has been agreed upon in principle by over 140 countries. During 2023, many countries took steps to incorporate Pillar Two model rule
concepts into their domestic laws. Although the model rules provide a framework for applying the minimum tax, countries may enact Pillar
Two slightly differently than the model rules and on different timelines and may adjust domestic tax incentives in response to Pillar Two.
Accordingly, we continue to evaluate the potential consequences of Pillar Two on our longer-term financial position as related tax laws are
enacted. In 2024 , we incurred insignificant tax expenses in connection with Pillar Two .
2024 FORM 10-K 74
Deferred Income Taxes. The components of the net deferred tax asset (liability) for the years ended December 31 were as follows:
December 31
2024
2023
Deferred tax assets
Contract liabilities, contract assets and deferred income
$ 2,633
$ 2,005
Principal pension plans
381
702
Other compensation and benefits
451
261
Accrued expenses
313
403
Intangible assets
503
690
Tax loss carryforwards(a)(b)
5,722
6,775
Tax credit carryforwards(a)(c)
208
806
Other
124
95
Total deferred tax assets
$ 10,335
$ 11,737
Valuation allowances(d)
( 8,420 )
( 9,706 )
Total deferred tax assets after valuation allowances
$ 1,915
$ 2,031
Deferred tax liabilities
Property, plant, and equipment
$ —
$ ( 97 )
Global investments, partnerships, joint ventures and non-consolidated
( 709 )
( 588 )
Other(e)
( 394 )
( 146 )
Total deferred tax (liabilities)
$ ( 1,103 )
$ ( 831 )
Net deferred tax asset (liability)
$ 812
$ 1,200
(a) Certain U.S. tax attributes, primarily tax loss carryforwards and tax credit carryforwards, were retained by GE following the Spin-off.
See Note 1 for further information regarding the Tax Matters Agreement.
(b) Tax loss carryforwards as of December 31, 2024 are primarily related to Switzerland and other foreign jurisdictions, which if unused,
approximately $ 2,349 million will expire between 2025-2044 and $ 3,373 million do not expire.
(c) Tax credit carryforwards as of December 31, 2024 are primarily related to U.S. foreign tax credits and research performed in the U.S.,
which if unused, will expire in various years through 2034.
(d) Valuation allowances decreased by $ 1,286 million in 2024 primarily due to a reduction in deferred tax assets related to certain U.S. tax
attributes retained by GE following the Spin-off and a $ 140 million net decrease resulting from a change in judgement regarding the
realizability of deferred tax assets in certain foreign jurisdictions, partially offset by additional tax loss carryforwards in certain foreign
jurisdictions where it is more likely than not the tax benefits will not be realized.
(e) We recognized $ 287 million of foreign deferred tax l iabilities transferred from GE in 2024 related to separation activities. See Note 1 for
further information regarding the Tax Matters Agreement.
We regularly assess the realizability of our deferred tax assets based on all available evidence both positive and negative. Based on our
assessment of the realizability of our deferred tax assets as of December 31, 2024 , we continue to maintain valuation allowances against
our deferred tax assets in the U.S. and certain foreign jurisdictions, primarily due to cumulative losses in those jurisdictions. Given the
current year profit and anticipated future profitability in the U.S., it is reasonably possible that the continued improvement in our U.S.
operations could result in the positive evidence necessary to warrant the release of a significant portion of our U.S. valuation allowance as
early as the second half of 2025. A release of the valuation allowance would result in the recognition of certain U.S. deferred tax assets and
a corresponding benefit in our provision for income taxes in the period the release occurs.
As of December 31, 2024 , we recognized a $ 103 million deferred tax liability, primarily related to withholding taxes, on undistributed
earnings we anticipate repatriating from certain highly -i nflationary or currency restricted foreign jurisdictions. N o deferred tax liability has
been provided on undistributed earnings of approximately $ 6,500 million from all other foreign subsidiaries which are considered to be
permanently reinvested. It is not practicable to determine the applicable income taxes payable on the permanently reinvested earnings if
fully repatriated to the U.S.
Income Taxes Paid. The Company's portion of income taxes for U.S. and certain foreign jurisdictions prior to the separation were deemed
settled at the date of the Spin-Off. Cash paid directly to tax authorities for income taxes was $ 872 million in 2024 and was no t significant in
2022 and 2023 .
2024 FORM 10-K 75
Uncertain Tax Positions. A reconciliation of the beginning and ending liability for uncertain tax positions was as follows:
UNCERTAIN TAX POSITIONS RECONCILIATION
2024
2023
Balance at January 1
$ 643
$ 763
Additions for tax positions of the current year
1
6
Additions for tax positions of prior years
30
63
Reductions for tax positions of prior years
( 133 )
( 92 )
Settlements with tax authorities
( 10 )
( 55 )
Expiration of statutes of limitation
( 55 )
( 51 )
Foreign currency effect
( 24 )
9
Balance at December 31
$ 452
$ 643
Accrued interest on uncertain tax positions
116
151
Accrued penalties on uncertain tax positions
70
92
Balance at December 31, including interest and penalties
$ 638
$ 886
Of the $ 638 million and $ 886 million liability for uncertain tax positions including interest and penalties at December 31, 2024 and 2023 ,
respectively, $ 434 million and $ 651 million , respectively, are recorded in All other liabilities and $ 204 million and $ 235 million , respectively,
are recorded as a net offset to Deferred income taxes on our Combined Statement of Financial Position. If recognized, $ 318 million and
$ 251 million of the liability for uncertain tax positions at December 31, 2024 and 2023 , respectively, would impact our effective tax rate.
As a result of tax audit closings, settlements with tax authorities, and the expiration of applicable statutes of limitation in various
jurisdictions, it is reasonably possible that the liability for uncertain tax positions could be reduced by approximately $ 37 million in the next
12 months.
For the years ended December 31, 2024 , 2023 , and 2022 , net interest expense (income) of $( 19 ) million , $ 20 million , and $ 6 million ,
respectively, was recognized in Interest and other financial charges – net and penalty expense of $( 21 ) million , $ 8 million , and $( 11 ) million ,
respectively, was recognized in our Provision for income taxes on our Combined Statement of Income (Loss).
Annually, we file over 2,600 income tax returns in over 270 global taxing jurisdictions. We are under examination or engaged in tax litigation
in many of these jurisdictions. The IRS is currently auditing the combined GE U.S. income tax returns for 2016-2021. In December 2020,
the IRS completed the audit of the combined GE U.S. income tax returns for 2014-2015. The Company has provided for its potential tax
exposure from uncertain tax positions as part of the combined GE U.S. income tax returns as an indemnification obligation with GE in
accordance with the Tax Matters Agreement.
NOTE 16 . ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) (AOCI) AND COMMON STOCK
Currency
translation
adjustment
Benefit plans
Cash flow
hedges
Total AOCI
Balance as of January 1, 2024
$ ( 1,335 )
$ 674
$ 26
$ ( 635 )
Transfer or allocation of benefit plans – net of taxes of $ 49 , $( 203 ) , and $ —
—
( 182 )
—
( 182 )
AOCI before reclasses – net of taxes of $( 16 ) , $( 7 ) , and $ — (a)
( 285 )
( 225 )
( 14 )
( 524 )
Reclasses from AOCI – net of taxes of $ — , $( 61 ) , and $ 1 (b)
( 111 )
( 323 )
21
( 414 )
Less: AOCI attributable to noncontrolling interests
2
2
—
4
Balance as of December 31, 2024
$ ( 1,734 )
$ ( 58 )
$ 33
$ ( 1,759 )
Balance as of January 1, 2023
$ ( 1,445 )
$ 32
$ ( 43 )
$ ( 1,456 )
Transfer or allocation of benefit plans – net of taxes of $ — , $ 70 , and $ —
—
1,702
—
1,702
AOCI before reclasses – net of taxes of $ — , $ 48 , and $( 1 )
95
( 735 )
45
( 595 )
Reclasses from AOCI – net of taxes of $ — , $( 2 ) , and $ —
19
( 327 )
24
( 284 )
Less: AOCI attributable to noncontrolling interests
4
( 2 )
—
2
Balance as of December 31, 2023
$ ( 1,335 )
$ 674
$ 26
$ ( 635 )
Balance as of January 1, 2022
$ ( 1,192 )
$ ( 43 )
$ ( 21 )
$ ( 1,256 )
AOCI before reclasses – net of taxes of $ 8 , $ 12 , and $( 1 )
( 254 )
106
( 46 )
( 194 )
Reclasses from AOCI – net of taxes of $ — , $ 4 , and $ —
—
( 28 )
24
( 4 )
Less: AOCI attributable to noncontrolling interests
( 1 )
3
—
2
Balance as of December 31, 2022
$ ( 1,445 )
$ 32
$ ( 43 )
$ ( 1,456 )
(a) Currency translation adjustment includes $ 39 million of AOCI allocated to us in connection with the Spin-Off.
(b) The total reclassification of AOCI included $ 111 million of currency translation adjustment related to the sale of a portion of Steam Power
nuclear activities to EDF. See Notes 3 and 19 for further information.
Common Stock. On April 2, 2024 , the Company began trading as an independent, publicly traded company under the stock symbol “GEV”
on the New York Stock Exchange. On April 2, 2024 , there were 274,085,523 shares of GE Vernova common stock outsta nding. On
December 31, 2024 , there were 275,880,314 shares of GE Vernova common stock outstanding. On December 10, 2024, we announced
that the Board of Directors had authorized up to $ 6 billion of common stock repurchases.
2024 FORM 10-K 76
NOTE 17 . SHARE-BASED COMPENSATION . We grant stock options, restricted stock units (RSUs), and performance share units
(PSUs) to employees under the 2024 Long-Term Incentive Plan (LTIP). Under the LTIP, we are authorized to issue up to approximately
25 million shares. We record compensation expense for awards expected to vest over the vesting period. We estimate forfeitures based on
experience and adjust expense to reflect actual forfeitures. When options are exercised, RSUs vest, and PSUs are earned, we issue
shares from authorized unissued common stock .
Stock options provide awardees the opportunity to purchase shares of GE Vernova common stock in the future at the market price of our
common stock on the date the award is granted (Strike price). The options become exercisable over the vesting period, typically becoming
fully vested in either 3 or 4 years from the date of grant, and generally expire 10 years from the grant date if not exercised. RSUs entitle the
awardee to receive shares of GE Vernova common stock upon vesting. PSUs entitle an awardee to receive shares of GE Vernova common
stock upon certification by the Company's Compensation and Human Capital Committee of the level of performance achievement of the
applicable performance metrics over a defined performance period. We value stock options using a Black-Scholes option pricing model,
RSUs using the market price of our common stock on the grant date, and PSUs using the market price of our common stock on the grant
date and a Monte Carlo simulation as needed based on performance metrics.
The following tables provide the weighted average fair value of options, RSUs, and PSUs granted under the 2024 LTIP to employees
during the nine months ended December 31, 2024 and the related stock option valuation assumptions used in the Black-Scholes model.
WEIGHTED AVERAGE GRANT DATE FAIR VALUE (In dollars)
December 31, 2024
Stock options
$ 69.56
RSUs
167.57
PSUs
182.85
KEY ASSUMPTIONS USED IN THE BLACK-SCHOLES VALUATION FOR STOCK OPTIONS
December 31, 2024
Risk-free interest rate
4.3 %
Dividend yield
— %
Expected volatility
30 %
Expected term (in years)
6.8
Strike price (in dollars)
$ 170.03
For new awards granted in 2024, the expected volatility was derived from a peer group’s blended historical and implied volatility as GE
Vernova does not have sufficient historical volatility based on the expected term of the underlying options . The expected term of the stock
options was determined using the simplified method. The risk-free interest rate was determined using the implied yield currently available
for zero-coupon U.S. government issues with a remaining term approximating the expected life of the options.
SHARE-BASED COMPENSATION ACTIVITY
Stock options
Shares (in
thousands)
Weighted average
exercise price (in
dollars)
Weighted average
contractual term
(in years)
Intrinsic value (in
millions)
Outstanding at April 2, 2024(a)
2,514
$ 101.32
Granted
1,450
170.03
Exercised
( 1,155 )
114.48
Forfeited
( 19 )
169.36
Expired
( 54 )
128.95
Outstanding at December 31, 2024
2,737
$ 131.16
6.6
$ 541
Exercisable at December 31, 2024
1,201
$ 90.45
3.2
$ 286
Expected to vest
1,171
$ 161.30
9.3
$ 196
RSUs
PSUs
Shares (in
thousands)
Weighted
average
grant date
fair value
(in dollars)
Weighted
average
vesting
period (in
years)
Intrinsic
value (in
millions)
Shares (in
thousands)
Weighted
average
grant date
fair value
(in dollars)
Weighted
average
vesting
period (in
years)
Intrinsic
value (in
millions)
Outstanding at April 2, 2024(a)
3,797
$ 59.34
741
$ 75.35
Granted
663
167.57
788
123.12
Vested(b)
( 1,294 )
45.70
( 436 )
—
Forfeited
( 157 )
82.25
( 18 )
150.68
Expired
N/A
N/A
N/A
N/A
Outstanding at December 31, 2024
3,008
$ 89.06
1.2
$ 989
1,076
$ 128.74
1.6
$ 354
Expected to vest
2,811
$ 88.04
1.2
$ 924
948
$ 126.25
1.5
$ 312
(a) On April 2, 2024 , the Company began trading as an independent, publicly traded company under the stock symbol “GEV” on the New
York Stock Exchange. The beginning shares outstanding pertain to GE equity-based awards issued by GE in prior periods that were
converted to GE Vernova equity-based awards as part of the Spin-Off. The conversion to GE Vernova awards was considered a
modification of the original award. Incremental fair value recognized was not significant.
(b) Vesting of PSUs associated with performance shares originally awarded and recognized by GE .
2024 FORM 10-K 77
Share-based compensation expense is recognized within Cost of equipment, Cost of services, Selling, general, and administrative
expenses, and Research and development expenses, as appropriate, in the Consolidated and Combined Statement of Income (Loss).
SHARE-BASED COMPENSATION EXPENSE
2024
Share-based compensation expense (pre-tax)
$ 155
Income tax benefits
( 59 )
Share-based compensation expense (after-tax)
$ 96
OTHER SHARE-BASED COMPENSATION DATA
Unrecognized compensation expense as of December 31, 2024 (a)
$ 255
Cash received from stock options exercised for the year ended December 31, 2024 (b)
130
Intrinsic value of stock options exercised and RSU/PSUs vested in the year ended December 31, 2024 (b)
424
(a) Amortized over a weighted average period of 1.1 years .
(b) Represents data after the Spin-Off as employees participated in GE equity-based awards prior to separation.
NOTE 18 . EARNINGS PER SHARE INFORMATION . On April 2, 2024 , there were approximately 274 million shares of GE Vernova
common stock outstanding. The computation of basic and diluted earnings (loss) per common share for all periods through April 1, 2024
was calculated using 274 million common shares and is net of Net loss (income) attributable to noncontrolling interests. For periods prior to
the Spin-Off, there were no dilutive equity instruments as there were no equity awards of GE Vernova outstanding prior to the Spin-Off. The
dilutive effect of outstanding stock options, restricted stock units, and performance share units is reflected in the denominator for diluted
EPS using the treasury stock method.
(In millions, except per share amounts)
2024
2023
2022
Numerator:
Net income (loss)
$ 1,559
$ ( 474 )
$ ( 2,722 )
Net loss (income) attributable to noncontrolling interests
( 7 )
36
( 14 )
Net income (loss) attributable to GE Vernova
$ 1,552
$ ( 438 )
$ ( 2,736 )
Denominator:
Basic weighted-average shares outstanding
275
274
274
Dilutive effect of common stock equivalents
3
—
—
Diluted weighted-average shares outstanding
278
274
274
Basic earnings (loss) per share
$ 5.65
$ ( 1.60 )
$ ( 10.00 )
Diluted earnings (loss) per share
$ 5.58
$ ( 1.60 )
$ ( 10.00 )
Antidilutive securities(a)
1
—
—
(a) Diluted earnings (loss) per share excludes certain shares issuable under share-based compensation plans because the effect would
have been antidilutive.
NOTE 19 . OTHER INCOME (EXPENSE) – NET
2024
2023
2022
Equity method investment income (loss) (Note 11 )
$ 53
$ ( 64 )
$ 60
Net interest and investment income (loss)
66
63
42
Purchases and sales of business interests(a)
1,147
209
22
Derivative instruments (Note 20 )
( 5 )
( 25 )
47
Licensing income
38
97
71
Other – net
72
44
128
Total other income (expense) – net
$ 1,372
$ 324
$ 370
(a) 2024 i ncludes a pre-tax gain of $ 964 million related to the sale of a portion of Steam Power nuclear activities to EDF and a pre-tax gain
of $ 66 million related to the sale of a portion of our China XD Electric Co., Ltd. equity method investment in our Electrification segment.
2023 includes a pre-tax gain of $ 90 million related to the sale of an equity method investment at Financial Services. See Notes 3 , 11 ,
15 , and 16 for further information.
NOTE 20 . FINANCIAL INSTRUMENTS
Loans and Other Receivables. The Company’s financial assets not carried at fair value primarily consist of loan receivables and
noncurrent customer and other receivables. The net carrying amount was $ 318 million and $ 328 million as of December 31, 2024 and
2023, respectively. The estimated fair value was $ 315 million and $ 324 million as of December 31, 2024 and 2023, respectively. All of these
assets are considered to be Level 3.
Derivatives and Hedging. Our primary objective in executing and holding derivatives is to reduce the earnings and cash flow volatility
associated with fluctuations in foreign currency exchange rates and commodity prices over the terms of our customer contracts. These
hedge contracts reduce, but do not entirely eliminate, the impact of foreign currency exchange rate and commodity price movements. The
Company does not enter into or hold derivative instruments for speculative trading purposes.
2024 FORM 10-K 78
We use foreign currency contracts to reduce the volatility of cash flows related to forecasted revenues, expenses, assets, and liabilities.
These contracts are generally one to 11 months in duration but with maximum remaining maturities of up to 15 years as of December 31,
2024 . The objective of the foreign currency contracts is to ultimately reduce the extent to which functional currency or U.S. dollar-equivalent
cash flows are affected by changes in the applicable foreign currency exchange rates. We evaluate the effectiveness of our foreign
currency contracts designated as cash flow hedges on a quarterly basis.
The embedded derivatives the Company recognizes primarily consist of foreign currency related features in our purchase or sales contracts
where the currency is not the functional currency of either party to the contract.
Cash Flow Hedges. For derivative instruments designated as cash flow hedges, changes in the fair value of designated hedging
instruments are initially recorded as a component of AOCI and subsequently reclassified to earnings in the period in which the hedged
transaction occurs and to the same financial statement line item impacted by the hedged forecasted transaction.
The total amount in AOCI related to cash flow hedges was a net $ 33 million gain and a net $ 26 million gain as of December 31, 2024 and
2023 , respectively, of which a net $ 22 million gain and a net $ 12 million gain, respectively, related to our share of AOCI recognized at our
non-consolidated joint ventures. We expect to reclassify $ 45 million of pre-tax net losses associated with designated cash flow hedges to
earnings in the next 12 months, contemporaneously with the earnings effects of the related forecasted transactions. The Company
reclassified net gains (losses) from AOCI into earnings of $( 21 ) million , $( 24 ) million and $( 24 ) million for the years ended December 31,
2024 , 2023 , and 2022 , respectively. As of December 31, 2024 , the maximum length of time over which we are hedging forecasted
transactions was approximately 10 years . The cash flows associated with cash flow hedges are recorded through the operating activities
section of the Consolidated and Combined Statement of Cash Flows. The Company assesses effectiveness for foreign currency cash flow
hedges related to long-term projects based on spot-to-spot foreign currency movements and excludes forward points from the assessment
of effectiveness.
Net Investment Hedges. We enter into foreign exchange forwards designated as the hedging instruments in net investment hedging
relationships in order to mitigate the foreign currency risk attributable to the translation of the Company’s net investment in certain non
USD-functional subsidiaries and equity method investees. The total amount in AOCI related to net investment hedges was a net gain of
$ 33 million and $ 225 million as of December 31, 2024 and 2023 , respectively.
The Company uses the spot method to assess hedge effectiveness for its net investment hedges. As such, for derivative instruments
designated as net investment hedges, changes in fair value of the designated hedging instruments attributable to fluctuations in foreign
currency spot exchange rates only are initially recorded as a component of the cumulative translation adjustments in AOCI until the hedged
investment is either sold or substantially liquidated. All other changes in the fair value of the hedging instrument are recognized in current
earnings.
Non-Designated Hedges. The Company also executes derivative instruments, such as foreign currency forward contracts and commodity
swaps, that are not designated in qualifying hedging relationships under U.S. GAAP. These derivatives are intended to serve as economic
hedges of foreign currency and commodity price risk, and depending on the derivative type, hedges of monetary assets and liabilities,
including intercompany balances subject to remeasurement.
The changes in fair value of non-designated hedges are recorded in line items in the Consolidated and Combined Statement of Income
(Loss) based on the nature of the derivative contract and the underlying item being economically hedged. The cash flows associated with
non-designated hedges are recorded in the same category as the cash flows from the items being economically hedged and are thus
primarily through investing and operating activities of the Consolidated and Combined Statement of Cash Flows.
The following table presents the gross fair values of our outstanding derivative instruments as of the dates indicated:
GROSS FAIR VALUE OF OUTSTANDING DERIVATIVE INSTRUMENTS
December 31, 2024
Gross Notional
All other current
assets
All other assets
All other current
liabilities
All other
liabilities
Foreign currency exchange contracts accounted for
as hedges
$ 5,789
$ 61
$ 144
$ 58
$ 65
Foreign currency exchange contracts
34,244
479
159
483
144
Commodity and other contracts
436
12
20
12
2
Derivatives not accounted for as hedges
$ 34,681
$ 491
$ 179
$ 495
$ 146
Total gross derivatives
$ 40,469
$ 552
$ 323
$ 552
$ 211
Netting adjustment(a)
$ ( 383 )
$ ( 166 )
$ ( 381 )
$ ( 166 )
Net derivatives recognized in the Consolidated and
Combined Statement of Financial Position
$ 168
$ 158
$ 171
$ 46
(a) The netting of derivative receivables and payables is permitted when a legally enforceable master netting agreement exists. Amounts
include fair value adjustments related to our own and counterparty non-performance risk.
2024 FORM 10-K 79
December 31, 2023
Gross Notional
All other current
assets
All other assets
All other current
liabilities
All other
liabilities
Foreign currency exchange contracts accounted for
as hedges
$ 5,035
$ 39
$ 91
$ 28
$ 41
Foreign currency exchange contracts
33,832
361
169
364
142
Commodity and other contracts
476
10
8
16
1
Derivatives not accounted for as hedges
$ 34,308
$ 371
$ 177
$ 380
$ 143
Total gross derivatives
$ 39,343
$ 410
$ 268
$ 408
$ 184
Netting adjustment(a)
$ ( 334 )
$ ( 150 )
$ ( 334 )
$ ( 150 )
Net derivatives recognized in the Consolidated and
Combined Statement of Financial Position
$ 76
$ 118
$ 74
$ 34
(a) The netting of derivative receivables and payables is permitted when a legally enforceable master netting agreement exists. Amounts
include fair value adjustments related to our own and counterparty non-performance risk.
PRE-TAX GAINS (LOSSES) RECOGNIZED IN AOCI RELATED TO CASH FLOW AND NET INVESTMENT HEDGES
2024
2023
2022
Cash flow hedges
$ 7
$ 34
$ ( 111 )
Net investment hedges
2
( 8 )
16
The tables below show the effect of our derivative financial instruments in the Consolidated and Combined Statement of Income (Loss):
For the year ended December 31, 2024
Sales of
equipment and
services
Cost of equipment
and services
Selling, general,
and administrative
expenses
Other income
(expense) – net
Total amount of income (expense) in the Consolidated and
Combined Statement of Income (Loss)
$ 34,935
$ 28,850
$ 4,632
$ 1,372
Foreign currency exchange contracts
( 6 )
14
—
—
Interest rate contracts
—
—
—
—
Effects of cash flow hedges
$ ( 6 )
$ 14
$ —
$ —
Foreign currency exchange contracts
( 2 )
16
88
( 4 )
Commodity and other contracts
—
10
( 24 )
—
Effect of derivatives not designated as hedges
$ ( 2 )
$ 26
$ 64
$ ( 5 )
For the year ended December 31, 2023
Sales of
equipment and
services
Cost of equipment
and services
Selling, general,
and administrative
expenses
Other income
(expense) – net
Total amount of income (expense) in the Consolidated and
Combined Statement of Income (Loss)
$ 33,239
$ 28,421
$ 4,845
$ 324
Foreign currency exchange contracts
( 20 )
1
—
—
Interest rate contracts
—
—
—
( 2 )
Effects of cash flow hedges
$ ( 20 )
$ 1
$ —
$ ( 2 )
Foreign currency exchange contracts
—
122
1
( 24 )
Commodity and other contracts
—
34
( 7 )
—
Effect of derivatives not designated as hedges
$ —
$ 156
$ ( 6 )
$ ( 24 )
For the year ended December 31, 2022
Sales of
equipment and
services
Cost of equipment
and services
Selling, general,
and administrative
expenses
Other income
(expense) – net
Total amount of income (expense) in the Consolidated and
Combined Statement of Income (Loss)
$ 29,654
$ 26,196
$ 5,360
$ 370
Foreign currency exchange contracts
( 22 )
—
—
—
Interest rate contracts
—
—
—
( 1 )
Effects of cash flow hedges
$ ( 22 )
$ —
$ —
$ ( 1 )
Foreign currency exchange contracts
5
129
3
47
Commodity and other contracts
—
( 25 )
—
—
Effect of derivatives not designated as hedges
$ 5
$ 104
$ 3
$ 47
The amount excluded for cash flow hedges was a gain (loss) of $ 20 million , $( 13 ) million , and $ 26 million for the years ended December
31, 2024 , 2023 , and 2022 , respectively. This amount is recognized in Sales of equipment, Sales of services, Cost of equipment, and Cost
of services in our Consolidated and Combined Statement of Income (Loss).
2024 FORM 10-K 80
Counterparty Credit Risk. The Company would be exposed to credit-related losses in the event of non-performance by counterparties on
executed derivative instruments. The credit exposure of derivative contracts is represented by the fair value of contracts as of the reporting
date. The fair value of the Company’s derivatives can change significantly from period to period based on, among other factors, market
movements, and changes in our positions.
We manage concentration of counterparty credit risk by limiting acceptable counterparties to major financial institutions with investment
grade credit ratings, by limiting the amount of credit exposure to individual counterparties, and by actively monitoring counterparty credit
ratings and the amount of individual credit exposure.
We also employ master netting arrangements that limit the risk of counterparty non-payment on a particular settlement date to the net gain
that would have otherwise been received from the counterparty. Although not completely eliminated, we do not consider the risk of
counterparty default to be significant as a result of these protections. Further, none of our derivative instruments are subject to collateral or
other security arrangements, nor do they contain provisions that are dependent on our credit ratings from any credit rating agency.
NOTE 21 . VARIABLE INTEREST ENTITIES (VIEs) . In our Consolidated and Combined Statement of Financial Position, we have
assets of $ 111 million and $ 122 million and liabilities of $ 134 million and $ 156 million as of December 31, 2024 and 2023 , respectively, from
consolidated VIEs . These entities were created to help our customers facilitate or finance the purchase of GE Vernova equipment and
services, and to manage our insurance exposure through an insurance captive, and have no features that could expose us to losses that
would significantly exceed the difference between the consolidated assets and liabilities.
Our investments in unconsolidated VIEs were $ 90 million and $ 1,323 million as of December 31, 2024 and 2023 , respectively. Of these
investments, $ 37 million and $ 1,272 million as of December 31, 2024 and 2023 , respectively, were owned by our Financial Services
business. At December 31, 2023, these investments w ere substantially all related to renewable energy U.S. tax equity investments that
were subsequently retained by GE in connection with the Spin-Off . See Note 11 for further information. Our maximum exposure to loss in
respect of unconsolidated VIEs is increased by our commitments to make additional investments in these entities described in Note 22 .
NOTE 22 . COMMITMENTS , GUARANTEES, PRODUCT WARRANTIES AND OTHER LOSS CONTINGENCIES
Commitments. We had total investment commitments of $ 73 million and unfunded lending commitments of $ 96 million at December 31,
2024. The commitments primarily consist of obligations to make investments in or provide funding by our Financial Services and Gas
Power businesses. See Note 21 for further information.
Guarantees . As of December 31, 2024, we were committed under the following guarantee arrangements:
Credit support . We have provided $ 699 million of credit support on behalf of certain customers or associated companies, predominantly
joint ventures and partnerships, using arrangements such as standby letters of credit and performance guarantees, and a line of credit to
support our consolidated subsidiaries. The liability for such credit support was $ 6 million . In addition, prior to the Spin-Off, GE provided
parent company guarantees to GE Vernova in certain jurisdictions. See Note 24 for further information.
Indemnification agreements . We have $ 882 million of indemnification commitments, including obligations arising from the Spin-Off, our
commercial contracts, and agreements governing the sale of business assets, for which we recorded a liability of $ 514 million . The liability
is primarily associated with cash deposits, of which $ 325 million relates to cash transferred to the Company from GE as part of the Spin-Off
that is restricted in connection with certain legal matters related to legacy GE operations. The liability reflects the use of these funds to
settle any associated obligations and the return of any remaining cash to GE in a future reporting period once resolved. In addition, the
liability includes $ 140 million of indemnifications in connection with agreements entered into with GE related to the Spin-Off, including the
Tax Matters Agreement.
Product Warranties. We provide for estimated product warranty expenses when we sell the related products. Because warranty estimates
are forecasts that are based on the best available information, mostly historical claims experience, claims costs may differ from amounts
provided. An analysis of changes in the liability for product warranties follows.
2024
2023
2022
Balance at January 1
$ 1,414
$ 1,430
$ 1,197
Current-year provisions(a)
687
684
928
Expenditures
( 686 )
( 719 )
( 617 )
Other changes
( 45 )
19
( 78 )
Balance at December 31
$ 1,370
$ 1,414
$ 1,430
(a) The increase in current- and prior-year provisions is primarily related to our Wind segment, which, in 2022, was substantially all due to
changes in estimates on pre-existing warranties and related to the deployment of repairs and other corrective measures in Onshore
Wind .
Credit Facilities. We have $ 6,000 million of credit facilities consisting of (i) a five -year unsecured revolving credit facility in an aggregate
committed amount of $ 3,000 million (the “Revolving Credit Facility”) provided pursuant to a credit agreement, dated as of March 26, 2024
and (ii) a standby letter of credit and bank guarantee facility in an aggregate committed amount of $ 3,000 million (the “Trade Finance
Facility” and, together with the Revolving Credit Facility, the “Credit Facilities”). The Revolving Credit Facility is available for borrowings in
U.S. dollars and euros. Up to $ 500 million of the Revolving Credit Facility is available for the issuance of letters of credit. There were no
borrowings outstanding on this facility as of December 31, 2024. The Trade Finance Facility will be available for the issuance of standby
letters of credit and bank guarantees in U.S. dollars, euros and various other currencies. The Trade Finance Facility has not been utilized
as of December 31, 2024. Each of the Credit Facilities will mature on April 2, 2029. We may voluntarily prepay borrowings under the
Revolving Credit Facility without premium or penalty, subject to customary breakage costs with respect to loans bearing interest by
reference to the applicable adjusted Term Secured Overnight Financing Rate (Term SOFR) or the Euro Interbank Offered Rate (Euribor).
2024 FORM 10-K 81
We may also voluntarily reduce the commitments under the Credit Facilities, in whole or in part, subject to certain minimum reduction
amounts. The Credit Facilities include various customary covenants that limit, among other things, our incurrence of liens and our entry into
certain fundamental change transactions. Fees related to the unused portion of the facilities were not material in the year ended December
31, 2024.
Legal Matters. I n the normal course of our business, we are regularly involved in various arbitrations, class actions, commercial litigation,
investigations, or other legal, regulatory, or governmental actions, including the significant matters described below, that could have a
material impact on our results of operations. In many proceedings, including the specific matters described below, it is inherently difficult to
determine whether any loss is probable or even reasonably possible or to estimate the size or range of the possible loss, and accruals for
legal matters are not recorded until a loss for a particular matter is considered probable and reasonably estimable. Given the nature of legal
matters and the complexities involved, it is often difficult to predict and determine a meaningful estimate of loss or range of loss until we
know, among other factors, the particular claims involved, the likelihood of success of our defenses to those claims, the damages or other
relief sought, how discovery or other procedural considerations will affect the outcome, the settlement posture of other parties, and other
factors that may have a material effect on the outcome. For these matters, unless otherwise specified, we do not believe it is possible to
provide a meaningful estimate of loss at this time. Moreover, it is not uncommon for legal matters to be resolved over many years, during
which time relevant developments and new information must be continuously evaluated.
Alstom legacy legal matters. In November 2015, we acquired the power and grid businesses of Alstom, which prior to the acquisition was
the subject of significant cases involving anti-competitive activities and improper payments. The estimated liability balance was $ 236 million
and $ 393 million at December 31, 2024 and 2023, respectively, for legal and compliance matters related to the legacy business practices
that were the subject of cases in various jurisdictions. Allegations in these cases relate to claimed anticompetitive conduct or improper
payments in the pre-acquisition period as the source of legal violations or damages. Given the significant litigation and compliance activity
related to these matters and our ongoing efforts to resolve them, it is difficult to assess whether the disbursements will ultimately be
consistent with the estimated liability established. The estimation of this liability may not reflect the full range of uncertainties and
unpredictable outcomes inherent in litigation and investigations of this nature, and at this time we are unable to develop a meaningful
estimate of the range of reasonably possible additional losses beyond the amount of this estimated liability. Factors that can affect the
ultimate amount of losses associated with these and related matters include formulas for determining disgorgement, fines and/or penalties,
the duration and amount of legal and investigative resources applied, political and social influences within each jurisdiction, and tax
consequences of any settlements or previous deductions, among other considerations. Actual losses arising from claims in these and
related matters could exceed the amount provided.
In June 2024, we executed a settlement agreement with the Government of the Kingdom of Saudi Arabia, represented by The Ministry of
Energy (MOE) in connection with certain Alstom steam power construction projects with Saudi Electric Company (SE) won between 1998
and 2008. In November 2015, prior to its acquisition by GE, Alstom had paid a fine and pled guilty to charges brought by the U.S.
Department of Justice under the U.S. Foreign Corrupt Practices Act, including in relation to conduct related to two of these SE steam power
projects. In December 2015, following the acquisition of Alstom by GE, SE contacted GE seeking recompense for alleged reputational
damage and in December 2021, the Saudi Arabia National Anti-Corruption Commission became involved and initiated an investigation. The
settlement of approximately $ 267 million consists of $ 141 million in cash payments to the MOE and the remainder as a credit note to SE,
and releases GE Vernova, GE and their respective affiliates from civil and criminal liabilities related to this matter after the settlement
obligations are met. The entire cash settlement of $ 141 million has been paid as of December 31, 2024.
Environmental and Asset Retirement Obligations. Our operations involve the use, disposal, and cleanup of substances regulated under
environmental protection laws and nuclear decommissioning regulations. We have obligations for ongoing and future environmental
remediation activities and may incur additional liabilities in connection with previously remediated sites. Additionally, like many other
industrial companies, we and our subsidiaries are defendants in various lawsuits related to alleged worker exposure to asbestos or other
hazardous materials. Liabilities for environmental remediation, nuclear decommissioning, and worker exposure claims exclude possible
insurance recoveries.
It is reasonably possible that our exposure will exceed amounts accrued. However, due to uncertainties about the status of laws,
regulations, technology, and information related to individual sites and lawsuits, such amounts are not reasonably estimable. Our reserves
related to environmental remediation and worker exposure claims recorded in All other liabilities were $ 138 million and $ 127 million as of
December 31, 2024 and 2023, respectively.
We record asset retirement obligations associated with the retirement of tangible long-lived assets as a liability in the period in which the
obligation is incurred and its fair value can be reasonably estimated. These obligations primarily represent nuclear decommissioning, legal
obligations to return leased premises to their initial state or dismantle and repair specific alterations for certain leased sites. The liability is
measured at the present value of the obligation when incurred and is adjusted in subsequent periods. Corresponding asset retirement costs
are capitalized as part of the carrying value of the related long-lived assets and depreciated over the asset’s useful life. Our asset
retirement obligations were $ 622 million and $ 581 million as of December 31, 2024 and 2023, respectively, and are recorded in All other
current liabilities and All other liabilities in our Consolidated and Combined Statement of Financial Position. Of these amounts, $ 546 million
and $ 519 million were related to nuclear decommissioning obligations. Changes in the liability balance due to settlement, accretion, and
revisions in fair value were not material during the year ended December 31, 2024.
Expenditures for nuclear decommissioning, site remediation, and worker exposure claims we re $ 11 million , $ 14 million , and $ 19 million , for
the years ended December 31, 2024, 2023, and 2022, respectively. We presently expect that such expenditures will be approximately $ 13
million and $ 11 million in 2025 and 2026, respectively.
NOTE 23 . RESTRUCTURING CHARGES AND SEPARATION COSTS
Restructuring and Other Charges. The Company has undertaken or committed to various restructuring initiatives, including workforce
reductions and the consolidation of manufacturing and service facilities. Restructuring and other charges primarily include employee-related
2024 FORM 10-K 82
termination benefits associated with workforce reductions, facility exit costs, asset write-down s, an d cease-use costs. We expect the
majority of costs to be incurred within two years of the commitment of a restructuring initiative.
This table is inclusive of all restructuring charges and the charges are shown below for the business where they originated. Separately, in
our reported segment results, major restructuring programs are excluded from measurement of segment operating performance for internal
and external purposes; those excluded amounts are reported in Restructuring and other charges. See Note 25 for further information.
RESTRUCTURING AND OTHER CHARGES
2024
2023
2022
Workforce reductions
$ 147
$ 224
$ 119
Plant closures and associated costs and other asset write-downs
266
173
166
Acquisition/disposition net charges and other
8
46
29
Total restructuring and other charges
$ 421
$ 443
$ 314
Cost of equipment and services
$ 256
$ 147
$ 192
Selling, general, and administrative expenses
165
296
122
Total restructuring and other charges
$ 421
$ 443
$ 314
Power
$ 266
$ 124
$ 141
Wind
141
232
156
Electrification
19
54
1
Other
( 5 )
33
16
Total restructuring and other charges(a)
$ 421
$ 443
$ 314
(a) Includes $ 248 million , $ 227 million , and $ 203 million for the years ended December 31, 2024 , 2023 , and 2022, respectively, primarily of
non-cash impairment, accelerated depreciation, and other charges not reflected in the liability table below.
Liabilities associated with restructuring activities were recorded in All other current liabilities, All other liabilities, and Non-current
compensation and benefits.
RESTRUCTURING LIABILITIES
2024
2023
2022
Balance as of January 1
$ 276
$ 283
$ 434
Additions
173
216
111
Payments
( 238 )
( 222 )
( 240 )
Foreign exchange and other
97
( 1 )
( 22 )
Balance as of December 31
$ 308
$ 276
$ 283
In addition to the continued impacts of ongoing initiatives, restructuring primarily included exit activities associated with previously
announced plans in October 2022 primarily reflecting the selectivity strategy to operate in fewer markets and to simplify and standardize
product variants across our Wind businesses. The estimated cost of this multi-year restructuring program was approximately $ 600 million .
This plan was expanded during the third quarter of 2023 to include the consolidation of the global footprint and related resources at our
Power businesses to better serve our customers. In the third quarter of 2024, in order to transform and optimize our global footprint, we
announced the restructuring of our Hydro Power business, as a result of which we recogn ized $ 155 million of charges, which is the vast
majority of the estimated cost of this program. The costs incurred in the year ended December 31, 2024 primarily relates to a non-cash pre-
tax impairment charge of property, plant, and equipment. See Note 6 for further information.
Separation Costs. In connection with the Spin-Off, the Company recognized s eparation costs (benefits) of $( 9 ) million for the year ended
December 31, 2024 in our Consolidated and Combined Statement of Income (Loss). Separation costs (benefits) include system
implementations, advisory fees, one-time stock option grant, and other one-time costs, which are primarily recorded in Selling, general, and
administrative costs. I n addition, in connection with GE retaining certain renewable energy U.S. tax equity investments as part of the Spin-
Off, the Company recognized a $ 136 million benefit in the second quarter related to deferred intercompany profit from historical equipment
sales to the related investees, recorded in Cost of equipment. See Note 11 for further information.
NOTE 24 . RELATED PARTIES
Aero Alliance. Aero Alliance is our joint venture with Baker Hughes Company that supports our customers through the fulfillment of
aeroderivative engines, spare parts, repairs, and maintenance services. Purchases of parts and services from the joint venture were
$ 651 million , $ 656 million , and $ 521 million for the years ended December 31, 2024 , 2023 , and 2022, respectively. The Company owed
Aero Alliance $ 24 million and $ 34 million as of December 31, 2024 and 2023, respectively. These amounts have been recorded in Due to
related parties on the Consolidated and Combined Statement of Financial Position.
Financial Services Investments. Our Financial Services business invests in project infrastructure entities where we do not hold a
controlling financial interest. These entities generally purchase equipment from our Wind and Power segments, and we have recognized
revenues of $ 4 million , $ 168 million , and $ 810 million for the years ended December 31, 2024 , 2023 , and 2022, respectively, for sales to
these entities. Revenues for sales to these entities for the year ended December 31, 2024 were no t significant as GE retained the
renewable energy U.S. tax equity investments. See Note 11 for further information.
Allocations From GE. Prior to the Spin-Off, GE historically provided the Company with significant corporate, infrastructure, and shared
services. Some of these services continue to be provided by GE to the Company on a temporary basis following the Spin-Off under the
Transition Services Agreement. Accordingly, for periods prior to the Spin-Off, certain GE corporate costs have been charged to the
Company based on allocation methodologies as follows:
2024 FORM 10-K 83
a. Centralized services such as public relations, investor relations, treasury and cash management, executive management, security,
government relations, community outreach, and corporate internal audit services were charged to the Company on a pro rata
basis of GE’s estimates of each business’s usage at the beginning of the fiscal year and were recorded in Selling, general, and
administrative expenses. Costs of $ 67 million and $ 70 million for the years ended December 31, 2023 and 2022, respectively,
were recorded in our Consolidated and Combined Statement of Income (Loss). Costs allocated to the Company for the three
months ended March 31, 2024 were no t significant as GE Vernova had established standalone capabilities for such services.
b. Information technology, finance, insurance, research, supply chain, human resources, tax, and facilities activities were charged to
the Company based on headcount, revenue, or other allocation methodologies. Costs for these services of $ 711 million and
$ 772 million were charged to the Company for the years ended December 31, 2023 and 2022 , respectively. Costs for these
services of $ 100 million were charged to the Company for the three months ended March 31, 2024 . Such costs are primarily
included in Selling, general, and administrative expenses and Research and development expenses in our Consolidated and
Combined Statement of Income (Loss).
c. Costs associated with employee medical insurance totaling $ 133 million and $ 114 million were charged for the years ended
December 31, 2023 and 2022 , respectively. Costs associated with employee medical insurance totaling $ 30 million were charged
to the Company for the three months ended March 31, 2024 . Costs were charged to the Company based on employee headcount
and are recorded in Cost of equipment, Cost of services, Selling, general, and administrative expenses, or Research and
development expenses in our Consolidated and Combined Statement of Income (Loss) based on the employee population.
Prior to January 1, 2023, employees of the Company participated in pensions and benefits plans that were sponsored by GE. The
Company was charged $ 64 million for the year ended December 31, 2022. These costs are charged directly to the Company based on
specific employee eligibility for those benefits. On January 1, 2023, these pension plans were legally split and allocated to GE Vernova and
are accounted for as multiemployer plans starting in 2023. See Note 13 for further information.
Additionally, GE granted various employee benefits to its employees, including prior to the Spin-Off to those of the Company, under the GE
Long-Term Incentive Plan. These benefits primarily included stock options and restricted stock units. Compensation expense associated
with this plan was $ 118 million and $ 123 million for the years ended December 31, 2023 and 2022 , respectively. Compensation expense
associated with this plan was $ 34 million for the three months ended March 31, 2024 . Such expense is included primarily in Selling,
general, and administrative expenses in our Consolidated and Combined Statement of Income (Loss). These costs were charged directly to
the Company based on the specific employees receiving awards.
Finally, while GE’s third-party debt had not been attributed to the Company, GE allocated a portion of interest expense related to its third-
party debt for funding provided by GE to the Company for certain investments held by Financial Services. The interest was allocated based
on the GE-funded ending net investment position each reporting period. Interest allocated was $ 35 million and $ 46 million for the years
ended December 31, 2023 and 2022, respectively. Interest allocated was $ 7 million for the three months ended March 31, 2024 . Such
expense is included in Interest and other financial charges – net in our Consolidated and Combined Statement of Income (Loss).
Management believes that the expense and cost allocations were determined on a basis that is a reasonable reflection of the utilization of
services provided or the benefit received by the Company. The amounts that would have been, or will be incurred, on a stand-alone basis
could materially differ from the amounts allocated due to economies of scale, difference in management judgment, a requirement for more
or fewer employees, or other factors. Management does not believe, however, that it is practicable to estimate what these expenses would
have been had the Company operated as an independent entity, including any expenses associated with obtaining any of these services
from unaffiliated entities. In addition, the future results of operations, financial position, and cash flows could differ materially from the
historical results presented herein.
Parent Company Credit Support. GE provided the Company with parent credit support in certain jurisdictions. To support the Company in
selling products and services globally, GE often entered into contracts on behalf of GE Vernova or issued parent company guarantees or
trade finance instruments supporting the performance of what were subsidiary legal entities transacting directly with customers, in addition
to providing similar credit support for some non-customer related activities of GE Vernova. There are no known instances historically where
payments or performance from GE were required under parent company guarantees relating to GE Vernova customer contracts.
Tran sfer of Tax Credits to GE. Under the Inflation Reduction Act of 2022, which went into effect in 2023, we generate advanced
manufacturing credits in our Wind business. These credits are transferable and are not reliant on a tax liability to be realized. During the
first quarter of 2024, we received cash of $ 249 million from GE for credits generated prior to the Spin-Off. See Note 11 f or further
information regarding production tax credits transferred to GE.
NOTE 25 . SEGMENT AND GEOGRAPHICAL INFORMATION
Operating segments include components of an enterprise about which separate financial information is available that is evaluated regularly
by the Company’s Chief Operating Dec ision Maker (CODM) for the purpose of assessing performance and allocating resources. The
Company’s CODM is its Chief Executive Officer (CEO). Our operating activities are managed through three segments: Power, Wind, and
Electrification. These segments have been identified based on the nature of the products and services sold and how the Company
manages its operations.
The performance of these segments is principally measured based on revenues and segment EBITDA. Segment EBITDA is determined
based on the performance measures used by our CEO to assess the performance of each business in a given period. In connection with
that assessment, the CEO may exclude matters, such as charges for impairments, significant higher-cost restructuring programs,
manufacturing footprint rationalization and other similar expenses, acquisition costs and other related charges, certain gains and losses
from acquisitions or dispositions and certain other non-operational items.
Consistent accounting policies have been applied by all segments for all reporting periods. See Note 1 for a description of our reportable
segments.
2024 FORM 10-K 84
TOTAL SEGMENT REVENUES BY BUSINESS UNIT
2024
2023
2022
Gas Power
$ 14,465
$ 13,220
$ 12,079
Nuclear Power
819
827
699
Hydro Power
781
887
703
Steam Power
2,063
2,502
2,643
Power
$ 18,127
$ 17,436
$ 16,124
Onshore Wind
$ 7,781
$ 7,761
$ 7,941
Offshore Wind
1,377
1,455
531
LM Wind Power
542
610
433
Wind
$ 9,701
$ 9,826
$ 8,905
Grid Solutions
$ 4,957
$ 3,955
$ 3,133
Power Conversion
1,194
1,027
843
Electrification Software
917
874
804
Solar & Storage Solutions
482
522
296
Electrification
$ 7,550
$ 6,378
$ 5,076
Total segment revenues
$ 35,377
$ 33,640
$ 30,105
SEGMENT EBITDA
For the year ended December 31, 2024
Power
Wind
Electrification
Total
Equipment revenues
$ 5,509
$ 8,018
$ 5,412
$ 18,939
Services revenues
12,391
1,642
1,923
15,955
Intersegment revenues
227
41
215
483
Segment revenues
18,127
9,701
7,550
35,377
Other revenues and elimination of intersegment revenues
( 442 )
Total revenues
34,935
Less:(a)
Cost of revenues(b)
13,608
9,513
5,359
Selling, general, and administrative expenses(b)
2,022
566
1,295
Research and development expenses(b)
384
222
345
Other segment items(c)
( 155 )
( 12 )
( 128 )
Segment EBITDA
$ 2,268
$ ( 588 )
$ 679
$ 2,358
For the year ended December 31, 2023
Power
Wind
Electrification
Total
Equipment revenues
$ 5,535
$ 8,327
$ 4,385
$ 18,246
Services revenues
11,758
1,488
1,733
14,979
Intersegment revenues
143
11
260
414
Segment revenues
17,436
9,826
6,378
33,640
Other revenues and elimination of intersegment revenues
( 401 )
Total revenues
33,239
Less:(a)
Cost of revenues(b)
13,425
10,006
4,690
Selling, general, and administrative expenses(b)
2,124
611
1,213
Research and development expenses(b)
315
248
320
Other segment items(c)
( 149 )
( 6 )
( 79 )
Segment EBITDA
$ 1,722
$ ( 1,033 )
$ 234
$ 923
For the year ended December 31, 2022
Power
Wind
Electrification
Total
Equipment revenues
$ 4,855
$ 7,595
$ 3,369
$ 15,819
Services revenues
11,039
1,302
1,494
13,835
Intersegment revenues
230
8
214
451
Segment revenues
16,124
8,905
5,076
30,105
Other revenues and elimination of intersegment revenues
( 451 )
Total revenues
29,654
Less:(a)
Cost of revenues(b)
12,346
9,664
3,767
Selling, general, and administrative expenses(b)
2,048
676
1,226
Research and development expenses(b)
300
368
299
Other segment items(c)
( 225 )
( 92 )
( 51 )
Segment EBITDA
$ 1,655
$ ( 1,710 )
$ ( 164 )
$ ( 219 )
(a) The significant expense categories and amounts align with the segment-level information that is regularly provided to the CODM.
Intersegment expenses are included within the amounts shown.
(b) Excludes depreciation and amortization expenses.
(c) Primarily includes equity method investment income and other interest and investment income.
2024 FORM 10-K 85
RECONCILIATION OF SEGMENT EBITDA TO NET INCOME (LOSS)
2024
2023
2022
Segment EBITDA
$ 2,358
$ 923
$ ( 219 )
Corporate and other(a)
( 323 )
( 116 )
( 209 )
Restructuring and other charges(b)
( 426 )
( 433 )
( 288 )
Purchases and sales of business interests
1,024
92
55
Separation costs (benefits)(c)
9
—
—
Arbitration refund(d)
254
—
—
Non-operating benefit income
536
567
188
Depreciation and amortization(e)
( 1,008 )
( 847 )
( 893 )
Interest and other financial charges – net(f)
130
( 53 )
( 97 )
Russia and Ukraine charges(g)
—
( 95 )
( 188 )
Steam Power asset sale impairment
—
—
( 824 )
Benefit (provision) for income taxes
( 995 )
( 512 )
( 247 )
Net income (loss)
$ 1,559
$ ( 474 )
$ ( 2,722 )
(a) Includes interest expense (income) of $ 10 million , $ 45 million , and $ 54 million and benefit (provision) for income taxes of $ 56 million ,
$ 168 million and $( 1 ) million for the years ended December 31, 2024, 2023, and 2022, respectively, related to the Financial Services
business which, because of the nature of its investments, is managed on an after-tax basis due to its strategic investments in renewable
energy tax equity investments.
(b) Consists of severance, facility closures, acquisition and disposition, and other charges associated with major restructuring programs.
(c) Costs incurred in the Spin-Off and separation from GE, including system implementations, advisory fees, one-time stock option grant,
and other one-time costs. In addition, includes $ 136 million benefit related to deferred intercompany profit that was recognized upon GE
retaining the renewable energy U.S. tax equity investments at the time of the Spin-Off in the second quarter of 2024.
(d) Represents cash refund received in connection with an arbitration proceeding, constituting the payments previously made to a
multiemployer pension plan, and excludes $ 52 million related to the interest on such amounts that was recorded in Interest and other
financial charges – net in the second quarter of 2024.
(e) Excludes depreciation and amortization expense related to Restructuring and other charges. Includes amortization of basis differences
included in Equity method investment income (loss) which is part of Other income (expense) - net.
(f) Consists of interest and other financial charges, net of interest income, other than financial interest related to our normal business
operations primarily with customers.
(g) Related to recoverability of asset charges recorded in connection with the ongoing conflict between Russia and Ukraine and resulting
sanctions primarily related to our Power business.
ASSETS BY SEGMENT December 31
2024
2023
Power
$ 24,161
$ 25,003
Wind
9,970
10,898
Electrification
7,402
6,607
Other(a)
9,952
3,613
Total assets
$ 51,485
$ 46,121
(a) We classify deferred tax assets as "Other" for purposes of this disclosure.
Property, plant, and equipment additions
Depreciation and amortization
2024
2023
2022
2024
2023
2022
Power
$ 380
$ 319
$ 203
$ 519
$ 494
$ 508
Wind
250
325
231
350
249
195
Electrification
153
74
52
88
85
88
Other(a)
93
20
1
216
136
1,006
Total
$ 877
$ 738
$ 487
$ 1,172
$ 964
$ 1,797
(a) Depreciation and amortization includes impairments related to our Hydro Power business of $ 108 million for the year ended December
31, 2024 and impairments related to our remaining Steam Power business of $ 806 million for the year ended December 31, 2022. See
Notes 6 and 8 for further information.
Revenues are classified according to the region to which equipment and services are sold. For purposes of this analysis, the U.S. is
presented separately from the remainder of the Americas.
REVENUES BY GEOGRAPHY
2024
2023
2022
U.S.
$ 14,679
$ 12,467
$ 11,590
Non-U.S.
Europe
8,325
8,417
6,583
Asia
4,698
5,259
4,942
Americas
3,038
3,177
3,090
Middle East and Africa
4,194
3,919
3,449
Total Non-U.S.
$ 20,256
$ 20,772
$ 18,064
Total geographic revenues
$ 34,935
$ 33,239
$ 29,654
2024 FORM 10-K 86
LONG LIVED ASSETS BY GEOGRAPHY December 31
2024
2023
U.S.
$ 1,940
$ 1,757
Non-U.S.
Europe
1,811
1,942
Asia
798
908
Americas
320
356
Middle East and Africa
282
265
Total Non-U.S.
$ 3,210
$ 3,471
Total long-lived assets
$ 5,150
$ 5,228
ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL
DISCLOSURE. None.
ITEM 9A. CONTROLS AND PROCEDURES.
Management’s Discussion of Financial Responsibility. Management is responsible for the preparation of the consolidated and
combined financial statements and related information that are presented in this report. The consolidated and combined financial
statements, which include amounts based on management’s estimates and judgments, have been prepared in conformity with U.S.
generally accepted accounting principles .
The Company designs and maintains accounting and internal control systems to provide reasonable assurance that assets are
safeguarded against loss from unauthorized use or disposition, and that the financial records are reliable for preparing consolidated and
combined financial statements and maintaining accountability for assets. These systems are enhanced by policies and procedures, an
organizational structure providing division of responsibilities, careful selection and training of qualified personnel, and a program of internal
audits.
The Board of Directors, through its Audit Committee, which consists entirely of independent directors, meets periodically with management,
internal auditors, and our independent registered public accounting firm to ensure that each is meeting its responsibilities and to discuss
matters concerning internal controls and financial reporting. Deloitte and Touche LLP and the internal auditors each have full and free
access to the Audit Committee.
Management's Annual Report on Internal Control Over Financial Reporting. This Annual Report does not include a report of
management's assessment regarding internal control over financial reporting or an attestation report of our registered public accounting
firm due to a transition period established by rules of the U.S. Securities and Exchange Commission for newly public companies.
Disclosure Controls. Under the direction of our Chief Executive Officer and Chief Financial Officer, we evaluated our disclosure controls
and procedures as of December 31, 2024 and concluded that our disclosure controls and procedures were effective as of December 31,
2024.
Changes in Internal Control Over Financial Reporting. T here have been no changes in the Company’s internal control over financial
reporting during the three months ended December 31, 2024, that have materially affected, or are reasonably likely to materially affect, its
internal control over financial reporting.
ITEM 9B. OTHER INFORMATION.
Disclosure provided pursuant to Item 5.02 of Form 8-K. Departure of Directors or Certain Officers; Election of Directors;
Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. On January 31, 2025, GE Vernova Inc. (the
“Company”) and Rachel Gonzalez, Executive Vice President, General Counsel, and Secretary, entered into a Separation Agreement and
Release (the “Separation Agreement”). The Separation Agreement provides that Ms. Gonzalez will depart from the Company on May 16,
2025. She will continue to receive her current compensation and benefits until her separation.
The Separation Agreement further provides that if Ms. Gonzalez remains employed by the Company through May 16, 2025, or if prior to
May 16, 2025, the Company terminates her employment without cause, Ms. Gonzalez’s departure shall be treated as a termination without
cause, and subject to her timely execution upon her cessation of employment of a supplemental release of claims, Ms. Gonzalez will be
entitled to (i) a lump sum payment equal to eighteen (18) months of Ms. Gonzalez’s current base salary, (ii) contributions to the cost of
COBRA continuation for a period of eighteen (18) months, (iii) reimbursement of expenses reasonably incurred for relocation not to exceed
$150,000, (iv) consistent with Ms. Gonzalez’s employment offer letter with the Company, a pro-rated annual bonus for calendar year 2025
based on Company performance, and (v) consistent with the Company’s long-term incentive good leaver program: (x) continued vesting of
a pro-rated portion of each outstanding equity award over Company common stock held by Ms. Gonzalez, other than any award
designated as a one-time stock option grant, for at least one year from the applicable date of grant and (y) the right to exercise outstanding
options until the applicable option expiration date.
The preceding summary of the Separation Agreement is qualified in its entirety by reference to the Separation Agreement, which is filed as
Exhibit 10.30 to this Annual Report on Form 10-K and is incorporated herein by reference.
Director and Officer Trading Arrangements. None of our directors or officers (as defined in Rule 16a-1(f) under the Exchange
Act) adopted or terminated a Rule 10b5-1 trading arrangement or adopted or terminated a non-Rule 10b5-1 trading arrangement (as
defined in Item 408(c) of Regulation S-K) during the three months ended December 31, 2024.
ITEM 9C. DISCLOSURE REGARDING FOREIGN JURISDICTIONS THAT PREVENT INSPECTIONS. Not applicable.
2024 FORM 10-K 87
PART III
ITEM 10. DIRECTORS, EXECUTIVE OFFICERS, AND CORPORATE GOVERNANCE. Information required by this item with
respect to executive officers, directors, corporate governance, code of ethics, insider trading policies and procedures, and compliance with
Section 16(a) of the Exchange Act will be presented in the 2025 Proxy Statement in the sections titled “Election of Directors.” “Corporate
Governance,” “Executive Officers,” and “Section 16(a) Beneficial Ownership Reporting Compliance,” and such information is incorporated
herein by reference.
ITEM 11. EXECUTIVE COMPENSATION. Information required by this item regarding executive and director compensation will be
presented in the 2025 Proxy Statement under the section titled “Executive Compensation” and the section titled “Director Compensation,”
and such information (other than the subsection titled “Compensation Committee Report," which is deemed furnished herein by reference,
and the subsection "Pay Versus Performance") is incorporated herein by reference.
ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED
STOCKHOLDER MATTERS. Information required by this item regarding security ownership of certain beneficial owners and
management and related stockholder matters, as well as equity compensation plan information, will be presented in the 2025 Proxy
Statement under the sections titled “Stock Ownership Information” and “Equity Compensation Plan Information,” and such information is
incorporated herein by reference.
ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND DIRECTOR INDEPENDENCE. Information
required by this item regarding certain relationships and related transactions and director independence will be presented in the 2025 Proxy
Statement under the sections titled “Certain Relationships and Related-Party and Other Transactions” and “Other Governance Policies and
Practices,” and such information is incorporated herein by reference.
ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES. Information required by this item regarding principal accounting fees
and services of our principal accountant, Deloitte & Touche LLP (PCAOB ID No. 34 ), will be presented in the 2025 Proxy Statement under
the sections titled “Independent Auditor,” and such info rmatio n is incorporated herein by reference.
2024 FORM 10-K 88
PART IV
ITEM 15. EXHIBITS AND FINANCIAL STATEMENT SCHEDULES.
FINANCIAL STATEMENTS. See Item 8. "Financial Statements and Supplementary Data" for a listing of our financial statements.
FINANCIAL SCHEDULES. Schedules required by Regulation S-X (17 CFR 210) are omitted because they are either not applicable or
the financial information is already included within the financial statements or notes thereto.
EXHIBITS.
2.1 Separation and Distribution Agreement, dated April 1, 2024, by and between General Electric Company and GE Vernova Inc.
(incorporated by reference to Exhibit 2.1 of the registrant’s Current Report on Form 8-K filed with the SEC on April 2, 2024, File No.
001-41966).†+
3.1 Certificate of Incorporation (incorporated by reference to Exhibit 3.1 of the registrant’s Current Report on Form 8-K filed with the SEC
on April 2, 2024, File No. 001-41966).
3.2 Bylaws (incorporated by reference to Exhibit 3.2 of the registrant’s Current Report on Form 8-K filed with the SEC on April 2, 2024,
File No. 001-41966).
4.1 Description of Securities Registered Pursuant to Section 12 of the Exchange Act (filed herewith).
10.1 Credit Agreement, dated as of March 26, 2024, among GE Vernova Inc., GE Albany Funding Unlimited Company and GE Funding
Operations Co., Inc., as borrowers, the other subsidiary borrowers from time to time party thereto, the lenders from time to time party
thereto and JPMorgan Chase Bank, N.A., as administrative agent (incorporated by reference to Exhibit 10.1 of the registrant’s Quarterly
Report on Form 10-Q for the quarter ended March 31, 2024, File No. 001-41966).+
10.2 Standby Letter of Credit and Bank Guarantee Agreement dated as of March 26, 2024, among GE Vernova Inc., as the borrower, the
issuing banks party thereto and HSBC Bank USA, National Association, as administrative agent (incorporated by reference to Exhibit 10.2
of the registrant’s Quarterly Report on Form 10-Q for the quarter ended March 31, 2024, File No. 001-41966).+
10.3 Transition Services Agreement, dated April 1, 2024, by and between General Electric Company and GE Vernova Inc. (incorporated
by reference to Exhibit 10.1 of the registrant’s Current Report on Form 8-K filed with the SEC on April 2, 2024, File No. 001-41966).+
10.4 Tax Matters Agreement, dated April 1, 2024, by and between General Electric Company and GE Vernova Inc. (incorporated by
reference to Exhibit 10.2 of the registrant’s Current Report on Form 8-K filed with the SEC on April 2, 2024, File No. 001-41966).†+
10.5 Employee Matters Agreement, dated April 1, 2024, by and between General Electric Company and GE Vernova Inc. (incorporated by
reference to Exhibit 10.3 of the registrant’s Current Report on Form 8-K filed with the SEC on April 2, 2024, File No. 001-41966).†
10.6 Trademark License Agreement, dated March 31, 2024, by and between General Electric Company and GE Infrastructure Technology
LLC (incorporated by reference to Exhibit 10.4 of the registrant’s Current Report on Form 8-K filed with the SEC on April 2, 2024, File No.
001-41966).†+
10.7 Real Estate Matters Agreement, dated April 1, 2024, by and between General Electric Company and GE Vernova Inc. (incorporated
by reference to Exhibit 10.5 of the registrant’s Current Report on Form 8-K filed with the SEC on April 2, 2024, File No. 001-41966).+
10.8 Framework Investment Agreement, dated April 1, 2024, by and between General Electric Company and GE Vernova Investment
Advisers, LLC (incorporated by reference to Exhibit 10.6 of the registrant’s Current Report on Form 8-K filed with the SEC on April 2,
2024, File No. 001-41966).†+
10.9 Form of Indemnification Agreement (incorporated by reference to Exhibit 10.6 of the registrant’s Registration Statement on Form 10
filed with the SEC on March 5, 2024, File No. 001-41966).
10.10 GE Vernova Inc. 2024 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.10 of the registrant’s Quarterly Report on
Form 10-Q for the quarter ended June 30, 2024, File No. 001-41966).*
10.11 GE Vernova Inc. Mirror 2022 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.2 of the registrant’s Registration
Statement on Form S-8 filed with the SEC on April 3, 2024, File No. 001-41966).*
10.12 GE Vernova Inc. Mirror 2007 Long-Term Incentive Plan (incorporated by reference to Exhibit 10.3 of the registrant’s Registration
Statement on Form S-8 filed with the SEC on April 3, 2024, File No. 001-41966).*
10.13 Offer Letter with Kenneth Parks (incorporated by reference to Exhibit 10.11 of the registrant’s Registration Statement on Form 10
filed with the SEC on March 5, 2024, File No. 001-41966).*
10.14 Offer Letter with Rachel Gonzalez (incorporated by reference to Exhibit 10.12 of the registrant’s Registration Statement on Form 10
filed with the SEC on March 5, 2024, File No. 001-41966).†*
10.15 Offer Letter with Steven Baert (incorporated by reference to Exhibit 10.13 of the registrant’s Registration Statement on Form 10 filed
with the SEC on March 5, 2024, File No. 001-41966).†*
10.16 Employment Agreement with Maví Zingoni (incorporated by reference to Exhibit 10.14 of the registrant’s Registration Statement on
Form 10 filed with the SEC on March 5, 2024, File No. 001-41966.)†*
10.17 Offer Letter with Jessica Uhl (incorporated by reference to Exhibit 10.16 of the registrant’s Quarterly Report on Form 10-Q for the
quarter ended March 31, 2024, File No. 001-41966).†*
10.18 Offer Letter with Victor Abate (incorporated by reference to Exhibit 10.17 of the registrant’s Quarterly Report on Form 10-Q for the
quarter ended March 31, 2024, File No. 001-41966).*
10.19 Amended GE Energy Supplementary Pension Plan (filed herewith).*
10.20 GE Energy Excess Benefits Plan (incorporated by reference to Exhibit 10.17 of the registrant’s Registration Statement on Form 10
filed with the SEC on March 5, 2024, File No. 001-41966).*
2024 FORM 10-K 89
10.21 Amended GE Vernova Annual Executive Incentive Plan (incorporated by reference to Exhibit 10.18 of the registrant’s Registration
Statement on Form 10 filed with the SEC on March 5, 2024, File No. 001-41966).*
10.22 GE Vernova Restoration Plan (incorporated by reference to Exhibit 10.19 of the registrant’s Registration Statement on Form 10 filed
with the SEC on March 5, 2024, File No. 001-41966).*
10.23 GE Vernova U.S. Executive Severance Plan (incorporated by reference to Exhibit 10.20 of the registrant’s Registration Statement
on Form 10 filed with the SEC on March 5, 2024, File No. 001-41966).*
10.24 Form of Agreement for Restricted Stock Unit Grants to Nonemployee Directors under the Company’s 2024 Long-Term Incentive
Plan, as of May 2024 (incorporated by reference to Exhibit 10.1 of the registrant’s Current Report on Form 8-K filed with the SEC on May
17, 2024, File No. 001-41966).+*
10.25 Form of Agreement for Restricted Stock Unit Grants for Employees at or above Executive Director level under the Company’s 2024
Long-Term Incentive Plan, as of May 2024 (incorporated by reference to Exhibit 10.2 of the registrant’s Current Report on Form 8-K filed
with the SEC on May 17, 2024, File No. 001-41966).+*
10.26 Form of Agreement for Stock Option Grants for Employees at or above Executive Director level under the Company’s 2024 Long-
Term Incentive Plan, as of May 2024 (incorporated by reference to Exhibit 10.3 of the registrant’s Current Report on Form 8-K filed with
the SEC on May 17, 2024, File No. 001-41966).+*
10.27 Form of Agreement for Performance Stock Unit Grants for Employees at or above Executive Director level under the Company’s
2024 Long-Term Incentive Plan, as of May 2024 (incorporated by reference to Exhibit 10.4 of the registrant’s Current Report on Form 8-K
filed with the SEC on May 17, 2024, File No. 001-41966).+*
10.28 Form of Agreement for Stock Option Grants for Employees at or above Executive Director level under the Company’s 2024 Long-
Term Incentive Plan, as of June 2024 (incorporated by reference to Exhibit 10.28 of the registrant’s Quarterly Report on Form 10-Q for the
quarter ended June 30, 2024, File No. 001-41966).+*
10.29 GE Vernova Inc. Executive Change in Control Severance Benefits Policy (incorporated by reference to Exhibit 10.1 of the
registrant’s Current Report on Form 8-K filed with the SEC on September 10, 2024, File No. 001-41966).*
10.30 Separation Agreement with Rachel Gonzalez (filed herewith). *
19.1 GE Vernova Inc. Insider Trading Policy (filed herewith).
21.1 Subsidiaries of the Registrant (filed herewith).
23.1 Consent of Independent Registered Public Accounting Firm (filed herewith).
31.1 Certification pursuant to Rules 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended (filed herewith).
31.2 Certification pursuant to Rules 13a-14(a) or 15d-14(a) under the Securities Exchange Act of 1934, as amended (filed herewith).
32.1 Certification pursuant to 18 U.S.C. Section 1350 (furnished herewith).
97.1 GE Vernova Inc. Clawback Policy (filed herewith).
99.1 Supplement to Present Required Information in Searchable Format (filed herewith) .
101 The following materials from GE Vernova's Annual Report on Form 10-K for the year ended December 31 , 2024 , formatted as Inline
XBRL (eXtensible Business Reporting Language); (i) Statement of Income (Loss) for the years ended December 31 , 2024, 2023, and
2022 , (ii) Statement of Financial Position at December 31, 2024 and 2023 , (iii) Statement of Cash Flows for the years ended December
31, 2024, 2023, and 2022 , (iv) Statement of Comprehensive Income (Loss) for the years ended December 31 , 2024, 2023, and 2022 , (v)
Statement of Changes in Equity for the years ended December 31 , 2024, 2023, and 2022 , and (vi) the Notes to Combined Financial
Statements (filed herewith).
104 Cover page interactive data file (formatted as Inline XBRL and contained in Exhibit 101).
†
Certain portions of this exhibit have been redacted pursuant to Item 601(b)(2)(ii) and Item 601(b)(10)(iv) of Regulation S-K, as
applicable. The Company agrees to furnish supplementally an unredacted copy of the exhibit to the Commission upon its request.
+
Certain schedules and exhibits to this agreement have been omitted pursuant to Item 601(a)(5) of Regulation S-K. The Company
agrees to furnish supplementally a copy of any omitted schedule or exhibit to the Commission upon its request.
*
Management contract or compensatory plan or arrangement.
ITEM 16. FORM 10-K SUMMARY. None.
2024 FORM 10-K 90
SIGNATURES
Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized.
GE Vernova Inc.
By:
/s/ Kenneth Parks
Kenneth Parks
Chief Financial Officer
(Principal Financial Officer)
Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf
of the registrant and in the capacities and on the dates indicated.
Signer
Title
Date
/s/ Scott Strazik
Chief Executive Officer and Director
February 6, 2025
Scott Strazik
(Principal Executive Officer)
/s/ Kenneth Parks
Chief Financial Officer
February 6, 2025
Kenneth Parks
(Principal Financial Officer)
/s/ Matthew Potvin
Vice President, Controller and Chief Accounting Officer
February 6, 2025
Matthew Potvin
(Principal Accounting Officer)
/s/ Stephen Angel
Non-Executive Chair of the Board
February 6, 2025
Stephen Angel
/s/ Nicholas K. Akins
Director
February 6, 2025
Nicholas K. Akins
/s/ Arnold W. Donald
Director
February 6, 2025
Arnold W. Donald
/s/ Matthew Harris
Director
February 6, 2025
Matthew Harris
/s/ Martina Hund-Mejean
Director
February 6, 2025
Martina Hund-Mejean
/s/ Kim K.W. Rucker
Director
February 6, 2025
Kim K.W. Rucker
/s/ Jesus Malave
Director
February 6, 2025
Jesus Malave
/s/ Paula Rosput Reynolds
Director
February 6, 2025
Paula Rosput Reynolds
FY 2025-12-31 (later)
ITEM 1A. RISK FACTORS.
You should carefully consider the following risks and other information set forth in this Annual Report on Form 10-K in evaluating GE
Vernova and GE Vernova’s common stock. The risks and uncertainties described below are not the only risks and uncertainties we face.
Additional risks and uncertainties not presently known to us or that we presently deem less significant may also adversely affect our
business.
Risks Relating to Operations and Supply Chain
Quality issues among our products, solutions, and services could cause us to incur significant costs, reduce demand for our
products and services, lead to claims for damages or regulatory actions, and harm our business or reputation. We design,
manufacture, and service sophisticated, software-enabled industrial machinery and infrastructure (including gas turbines, onshore and
offshore wind turbines, grid infrastructure, and nuclear power generation equipment), engineered for demanding conditions and compliance
with stringent certification, performance, and reliability standards. A serious product, solution, or execution failure could result in injury or
death, widespread power outages, suspension of power production or operations, delivery delays, environmental impacts, or other
systemic issues.
Actual or perceived design, production, performance, or other quality issues in new introductions or existing product lines have resulted and
can result in warranty, maintenance, and other damage claims, including costs for project delays, repairs, and replacements, potentially in
significant amounts. These potential impacts are greater where the defects or issues affect an entire product line or component and can be
more pronounced with new technologies.
Developing and maintaining offerings that meet these standards is complex, costly, and technologically challenging and requires extensive
coordination across suppliers and global manufacturing and project sites. Failures to meet these standards, whether actual or perceived,
may result in significant contractual or other claims and regulatory suspensions of installation or operations, with adverse financial,
competitive, and reputational effects. Warranty and quality-related costs have represented, and may in the future represent, a meaningful
portion of our expenses.
2025 FORM 10-K 11
Significant supply chain and logistics disruptions, including volatility in the cost or availability of critical materials and
components, could delay or impact our ability to deliver on customer obligations, increase costs, and expose us to contractual
and reputational risks. We rely on third-party suppliers, contract manufacturers, service providers, and commodity markets for raw
materials, parts, components, and subsystems. Our globally distributed supply chains are subject to economic and geopolitical dynamics,
sanctions, tariffs, import/export restrictions, severe weather events, as well as other factors. We operate in a supply-constrained
environment and have experienced, and may continue to experience, shortages of materials and skilled labor, inflationary pressures,
transportation and logistics challenges, and manufacturing disruptions that affect revenues, profitability, cash flow, and on-time fulfillment.
While we pursue mitigation measures, such as long-term supply agreements, dual-sourcing, increased inventory levels, factory capacity
expansion, lean initiatives, alternative logistics, product or component redesign, and cost-sharing with customers and suppliers, supply
chain pressures are expected to persist and may continue to adversely affect our operations and financial performance. Certain inputs are
limited or sole-sourced, concentrated with a small number of suppliers, or primarily available from a single country, including semiconductor
chips and critical materials (such as specialty metals and rare earths). Although prior disruptions have not been material, the inability of a
supplier to deliver, and our inability to secure timely and cost-effective alternatives, could impair our ability to manufacture products or
provide services.
Our operations may be adversely affected by delivery delays, capacity constraints, upstream or downstream production disruptions, price
spikes, cyber-related attacks, or decreased availability of materials and commodities arising from war or other hostilities, natural disasters,
public health emergencies, increased tariffs or trade restrictions, or other business continuity events. Supplier nonperformance or
underperformance could impact our ability to fulfill customer commitments, trigger contract terminations or liability, and impair our
competitiveness.
We depend on multiple forms of transportation and transportation routes. Logistics can be disrupted by weather, strikes or lockouts,
inadequate infrastructure or port capacity, hostilities, terrorism, or other events, and transportation costs can be volatile. Any of these
factors could impede our ability to deliver quality products, solutions, and services and have a material adverse effect on our results of
operations, cash flows, and financial condition.
Disruptions or capacity constraints at our manufacturing and operating facilities could delay deliveries, increase costs, damage
customer relationships, and limit our ability to meet demand for our products and services, and planned capacity expansions
may not result in the benefits we expect if demand does not meet expectations. We depend on our global production and operating
network to develop, manufacture, assemble, supply, and service our offerings. Disruptions such as work stoppages, labor shortages,
import/export restrictions, significant public health or safety events, severe weather or natural disasters, financial distress, unplanned
downtime, manufacturing deviations or quality issues, production constraints, equipment failures, cybersecurity attacks, and geopolitical
dynamics can interrupt our operations, with risks heightened in certain emerging markets .
We also rely on our production facilities for critical components. If disturbances at these locations prevent us from producing sufficient
quantities, we may need to source more from external suppliers, which could introduce delays, quality control issues, or additional costs.
A significant event affecting any of our production or operating facilities, particularly when capacity is at or near full utilization or alternative
sites are unavailable, may disrupt our ability to supply customers, require us to defer or decline orders, or cause late deliveries. Expanding
our capacity to meet current or future demand or support new products requires significant capital investment and lead time and may be
delayed in execution.
Further, our capacity expansions and related commitments may outpace realized demand. We make capacity expansion decisions and
supply commitments based on demand forecasts, orders, slot reservation agreements, and deposits. If anticipated demand is delayed or
does not materialize, orders may be deferred, reduced, or canceled and slot reservation agreements may not result in orders. As a result,
we could be over-invested in our facilities and could incur excess or idle capacity, under-absorption of fixed costs, production inefficiencies,
inventory build and write-downs, penalties under supply agreements, lower margins, and impairment of long-lived assets.
Risks Related to Managing Growth and Competition
We may fail to achieve anticipated cost savings . Achieving our long-term financial and cash flow goals depends on our ability to
effectively manage operating costs. Because many costs are affected by factors outside our control, we rely on productivity initiatives
(including lean operations and supply chain management) to drive savings, but there is no assurance they will succeed. Expected savings
are based on estimates and assumptions that are inherently uncertain and subject to business, economic, and competitive factors. If we
cannot identify, implement, and sustain initiatives that effectively manage costs and increase operating efficiency, or if implemented
initiatives fail to generate expected savings, our financial results and cash flows could be adversely affected and we may fail to achieve our
financial goals.
We may fail to execute and accurately estimate long-term service obligations. We enter into long-term service agreements with many
of our customers in connection with significant contracts for the sale of products. Profitability under these agreements, particularly in Gas
Power, depends on our ability to execute and estimates of product durability and reliability, our costs to deliver products and services over
time, and the availability of cost-reducing materials, technology, and skilled technicians. Under such agreements for our long-cycle
businesses, errors in estimating, planning, or execution may cause us to miss delivery, cost, or financial performance targets, leading to
excess costs, inventory build (including obsolescence), lower profit margins and cash flows, loss contracts, and erosion of our competitive
position.
We may fail to compete successfully in the highly-competitive global markets in which we operate. We operate in highly competitive
domestic and international markets, and our products, solutions, and services face significant pressure on technology, quality, delivery, and
price. Remaining competitive requires continual development of advanced technologies and product enhancements, as well as cost-
effective supply chain, production, and delivery. If we change strategic priorities or fail to anticipate or respond quickly to technological
developments, evolving industry standards, new regulations or incentives, changing customer demands, supply chain disruptions, or
innovations in production techniques, we could experience lower revenues, price erosion, reduced margins, and forgone growth
opportunities. Competition has intensified as existing participants expand internationally and as new entrants, including manufacturers from
2025 FORM 10-K 12
regions such as China, improve quality and reliability and pursue markets outside their home countries. Some competitors are government-
sponsored, which may provide them with an advantage over us, such as access to more resources. In addition, global competition
increasingly depends on innovation in emerging technologies, including nuclear fuels and advanced energy systems, where failure to
innovate could limit our ability to participate in new markets. Further, government policies and actions may impact us more adversely
compared to competitors whose operations are more limited in scope or geographic exposure. If we are unable to continue to compete
successfully against our current or future competitors in our core businesses, we may experience declines in revenues and industry
segment share.
Our business success is dependent upon our ability to innovate and successfully commercialize new technologies in fast-
changing markets, and manage our product cycles. We operate in industries where technology and customer needs evolve rapidly, and
our growth and business depend on developing and bringing to market new products, solutions, and services. The commercial success of
technologies such as small modular or other advanced nuclear power, hydrogen-based power generation, carbon capture and
sequestration, and grid-scale batteries or other storage solutions depends on factors including the pace of innovation; development costs;
capital resource availability; the intensity of competition; our customers’ ability to obtain and maintain required permits or certifications; the
effectiveness of our production, distribution, and marketing, including our ability to successfully deploy technologies intended to cost-
effectively enhance our production, such as robotics and automation, and integration of AI; the availability of raw materials and
components; our supply chain; the economics for customers to deploy and support these technologies; overall market demand and
acceptance; and the timing of market entry.
Global competition increasingly depends on innovation in emerging technologies, including nuclear fuels and advanced energy systems,
where failure to innovate could limit our ability to participate in new markets. Failure to cost-effectively innovate and commercialize
technologies, products, solutions, and services our customers demand could adversely impact our competitive position, growth, and
financial results and position. Rapid innovation can shorten product cycles and accelerate market introductions, increasing quality and
execution risks, raising costs, and challenging profitability for new products. These risks are heightened in our Nuclear Power business,
which is constructing small modular reactors. Due to the nascent nature of the industry and higher ramp-up costs, new product
introductions could result in losses in the near and long term. Further, breakthrough technologies deployed at scale by competitors may
reduce the demand for legacy products and technologies.
We may not realize the benefits we expect from our strategic transactions. Our strategy includes acquiring technologies and
businesses that expand, enhance or complement our portfolio through acquisitions, minority equity investments, joint ventures, and other
alliances, and divesting non-core assets or businesses and reinvesting any proceeds in our core businesses. Success depends on
identifying suitable opportunities and synergies, conducting effective due diligence, negotiating favorable terms, obtaining required
approvals, closing transactions, effectively integrating acquired businesses or separating divested operations, and collaborating well with
any joint venture participants, partners, and equity co-owners.
Strategic transactions may expose us to risks and uncertainties, including competition driving higher prices or less favorable terms; delays,
costs, or failures in integration or separation of assets, people, systems, and products; noncompliance with multi-jurisdictional laws,
regulations, disclosures, and filings; operational disruption and management distraction from core operations; dependence on external
capital and financing availability and cost; antitrust or other regulatory reviews, conditions, or adverse rulings; legacy noncompliance or
violations at acquired companies; inability to scale production or loss of distribution channels; inadequate IP rights or heightened scrutiny of
acquired IP, or systems integration and transition complexities; failure to achieve expected growth, cost savings, synergies, or market
acceptance; due diligence gaps or unidentified/underestimated liabilities; successor liability for pre-acquisition conduct; inadequate
compliance and risk management organization and infrastructure at acquired companies; retained liabilities or continued losses after
divestitures; loss of key customers or personnel; and adverse market reactions and stock price volatility.
Assessments and assumptions supporting a transaction may prove incorrect, and actual outcomes may differ significantly from
expectations. In joint ventures and other strategic alliances, we may share ownership and, in some cases, management with others whose
objectives, priorities, or resources may differ from ours, increasing governance and execution risk. Further, any such joint venture or other
strategic alliance, may restrict us from taking certain actions in our business and we may be limited in our ability to exit such arrangements
if we later desire to do so.
Divestitures may be delayed or prevented by difficulties finding buyers or by regulatory, governmental, or contractual constraints, including
provisions of the Separation and Distribution Agreement described under “Certain Relationships and Related Person Transactions—
Agreements with GE" in Part III, Item 13 of our annual report on Form 10-K for the year ended December 31, 2024, as incorporated by
reference from our definitive proxy statement relating to our 2025 Annual Meeting of Stockholders filed with the SEC pursuant to Regulation
14A.
Joint ventures, consortiums, and other third-party collaborations expose us to partner, governance, compliance, and financial
risks that could impose additional costs and obligations, cause reputational harm and adversely affect our business, results of
operations, cash flows, financial condition, or prospects. We have entered, and expect to continue entering, into joint ventures for
manufacturing, commercial operations, and project development and funding, and into consortium arrangements to perform projects. These
arrangements involve risks, including exposure to the economic, political, legal, and regulatory environments of partners’ jurisdictions; legal
or regulatory violations by partners outside our control; and contractual, governmental, or exclusivity obligations that may restrict our
operations. They may also require us to incur nonrecurring charges, increased expenditures, or disruption to our normal operations. If
partners face financial distress, restructure, or declare bankruptcy, we may be required to provide additional investment or services,
assume responsibility for contract breaches, or take on additional financial or operational obligations, which may expose us to credit risk.
Our influence over joint ventures varies by ownership and negotiated rights, and major decisions often require consensus, creating risks of
impasses and delays where partner interests diverge. Disputes may arise over performance milestones, interpretation of key terms
(including financial obligations and termination rights), or ownership and control of intellectual property developed in the arrangement. We
cannot control partner actions; in some projects we have joint and several liability and cannot ensure partners will satisfy their
responsibilities. These arrangements may also restrict our access to cash flows or assets of a joint venture, and some joint ventures are
2025 FORM 10-K 13
subject to governmental limitations on cash distributions. Consortium project outcomes depend on partner performance. Partners may
block or delay critical decisions, pursue strategies contrary to our interests, or fail to fulfill obligations, reducing expected returns. We may
need to provide or procure additional services to compensate for such failures, which can increase costs and expose us to reputational
harm and customer or counterparty complaints. Any of the foregoing could materially adversely affect our business, results of operations,
cash flows, financial condition, or prospects.
Risks Related to our Customers and Industry Dynamics
Issues with grid connectivity and customers’ ability to sell generated electricity could delay projects, reduce output, demand and
revenues, increase costs, and cause reputational harm. Many of our customers, projects, and offerings depend on timely grid
connection. Factors beyond our control, including regulatory and permitting requirements and delays, interconnection constraints, limited
land for connection infrastructure, and system failures, may impede or prevent grid connection. If customers cannot obtain grid access or
agreements to sell their electricity on reasonable terms and timelines, order timing and project milestones may be delayed. Grid connection
and operations are governed by statutory and regulatory frameworks intended to ensure safety and stability, but transmission constraints
and operating practices can lead to curtailment (e.g., congestion, limited transmission capacity, or dispatch restrictions). Unplanned project
execution or commissioning challenges due to delays from construction, contractors, or severe weather issues (e.g., wind speed or
direction) can further delay project execution leading to reduced electricity output, reduced demand for our products and solutions,
increased costs for us and our customers, and reputational harm.
Our failure to manage customer and counterparty relationships and contracts could adversely affect our financial results. Our
success depends on delivering in accordance with contractual requirements and anticipating changes in customer and counterparty needs.
Customers and counterparties, including those undertaking large infrastructure projects, may delay or cancel purchases or be unable to
meet their obligations due to business deterioration, cash flow constraints, reduced availability of financing for certain technologies (such as
prohibitions on financing for fossil fuel–based projects), macroeconomic conditions, changes in law or policy, disputes, or other delays. If a
major customer reduces purchases, ceases doing business with us, favors competitors or new entrants, or changes purchasing patterns,
our business could be harmed.
Many of our contracts are complex and contain warranty, performance, delivery, and availability provisions that can trigger significant repair
or replacement costs, penalties, liquidated damages, or other unanticipated expenses if we fail, actually or allegedly, to meet specifications
or schedules. For example, in our Wind business, delays in assembling and delivering critical components (such as nacelles) or other
noncompliance with contract terms have increased costs, presented litigation risks, and exposed us to damages, and we may experience
similar delays and possible consequences in the future. Warranty costs and contract-related penalties have represented, and may in the
future represent, a meaningful portion of our expenses.
We also contract with U.S. and non-U.S. governmental and government-affiliated entities, which may delay, modify, or terminate contracts if
funding or support is unavailable. Collecting receivables can be more challenging with sovereign or state-owned customers and in
emerging markets.
Engaging in new types of transaction structures or unique contractual relationships with nontraditional customers, such as hyperscalers,
government departments focused on energy, or other first‑time counterparties, or with new contracting approaches adopted by traditional
customers, may challenge our ability to effectively negotiate and manage our relationships. Due to our limited experience with such
customers, counterparties, and contracting parties, we may fail to anticipate or control the unique expectations, costs, and operational
complexities associated with such arrangements. Some counterparties may have limited operating histories, different contracting practices,
or weaker credit profiles. They may depend on external financing, subsidies, or project milestones, and may delay payment, seek to
renegotiate terms, or default. Further, some counterparties to slot reservation agreements may not place orders equal to the value of their
reservation amount or at all, and the volume of orders we expect under such agreements may fail to materialize.
Our ability to maintain our investment grade credit ratings could affect our ability to access capital, increase our interest rates,
and limit our ability to secure new contracts or business opportunities. Our commercial relationships and competitive positioning rely
on maintaining corporate investment grade credit ratings, which are evaluated by major rating agencies. Any downgrade could increase the
cost of existing or future indebtedness, constrain borrowing and bonding capacity or worsen terms, and limit or prevent access to capital on
competitive terms. Adverse rating actions may also reduce our ability to secure new contracts and business opportunities and limit our
ability to maintain and obtain supply sources and customers.
Fixed‑price customer contracts expose us to reduced margins and project loss risks if costs exceed expectations. We enter into
contracts that commit to a fixed price well before project completion. However, actual revenues and costs may differ from estimates due to
factors that are difficult to predict or control, which include: procurement challenges and schedule disruptions on large projects; product
performance failures; unforeseen site conditions; rejection or termination clauses in contracts that reduce revenue or increase costs;
inability to be compensated for additional work arising from unanticipated technical issues or deficient customer‑provided designs,
engineering information, products, or materials; inaccurate estimates based on historical data under current conditions (e.g., inflation, labor
and material cost increases); weather and other force majeure events that cause delays or productivity losses; contractual obligations to
pay liquidated or other damages for failure to meet schedule or performance requirements; difficulties engaging or overseeing third‑party
subcontractors, manufacturers, or suppliers, or their underperformance or nonperformance, resulting in delays and added costs; and
project modifications or change orders that create unanticipated costs or delays and potential claims or disputes. Any of these factors can
reduce our margins or result in project losses. Cost overruns and related penalties have represented, and may in the future represent, a
meaningful portion of our expenses.
We may not be able to access the capital and credit markets or obtain other financing on terms that are favorable to us, or at all.
Our business depends on the availability of financing. Capital and credit markets can experience volatility and disruptions that reduce
liquidity and increase borrowing costs. Although we maintain a $3.0 billion committed credit facility and a $3.0 billion committed trade
finance facility, there is no assurance these will be sufficient for our needs, and we may need additional capital markets financing. Factors
beyond our control, including domestic and international economic conditions, increases in benchmark interest rates and credit spreads,
2025 FORM 10-K 14
changes in banking and capital market regulations, and market risk repricing, could limit or increase the cost of financing. Adverse market
conditions or credit rating changes could impair our access to capital on acceptable terms or at all. These conditions may also hinder our
customers’ and suppliers’ ability to obtain debt, guarantees, trade finance, or hedging, negatively affecting our business. In addition, our
customers’ projects often require co-financing through project development loans, structured debt, or equity investments. Such financing
arrangements may be unavailable or more costly than anticipated, which could limit our ability to bid for projects and adversely affect
financial results, cash flows, and returns.
Risks Related to the Energy Transition
We are subject to decarbonization and energy-transition dynamics, including shifting policies, market economics, and
technology trajectories. We must anticipate and respond to market, technological, regulatory, governmental policy, and energy security
changes driven by decarbonization and energy transition dynamics. For example, increased policy support for fossil fuels or the rollback or
suspension of renewable-supportive policies could reduce demand for our renewable and other decarbonization products and services.
Conversely, as a supplier to the power generation sector, falling renewable costs and evolving stakeholder expectations can reduce
demand for and the competitiveness of sales of new gas turbines and service for unabated gas plants.
Continued increases in renewables’ share of capacity additions and generation, depending on pace and timing, could materially affect our
Power segment and consolidated results. Key uncertainties include the level and timing of government subsidies and credits (including the
implementation of U.S. and global policies), regulatory and permit approval timeframes, level of price competition among manufacturers,
competition from solar and other technologies, deprioritization of renewables, the pace of grid modernization needed to maintain reliability
with higher renewables penetration, and industrywide pressure on profitability.
Our long-term success depends on addressing both electrification and decarbonization by adapting our portfolio and scaling less carbon-
intense and lower carbon technologies (such as gas as a replacement for coal, small modular or other advanced nuclear reactors,
hydrogen-based power generation, carbon capture and sequestration, and grid-scale storage). These transitions require substantial
investments by us and third parties in grids, infrastructure, R&D, and new technologies, and depend on timely governmental and regulatory
support, incentives, and market design. If we do not succeed, or are perceived to not succeed, to advance our electrification and
decarbonization objectives, or if investors and financial institutions shift funding away from certain types of generation, our and our
customers’ access to capital could be negatively affected. Government actions may also affect these dynamics in unforeseeable ways.
Developing new high-technology products and enhancing existing offerings to address dynamic energy markets is complex, costly, and
uncertain, and strategies or investments may not be commercially successful within expected timeframes or at all. If the decarbonization
landscape evolves faster or differently than anticipated, demand for our products, solutions, and services could be adversely affected.
Changes in energy, environmental, and tax policies may reduce demand for our products and undermine project economics. Our
businesses benefit from government incentives and policies supporting utility-scale renewable energy (e.g., tax incentives). In addition,
regulatory policies influencing renewable energy mandates and grid integration standards directly impact the demand for wind energy.
Reductions, elimination, suspension or adverse modifications have and could in the future limit markets for new projects, reduce returns on
projects or manufacturing, lead to project abandonment, or impair investments. Eligibility and structuring rely on legal and regulatory
guidance, which is subject to uncertainty, potential modification (possibly retroactive), and governmental audit challenge. Repeal,
modification, suspension or unfavorable interpretations could reduce available credits, require changes to tax equity arrangements, or force
alternative funding, adversely affecting our business and financing.
Separately, changes to environmental regulations and enforcement could increase costs or impede sales. For example, broader
greenhouse gas regulations and carbon pricing could increase compliance costs for us and our customers. While such policies can
increase demand for decarbonization technologies we are developing (e.g., hydrogen and carbon capture capabilities for our gas turbines
and direct air capture) , they may also impose significant compliance burdens that adversely affect our business and may reduce demand
for our offerings.
Demand for certain of our products, solutions, and services, particularly in our Power segment, depends on oil and gas regulatory policy,
prices, and global and regional supply and demand, all of which are largely outside our control. More stringent regulations and
commitments stemming from international initiatives could increase production costs, reduce oil and gas demand, and curtail investments
in gas turbine generation; further, if renewable energy or other alternatives become more affordable than gas, customers may switch away
from gas-fired solutions. Periods of elevated prices and volatility can contribute to economic slowdowns and prompt countries dependent
on oil and gas revenues to reduce investment in oil and gas, power generation, and transmission projects, lowering demand for our
offerings.
Risks Related to Macroeconomic and Geopolitical Factors
Operating globally, especially in emerging markets, creates complex legal, regulatory, and compliance risks. We operate across
diverse legal and regulatory systems in approximately 100 different countries and, as a result, are subject to varying requirements,
procedures and standards, including country-specific regulatory regimes relating to anti-corruption and anti-bribery laws, tax, trade controls,
environmental, employment and labor requirements, sustainability, product safety, liability and design regulations, human rights laws, and
privacy, data protection and cybersecurity laws. Further, we expect increasingly stringent environmental and safety standards across
diverse global jurisdictions, including potential liabilities related to chemicals such as PFAS, that could affect product design, manufacturing,
servicing, and financial results across various jurisdictions.
Navigating a variety of legal and regulatory regimes, which may evolve and be interpreted differently across jurisdictions, including on an
extra-territorial basis, increases the complexity of compliance. Risks in emerging markets may be particularly complex due to less mature
regulatory frameworks, inconsistent and aggressive enforcement, and heightened exposure to geopolitical and economic volatility, which
can amplify the challenges of maintaining compliance across our global operations. Any actual or perceived failure to comply with relevant
laws, regulations, or standards could damage our reputation and customer relationships, and expose us to investigations, inquiries,
2025 FORM 10-K 15
litigation, or other proceedings initiated by governmental entities, customers, or individuals. Such actions could result in significant fines,
sanctions, penalties, awards, or judgments, all of which could negatively affect our business and operating results.
Further, as a global employer in more than 100 countries of permanent and fixed-term contract employees, contingent workers and
contractors, we must design and maintain compensation programs, employment policies, cybersecurity and other intellectual property
protections, compliance programs, and other administrative frameworks that align with the laws of multiple countries. Shifting requirements
and interpretations may influence how we structure our operations and investments, and can lead to rising costs, including those
associated with organizational changes and protective measures. We implement, communicate, audit and monitor, and enforce group-wide
standards and practices across our businesses to address these risks; however, these efforts may not be successful. We are also
responsible for communicating, monitoring, and upholding group-wide directives across our global network, including among suppliers,
subcontractors, and other relevant stakeholders. Failure to manage our geographically diverse operations in light of these challenges could
impair our responsiveness to changing conditions and our ability to enforce compliance with group-wide standards and applicable
requirements.
Major events beyond our control, such as natural disasters, the physical effects of climate change, pandemics, and others, may
increase our cost of doing business or disrupt our operations. Natural disasters, fires, tornadoes, tsunamis, hurricanes, earthquakes,
floods, severe weather, product failures, and power outages in regions where we, our customers or our suppliers operate can damage
facilities. In addition, the physical effects of climate change include increased frequency and severity of significant weather events, natural
hazards, rising average temperatures and sea levels, and long-term changes in precipitation. These events and conditions can disrupt our
operations and those of our customers and suppliers, damage project sites, cause partial or complete plant or distribution center closures,
delay logistics and transportation to project sites, and contribute to supply chain disruption and market volatility. Changes in temperature
and precipitation can also affect electricity demand patterns. Public health crises, epidemics or pandemics can prevent employees,
contractors, suppliers, customers, and other partners from conducting business due to shutdowns, travel restrictions, or other governmental
actions, and may otherwise impair operations. Any of these effects could adversely impact our business, results of operations, cash flows,
and prospects. Insurance may not cover all losses from these events or may become more costly or less available, and our disaster
recovery and business continuity plans (including for information technology systems) may not fully mitigate the impact of these events.
Geopolitical events beyond our control may impact or increase our cost of doing business or disrupt our operations. Events such
as armed conflicts, acts and threats of terrorism, civil unrest and political and economic instability in regions where we, our customers or
our suppliers operate can damage facilities, cause partial or complete plant or distribution center closures, disrupt component supply,
damage infrastructure and delay transportation to project sites. The broader consequences of geopolitical and terrorism threats, which may
also include sanctions that prohibit our ability to do business in specific countries, embargoes, restrictions on repatriation of funds, the
potential inability to service our remaining performance obligations, and potential contractual breaches and litigation, regional political and
economic instability and geopolitical shifts, and the extent of any such threats effect our business and results of operations as well as the
global economy, cannot be predicted. Geopolitical conflicts also contribute to volatility in financial markets, energy costs, and commodity
prices. If global economic and market conditions were to deteriorate, we may experience material harm to our business, operating results,
and financial condition.
Risks Relating to Policy, Government Regulations and Legal Matters
Failure to meet expectations, standards, or our goals for sustainability could harm our business and reputation. Certain of our
regulators and stakeholders focus on ESG topics, including emissions and climate risk, inclusive employment, responsible sourcing, human
rights, and governance. We have set sustainability goals aligned with these objectives, but our ability to accomplish them presents
numerous operational, regulatory, financial, legal, and other challenges, several of which are outside of our control. Perceived deficiencies
in our sustainability policies or performance, or unfavorable ESG ratings of our voluntary disclosures (e.g., under the Global Reporting
Initiative, the Sustainability Accounting Standards Board, and recommendations issued by the Financial Stability Board’s Task Force for
Climate-related Financial Disclosures), could negatively affect investor sentiment, our stock price, and our cost of capital. Regulatory
requirements are frequently changing, including EU CSRD, EU Taxonomy, and EU CSDDD, and U.S. state-level requirements. Given our
extensive disclosures about our sustainability framework and goals and notwithstanding efforts we undertake to manage those disclosures
appropriately, we also face increasing risks of allegations of inaccurate or misleading ESG statements. Failure to meet our goals or comply
with evolving requirements could lead to penalties, supply chain disruption, operational restrictions, product redesign investments, carbon
offset purchases, competitive disadvantages, reputational harm, talent attraction and retention challenges, and heightened scrutiny or
enforcement.
International trade policies could limit market access, disrupt supply chains and operations, raise costs, and harm our
competitiveness. Changes globally in various countries’ international trade and investment policies have increased and may in the future
increase our costs and could meaningfully reduce demand for our offerings or restrict our ability to sell, manufacture, and transport to or in
certain countries. Changes to tariffs, import/export controls, trade barriers, inflation, sanctions, licensing and authorization requirements,
restrictions on outbound or inbound investment, inspections, cash and exchange controls, buy-national policies, local production
requirements, supply chain impacts, and/or other barriers to entry have been and could in the future be disruptive and costly to us and our
supply chain and adversely affect our results, creditworthiness, cash flows, and prospects. Failure to comply with such policies could
increase our exposure to regulatory enforcement actions or penalties. Global or regional economic conditions and government policies may
change in ways we do not anticipate. In addition, our responses to mitigate the impact of these conditions, such as potential price
increases, could negatively impact our sales volume, market share, or relationships with our customers.
Failure to obtain, maintain, or comply with approvals, licenses, and permits could disrupt operations and growth. Parts of our
business require international, federal, state, and local approvals, licenses, and permits that may be denied, revoked, suspended, modified,
delayed or not renewed, or made more onerous. Noncompliance leads to suspended operations, curtailed work, penalties, and other
sanctions. For example, our U.S. nuclear operations are regulated by the NRC; failure to obtain or renew NRC licenses could significantly
disrupt our nuclear business. Obtaining and renewing approvals, licenses or permits can involve extended delays or suspensions and has
and may in the future be jeopardized by noncompliance, violations, or community and political opposition, resulting in substantial costs.
Heightened climate concerns and activism may slow approvals for fossil fuel-related activities in certain regions where we sell our products,
2025 FORM 10-K 16
affecting associated offerings. New or amended laws or changed enforcement may require additional approvals, facility, labor or product
adaptations, leading to substantial costs. Our customers and suppliers are also subject to such approvals; their failures or difficulties in
obtaining or complying with them may hinder our ability to provide products and services and execute projects.
Compliance with EHS laws and regulations could result in significant costs, sanctions, operational restrictions, and reputational
harm. We are subject to extensive EHS regulations worldwide, including, for example, hazardous chemical handling laws, and may incur
liabilities for personal injury, property damage, and health risks from exposures to hazardous substances, processes, or working conditions
at current or former facilities, including from third-party contractor activities. Real or perceived safety issues can be costly, damage our
reputation, divert management attention, and jeopardize our ability to operate in certain jurisdictions. We have and may in the future
continue to face increased regulatory oversight and operational suspensions at our projects. We invest significant amounts to maintain
policies and procedures designed to comply with EHS regulations, and we may need to invest increased amounts in the future if there are
material changes in EHS regulations or in their interpretation or application or in potential environmental liability exposures. In some
jurisdictions, environmental laws can impose strict, joint, and several liability for investigation and remediation, including for conduct
compliant at the time or caused by others. We are subject to governmental safety-related requirements globally, including the U.S.
Department of Energy and the NRC; noncompliance could lead to increased oversight, fines, or shutdowns. Changes to security and safety
requirements could necessitate substantial expenditures.
For our nuclear operations, the handling of radioactive and hazardous materials exposes us and our customers to regulation, attendant
costs and delays, and potential liabilities. Improper handling could cause personal injury, environmental contamination, property damage,
and harm to surrounding communities. Accident severity may depend on the nature of the event, speed of corrective action, and factors
beyond our control (such as weather). Releases may damage or destroy property, depress property values, injure people, and require
costly response actions. Activities of contractors, suppliers, or other counterparties involving these materials may also expose us to
contractual or legal liability. We are subject to international, federal, state, and local regulations that are complex and frequently change;
new or stricter requirements, changed interpretations, or newly discovered contamination could require material expenditures or create
unanticipated liabilities. Contractual protections and insurance may not be effective in all cases or cover all liabilities; defense costs and
damages resulting from an accident or release (including those associated with a precautionary evacuation) could adversely affect our
results, cash flows, and financial condition.
Claims, litigation, regulatory proceedings, and enforcement actions could be costly, disruptive, and unpredictable. We are, in the
ordinary course of business, regularly subject to claims, lawsuits, regulatory proceedings, inquiries, investigations, and enforcement actions
involving customers and their insurers, employees, joint venture and consortium participants, subcontractors, suppliers, and government
agencies. We also face legacy risks associated with previously owned businesses or acquired businesses or liabilities assigned to GE
Vernova in its Spin-Off from GE. Customers have asserted, and may assert in the future, contractual or other claims related to product
performance, design, delivery, or commercial terms, among other claims. Given our size, the nature and type of our products, services, and
contracts, large and long-duration projects and long-term relationships, claims can be significant. Global customs and anti-corruption
enforcement (e.g., under the U.S. Foreign Corrupt Practices Act) is unpredictable, and in such proceedings, we have incurred, and may in
incur in the future, liability for actions beyond our control, including with respect to prior actions taken by others we have assumed by
acquisition or by assignment in connection with the Spin-Off. These proceedings may limit our access to financing from, or being involved
with projects funded by, multilateral development banks, the World Bank, and other sources of financing. Outcomes are uncertain; plaintiffs
and regulators may seek injunctive relief or very large or indeterminate amounts, and potential losses may remain unknown for extended
periods. Initial claims in commercial disputes can be large even if ultimate liability is lower, and plaintiffs may seek punitive, consequential,
or other damages. Defense can be costly and distract management from the operation of the business. We may incur significant defense
costs and payments or be required to alter operations, adversely affecting results, cash flows, and financial condition. Insurance may not
cover all liabilities or amounts and premiums may rise. See Note 22 in the Notes to the consolidated and combined financial statements for
further information on material pending legal proceedings.
Noncompliance with antitrust and competition laws could result in fines, sanctions, business restrictions, and reputational harm.
Antitrust and competition laws prohibit conduct deemed anti-competitive (e.g., price fixing, bid rigging, cartels, price discrimination,
monopolization, tying, anti-competitive acquisitions, and market allocation). Authorities may impose fines, sanctions, restrictions, or
conditions on our business, and violations can lead to suspension or debarment from certain contracts or transactions. The risk of
investigation or enforcement may also chill or inhibit business activities. Many jurisdictions provide private rights of action for damages.
Increased scrutiny or enforcement in this area could harm our business and reputation and result in increased compliance or defense
costs.
Noncompliance with government contracting and procurement laws and rules could result in penalties, contract loss, or
debarment. We sell to government entities globally and are subject to laws and rules governing government contracts and public
procurement, which differ from private contracting and may impose additional risks and liabilities, including local presence, local
manufacturing or sourcing, and technology or IP transfer requirements. Governments have a broader array of criminal, civil, administrative
and other penalties than are available in purely commercial contract disputes.
Many government entities can terminate contracts for convenience or for default and their ongoing business with us may be subject to
legislative or executive funding approvals. Termination or funding changes could reduce expected revenues; a default termination could
trigger penalties and reprocurement costs.
We are subject to audits, investigations, and oversight; ensuring compliance imposes costs, and authorities may conclude our practices are
noncompliant. Adverse findings could result in civil, criminal, and administrative penalties, damages, disgorgement, exclusion from
programs, reputational harm, delayed or reduced payments, diminished profits, operational curtailment or restructuring, contract
terminations, or suspension/debarment.
Failure to comply with financial services regulations or manage conflicts of interest could result in enforcement actions and
reputational harm. Certain affiliates are a broker-dealer or a registered investment adviser, providing fee-based arranging and syndication
of securities, advisory and structuring, and investment management (including tax equity). These activities may present conflicts of interest
2025 FORM 10-K 17
because they often involve investments in large energy infrastructure projects to which our businesses sell equipment and services,
potentially leading to litigation or regulatory actions. Broker-dealers are regulated by the SEC and FINRA under the Exchange Act and
FINRA rules; investment advisers are regulated by the SEC under the Advisers Act. These regimes are extensive and evolving, and
complying with them, or failing to comply, could be costly, time consuming, and disruptive.
Risks Related to Technology, Cybersecurity, Data Privacy & Intellectual Property
We may fail to secure, successfully deploy, and protect our IP or defend against third party IP claims. We may be unable to secure,
successfully deploy, and protect our IP rights. IP laws and enforcement requirements and standards vary by jurisdiction. In some countries
where we do business, there are limited protection or effective remedies. Protecting proprietary technology is difficult and costly, and IP
disputes are complex and unpredictable.
From time to time, third parties allege that our offerings violate their IP rights. To resolve or avoid such claims, we may seek licenses that
are costly or unavailable on acceptable terms, if at all. Failure to obtain necessary licenses could result in financial damages or injunctions
that restrict our business. Any settlement or license may limit our ability to use or protect our own IP in the future. We do not maintain
insurance for IP claims, and any IP dispute—regardless of merit—could require significant financial and management resources.
Our pending and future IP applications may not issue, and any issued rights may be narrower than expected, challenged, invalidated, held
unenforceable, or circumvented. Competitors may infringe, misappropriate, or otherwise violate our IP; both our ability to detect it and the
available remedies may be limited. In addition, our contracts with customers and other third parties often include indemnification or similar
obligations for certain third-party IP claims; we may be unable to limit our liability and could face significant indemnity payments or
damages for alleged contractual breaches. If we fail to obtain and protect our IP, secure necessary licenses and approvals, and defend
against third-party IP claims, our competitiveness may be harmed and we may incur liabilities.
We do not own GE trademarks and use them under a license agreement that, if terminated, could require costly rebranding and
other actions. We do not own the GE trademark or logo. We use them under a Trademark License Agreement with GE, in combination
with our Vernova trademark. GE owns and controls the GE brand, and its integrity and strength depend on how GE and other GE brand
licensees use, promote, and protect it, which are factors largely outside our control. The Trademark License Agreement may be terminated
under certain circumstances. Termination would eliminate our rights to use specified GE marks and could force us to negotiate a new or
reinstated license on less favorable terms or discontinue use of those marks. Loss of these rights would likely require a corporate name
change and significant global rebranding, which could be costly, require substantial management resources, disrupt customer relationships,
and impair our ability to attract and retain customers.
Security or data privacy incidents or disruptions of our or our third parties’ information technology systems could adversely
affect our business. In some of our businesses, we design, build and support software that are embedded in our products and may
operate within our customers’ IT environments and process data. In many jurisdictions, customers and regulators require built in
cybersecurity protections. Techniques used to circumvent cybersecurity protections to gain unauthorized access or sabotage systems are
constantly evolving and increasingly sophisticated, and our measures may not prevent, detect, or mitigate attacks across our installed
base, current offerings, newly introduced products, or legacy technologies still in use.
Global cybersecurity threats, including malware and ransomware, human or technology errors, and attacks by state, state-affiliated actors
or cybercriminal groups, pose risks to us and to our customers, partners, suppliers, and service providers as well as to those of companies
we have acquired. Broader attacks on critical infrastructure could disrupt our operations even if our existing or new systems or products are
not directly targeted. Industry wide third-party incidents continue to increase, and our large supplier base requires ongoing verification of
cybersecurity practices. Growing interconnectedness and shared liability within our ecosystem heighten our exposure to cybersecurity
risks. We also outsource certain cybersecurity functions, use managed service providers, and collaborate with GE during the transition
period that follows our Spin-Off ; these arrangements increase risk due to interconnectivity and potential impacts from a cybersecurity
incident.
We handle sensitive, confidential, and personal information in accordance with privacy and security requirements. Security incidents, data
loss, programming or employee errors, social engineering or malfeasance (including by employees or third parties) could result in
unauthorized access, use, disclosure, modification, destruction, or denial of access to information, as well as defective products, production
downtime, and operational disruptions.
We rely on third-party hardware, software, and other components. A supplier’s cyber incident could interrupt component availability and our
manufacturing or business process. Third-party software (including open source or embedded code), malicious code, or critical
vulnerabilities could increase customer risk. A significant incident involving our systems or data could result in significant material
investigation, remediation, and notification costs, damage our reputation, and expose us to litigation and regulatory enforcement.
Evolving and divergent global data privacy and protection requirements, and any failure to comply with them or adequately
safeguard personal information, could lead to significant costs, fines, litigation, operational restrictions, and reputational harm.
We access sensitive, confidential, proprietary, and personal information subject to numerous jurisdiction specific laws and regulations
contractual obligations, and customer-imposed controls. The legal environment for privacy, data protection, and security is increasingly
complex and rigorous, with continually evolving requirements, including novel issues arising from new technologies such as generative AI.
In the United States, the Federal Trade Commission and various state laws may impose privacy and security obligations that may require
changes to our data processing practices and policies and could result in substantial compliance costs and operational impacts.
Internationally, many jurisdictions maintain unique privacy and cybersecurity frameworks. Violations can lead to substantial fines, regulatory
investigations, orders to cease processing or change data uses, sanctions, enforcement notices, civil claims (including class actions), and
reputational damage.
These laws differ significantly and are interpreted and enforced inconsistently across jurisdictions, often with delayed guidance that creates
prolonged uncertainty. Increasing cross border transfer restrictions and reliance on globally distributed third parties add complexity,
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potentially necessitating organizational changes, additional technical safeguards, vendor management measures, and external expertise,
and may divert management attention and resources.
Any failure or perceived failure to comply with applicable laws, regulations, standards, contractual obligations, or customer-imposed
controls relating to data privacy and security, or to adequately protect personal information, could damage customer and employee
relationships and our reputation and result in our incurring significant costs.
Risks Related to Employee Matters
Inability to attract, retain, and safely deploy highly qualified personnel could impair execution of our strategy and adversely affect
our operations, reputation, and financial results. Our success depends on our personnel, particularly senior management, key
employees, and technical staff, to develop, manufacture, and deliver our products and provide services worldwide. Competition for talent,
our reputation, the availability of qualified individuals, and the emergence of new skills could limit our ability to hire and retain needed
personnel. Difficulties hiring, ineffective succession planning, or depletion of institutional knowledge, as well as inefficient workforce
utilization and ability to engage qualified contractors, could impede execution of our strategy and growth objectives and adversely affect our
business performance, results of operations, liquidity, and financial condition.
Many projects require deploying personnel or contractors in geographically remote or high-risk locations. We incur significant costs to meet
safety requirements and to attract and retain skilled workers, and some roles—such as the installation, operation, and maintenance of
offshore wind turbines—are difficult, labor-intensive, costly, and depend on the availability of highly-skilled labor. Despite our safety
precautions and compliance with applicable laws and regulations, we have experienced serious safety incidents, including injury and death.
Safety concerns or incidents, regardless of fault, could harm our reputation and further impede our ability to attract and retain qualified
employees and contractors.
Significant postretirement benefit obligations and volatility in assumptions and asset returns could increase required
contributions and expenses and adversely affect our earnings, cash flows, and financial condition. We have net liabilities for
pension, healthcare, and life insurance benefits for our employees, former employees, and certain legacy former employees allocated to us
by GE. These obligations arise under multiple plans and statutory requirements across various countries and include defined benefit
pension plans that are fully funded, partially funded, or unfunded. Upward pressure on healthcare costs, increases in benefit obligations, or
asset underperformance could adversely affect our earnings, cash flows, and financial condition.
Our defined benefit expense is determined under U.S. generally accepted accounting principles using actuarial valuations and annual
remeasurements that rely on assumptions and market inputs, including discount rates (generally based on high-quality corporate bond
yields), expected long-term returns on plan assets, compensation growth, and biometric factors (such as participant mortality). Changes in
these assumptions or economic conditions, such as lower discount rates or sustained market volatility, can increase our obligations and
pension expense and require us to make additional cash contributions to the defined benefit plans. Differences between actual experience
and actuarial assumptions, as well as deviations in investment performance, can materially change net plan liabilities and funding
requirements. In addition, changes in legislation, regulations, case law, or accounting standards could result in increased obligations, cash
requirements, and expenses. For further information, see Note 13 in the Notes to the consolidated and combined financial statements .
Labor disputes, collective bargaining obligations, and other labor actions could disrupt our operations and increase our costs. A
significant number of our employees are represented by labor unions under collective bargaining agreements, and many of our European
employees are represented by works councils. These arrangements may limit our flexibility to manage costs and respond to market
changes, and employees who are not currently represented may seek representation in the future. We cannot assure that existing
collective bargaining agreements will prevent strikes or work stoppages, that we will successfully negotiate new agreements, or that
negotiations will not result in increased labor costs (including wages, healthcare, pensions, and other benefits). Negotiations, potential work
stoppages, and related disputes may divert management attention. In addition, labor actions affecting our customers or suppliers, or
general country strikes or work stoppages, could disrupt our operations, project execution, supply chain, and deliveries.
Risks Relating to Financial, Accounting, and Tax Matters
Volatility in foreign currency exchange rates may adversely affect our financial condition, results of operation, and cash flows.
Because we operate globally, we transact in a variety of currencies. Fluctuations in exchange rates can affect our pricing, cost structure,
and margins. For transactions not denominated in the U.S. dollar, we are subject to foreign currency exchange translation risk. In addition,
since our financial statements are denominated in U.S. dollars, changes in foreign currency exchange rates between the U.S. dollar and
other currencies have had, and will continue to have, an impact on our financial condition, results of operations, and cash flows. Although
we use hedging and derivatives to reduce earnings and cash flow volatility, our efforts may not be successful. For additional information,
see Note 20 in the Notes to the consolidated and combined financial statements and Item 7A. “Quantitative and Qualitative Disclosures
About Market Risk.”
Future impairments of long-lived assets, including goodwill, could result in significant non-cash charges. We review our goodwill
for impairment annually and whenever indicators of impairment arise and our other long-lived assets, including identifiable intangible assets
and property, plant, and equipment, for impairment whenever indicators of impairment arise. Adverse changes in market conditions or in
our business outlook, as well as future events or strategic decisions (including asset sales or changes in business direction), could result in
impairment charges and related losses. Certain non-cash impairments may arise from shifts in strategic goals or broader business
environment factors. Any impairment charges we recognize will reduce our results of operations.
Changes in tax laws and rates, adverse positions taken by taxing authorities, and tax audits could increase our tax obligations
and costs and our ability to use deferred tax assets may be subject to limitation. We are subject to income and other taxes (including
sales, excise, and value added) in the U.S. and numerous foreign jurisdictions. Determining our worldwide tax provision requires significant
judgment across diverse legal regimes. Changes in tax laws, tax rates, or interpretations; new or increased tariffs; adverse positions by
taxing authorities; and the resolution of governmental audits and assessments may significantly increase our tax obligations and costs. We
2025 FORM 10-K 19
have deferred tax assets in certain countries, and their utilization depends on generating sufficient taxable income in those jurisdictions
(and within applicable carryforward periods). Subsequent changes in tax laws, rates, or rules in those jurisdictions could restrict or delay
utilization, reduce the value of these assets, and adversely affect our financial results.
The Spin-Off could result in significant tax liability to GE and its stockholders if it is determined to be a taxable transaction and
we may have corresponding indemnification obligations. The Spin-Off may not qualify as tax-free, which could result in significant tax
liabilities for GE and its stockholders and substantial indemnification obligations by us to GE. Although GE obtained an IRS private letter
ruling and tax opinions supporting tax-free treatment under Sections 355 and 368(a)(1)(D), these are not binding on the IRS or courts, rely
on compliance with specified agreements and representations, and do not cover state, local, or foreign taxes. The IRS could determine that
the Spin-Off or related transactions are taxable, including due to incorrect assumptions, breaches of covenants, or post-Spin-Off ownership
changes. If the Spin-Off is taxable, GE and its stockholders could face significant adverse tax consequences. Under our Tax Matters
Agreement with GE, if tax-free treatment fails because of our actions or certain ownership changes (including a 50% or greater change in
our stock by vote or value within the specified four-year period under Section 355(e), excluding the change that resulted from the Spin-Off),
we may be required to indemnify GE for resulting taxes, interest, penalties, and related expenses, which amounts could be substantial.
The Tax Matters Agreement limits us from taking certain actions and may require us to indemnify GE significant amounts. We are
subject to covenants under the Tax Matters Agreement for the period required under the agreement. These covenants are intended to
preserve the non-recognition treatment of the Spin-Off under Section 355 and related provisions of the Code (and analogous state, local,
and foreign tax laws). The covenants include limits on certain acquisitions, mergers, liquidations, sales, dispositions, transfers or stock
redemptions involving our stock or assets; discontinuing the active conduct of our Gas Power business; issuing or selling stock or other
securities (including convertibles, except certain compensatory arrangements); and selling, disposing or transferring assets outside the
ordinary course. We may be required to indemnify GE for taxes, interest, penalties, and related expenses that may result from any violation
of these covenants. Further, under the Tax Matters Agreement, we may be allocated a portion of liability relating to certain pre-Spin-Off tax
matters. Any such allocation or indemnification amounts could be substantial. These covenants and indemnification obligations may require
us to forgo, delay, or restructure strategic transactions and other initiatives, and may discourage third parties from proposing transactions
that our stockholders might otherwise favor.
We may not realize expected benefits from the Spin-Off. We may not realize the benefits we expect from the Spin-Off, including greater
strategic focus, operational simplification, cost savings, targeted innovation, and a tailored capital allocation policy. Achieving these benefits
depends on timely and successful execution of our stand alone strategy and may be limited by the costs and distractions of operating as an
independent public company, restrictions intended to preserve the tax-free treatment of the Spin-Off that may limit strategic transactions for
a period of time, and reduced scale and diversification versus GE pre-separation. Building and sustaining standalone capabilities takes
time, may be less effective, and could be costly and disruptive. Our ongoing relationship with GE creates potential conflicts of interest,
including where directors or officers have roles or equity interests in both companies, and our governance policies may not fully mitigate
these risks. We and GE are subject to multiple separation and transition agreements; if either party fails to perform (including with respect
to indemnities, transition services, or other obligations), we could experience operational disruption and increased costs. Further, we may
be obligated to indemnify GE for actions and positions taken prior to the Spin-Off, and we may have limited influence on the determination
of the indemnifiable amounts, which could be significant. In addition, certain GE credit support and guarantees of our obligations may not
be replaced or released when expected, which could impose contractual restrictions, require alternative credit support, and obligate us to
indemnify GE for amounts paid. Any of these events could adversely affect our business, financial condition, cash flows, and results of
operations and could limit our strategic flexibility.
Risks Relating to Our Common Stock and the Securities Market
Our stock price may be volatile, and we could face securities litigation. The market price of our common stock has in the past
fluctuated, and may in the future fluctuate, significantly. Because we manufacture and sell products used in AI infrastructure, our
performance and the market price of our common stock are frequently linked to AI investment trends and sector sentiment, which has
resulted in, and may continue to result in, significant volatility. A significant decline could result in securities class action litigation, which
could be costly, divert management’s attention, and adversely affect our business.
We may not achieve our targeted return of cash to stockholders. Our ability to return cash to stockholders in the form of dividends or
stock repurchases depends on earnings, financial condition, cash needs, other potential uses of cash, and market conditions. In addition,
the price, availability, and trading volumes of our stock will also affect repurchase timing and size.
Future equity issuances, including equity compensation, may dilute stockholders. We may issue equity to finance acquisitions, raise
capital, or for other purposes. We also grant stock-based awards to directors, officers, and employees, and some of those persons also
have stock-based awards granted by GE prior to the Spin-Off that converted to our stock-based awards at the Spin-Off. We plan to
continue granting additional awards (e.g., annual, new hire, and retention) under our equity compensation programs. These issuances
dilute existing stockholders and may reduce earnings per share, potentially adversely affecting our stock price.
Anti-takeover provisions and Delaware law may deter transactions and limit stockholder rights. Provisions in our certificate of
incorporation, bylaws, the Separation and Distribution Agreement, and Delaware law that may delay, deter, or prevent a change in control
include: a classified board through 2029 with directors removable only for cause during that period; advance notice requirements for
stockholder proposals and director nominations; limitations on stockholders’ ability to call special meetings or act by written consent; Board
authority to issue preferred stock without stockholder approval; and only the Board having authority to fill vacancies (including those
created by Board expansion). We are also subject to Section 203 of the Delaware General Corporation Law (DGCL), change-of-control
restrictions under the Separation and Distribution Agreement, and restrictions in the Tax Matters Agreement intended to preserve the Spin-
Off’s tax treatment. These provisions may discourage certain unsolicited transactions that could offer stockholders a premium for their
shares.
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Exclusive forum provisions may limit stockholders’ choice of judicial forum. Unless we consent otherwise, our certificate of
incorporation provides that the Delaware Court of Chancery (or, if it lacks jurisdiction, another Delaware state court or the U.S. District
Court for the District of Delaware) is the exclusive forum for (a) any derivative action or proceeding brought on our behalf, (b) any action
asserting a claim of breach of a fiduciary duty owed by any of our current or former directors, officers, employees, agents or stockholders to
us or our stockholders, (c) any action asserting a claim arising pursuant to any provision of the DGCL, our certificate of incorporation or
bylaws, or (d) any action asserting a claim governed by the internal affairs doctrine, and that federal district courts are the exclusive forum
for claims under the Securities Act of 1933, as amended. These provisions do not apply to Exchange Act claims, which are subject to
exclusive federal jurisdiction. Courts may not enforce our exclusive forum provisions in all circumstances. The provisions may increase the
cost of litigation for stockholders, limit forums perceived as more favorable, discourage certain lawsuits, or, if found unenforceable, require
us to litigate in multiple jurisdictions, thereby increasing our costs.