NuScale Power Corporation's strategic trajectory is fundamentally anchored on successfully transforming its existing framework agreement with TVA–ENTRA1 into concrete power purchase agreements, specifically targeting the burgeoning demand from hyperscale data centers within the TVA service area. This ambition is set against a backdrop of approximately 11 GW of requested load from these data centers, presenting a significant opportunity for NuScale's Small Modular Reactors (SMRs). The company's unique position as the sole entity with U.S. NRC design certification for SMRs gives it a distinct advantage in this evolving energy landscape, where reliable and clean power sources are becoming increasingly critical.
However, the company recently encountered a setback with its third-quarter earnings announcement, which revealed a performance below analyst expectations. Revenue came in at $8.24 million, missing the consensus of $11.2 million, and an EPS of -$1.85 significantly diverged from the anticipated -$0.15. This discrepancy was primarily attributed to a one-time accounting adjustment of a $495 million ENTRA1 Project Management Agreement (PMA) milestone within General & Administrative expenses, which understandably caused market consternation. Despite this, NuScale's financial health appears robust, with SMR liquidity at a solid $753.8 million and no outstanding debt. The company also disclosed $551.8 million in contracted cash obligations extending through 2028 and has initiated a new $750 million At-The-Market (ATM) offering. This ATM is projected to provide a financial runway of approximately 77.8 months, or about 6.4 years, indicating a thoughtful approach to managing its capital needs.
Looking ahead, NuScale faces critical risks, including the non-binding nature of its agreements with TVA, which could affect the certainty of future revenue streams, and the potential for share dilution from its ATM offering. The valuation metrics also present a challenge, with the company currently trading at 91.3 times next-year sales, a figure substantially higher than the sector median. On a more positive note, NuScale is actively pursuing additional revenue avenues. It is closely monitoring the RoPower Phase 2 Front-End Engineering Design (FEED) services project in Romania, which could provide a steady income. Furthermore, the company is anticipating the completion of the Fluor monetization plan by the second quarter of 2026, an initiative that could significantly bolster its near-term sales performance and overall financial outlook.
The path forward for NuScale Power, though fraught with financial and operational challenges, is illuminated by the promise of advanced nuclear technology. The company's dedication to developing safe, scalable, and sustainable energy solutions for a world increasingly reliant on clean power sources exemplifies a forward-thinking approach. As global energy demands continue to rise, NuScale's efforts in innovating nuclear energy signify a commitment to progress and a brighter, more sustainable future for all.