Earnings call transcript: Nuscale Power Q1 2025 sees revenue surge, stock rises

Nuscale Power Corp reported a significant increase in revenue for the first quarter of 2025, reaching $13.4 million, a notable rise from $1.4 million in the same quarter the previous year. The company’s earnings per share (EPS) forecast was -$0.13, aligning with projections. Following the earnings announcement, Nuscale’s stock price rose 1.78% in regular trading hours and an additional 2.3% in aftermarket trading, closing at $18.20. According to InvestingPro data, the company maintains impressive gross profit margins of 86.67% and has shown strong revenue growth of 62.41% over the last twelve months. Based on InvestingPro’s Fair Value analysis, the stock appears fairly valued at current levels.

Key Takeaways

• Revenue for Q1 2025 increased nearly tenfold compared to the previous year.
• Stock price increased by 1.78% during regular trading and 2.3% in aftermarket trading.
• The company is advancing its 77-megawatt electric design approval, expected by July 2025.
• Operating expenses decreased to $42.3 million from $44.6 million the previous year.
• Nuscale maintains a strong cash position with $491.4 million in cash and equivalents.

Company Performance

Nuscale Power demonstrated robust performance in the first quarter of 2025, with revenue surging to $13.4 million, a stark contrast to the $1.4 million reported in the same period last year. This growth is attributed to increased interest and investment in small modular reactor (SMR) technology, as well as strategic partnerships and innovations in hydrogen production capabilities. The company’s efforts to secure design approval from the U.S. Nuclear Regulatory Commission and engage with potential customers have positioned it as a leader in the SMR industry.

Financial Highlights

• Revenue: $13.4 million, up from $1.4 million year-over-year.
• Operating expenses: $42.3 million, down from $44.6 million the previous year.
• Cash and cash equivalents: $491.4 million.
• Short-term investments: $30 million.
• Raised $102.4 million through an ATM program.

Earnings vs. Forecast

Nuscale’s EPS for Q1 2025 met the forecast of -$0.13, maintaining alignment with market expectations. The revenue of $13.4 million significantly exceeded the forecasted $2.31 million, marking a substantial positive surprise. This outperformance reflects the company’s successful execution of its strategic initiatives and growing market demand.

Market Reaction

Following the earnings release, Nuscale Power’s stock experienced a positive reaction, with a 1.78% increase during regular trading hours and an additional 2.3% rise in aftermarket trading, closing at $18.20. This movement reflects investor confidence in the company’s growth trajectory and strategic direction, as well as its strong financial position.

Outlook & Guidance

Looking ahead, Nuscale Power anticipates securing its first firm customer order in 2025, with commercial deployment targeted for 2030/2031. The company is in discussions with ten advanced customer prospects and is focusing on the Row Power project in Romania, with a potential final investment decision expected in late 2025 or early 2026. With a market capitalization of $5.01 billion and a beta of 1.63, InvestingPro data suggests the stock carries higher volatility compared to the broader market. Discover more detailed analysis and forecasts with InvestingPro’s exclusive Fair Value model and financial health scores. Nuscale’s guidance for future quarters remains consistent, with EPS forecasts of -$0.13 for Q2, Q3, and Q4 of 2025, and -$0.21 for Q1 2026.

Executive Commentary

CEO John Hopkins expressed confidence in Nuscale’s leadership position in the SMR industry, stating, "We truly believe NuScale is leading the way in the SMR industry." CFO Ramsey Hamady highlighted the financial strategy, noting, "Money instigates money. It instigates investment." Hopkins also described the company’s modular approach as being akin to "the Intel inside of Dell computer."

Risks and Challenges

• Regulatory hurdles: Securing design approval from the NRC is critical for future deployment.
• Market competition: As interest in SMR technology grows, competition may intensify.
• Supply chain disruptions: Potential issues with suppliers could impact project timelines.
• Economic conditions: Macroeconomic pressures could affect investment and customer demand.
• Technological advancements: Rapid changes in technology could require ongoing innovation.

Q&A

During the earnings call, analysts inquired about the diversity of Nuscale’s potential customer base beyond data centers, the company’s manufacturing readiness, and supply chain preparedness. Executives emphasized the advantages of their light water reactor technology and confirmed their ability to support multiple concurrent projects, signaling strong operational capabilities.

Full transcript - Nuscale Power Corp (SMR) Q1 2025:

Conference Operator: Good afternoon, and welcome to NuScale’s First Quarter twenty twenty five Earnings Results Conference Call. Today’s call is being recorded. A replay of today’s conference call will be available and accessible on NuScale’s Investor Relations Web site. The web replay will be available for thirty days following the earnings call. At this time, for opening remarks, I would like to turn the call over to Rodney McMahon, Senior Director of Investor Relations.

Please go ahead.

Rodney McMahon, Senior Director of Investor Relations, NuScale: Thank you, operator. Welcome to NuScale’s first quarter twenty twenty five earnings results conference call. With us today are John Hopkins, President and Chief Executive Officer and Ramsey Hamady, Chief Financial Officer. On today’s call, we will provide an update on our business and discuss our quarterly financial results. We will then open the phone line for questions.

This afternoon, we posted a set of supplemental slides on our Investor Relations website. As reflected in the Safe Harbor statement on Slide two, the information set forth in the presentation and discussed during the course of our remarks and the subsequent Q and A session includes forward looking statements, which reflect our current views of existing trends and are subject to a variety of risks and uncertainties. You can find a discussion of our risk factors, which could potentially contribute to such differences in our 2024 annual report on Form 10 ks and subsequent SEC filings. I’ll now turn the call over to John Hopkins, NuScale’s President and Chief Executive Officer.

John Hopkins, President and Chief Executive Officer, NuScale: Thank you, Rodney, and welcome to NuScale. Good afternoon, everyone. As 2025 progresses, I’m excited to share that NuScale continues to build momentum and strengthen its leadership position in the SMR space. We remain the only SMR company with U. S.

Nuclear Regulatory Commission design approval and we continue to advance our commercialization efforts. During the first quarter of twenty twenty five, we focused on deepening customer engagement and further enhancing our manufacturing and supply chain readiness, ensuring we remain on track to meet our 02/1930 delivery target. Today, I’ll provide further insights into these initiatives and share updates on our business commercialization progress and market opportunities. Ramzi will follow with a financial update. Starting with a business update, the Row Power project in Romania as discussed on slide three continues to move forward with a floor led Phase two front end engineering and design delivering meaningful revenue and cash flow for NuScale.

Notably, we are on schedule to deliver the Class three estimate by this fall. Furthermore, discussions are underway to extend the project into the detailed design phase, a critical step that would enable the submission of a final investment decision application to the Romanian government by late Q1 or early Q2 twenty twenty six. Moving on to slide four, let’s shift to our commercialization progress. It’s essential to reiterate that NuScale remains well ahead of its competition and continues to lead the market as the only near term deployable SMR. As we have mentioned before, recently proposed non light water SMR projects in The U.

S. Are still in what we call the demonstration phase, which means they still require a minimum of four years of operation before securing U. S. Nuclear regulatory approval for commercial deployment, an important and rigorous regulatory requirement that NuScale has already achieved, which we believe sets us years ahead of the other players. To that end, we are pleased to report that our standard design approval application with the NRC, which aims to increase the power output per module from the previously approved 50 megawatt electric to 77 megawatt electric continues to progress on schedule.

We anticipate final approval by the NRC by July of this year. We are proud to be a first mover in the industry when it comes to manufacturing preparedness, a crucial step towards deployment and we continue to gather early valuable knowledge about the process that will only make it more streamlined and efficient, as well as enhanced scalability going forward. Turning to slide five, this was a pivotal quarter for our supplier working group, another demonstration of our commitment to meeting our deployment plans. NuScale’s team worked from on-site delivery days to identify key near term supply chain actions that need to be completed to assure a 02/1930 delivery of our first NuScale power module. For example, during the first quarter, we conducted multiple pre bid meetings with Doosan on an upper reactor pressure vessel fabrication proposal, continued progress on long lead material orders, issued a preliminary scheduled delivery date notification to our fuel supplier Framatone for the initial core and initial order of control rod assemblies, and executed a Neutron monitoring system supply agreement with Paragon.

We also held a productive meeting with our supplier working group in April, where we continue to build and invest in strong relationships with our suppliers in anticipation of a near term customer order. With more than 30 suppliers attending the meeting, we focused on critical path production items and identifying near term supply chain investments. A strong supply chain is essential in successful deployment. And NuScale continues to be proud of our robust relationship with our valued suppliers. Now let’s talk about market opportunity.

Looking at slide six, we remain confident that the growing interest in our technology and its critical use cases, as well as NuScale’s distinct competitive edge in module manufacturing and fuel readiness will result in a firm customer order during 2025. In collaboration with our exclusive commercialization partner, InterOne Energy, we are in various stages of discussions with potential customers both here in The U. S. And abroad. Domestically, this includes discussions with government officials and industries, including data centers, utilities, coal plant operators transitioning to nuclear and petrochemical and energy companies.

Internationally with stakeholders around the globe in Europe, The Middle East, Africa and Asia. On the data center front, IntraOne continues to lead discussions with major U. S. Hyperscalers with a strong focus on powering AI operations. Potential customers continue to be attracted to EntreOne’s commercial model, which is designed to provide financial flexibility while mitigating deployment risks.

Of these customer discussions, classify upwards to 10 as advanced, many of which have progressed to the point of multiple iterations of term sheets exchanged between parties and customer site visits to Doosan’s manufacturing facilities in South Korea where NuScale power modules are being built. Across the board, we are continuously encouraged that both prospective customers in the broader market are better informed and more aware of the significance and advantages of NuScale’s advanced SMR technology, in part due to our extensive outreach efforts. Now I’d like to briefly discuss other applications of NuScale’s technology beyond generating electricity as shown on slide seven. One of these applications drawing a significant amount of attention is the production of carbon free hydrogen. And we believe NuScale is uniquely positioned to lead in this space.

We are proud to be the first SMR company to integrate hydrogen production systems in controls into a multi module main control room simulator, enabling efficient carbon free hydrogen production. Notably, our solution is designed to meet the needs of commercial scale industrial applications requiring over 200 metric tons of hydrogen per day. Our presentation at the World Petrochemical Conference in March, where we were the only nuclear company to present, introduced an approach to produce a hydrogen carrier from the brine waste generated by desalinization, consistent with our mission to provide both clean energy and clean water. We’ve attracted strong interest from major industrial players and we look forward to future collaborations to cement our leadership in this space. As we look to the future of SMRs in the nuclear field, I want to take a moment to note the recent opening of three new NuScale Energy Exploration Centers at leading universities.

Soon, we’ll be opening two additional centers bringing the total to 11. These innovative learning environments that stimulate a NuScale SMR control room as well as NuScale’s licensed operator training program for helping to pair the next generation of nuclear talent. And we are proud to partner in this important effort. Lastly, I want to share that NuScale is actively assessing the potential impact of tariffs on our operations in the current market environment. At this time, we do not anticipate any material impact.

However, we remain vigilant in monitoring the situation. We’re also working closely with our suppliers to ensure operational continuity and are prepared to address any changes proactively to mitigate potential risk. This is an important year for NuScale and we remain steadfast in our commitment to delivering sustainable, carbon free electricity to end users worldwide. I am proud of where we are today and look forward to updating you all on our progress over the course of 2025. The demand for clean, reliable energy has never been more pronounced and we have an exciting future ahead.

Now over to Ramzi for the financial update.

Ramsey Hamady, Chief Financial Officer, NuScale: Thank you, John, and hello everyone. Our financial results are available in our filings. So my focus will be on explaining major line items, which can be found on Slide eight. UScale’s overall liquidity improved during the period ending the first quarter of twenty twenty five with cash and cash equivalents of $491,400,000 and short term investments of 30,000,000 The primary driver of this increase was our successful sale of 4,500,000.0 shares through our ATM program during the quarter generating $102,400,000 in gross proceeds. Our strong balance sheet positions us to continue bolstering our manufacturing and supply chain preparedness as we drive towards commercialization.

For the quarter ended 03/31/2025, NuScale reported revenue of $13,400,000 During the same period in the prior year, the company reported revenue of $1,400,000 This increase was driven by fees received from the engineering and licensing work and other services we provide in support of the Row Power project. Operating expenses were $42,300,000 for the quarter ended 03/31/2025 compared to $44,600,000 during the same period in the prior year. More notably, operating expenses since the beginning of 2024 are well below the $69,900,000 per quarter average in 2023. This material reduction underscores NuScale’s commitment to streamline costs and improve operational efficiency. Looking ahead, we are excited about the next phase of growth.

As John highlighted, this is a pivotal year for NuScale and the solid start we had in the first quarter positions us well to maintain and build upon the momentum. I will conclude my remarks with a brief view of our capitalization summary on Slide nine. Additional information may be found in our 10 Q and earnings release, both filed with the SEC. With that, I’d like to thank you again for joining today and for your continued support of NuScale. We’ll now take questions.

Operator?

Conference Operator: Thank you. And we will now begin the question and answer session. If you have dialed in and would like to ask a question, please press star one on your telephone keypad to raise your hand and join the queue. If you would like to withdraw your question, press star one a second time. If you are called upon to ask your question and are listening via speakerphone on your device, please pick up your handset and ensure that your phone is not on mute when asking your question.

Again, it is star one if you would like to join the queue. And our first question comes from the line of Mark Bianchi with TD Cowen. Your line is open.

Mark Bianchi, Analyst, TD Cowen: Hi. Thanks. Hi, guys. Was pleased to see the hi. I was pleased to see the, kinda outlook to have a firm customer order by the end of twenty twenty five.

Can you talk about, you know, what that means, from a you know, how do you define that? Is that the customer reaching a final investment decision? Is it some other intermediate, threshold that that needs to be crossed to sort of fall into that category? And then, you know, what what are the the events that need to unfold to to get to that?

John Hopkins, President and Chief Executive Officer, NuScale: Hey, Mark. This is John Hopkins. How are doing?

Mark Bianchi, Analyst, TD Cowen: Good. Thanks.

John Hopkins, President and Chief Executive Officer, NuScale: Let me just first let me just start by saying, you know, we’re I think we mentioned in the last earning calls, our focus right now is to get closure on near term contracts. We are no longer chasing or announcing MOUs. Where we are with our current customers and then we’re in discussions with right now, as I commented earlier, we’re actually in the process of of submittal and and negotiating term sheets. We’ve got customers that are wanting to go to do so and to actually go touch steel and see our modules online and and and production. In fact, I’m going to be in Korea with an executive team of a prospective customer this June.

So, you know, the groundswell continues to build. I I spoke with the CEO of Nuclear Electra today on on Romania. We’re keeping a close thumb on the pulse there. There’s you know, they’re having presidential elections coming up this coming Sunday. But so far, they’re, you know, paying their bills, and the team is working well together.

And, Flora is still leading as a prime for the front end engineering design. So, you know, I feel pretty comfortable that, you know, this is gonna be a pivotal year. I’m appreciative of this administration and things that I’m hearing coming out of both Secretary Wright and Secretary Vergam in terms of advanced new nuclear, and it needs to be quickly put into the energy mix. So we’re not in discussions about LCOE or we’re beyond that with these customers. Now it’s discussions of getting long term power purchase agreements negotiated in place.

So we’re working diligently on getting that done. So I’m pretty excited where we are right now in our space.

Mark Bianchi, Analyst, TD Cowen: Okay. Thanks for that, John. I guess you mentioned you know, the the administration, and and their their support for nuclear. There was some news last week about some draft executive orders, from the White House to to of help streamline the the, I guess, the licensing process. Can you talk about sort of what could potentially be done that would streamline permitting?

Because my understanding is that NRC is supposed to be kind of like the Fed and sort of you can’t be White House, can’t be telling them what to do. But just kinda curious what what might be some low hanging fruit to streamline the process.

John Hopkins, President and Chief Executive Officer, NuScale: Yeah. Actually, I’m at a SMR conference, this week. In fact, right now, I’m meeting with customers and and our suppliers here, and that’s kind of the talk of what’s going on. I I think everybody’s trying to figure it out what it means. It’s too early really to ascertain.

But, you know, thankfully, you know, I’m in the process right now. We’ve had ongoing meetings with with the Nuclear Regulatory Commission and ACRS. I feel very comfortable in our discussions that we are on track to get closure on our 77 megawatt this July. So we’re still on track of the NRC schedule. Hopefully, we could beat it.

But I feel pretty comfortable. In terms of streamlining, I just can’t envision that we’re going to take the rigor of safety away. Are there areas in license that can be streamlined in a few other areas? Absolutely. But I’m just thankful we are in a good place right now as a company having gone through the licensing with 50 megawatts, having got the methodology approved for emergency plans on its side boundary, by the way, took us seven years to get that done.

And then, you know, now now once, you know, we’re I’m just kinda staying low key. I wanna get the 77 megawatt approved in July and really hit the ground running.

Mark Bianchi, Analyst, TD Cowen: And

Conference Operator: our next question comes from Sherif Ehab Elmigrabi Your line is open.

Sherif Ehab Elmigrabi, Analyst: Hey, thanks for taking my question. You long lead items in the works for a dozen or half a dozen unclaimed modules depending on how you want to slice it. So how quickly and you know you talked about order by the end of the year. How quickly after booking an order could NuScale turnaround and deliver modules if it was The US power plant?

John Hopkins, President and Chief Executive Officer, NuScale: Well, made the comment previously. If you haven’t ordered long lead items, we started this process a few years ago. So Doosan was originally slated to do six of the modules of the F Reactor vessel. We just put a placement in recently for six more. So, you know, if we’re going to adhere to a 2020 or at the end of this decade, let’s say, COD, that’s what we’ve been working with our supply chain to get ensure we could make that.

If in fact now I gotta tell you, you know, as the window keeps pushing out, you know, can we do 2030? Yes. If we get closure on a deal here soon. If we don’t, then it get pushed out to 2031. But our our suppliers and and I gotta tell you, Doosan has spent a lot of their own capital that none of come with with NuScale.

We you know, they’re they’re they’re doing our helical coil steam generators right now. They went out and acquired two bending equipment. And that’s why we’re excited now that we’re in a place to bring customers to to Doosan manufacturing and see and actually see where we are in the process. And they’re very far along.

Ramsey Hamady, Chief Financial Officer, NuScale: Sure. May maybe I can add a little bit to your comment. We call them, or you call them, I think, unclaimed modules. You know, I think of those really as long lead materials, which we’re producing for our first contract. And we anticipate that once we sign a contract with our business model, we’ll seek cash flow immediately in relation to the modules.

We believe that once we sign it once we sign a contract with a major customer, that we’ll receive payments in relation to the modules, we’ll receive positive cash flow. Remember, NuScale has a few different revenue sources. We have pre engineering services. We have the sale of the modules, and we have some post delivery services. But in relation to the sale of modules, we expect somewhere around 25% of the cost of modules to come in the first year and for NewScale to be cash flow positive from that perspective.

So I I think that that contract will be important for us. It’ll be pivotal in terms of pushing our balance sheet and our cash flow towards a cash flow positive position. And and that’s why we’re, you know, we’re we’re producing we’re producing today because we anticipate that sale to be a near term event.

John Hopkins, President and Chief Executive Officer, NuScale: Good morning, Ramsey.

Sherif Ehab Elmigrabi, Analyst: Got it. That’s really helpful color actually. And then maybe just you’ve answered a couple of my questions. So just kind of a simple one. But on slide three, when we talk about extension of phase two for, Row Power for the first quarter of next year, what does that entail?

John Hopkins, President and Chief Executive Officer, NuScale: Ramsey?

Ramsey Hamady, Chief Financial Officer, NuScale: Sure. You know, I I think Row Power has taken a very sensible and measured approach to the development of the project, the SMR project in protest. And, currently, the scope of FEED phase two and residences a two step FID. And I think what RealPower now is looking at is, we went and they scoped the first step, and they’re pushing forward very deliberately and very steady on that pathway. And I believe Row Power now is looking to fund the FEED phase two for the second step of FID.

So really, it’s it’s it’s just greater assurance, I think, on our side and greater assurance to the market that ultimately at the end of FEED phase two, RealPower will have completed sufficient engineering studies to get to an FID, which is final investment decision, and they will take a view on moving forward with the project. So we see it as a very positive idea. We’re thrilled that Pro Power is doing that, and we’re here to support them in every step of the way.

John Hopkins, President and Chief Executive Officer, NuScale: Yeah. We Ramsey and I actually met with the CEO of Nuclear Electrica last week in Washington, DC. So, their FID or final investment decision is still looking to be latter part of twenty twenty five or early twenty twenty six is their target.

Sherif Ehab Elmigrabi, Analyst: Got it. That’s great color. Thanks and I’ll turn it over.

Ramsey Hamady, Chief Financial Officer, NuScale: Thank you.

Conference Operator: And our next question comes from the line of George Gianarakis with Canaccord Genuity. Your line is open.

George Gianarakis, Analyst, Canaccord Genuity: Thank you for taking my question. I’m curious, yeah, in terms of this form order you expect by the end of the year, you sort of articulated a series of customer conversations that you’re having multiple shots on goal, likely is it that one of these customers could be a large tech company versus some of the other descriptions that you made during the call? Thank you.

John Hopkins, President and Chief Executive Officer, NuScale: I I think it could very well be. You know, we we have nondisclosure agreements with the tier ones on the in the AI side. And, you know, the you know, Google’s and the Amazons have made some announcements, but trust me, they I was speaking with one of the tier ones today here at this conference. They need a lot of energy. And in terms of near term deployable and you gotta remember, you know, as far as I know, no other technology has even submitted a design certification certification application to the NRC as yet.

You know? So, you know, when we get that 77 megawatt power upgrade, we’re fully licensed under a part 52, not only to construct, but to operate. So if they really truly need power now, we are near term deployable, George.

Ramsey Hamady, Chief Financial Officer, NuScale: George, I may add that when we look at projects, you know, we talk about who the customer is and and the, you know, the possibility that one of our customers is, you know, a hyperscaler tier one data center AI developer. And I think it’s important to understand that our projects are complex. And, really, the customer, in many cases, will be the developer who’s developing the plant and purchasing the SMRs from NuScale. Supporting that idea will be a power purchase agreement and a buyer and a power user, which we anticipate would be a tier one data center or AI developer. But there’s many others within that ecosystem of us developing the first deal, And that includes having a site, includes a site operator, most likely in the form of utility, our exclusive development partner, EntrA1, and capital to support the deal.

So I I hate to, you know, immense words for the sake of precision, but I think it’s it’s meaningful. There’s a number of entities that will be involved in announcing the first project, and the the tier one AI data center, which we hope will be involved in the first project, will really be the power user versus the direct customer to NuScale, who’s buying SMRs.

George Gianarakis, Analyst, Canaccord Genuity: Thanks. And maybe for a second question, you did a nice job this quarter with cash management’s cash increased sequentially. Can you just help us again maybe articulate again how much what we should expect for quarterly cash burn for the foreseeable future?

Ramsey Hamady, Chief Financial Officer, NuScale: Sure. I mean, I think we’ve you know, George, I I think we’ve done a good job. NuScale has done a good job of, you know, showing steady OpEx over the last, you know, probably the last five quarters or so through 2024 and into q one twenty twenty five, recapped OpEx between ’41 or so 41 to 44,000,000. If we look at cash flow from operations, it fluctuates a little bit. For example, in q four, we had to have a boost from some onetime type payments in relation to technology license agreement with Row Power, but we continue to derive revenue from that project.

So if I look at just just like an OpEx cash burn, it’s still in that range, let’s say, 40,000,000, 40 5 million a quarter. We’ll probably push it up a little bit as we invest in our supply chain. That’s something that we’re actively doing now because we anticipate a near term project, and we’re focused on supply chain manufacturing and delivery dates. And revenue, I think, will stay fairly steady throughout this year, So more reflective of our q one twenty five revenue versus our q four twenty twenty four revenue. But steady state revenue to offset some of the OpEx.

And I think you’ll see that pretty consistent, George, until the time that we get to, you know, the announcement of a project and we think a near term cash inflow in relation to the modules. So, you know, no surprises, nothing nothing wavering, very steady, very deliberate on behalf of management. Probably try and keep our cash position about the same. We think we have two years or so of operating runway just based on just based on where we are today, just based on what what we have what cash we have and what we bring in, what we spend, And that will change only when we get a project. And I think it will change in a positive way for the company and for our liquidity position.

Conference Operator: And our next question comes from Craig Scherer with Tuohy Brothers. Your line is open.

Craig Scherer, Analyst, Tuohy Brothers: Hi. Thanks for taking the questions. So I mean, let’s talk about, you know, possibly hitting the trifecta. I mean, do you have bandwidth in your supply chain and with EntraOne capacity to support a couple initial projects that could be, you know, deployed in the early very early 2030s, either two twelve modules or or 12 and a six? Could could you swing to, kind of back to back?

John Hopkins, President and Chief Executive Officer, NuScale: Yeah. Doosan has the capacity to put out about 20 modules a year. We’re also in discussions with other of our key suppliers such as IHI manufacturing in Japan. So and we had the supplier day in April. We had 30 US suppliers in international show up in Charlotte.

So what we’re keeping very close eye on is, to your point, we don’t wanna overextend our capacity to execute. So and our model is just what you’ve said. It’s always been, you know, these are fungible assets that are gonna be built in a factory and shipped to multiple locations. So, you know, we don’t want a one off project at a time. We want multiple projects.

So we’re looking right now to see to your question, what’s it gonna take if we had two projects simultaneously show up? Do we, in fact, have the capacity to to commit? And and that’s what we’re looking at right now.

Craig Scherer, Analyst, Tuohy Brothers: Gotcha. And

John Hopkins, President and Chief Executive Officer, NuScale: then For me, honestly, I just wanna get one hard contract right now. One, to showcase the world. And and, you know, we’re we’re very careful. We’re not, you know, a mile wide, an inch deep. We’re we’re we’re staying focused and staying in our swim lane.

And, you know, as I said, progress is is being made.

Ryan Pfingst, Analyst, B. Riley Securities: Gotcha.

John Hopkins, President and Chief Executive Officer, NuScale: So

Craig Scherer, Analyst, Tuohy Brothers: and to to the degree you could swing two relatively concurrent projects, and I and I suppose, at least from your own, you know, financial standpoint, to the degree you’re getting upfront payments that that is doable from from your perspective, maybe even with with some, you know, more proactive customer support, you know, for for the equipment, upfront equipment. Right. Is is it plausible to do two twelve modules within, you know, kind of COD within a year ish?

John Hopkins, President and Chief Executive Officer, NuScale: My answer is yes. You know, again, Ramsey said, you know, this is a complicated process. What NuScale is and I keep using this analogy. We’re the Intel inside of Dell computer. I bring I we put modules, which I said are fungible assets, into an owner’s power plant.

So a lot of it has to do commensurate with the owner and their capacity put together, who the contractors are. So it’s it’s complex. But, you know, again, that is our model. Continue to build out a robust supply chain. And what are these suppliers like about NuScale?

They see sustainable opportunity. This is not just one off plans one at a time. This is gonna be, hopefully our our objective is to do, to your point, multiple plans at any given time. Ramsey, I interrupted. I’m sorry.

Ramsey Hamady, Chief Financial Officer, NuScale: No. I was I was gonna make the comment that we tend to be pretty conservative when we look at how we ramp up. I think I think today, there’s expectation that our supply chain could take up to 20 modules a year. And I’ll I’ll be honest, in my financial modeling, I’m more conservative. But supply chain isn’t static.

And money money instigates money. It instigates investment. And I think that our supply chain has been great partners. Great, great, great partners. And we have bolstered up.

We have invested in supply chain. We’ve invested in design finalization, and our supply chain partners have invested in that as well. Once we have a first contract, I think you’ll see more money going into the supply chain in order to increase capacity. Right? We we believe that getting the first contract is difficult, but we think there’s gonna be a lot of fast seconds.

And, you know, we’ll we’ll we’ll be in a great place if our biggest challenge is keeping up with orders, But we anticipate that that’s where we’ll be, and we anticipate that our supply chain partners will invest for the capacity, and we’re planning for that already. So, you know, I I don’t know that we’re able to fulfill, you know, two, three orders at once in the first year. I don’t think that’s reasonable. The nuclear supply chain is tight. It’s very specific.

There’s a limited number of suppliers. But, fortunately, we’re the first SMR company to go into production. We’re the first one. We’ve been working on a supply chain and working with those partners for seven, eight years already. So I think we’re well positioned to increase capacity in the supply chain and be the company that’s able to deliver in volume relative to our competitors.

Craig Scherer, Analyst, Tuohy Brothers: Great. That’s helpful. And my second, so I mean you only burned through less than $23,000,000 of operating cash flow in the quarter and you’ve got a fair amount of liquidity and you seem to be indicating that you’re anticipating at least one order that will turn you cash flow positive in whatever the next two, three quarters. So what’s the rationale for continuing to hit the ATM? And could we assume that that may slow or cease in the near future?

Ramsey Hamady, Chief Financial Officer, NuScale: Well, one point is that, especially on earnings calls in a public setting, I make no forward looking comments on the ATM. But I will say that we manage cash conservatively. We’ve done so in the past. We’ve raised capital. And if you look at our slide, page eight, going from less than $200,000,000 in Q1, Q2, Q3 of ’twenty ’4 now up to cash reserves of 526,500,000.0.

We’ve we’ve done a great job in solidifying our liquidity position, and I intend to keep about two years worth of cash flow. I think that’s the smart conservative thing to do. I anticipate a project coming this year. I anticipate a project coming soon. But I don’t plan our financial outlook based on anticipated commercial activities.

I plan it based on a conservative scenario. And so again, without making any forward looking statements on whether we hit the ATM, I think it’s clear our cash position and our revenue relative to our OpEx makes our cash needs pretty low in order to maintain a two year cash position. And, you know, we’ll we’ll remain vigilant, and we’ll take advantage of of positive market positions if they if they exist. But there’s no you know, looking at our balance sheet, you couldn’t see a large need for, you know, for a big kind of follow on or some convert or some sort of event like that. That’s just not where we are in our development.

We’ve gone through. We’ve done the spending for r and d. Now we’re really just investing in our supply chain and manufacturing readiness, and those are slightly different ideas.

Craig Scherer, Analyst, Tuohy Brothers: So two years, it sounds like in answer to George’s question, I think you said like $41,000,000 quarterly OpEx, give or take. So it’s eight times that number is the minimum you want to maintain until you have a hard contract?

Ramsey Hamady, Chief Financial Officer, NuScale: Yeah. Yeah. But, you know, we’ll be pushing up some of the investments in supply chain because we believe we’re nearing a commercial project. As we near the commercial project, we’re investing in the long lead materials We’re investing in some of the components that will go into modules, and we’re investing in design finalization, and we invest in our suppliers. So that that may bump up a little bit, but we’re taking this pretty conservatively.

Right? I do believe that we have a project just around the corner. I do believe that we’re responsible stewards of capital to our shareholders. We’re not just pushing cash into the market willy nilly. So, you know, that they even the numbers I present, the 40 to 45,000,000, these are the 500 worth of cash, would seem to instigate an idea of greater than two years runway, especially when you add some revenue there.

Right? Because it lowers the burn rate. But I’d like to keep two years two years runway. I foresee OpEx moving up just a little bit, and we remain conservative in how we look at the markets and, you know, potentially raise money as, again, as market conditions permit us to, but we haven’t done any large capital raises. We haven’t introduced something nothing strange into our cap structure.

We haven’t choose convertibles or we have derivative liabilities that’s gonna impact our shareholders. We’re trying to remain very conservative, very, very steady, very, very consistent. Consistency and being steady and not surprising anyone is the key to, I think, good financial stewardship, and that’s what we’re trying to show. That’s why our OpEx is so steady. Quarter on quarter, it’s just very, very consistent.

And we intend to maintain that level or a little bit higher level of OpEx just investing into supply chain.

Craig Scherer, Analyst, Tuohy Brothers: Thank you.

Ramsey Hamady, Chief Financial Officer, NuScale: Yes. Thank you. And

Conference Operator: our next question comes from the line of Ryan Pfingst with B. Riley Securities. Your line is open.

Ryan Pfingst, Analyst, B. Riley Securities: Hey, guys. Thanks for taking my questions, and I appreciate all the details so far. Just a quick one. For the 10 customer discussions that you’re considering advanced, are those all around U. S.

Data center related projects? Or is there anything in there that’s not data center related or not U. S?

John Hopkins, President and Chief Executive Officer, NuScale: No, it’s not all data centers. I put there’s three components of what we see the market right now. There’s the coal plant replacement that, you know, we’ve got a lot of coal plants coming offline at the end of this decade. That market is

Ramsey Hamady, Chief Financial Officer, NuScale: still

John Hopkins, President and Chief Executive Officer, NuScale: there. We’re in discussions with process companies that have interest in, you know, energy for process heat or energy for ammonia production. And, interestingly, those particular customers that we’re talking don’t necessarily wanna own a nuclear asset. What they want is clean, reliable twenty four seven energy. And this is where the BOOT, BOO intra one model comes to play.

And then the third one, to your point, and the elephant in the room is AI and soon to be quantum, just huge amounts of energy. So in in part of these sales, it’s working with the state, it’s working with utility, working with an AI company, and then working with our with our with our developer to bring it all together. That’s that’s the degree of complexity that Ramsey was alluding to. That it it’s not necessarily just AI.

Ryan Pfingst, Analyst, B. Riley Securities: Got it. That’s helpful. Thanks, John. And then just one on Romania. Can you give more detail on what goes into the class three estimate you expect to deliver to Roe Power this fall and and what the next steps are for you and Floor in between that and FID?

John Hopkins, President and Chief Executive Officer, NuScale: Yeah. You know, as a as a comment, we are a subcontractor to Floor. They are the prime on this particular project. The the class three estimate just gets roll power in a better position just to understand the the cost to complete and what’s gonna take them for the next step. So, you know, as I said, we’re keeping, you know, vigilant on there there is an election coming up.

I did speak with the CEO of Nuclear Electrica today, and he said, so far, they’ve had no indications of any slowdown. And but, you know, we’ll see what happens after Sunday with the new president. But, you know, Romania what I like about Romania, they have nuclear. You know, they have candy reactors with the refurbishing. They have a strong regulator, and regulators actually working, you know, with with in discussions with the NRC.

Romania would like to see themselves positioned for Central Eastern Europe to be a manufacturing facility. So I I think from what I’m hearing is the ground floor continues to build for that particular country. And, you know, again, we we hope it just we’re hopeful that this thing after elections, we’ll have a better sense, you know, probably in a couple, two weeks if there’s gonna be any changes. But right now, it looks to be, as far as what what we’ve been told, things would continue to move forward.

Ryan Pfingst, Analyst, B. Riley Securities: Got it. Appreciate that detail. I’ll turn it back.

Conference Operator: And our next question comes from Eric Stine with Craig Hallum. Your line is open.

Ryan Pfingst, Analyst, B. Riley Securities: Hi, everyone. Good afternoon.

Ramsey Hamady, Chief Financial Officer, NuScale: Hi. Good afternoon.

Ryan Pfingst, Analyst, B. Riley Securities: So many of my questions obviously answered a lot of detail So thank you for that. But what I kind of keep thinking about, obviously, this has been really important as you’ve gone through the regulatory process and everything that you have accomplished over many years. But I’m just curious the importance of light water technology rather than some of the other advanced reactors and technologies that don’t have the operating history of what yours is based on, how that has played in discussions with customers. Clearly, I mean, even in the last two months, right, your tone is different, it seems.

It seems like some of these opportunities have accelerated. And I know part of it is obviously what you’re doing in the supply chain, that’s key. But just curious how the basis being light water reactor technology plays into all of it.

John Hopkins, President and Chief Executive Officer, NuScale: When when I hear the word advanced nuclear, I immediately come to to mind of NuScale. If you’re really looking for a truly advanced SMR, it’s NuScale. I think doctor Jose Reyes because I’ve often asked him, you know, did you look at other fuel sources? You know, we have the ability to burn mixed oxide fuel. We have the ability.

We could burn thorium. And we’ve done a lot of studies to justify that. But the fact is, as I mentioned before, the regulators around the world, they know light water. The NRC regulators, you know, seventy years of experience in this technology with light water. And so I think, you know, it took us forty two months even though to get through that NRC process, and a lot of it was to have to scale up.

And that’s how we ended up spending so much money to prove the NRC that, you know, we we we don’t need a lot of the components of a gig gigawatt size reactor. You know, our fuel is conventional fuel. We don’t have a need for more you know, our fuel is less than 5% enriched. We don’t need up to 19% halo high assay fuel. And as you know, that fuel is not commercially commercially readily available for scale in this country.

So I think there are a lot of distinctives. And once that’s just why it’s so important to get to 77 complete because then we are truly we have the ability not only go construct the plant, you can construct plants, but you can’t operate it without an operating license. So we’re we went under part 52 where we construct and operate a plant, you know, via the, you know, part 52 in our sea. So, you know, I I want others I don’t wanna be a monopoly. I want others to be successful, but I think we’re still in a very good position to be the first mover.

Ryan Pfingst, Analyst, B. Riley Securities: No. Absolutely. And curious also just it seemed like for a bit of time, the fact that you were ahead and that you were, as you said, know, you can be, I guess, I’m forgetting the exact term you used, but deployable, right, in the near term. But that might have been something that that, you know, kind of, I don’t I don’t wanna say scared counterparties, but, you know, it’s like if they’re if they’re gonna talk with you about something, you know, they better be prepared to move forward. So just I mean, obviously, the urgency in some of these applications is what’s pushing people to, you know, be the first, and as Ramsay said, you know, many seconds to follow.

So I don’t even know if that was a question, but, anyways, thanks a lot.

John Hopkins, President and Chief Executive Officer, NuScale: No. Thank you.

Conference Operator: And that concludes our question and answer session.

John Hopkins, President and Chief Executive Officer, NuScale: Thank you, operator. Oh, I’m sorry.

Conference Operator: No. Please go ahead, Mr. Hopkins.

John Hopkins, President and Chief Executive Officer, NuScale: No. I just wanted to end up by saying, we truly believe NuScale is leading the way in the SMR industry. We believe we’re uniquely positioned to commercialize and deliver clean energy at scale With nuclear technology becoming increasingly vital to meeting global energy demands, we are both excited and proud to be at the forefront delivering safe, reliable and scalable carbon free power. So I’d like to thank all of you. Thank you for your interest in NuScale and for joining our call today.

Operator?

Conference Operator: Thank you. And ladies and gentlemen, this concludes today’s call, and we thank you for your participation. You may now disconnect.

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