Fermi (NASDAQ:FRMI) Releases Quarterly Earnings Results, Beats Expectations By $0.02 EPS

Key Points

• Fermi beat earnings expectations, reporting a quarterly loss of $0.04 per share versus analysts’ expected $0.06 loss, but the company remained unprofitable.
• The company secured TensorWave as its first anchor customer through a 222-megawatt, 15-year agreement worth approximately $6.5 billion, with expansion potential to 650 MW. A Hilcorp alliance could add 2.6 GW of capacity, more than doubling Project Matador’s potential output.
• Fermi advanced its execution plans by appointing Lee McIntire as CEO, partnering with major contractors and receiving three turbines, while targeting 210 MW of first power by July 2027 and 640 MW of capacity by late 2027. However, substantial financing, construction and delivery risks remain, and the stock fell 13.2% after the results.

Fermi (NASDAQ:FRMI - Get Free Report) released its quarterly earnings data on Thursday. The company reported ($0.04) earnings per share (EPS) for the quarter, beating analysts' consensus estimates of ($0.06) by $0.02, Briefing.com reports.

Here are the key takeaways from Fermi's conference call:

• Anchor customer secured: Fermi signed a binding agreement with TensorWave for an initial 222 MW, 15-year commitment representing approximately $6.5 billion in revenue, with expansion options up to 650 MW. A backstop agreement covering the full initial term is expected to be finalized shortly.
• Power capacity could more than double: The Hilcorp alliance is expected to add approximately 2.6 GW under a build-own-operate-transfer structure, taking Project Matador’s potential capacity to 4.8 GW without upfront capital outlay from Fermi. Power purchases will be matched to signed tenant leases, with fuel costs passed through to customers.
• Execution milestones advanced: Fermi appointed project-delivery veteran Lee McIntire as CEO, announced EPC partnerships with Primoris and TSK, and received three Siemens F-class turbines. The company targets first power of 210 MW by July 1, 2027, and 640 MW of nameplate capacity by the fourth quarter of 2027.
• Liquidity strengthened: Fermi raised more than $430 million through 5% convertible senior notes due 2031, generating approximately $382 million in net proceeds after the capped call. Management said the structure provides additional runway and is intended to limit dilution until the share price more than doubles.
• Significant funding and execution requirements remain: Management is not disclosing total project costs, but cited typical costs of $3 million–$4 million per MW for power infrastructure and $10 million–$12 million per MW for turnkey data centers. Project financing and the TensorWave backstop must still be completed before full construction spending begins, leaving timing and delivery risk ahead of 2027 revenue commencement.

Fermi Trading Down 13.2%

NASDAQ FRMI traded down $1.00 on Thursday, hitting $6.60. 34,713,089 shares of the company's stock traded hands, compared to its average volume of 14,887,393. The firm has a market capitalization of $4.21 billion and a PE ratio of -5.79. The firm's 50-day moving average price is $7.18 and its two-hundred day moving average price is $7.22. Fermi has a 1-year low of $4.47 and a 1-year high of $36.99.

Analyst Ratings Changes

A number of brokerages have recently issued reports on FRMI. Mizuho cut their price target on Fermi from $27.00 to $11.00 and set an "outperform" rating on the stock in a report on Tuesday, July 28th. Wall Street Zen downgraded Fermi from a "hold" rating to a "sell" rating in a research report on Sunday, May 10th. Stifel Nicolaus dropped their price objective on Fermi from $29.00 to $17.00 and set a "buy" rating on the stock in a research report on Tuesday, June 23rd. Weiss Ratings reiterated a "sell (d-)" rating on shares of Fermi in a research note on Thursday, July 2nd. Finally, Evercore lowered shares of Fermi from an "outperform" rating to an "in-line" rating and set a $11.00 price target for the company. in a research report on Friday, May 15th. Two analysts have rated the stock with a Strong Buy rating, seven have assigned a Buy rating, three have assigned a Hold rating and one has given a Sell rating to the stock. Based on data from MarketBeat.com, Fermi currently has an average rating of "Moderate Buy" and an average price target of $20.67.

Insider Activity

In related news, Director James Richard Perry sold 863,637 shares of the stock in a transaction on Tuesday, June 30th. The shares were sold at an average price of $7.31, for a total transaction of $6,313,186.47. Following the sale, the director directly owned 15,827,807 shares of the company's stock, valued at approximately $115,701,269.17. This represents a 5.17% decrease in their ownership of the stock. The sale was disclosed in a filing with the SEC, which is available at this hyperlink. Also, insider Mesut Uzman sold 79,509 shares of the firm's stock in a transaction dated Wednesday, June 3rd. The shares were sold at an average price of $6.31, for a total value of $501,701.79. Following the sale, the insider owned 670,491 shares in the company, valued at $4,230,798.21. This trade represents a 10.60% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. In the last three months, insiders sold 1,022,178 shares of company stock valued at $7,313,580.

Institutional Investors Weigh In On Fermi

Institutional investors and hedge funds have recently added to or reduced their stakes in the stock. Evercore Wealth Management LLC acquired a new position in shares of Fermi during the fourth quarter valued at approximately $120,000. Atom Investors LP acquired a new stake in shares of Fermi in the fourth quarter worth approximately $94,000. Royal Bank of Canada purchased a new stake in shares of Fermi during the fourth quarter worth approximately $220,000. Quinn Opportunity Partners LLC purchased a new stake in shares of Fermi during the fourth quarter worth approximately $115,000. Finally, Concorde Asset Management LLC acquired a new position in Fermi in the 4th quarter valued at $121,000.

Key Stories Impacting Fermi

Here are the key news stories impacting Fermi this week:

• Positive Sentiment: Fermi signed its first anchor customer for Project Matador: TensorWave agreed to lease capacity in a deal valued at approximately $6.5 billion. The agreement covers up to 650 megawatts, providing an important validation of demand for Fermi’s planned AI infrastructure. Rick Perry's Fermi Finally Finds a Customer for Its Giant Texas AI Power Bet
• Positive Sentiment: The company said it completed all five objectives in its 90-day plan, including securing the customer, receiving three F-Series turbines, forming a strategic alliance with Hillcore Energy Capital, and appointing major contractors. Hillcore is expected to construct a 2.6-gigawatt gas plant supporting the larger, potentially 11-gigawatt Matador project. Fermi Announces Second Quarter 2026 Results and Delivers on All Five 90-Day Objectives
• Positive Sentiment: Fermi appointed Lee McIntire as chief executive officer. His more than 40 years of experience at Bechtel, CH2M Hill and TerraPower could help stabilize leadership and advance construction after months of legal and C-suite turmoil. Fermi Names Lee McIntire as Chief Executive Officer
• Neutral Sentiment: Fermi outlined a target of 640 megawatts of operational capacity by the fourth quarter of 2027. The milestone may improve investor confidence, but it remains dependent on construction, financing, permitting and customer execution. Fermi outlines 640 MW by Q4 2027 as it signs up to 650 MW with TensorWave
• Negative Sentiment: Second-quarter adjusted results showed a $0.04-per-share loss, beating the expected $0.06 loss by two cents but remaining unprofitable and wider than the year-earlier loss. With the stock having already rallied sharply on the TensorWave announcement, investors may be taking profits and demanding evidence that the deal converts into revenue and cash flow. Fermi Reports Q2 2026 Results

Fermi Company Profile

Fermi's mission is to power the artificial intelligence (“AI”) needs of tomorrow. We are an advanced energy and hyperscaler development company purpose-built for the AI era. Our mission is to deliver up to 11 gigawatts (“GW”) of low-carbon, HyperRedundant™, and on-demand power directly to the world's most compute-intensive businesses with 1.1 GW of power projected to be online by the end of 2026. We have entered into a long-term lease on a site large enough to simultaneously house the next three largest data center campuses by square footage currently in existence.

This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to contact@marketbeat.com.

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