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

Fermi (NASDAQ:FRMI) announced its quarterly earnings results on Thursday. The company reported ($0.04) earnings per share (EPS) for the quarter, beating the consensus estimate 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 Price Performance

NASDAQ FRMI traded down $0.20 during trading hours on Friday, hitting $6.40. The company’s stock had a trading volume of 17,146,261 shares, compared to its average volume of 20,799,300. Fermi has a 12 month low of $4.47 and a 12 month high of $36.99. The company’s 50 day simple moving average is $7.20 and its two-hundred day simple moving average is $7.19. The company has a market cap of $4.08 billion and a P/E ratio of -5.61.

Wall Street Analyst Weigh In

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

Key Stories Impacting Fermi

Here are the key news stories impacting Fermi this week:

• Positive Sentiment: First anchor customer secured: Fermi signed a lease and power agreement with AI-computing provider TensorWave for up to 650 megawatts. The deal gives Fermi a customer for its large Texas power project and improves the credibility of its AI-data-center strategy. Fermi outlines 640 MW by Q4 2027 as it signs up to 650 MW with TensorWave
• Positive Sentiment: Project moves toward construction: Hillcore will build a 2.6-gigawatt gas-fired power complex at Fermi’s Matador site in Amarillo, Texas, supporting a potential 11-gigawatt campus. Fermi said it expects to have 640 megawatts operational by the fourth quarter of 2027, providing a clearer development timetable. Hillcore construction announcement
• Positive Sentiment: 90-day objectives completed: Fermi announced a new CEO, a strategic alliance, premier contractors, delivery of three F-Series turbines and more than $431 million in capital raised. These milestones strengthen liquidity and demonstrate progress after a period of leadership instability. Fermi second-quarter results and objectives
• Neutral Sentiment: CEO transition: Fermi appointed a new chief executive more than three months after removing co-founder Toby Neugebauer. The change could improve execution and governance, although investors will likely watch for evidence of stability and delivery under the new leadership. Fermi names a new CEO
• Negative Sentiment: Losses continue: Fermi reported a second-quarter loss of $0.04 per share, better than the $0.06 consensus loss but wider than the year-earlier result. The company remains unprofitable, with analysts expecting approximately negative $0.33 EPS for the full year.
• Negative Sentiment: Execution and funding risks remain: Project Matador requires substantial construction, power-generation and customer ramp-up execution. Recent legal and C-suite turmoil, along with the stock’s sharp retreat from its 12-month high, may keep investors cautious despite the new customer and construction announcements.

Insider Buying and Selling

In other news, insider Mesut Uzman sold 79,509 shares of the company’s stock in a transaction dated Wednesday, June 3rd. The shares were sold at an average price of $6.31, for a total transaction of $501,701.79. Following the completion of the sale, the insider owned 670,491 shares of the company’s stock, valued at $4,230,798.21. This represents a 10.60% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is available through this link. Also, Director James Richard Perry sold 863,637 shares of the firm’s stock in a transaction that occurred on Tuesday, June 30th. The stock was sold at an average price of $7.31, for a total transaction of $6,313,186.47. Following the completion of the transaction, the director directly owned 15,827,807 shares in the company, valued at approximately $115,701,269.17. The trade was a 5.17% decrease in their position. The SEC filing for this sale provides additional information. Insiders sold 1,022,178 shares of company stock valued at $7,313,580 over the last quarter.

Institutional Inflows and Outflows

Several institutional investors and hedge funds have recently modified their holdings of the business. Balyasny Asset Management L.P. purchased a new stake in shares of Fermi in the 4th quarter worth $16,549,000. M&G PLC bought a new stake in Fermi during the fourth quarter valued at about $14,443,000. Nuveen LLC bought a new stake in Fermi during the fourth quarter valued at about $11,067,000. Millennium Management LLC bought a new position in shares of Fermi in the fourth quarter worth about $10,871,000. Finally, Nexpoint Asset Management L.P. purchased a new position in shares of Fermi during the 4th quarter valued at about $10,412,000.

About Fermi

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.