NuScale Power (SMR) 7 Nov 24 2024 Q3 Earnings call transcript
In NuScale's third quarter earnings call for 2024, President and CEO, John Hopkins, provided insightful updates on the company's progress, financial results, and the future of nuclear energy, particularly in the context of powering data centers. Hopkins highlighted the significant increase in demand for carbon-free energy, driven by the technology industry and the need for sustainability and AI revolution.
The Urgent Need for Carbon-Free Energy and NuScale's Role
The growth in power demand, especially in data centers, has accelerated, with technology companies seeking more computing power, faster processing, and enriched artificial intelligence. This increased demand for energy, which needs to be available 24/7 with five nines reliability, has led to a significant interest in nuclear energy and specifically, small module reactors (SMRs). NuScale, as a leader in SMR technology, is uniquely positioned to meet this demand, given its clean, constant, and compact nature.
Major Tech Companies Embrace Nuclear Energy
The call highlighted recent developments in the tech industry, with major companies like Amazon, Microsoft, Google, and Oracle investing in nuclear energy to power their data centers. These companies are recognizing the value of nuclear energy in providing uninterrupted power, essential for their operations, and the need to reduce carbon emissions. NuScale, with its near-term deployability and partnership with ENTRA1 Energy, is at the forefront of these developments, with ongoing discussions with potential customers.
Financial Highlights and Looking Ahead
Financially, NuScale reported a net loss of $45.5 million in Q3 2024, reflecting a reduction in operating expenses due to cost optimization efforts. The company's cash position improved, with $161.7 million in cash, cash equivalents, and short-term investments, and no debt. Looking ahead, NuScale remains committed to maintaining a prudent liquidity reserve and is focused on managing risks while sustaining financial discipline.
International Opportunities and RoPower Project Update
NuScale's technology is also gaining attention internationally, with interest from East and Southeast Asia, Eastern Europe, the Middle East, and Africa. The company has made significant progress with the RoPower project, with Phase 2 front-end engineering design (FEED) work authorized, and Fluor, the prime for Phase 2 FEED, finalizing a sub-agreement with NuScale FEED Phase 2. Additionally, NuScale plans to open an energy exploration or E2 Center at the Ghana Atomic Energy Commission site, further expanding its global presence.
Conclusion
NuScale's third quarter earnings call painted a picture of an exciting future for nuclear energy, particularly in powering data centers. With its unique position as the only U.S. NRC-approved technology with reactors in production, NuScale is well on its way to commercializing its technology, driven by the increasing demand for carbon-free energy. The company's partnership with ENTRA1 Energy, coupled with its financial discipline and manufacturing readiness, positions NuScale as a leader in the SMR market, poised to make a significant impact on the global energy transition.