Oklo Stock Plummets: What's Driving the Decline?

Oklo, the nuclear power startup that made waves with its public debut through a SPAC merger in May 2024, has seen its stock price plummet in recent months. The company, founded by two MIT graduates, Jacob DeWitte and Caroline Cochran, has been a hot topic among investors due to the global resurgence of nuclear energy and the soaring power demand from data centers, AI, and the electrification boom. However, the hype seems to have faded, and Oklo’s stock has cratered roughly 55% from its February highs. So, what’s driving this decline?



One of the primary factors contributing to the recent decline in Oklo's stock price is investor worries about the U.S.’s potentially overblown data center energy forecasts. As China’s AI dominance grows, investors are becoming increasingly wary of the U.S. market's ability to sustain the demand for data centers and energy solutions. This concern has led to a significant pullback in Oklo's stock price, which has cratered roughly 55% from its February highs.

Another key factor is Oklo's shaky financial results. In fiscal 2024, the company posted a net loss of $73.6 million, or $74 per share, significantly worse than the loss of $32.2 million, or $0.47 per share, from the prior year. With no revenue generated as it continues to develop its Aurora reactor, Oklo warned that deeper losses are expected in 2025. This financial instability has contributed to the decline in stock price, as investors become increasingly cautious about the company's ability to turn a profit.



Additionally, CNBC’s Mad Money host Jim Cramer has recently warned investors against jumping in too soon. When asked if OKLO’s current dip was an early buying opportunity, Cramer replied that it is “mega too early” to bet on the stock. He even labeled Oklo as “one of the most speculative” players in the market, which has likely deterred some investors from buying the stock.

The long road to commercialization is another factor contributing to the decline in Oklo's stock price. The company's first reactor isn’t expected to generate power until late 2027 at the earliest, assuming regulatory approval. This long road to commercialization has made investors cautious about the stock, as they wait to see if the company can deliver on its promises.

Despite these challenges, Oklo is making big moves in 2025, ramping up its growth potential. The company boosted its Aurora reactor capacity to 75 MW, teamed up with RPower on a gas-to-nuclear strategy, and expanded into radioisotope production with its acquisition of Atomic Alchemy. These strategic steps could unlock new revenue streams and open the door to broader market opportunities.

In conclusion, while Oklo's stock price has plummeted in recent months, the company is still making progress towards its goals. However, investors should be cautious about the stock, as the long road to commercialization and the company's shaky financial results pose significant risks. As always, it's important to do your own research and make informed investment decisions.