Oklo Stumbles 10%! Buying Chance or Bubble Burst?

🐾 Paws & Profits: AI Stock Picks on Trial — Can Chatbots Really Beat Wall Street?

Oklo’s stock plunged more than 10% after Goldman Sachs released its first-ever research note. With nuclear energy and AI power demand colliding, is this a once-in-a-generation buying chance — or the start of a painful bubble burst?

Goldman Sachs has released its first research report on Oklo, a leading nuclear power company. Goldman believes that Oklo is positioned in a golden track, benefiting from the revival of nuclear energy and the explosive growth of AI-driven electricity demand. The company holds the largest pipeline of potential orders in the industry and faces a future full of potential catalysts.

However, its current stock price seems to have already “largely priced in” these expectations. Goldman highlights that high valuation, enormous capital requirements, bottlenecks in the supply of key fuel, and pending regulatory approvals are four major hurdles hanging over Oklo. Specifically:

High order volume not yet translated into real revenue:

Although Oklo’s customer pipeline is impressive, all agreements are non-binding letters of intent (LOIs). To date, it has not signed a single legally binding Power Purchase Agreement (PPA). This means customers could withdraw at any time.

The huge financial black hole of a “self-financing” model:

The company’s asset-heavy strategy of self-financing reactor construction is expected to require as much as $14 billion in capital by 2045, exposing it to extremely high financial risk.

Bottleneck in critical fuel supply:

Oklo’s advanced reactors rely on High-Assay Low-Enriched Uranium (HALEU) as fuel. Current global supply of HALEU is extremely tight. This is not only Oklo’s Achilles’ heel but also that of the entire advanced nuclear sector.

Uncertainty in licensing approvals:

Although the company plans to submit its combined license application in Q4 2025 and expects a shorter approval process, it remains a critical hurdle that typically takes two to three years and carries uncertain outcomes.

Goldman has assigned a “Neutral” rating with a price target of $117. Based on today’s trading price around $110, Oklo’s stock is already below Goldman’s target.

Details of Goldman’s Research

Goldman first acknowledges the scale of the opportunity Oklo sits upon. Against the backdrop of global clean energy transition and surging data center electricity demand, nuclear energy is experiencing a renaissance. Leading technology figures such as Sam Altman and Bill Gates have already entered the field.

As AI demand continues to increase, so does energy consumption. By 2027, the AI industry is expected to consume 85 to 134 terawatt hours annually—roughly equal to Beijing’s entire electricity consumption in 2023. If all of this were powered by fossil fuels, the environmental pollution would be massive, something governments around the world cannot permit.

Renewable energy sources such as wind and hydro are unstable, while AI demands stability. Ultimately, nuclear energy—which is not weather-dependent—emerges as the best choice.

With technological advances, the cost of nuclear power generation continues to fall. Since the mid-20th century, the industry has relied on conventional water-cooled reactors. New reactor designs now use liquid sodium instead of water for cooling, cutting construction costs by half. Nuclear and AI have a mutually reinforcing relationship: nuclear provides cheaper electricity for AI, while AI enhances nuclear system design.

As a U.S.-based leader, Oklo is well positioned to benefit deeply with its sodium-cooled fast neutron reactor technology, the “Aurora Powerhouse.”

Goldman’s Concerns

Goldman emphasizes that Oklo has accumulated more than 14 gigawatts of potential customer orders—by far the largest pipeline among nuclear peers. Its customers include data centers, oil and gas companies, and even OpenAI.

However, Goldman pours cold water on this achievement: all of these agreements are LOIs or non-binding contracts.

The only substantive progress so far is a $25 million prepayment from Equinix. Yet Goldman notes this is insufficient to cover even 10% of the cost of a single 75MW reactor. Without any finalized PPAs, the value of Oklo’s 14GW pipeline remains purely theoretical.

History offers a stark lesson. In the 2000 dot-com bubble, Cisco once held a massive backlog of orders, but customers abruptly canceled them, leading to a rapid collapse of its stock price.

The Heavy Asset Model and Massive Financing Pressure

Unlike peers that only provide technology and designs, Oklo has chosen an asset-heavy model: it will fund construction, own the assets, supply electricity to customers, and collect payments over time.

This means the company must manage every stage—from design and licensing to construction, operation, and maintenance. While this model offers greater operational control, it also exposes Oklo to enormous financial risk and capital intensity.

Goldman estimates that by the mid-2040s, Oklo will need to raise about $14 billion to sustain operations and expansion. This will require continuous “cash burn,” making the company highly dependent on capital markets. If financing falters, Oklo risks bankruptcy from cash flow shortages.

This massive funding gap will need to be filled through a mix of equity, corporate debt, government loans, and project financing. By contrast, peers like NuScale, which only provide technology without heavy asset ownership, face far smaller financing needs.

Moreover, to support such capital expenditures, Goldman projects Oklo will need to raise about $4.2 billion in equity financing, exposing current shareholders to ongoing dilution.

The Fuel Bottleneck: HALEU

Goldman considers fuel supply to be the weakest link in Oklo’s grand vision.

Based on Oklo’s deployment plan, by 2035 its HALEU demand will equal about 3% of today’s global natural uranium supply. By 2050, this could rise to 12%.

This means that if Oklo and other HALEU-dependent nuclear firms are to commercialize, the current fuel supply system is wholly inadequate and will require massive investment and expansion.

Oklo is pursuing a “three-pronged” fuel strategy: sourcing newly enriched HALEU, down-blending weapons-grade nuclear materials, and recycling nuclear waste, including building a $1.7 billion fuel recycling facility.

But these initiatives will take years to materialize and add to Oklo’s capital burden and execution risk. Historically, nuclear fuel recycling has always faced questions about cost-effectiveness.

The Long Road of Licensing and Uncertain Commercialization

Despite Oklo’s technological lead and strong partnerships, its commercialization depends on the most critical hurdle: regulatory approval from the U.S. Nuclear Regulatory Commission (NRC).

The company plans to submit a combined license application for its 75MW Aurora Powerhouse in Q4 2025.

Goldman views this as a key catalyst. Oklo’s chosen customized licensing path theoretically shortens approval from the traditional timeline of many years to about 24–36 months.

However, Goldman stresses this is only an expected timeline, with no guarantee of timely approval—or approval at all. In fact, in 2022, Oklo’s earlier application was rejected by the NRC for lack of sufficient information.

Oklo’s goal is to commercialize its first reactor at Idaho National Laboratory by late 2027 or early 2028. But this timeline is tightly tied to NRC approvals, and any delay would push back its revenue generation.

Goldman’s Valuation and Target Price

Goldman ultimately assigns a Neutral rating and a $117 target price, derived from an equal weighting of EV/EBITDA and discounted cash flow (DCF) models.

Importantly, since Oklo will generate no revenue before 2027, Goldman’s valuation relies heavily on long-term projections. Specifically:

The EV/EBITDA model applies a 50x multiple to 2035 EBITDA, discounted nine years at about 15% WACC.

The DCF model stretches out to 2050, meaning the stock’s support today rests on expectations far in the future.

In short, Oklo’s story is full of imagination, but the path from dream to reality is littered with hurdles requiring massive funding, fuel solutions, and regulatory approvals.

Goldman concludes that until these uncertainties are resolved, Oklo’s current valuation already reflects all the positives.