OKLO

1. Executive Summary

• Oklo advanced materially on execution, regulatory streamlining, and vertical fuel strategy in Q3 2025, culminating in DOE selection to pilot a domestic advanced nuclear fuel line and groundbreaking of its first Aurora-INL powerhouse. Near-term licensing milestones and a reinforced cash position support the late 2027–early 2028 first-power timeline.

Key Takeaways

• Accelerated licensing momentum: NRC accepted Oklo’s PDC topical report under an accelerated timeline; draft evaluation expected in early 2026.
• First plant execution underway: Groundbreaking at INL completed; Kiewit engaged as lead constructor.
• Fuel supply chain control: Selected by DOE for Fuel Line Pilot Projects to build/operate three fuel-fabrication facilities; announced a $1.68B Tennessee Fuel Recycling Facility (first phase of an Advanced Fuel Center).
• Liquidity and burn visibility: ~$683M cash and securities at Q2-end; full-year cash used in ops guidance: $65–$80M unchanged despite potential CapEx pull-forward.

2. Financial Performance

Capital Raises & Proceeds

• Follow-on equity (June 12, 2025): Raised $460M gross; quarter-end cash and marketable securities ~$683M (Q2 2025 call).
• Prior financing signals: 2024 Equinix partnership included a $25M prepayment; Liberty Energy invested $10M in 2023 (contextual, older).
• Use of proceeds: General corporate purposes, working capital, CapEx, and potential investments (June 2025 offering documents).

Investor read-through: Strong demand for the follow-on (upsized from the initially proposed $400M) and a sizeable cash balance de-risk near-term execution and licensing milestones.

Early Revenue Initiatives

• Federal/Defense:
• Notice of Intent to Award (NOIA) to provide clean power to Eielson AFB under a long-term PPA (June 2025).
• Selected for DOE Reactor Pilot Program (3 projects total across Oklo + Atomic Alchemy); objective includes demonstrating criticality in at least three test reactors by July 4, 2026.
• Commercial/Data centers:
• Non-binding 12 GW Master Power Agreement with Switch (Dec 2024).
• LOIs up to 750 MW with two major data center providers (Nov 2024).
• Strategic alliance with Liberty Energy to deliver integrated power for large loads (July 2025); Vertiv collaboration for power/cooling reference designs (July 2025); RPower phased power model for data centers (Jan 2025).
• Diversified products:
• Atomic Alchemy acquisition (Mar 2025, $25M all-stock) to launch radioisotope business; management expects initial revenue prior to completion of first production reactors.

Latest updates emphasize maturing commercial channels (federal and data centers) with early monetization potential in radioisotopes ahead of first power.

Expense Management & Cash Flow

• Q2 2025 operating loss $28.0M (incl. $11.4M SBC); company reaffirmed full-year cash used in ops $65–$80M.
• Q1 2025 operating loss $17.9M; cash used in ops $12.2M.
• Management may advance modest CapEx into 2025 (fuel supply/fabrication and INL deployment) without changing full-year cash-use guidance.

Interpretation: Operating burn remains controlled relative to cash on hand. Any CapEx pull-forward is being paced against liquidity.

3. Guidance and Future Outlook

Production Ramp–Up

• Project execution:
• Aurora-INL groundbreaking (Sep 22, 2025); Kiewit Nuclear Solutions as lead constructor.
• Two of four DOE authorization steps completed for Aurora Fuel Fabrication Facility (A3F) initial core at INL.
• Licensing acceleration:
• NRC accepted PDC topical report within 15 days; draft evaluation expected early 2026.
• Plan to file Phase One COLA for Aurora-INL early Q4 2025 (per Q2 call).
• Operator licensing topical report under review; product-based licensing supports centralized operations.
• First power: Target late 2027–early 2028 for Aurora-INL.

Expansion Plans

• Fuel Line Pilot Projects (Oct 2025): DOE selected Oklo to build/operate three fuel-fabrication facilities, accelerating domestic advanced fuel supply.
• Advanced Fuel Center, TN: First-phase Fuel Recycling Facility announced; up to $1.68B planned investment; exploring collaboration with TVA; early 2030s initial metal fuel production, pending approvals.
• Transatlantic supply chain: Blykalla partnership (Sep 2025) for technology collaboration and potential component/fuel fabrication services; Oklo to co-lead Blykalla’s A2 round (~$5M commitment).

Operational Targets

• DOE Reactor Pilot Program aims to achieve criticality in ≥3 test reactors by July 4, 2026.
• Centralized multi-plant operations via product-based operator licensing and ABB-enabled monitoring/training center.
• Continued Argonne GAIN testing supports transition from design to production for fuel assemblies (Sep 2025).

4. Strategic Positioning and Initiatives

Cost Management

• Regulatory cost tailwinds: NRC licensing fee reduction (~55%) effective Oct 1, 2025 (ADVANCE Act).
• Execution efficiency: Kiewit MSA to lower cost/schedule risk; centralized operations to reduce O&M overhead; fuel recycling to reduce lifecycle fuel costs and waste volumes.
• Capital pacing: Potential 2025 CapEx pull-forward while maintaining cash burn guidance.

Product Development

• Sodium-cooled fast reactor design (up to 75 MWe units) and proprietary metal fuel supply chain.
• Fuel assembly prototypic flow testing and modeling validation at Argonne.
• Operator licensing framework and PDC topical report to codify repeatable, referenceable design/licensing.

Market Expansion

• Data centers (AI/HPC) via Switch, Vertiv, RPower, Liberty collaborations; federal/DoD through Eielson AFB NOIA and DOE programs.
• Radioisotopes (Atomic Alchemy) and fuel cycle services (Lightbridge collaboration; TN Fuel Recycling Facility).
• International reach via Blykalla and KHNP MOUs.

5. Competitive Positioning and Market Trends

Market Positioning

• Among the few advanced reactor developers with a DOE site use permit and a fuel award (EBR‑II recovered fuel) for the initial core.
• Growing commercial pipeline: management references >14 GW of announced customers/partners.

Competitive Strengths

• Vertically integrated approach: build–own–operate model + fuel recycling + operator licensing efficiencies.
• Regulatory momentum: accelerated NRC reviews and federal policy support (executive orders, ADVANCE Act).
• Customer-aligned solutions for high-reliability, low-carbon baseload with modularity suitable for data centers and defense.

Emerging Industry Trends

• Surging AI/data center loads requiring firm, scalable, carbon-light power.
• U.S. policy prioritizing domestic fuel security and advanced reactor deployment.
• Movement toward fleet-based operations and digitalization of nuclear operations (ABB partnership).

6. Technology and Innovation Strategy

Technological Advancements

• PDC topical report acceptance under accelerated NRC timeline modernizes regulatory underpinnings for future applications.
• Prototypic fuel assembly testing (pressure drop/flow distribution) provides manufacturing parameters for scale-up.

New Product Developments

• Digital monitoring room (ABB) to anchor operator training/simulation; supports product-based licensing and fleet operations.
• Advanced Fuel Center (TN) to produce recycled metal fuel for fast reactors; DOE Fuel Line Pilot Projects add near-term fabrication capacity.

Alignment with Market Needs

• Designs tailored for baseload reliability and modular deployment, meeting AI/data center uptime and sustainability targets.
• Integrated fuel strategy addresses supply-chain bottlenecks and cost containment, critical as advanced reactors commercialize.

7. Risk and Reward Analysis

Growth Catalysts

• Execution milestones: Aurora-INL construction progress; COLA Phase One filing (early Q4 2025); NRC PDC review into 2026.
• Federal tailwinds: DOE Pilot Programs, ADVANCE Act, executive orders (licensing modernization, fuel access, NEPA acceleration, loan programs, bonus depreciation).
• Commercial traction: Conversion of NOIA/LOIs and MPA into binding PPAs; radioisotope revenues prior to first power.
• Vertical fuel build-out: Fuel Recycling Facility (TN) and Fuel Line Pilot Projects improve fuel security and cost visibility.

Downside Risks

• Licensing/permit slippage despite accelerated frameworks; first-of-a-kind (FOAK) construction risk impacting schedule/cost.
• CapEx scale and funding requirements for TN fuel campus (up to $1.68B) and fabrication facilities.
• Supply chain and inflation risks for specialized materials/components.
• PPA conversion risk and potential pricing pressure from power markets over time.
• Policy continuity risk and public acceptance constraints for siting.

Valuation Metrics

• Current state: Pre-revenue, FOAK asset under construction; traditional P/E/EV/EBITDA not yet applicable.
• Practical frameworks:
• Project DCF for Aurora-INL (start late 2027–early 2028), layering a fleet deployment curve and O&M efficiencies from centralized operations.
• Sum-of-the-parts: (i) Power PPAs (federal + data centers), (ii) Radioisotopes (earlier cash flows), (iii) Fuel cycle economics (fabrication/recycling margin capture).
• Capacity-based benchmarks: implied EV per MW vs. pipeline progress (binding vs. non-binding).
• Near-term valuation drivers to monitor:
• Conversion of NOIA/LOIs/MPA into binding PPAs with price/tenor disclosure.
• Confirmation of loan guarantees/tax incentives; cost of capital trajectory.
• CapEx per MWe on FOAK vs. nth-of-a-kind, and schedule adherence.

8. Investment Thesis

Investment Rationale

• Strong policy and regulatory momentum with accelerated NRC processes and DOE pilot program selections.
• Tangible execution via INL groundbreaking, experienced EPC partner (Kiewit), and fuel verticalization (TN facility + DOE Fuel Line awards).
• Large and urgent end-markets (AI/data centers, defense) with diversified early revenue via radioisotopes.

Price Target Justification

• Given pre-revenue status and lack of disclosed PPA pricing, a formal numerical target is not set. However:
• Upward re-rating likely tied to: (i) COLA Phase One filing and NRC docketing; (ii) conversion of major commercial PPAs (Switch/LOIs/Eielson) with disclosed economics; (iii) visible CapEx and schedule adherence at INL; (iv) funded plan for TN fuel phase and DOE Fuel Line facilities.
• Downward pressure if: delays in NRC milestones, slippage in construction, or slower conversion of commercial demand.

Influencing Market Dynamics

• Macro demand from AI/HPC catalyzes long-dated, premium baseload PPAs.
• U.S. energy security policy favors domestic fuel and advanced nuclear deployment, potentially improving financing terms and permitting timelines.

9. Macroeconomic and Industry Trends

Regulatory Changes

• ADVANCE Act and executive orders drive modernization of licensing, NRC fee reductions (~55%) effective Oct 1, 2025, and expansion of federal support (NEPA acceleration, loan programs, tax incentives, bonus depreciation).
• NRC accelerated PDC review timetable reflects institutional shift toward advanced reactor readiness.

Supply Chain Dynamics

• DOE Fuel Line Pilot Projects and Oklo’s TN Fuel Recycling Facility directly address domestic fuel scarcity, enabling scale.
• Cross-border partnerships (Blykalla, KHNP) and industrial alliances (ABB, Vertiv) mitigate component/supply risk and compress timelines.

Technology Adoption Trends

• Rapid growth in AI/data center power demand drives preference for on-site, resilient, low-carbon baseload.
• Movement toward centralized fleet operations and digitalization (operator licensing by design, remote monitoring).
• Rising interest in radioisotopes (projected large market) and high-assay fuels as complementary revenue streams.