Key Highlights

  • An agreement with an Investment grade hyperscaler covers 600 megawatts of power capacity.
  • The agreement includes a USD 200 million prepayment arrangement.
  • Cash and cash equivalents were USD 286.3 million at September 30, 2026.
  • The company issued USD 431.25 million of 5.00% convertible senior notes in July.

Fermi (NASDAQ:FRMI) reported third-quarter 2026 results with loss per share of USD 0.22, against an estimate of USD 0.04. The company develops power-focused Data Center sites, and management referred to its Project Matador site in the Texas Panhandle. No Revenue was reported in the period.

On the call, management said it reached an agreement with an investment grade hyperscaler for 600 megawatts of its power capacity. It described the arrangement as a single-customer power deal in which the customer builds its own data centers under a project manager, so the company does not carry that construction Capital requirement.

The Hyperscaler Agreement

Management said the arrangement consists of a USD 200 million prepayment agreement that provides upfront funding for the 600 megawatt development, along with an early construction and site development agreement that sets a framework to start site preparation. It said the structure comes with little or no dilution and described its strategy as investing early to get the site ready.

Management listed five priorities for the near future. They are finalizing a definitive Lease agreement with the hyperscaler, converting other pipeline customers into tenants, protecting Liquidity and matching spending to commitments, advancing financing partnerships and bringing in customer capital, and keeping the site ready to deliver first power next year.

Management also said it had invested more tha USD 1.6 billion in the site, holds air permits for 6 gigawatts and has more than 2 gigawatts of generation equipment secured, with turbines on-site. It said Energy Transfer has committed Natural Gas Supply through on-site pipeline, rated at 450 million cubic feet per day, which management described as sufficient for 2 gigawatts. It said its water strategy uses dry and hybrid closed-loop systems.

A university official reaffirmed that the university remains committed to Project Matador, according to management. Management said its data show Powered Land Plus has cost roughly USD 3.9 million to USD 5.1 million per megawatt of total power capacity to build.

Cash, Notes and Cash Flow

As of September 30, 2026, the company had cash and cash equivalents of USD 286.3 million and restricted cash of USD 29.2 million, a portion of which is available to fund defined capital expenditures. In July 2026, it issued USD 431.25 million aggregate principal amount of 5.00% convertible senior notes due 2031 in a private offering to qualified institutional buyers.

For the nine months ended September 30, 2026, the use of cash primarily reflects a net loss of USD 356.1 million, partly offset by USD 184.5 million of non-cash share-based compensation expense. Other items include a USD 24.8 million loss on extinguishment of the Macquarie term loan, USD 22.0 million of non-cash share-based payments for professional services and a USD 6.9 million write-off of previously capitalized construction in progress. Management also referred to approximately USD 25 million in amendment fees paid to lenders.

Reported Reference Points for the Quarter

In the prior-year period, general and administrative expenses were USD 37.8 million for the three months ended September 30, 2025, including USD 24.8 million of share-based compensation. The filing records operating lease and convertible note accounting items, and notes that all potentially dilutive securities were excluded from the diluted net loss per share computation because of net losses.

The reported items for the quarter are the 600 megawatt hyperscaler agreement, the USD 200 million prepayment arrangement, cash of USD 286.3 million and the convertible notes issuance. The company is listed on the Nasdaq Stock Market.