SMR Stocks Collapse: What's Next for Oklo & NuScale?

In the past year, small modular reactor (SMR) developers Oklo and NuScale Power have experienced dramatic stock declines, falling by over 80%. Oklo's stock dropped 81.4%, while NuScale's fell 85.8%. Both companies are currently in development stages, with Oklo reporting trailing revenue of $1.21 million and NuScale booking $75,000 last quarter, neither selling commercial power.

The initial optimistic outlook for these companies was built upon several pillars: a U.S.-U.K. partnership for advanced nuclear energy, the promise of reduced NRC licensing timelines to approximately two years, and increased power demand from AI data centers. Despite the U.S. Department of Energy's target of 400 gigawatts of nuclear capacity by 2050, neither NuScale nor Oklo has secured definitive commercial agreements.

Oklo holds approximately $3 billion in cash and securities, with its Aurora INL project targeting a 2028 startup. NuScale possesses $1.90 billion in cash and investments, and its partner ENTRA1 is discussing terms for up to 6 GW with TVA. NuScale's NRC certification, previously seen as a competitive advantage, has not prevented its stock collapse, with revenue dropping significantly after initial work concluded.

Binding contracts are essential for SMR companies like Oklo and NuScale to demonstrate tangible progress and for their stock prices to rebound. Oklo's progress depends on its Idaho isotope lab and the Aurora INL project's successful safety analysis, while NuScale needs a signed TVA power agreement or a final notice to proceed in Romania. Until these crucial contracts are secured, both companies remain speculative investments on future potential.