Artificial intelligence (AI) is emerging as a once-in-a-civilization technology. Indeed, if progress keeps compounding, the last 50 years of internet innovation may seem as quaint as black-and-white films do today.
Note the conditional "if" above. AI has made mind-boggling leaps in the last half-decade, but several obstacles remain. One of the most pressing is power. Data centers, as the backbone of AI compute, consume enormous amounts of electricity, and current power generation simply wasn't engineered to meet their demands.
What's needed is a new source of energy, one that can provide continuous power without needing the sun or wind. And that, in a nutshell, is the mega-idea NuScale Power (SMR 2.22%) is trying to sell.
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A small reactor with big applications
NuScale Power is an advanced nuclear company aiming to build small modular reactor (SMR) power plants for governments, utilities, and data centers.
NYSE: SMR
Key Data Points
Unlike large conventional nuclear plants, which are big and can take a decade or longer to build, SMR plants are designed to be smaller and factory-built, which can theoretically lower upfront costs and assembly time. A single NuScale plant can be configured to fit four, six, or 12 modules, which makes it easier for customers to match power generation capacity to actual needs.
Although NuScale isn't a sole player in the nascent SMR market, it is currently the only one with a reactor design approved by the U.S. Nuclear Regulatory Commission (NRC). That gives it a first-mover advantage in a regulatory process known for taking its time.
NuScale stock is up about 37% in the brand-new year, helped by the Trump administration's recent award of $2.7 billion to three uranium enrichment companies. NuScale wasn't one of the recipients, but the announcement boosted sentiment across the nuclear sector.
NuScale stock trades at about 50 times sales, so it's not cheap. It also hasn't built an SMR power plant yet, so meaningful revenue is lacking.
If you're hunting a millionaire maker, NuScale is a high-risk bet: massive upside if deployments happen, but disappointment if success is delayed.
