Shares of Fermi (FRMI +21.09%) rose sharply on Tuesday after the developer of next-generation private electric grids signed the first lease for its Project Matador campus in Texas.
Image source: Getty Images.
Project Matador is progressing
Fermi signed a 15-year lease with artificial intelligence (AI) infrastructure provider TensorWave, valued at roughly $6.5 billion.
Fermi is constructing a facility supported by 222 megawatts (MW) of power. The lease includes expansion rights for two more data centers, which could increase that figure to over 650 MW.
"A lease of this size and this term is a tremendous vote of confidence in Fermi," board chair Marius Haas said.
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Key Data Points
The site is intended to house "tens of thousands" of high-performance graphics processing units (GPUs) designed by Advanced Micro Devices for AI model training and inference workloads.
"Our customers need hundreds of thousands of next-generation AMD Instinct GPUs in aggregate, on timelines they can count on," TensorWave CEO Darrick Horton said. "Fermi has assembled the power, land, and permits to deliver at that pace, and we are proud to be the first customer at a campus built for the decades ahead."
The phased delivery plan is slated to begin in the second half of 2027.
Energy is the key
Reliable and cost-effective power has emerged as the major constraint in the AI race. Fermi's Project Matador is specifically designed to address this challenge.
Construction at the massive data center project is advancing quickly, supported by more than $1.5 billion in investments and with 6 gigawatts (GW) of capacity already permitted.
This gives Fermi an edge over slower-moving rivals, many of whom are facing political pushback and regulatory delays as homeowner opposition mounts.
