XE Earnings Call

OperatorHello and welcome to the Xenergy First Quarter 2026 Earnings Conference Call. All participants are in a listen-only mode. After today's prepared remarks, there will be a question and answer session. At that time, I will provide instructions for those wishing to ask a question. Please note that this call is being recorded. I'll now turn the call over to Patricia Gil, Director of Investor Relations for Xenergy. You may now begin.

Patricia GillThank you and good morning, everyone. Welcome to X Energy's first quarter 2026 earnings call. X Energy completed its initial public offering and as of April 24th is listed on the NASDAQ under the ticker XE. We're excited to be with you today for our first earnings call. This morning we released first quarter 2026 financial results and operational highlights for X Energy Reactor Company LLC, the predecessor company to X Energy Inc. Today's presentation and our earnings press release are available on the investor relations portion of X Energy's website at investors.x-energy.com.

Patricia GillOur remarks today will include forward-looking statements, which are based on assumptions as of today and are subject to significant risks and uncertainties. Actual results may differ materially from those set forth in the forward-looking statements. Our SEC filings, including our quarterly report on Form 10-Q, identify certain risk factors and cautionary statements that could cause the company's actual results to differ materially from those projected in our forward-looking statements made this morning. We undertake no obligation to update any forward-looking statements except as required by law. During this call, we also present a non-GAAP financial measure. There is a reconciliation included in our investor presentation. Joining me today are Clay Sell, our CEO, and Daniel Gross, our CFO. Clay will open today's call with an introduction to our company. He will also review highlights for 2026 year-to-date and provide operational updates.

Patricia GillDaniel will then review our financial performance for the first quarter in more detail before turning it back to Clay for closing remarks. We will then open the call up to Q&A. With that, I'll now turn the call over to Clay, and for those of you following along with our presentation, please turn to slide 3.

Clay SellThank you, Patricia, and thank you everyone for joining us today. I'd like to begin by acknowledging this important day for Xenergy as we report our first quarterly earnings results as a public company. On April 24th, we began trading on NASDAQ, and then on April 27th, we closed our IPO. This marked an exciting milestone on our journey to commercialize advanced nuclear technology at scale. We're grateful for the support of our investors, both new and old, and we look forward to partnering with all of you in this next chapter as a publicly traded company. Now, before we dive into updates from the quarter, I'd like to provide a bit of background on who we are and what we do here at Xenergy. We're a leader in advanced nuclear technology committed to addressing the increasing power demands of today and tomorrow. Backed by decades of development and operational experience, We believe that our small modular reactor design and proprietary TRISO-X fuel are well matched to power the needs of AI revolution, industrial electrification, industrial process heat, and growing power demand.

Clay SellOur technology has earned the support and capital commitment of high-quality blue-chip customers and partners like Dow, Amazon, and Centrica. We are advancing the first deployment of our Xe-100 Small Modular Reactor, or SMR, at Dow's Seadrift, Texas, manufacturing facility. We are presently in advanced stages of regulatory review and believe we have a clear and compelling pathway toward approval. Once complete, the project is expected to be among the first grid-scale advanced nuclear power plants in North America and the first to provide industrial steam.

Clay SellAs we scale from first of a kind to nth of a kind, our success will be underpinned by an attractive business model. Our planned approach uses a combination of licensing fees, service fees, and fuel sales to generate a long-term, high-margin revenue stream. Revenue begins in the pre-commercial project planning stage and continues throughout the multi-decade lifetime of a plant. Our recent IPO has enhanced our liquidity profile. Providing approximately $1.1 billion in net proceeds of additional capital for us to continue to work to de-risk our supply chain and move projects forward. We are confident that we have the right team, the right technology, and the right business model to succeed. And we are excited to continue this journey as a publicly traded company. I'll now ask you to turn to Slide 4. We've delivered an impressive first quarter and year-to-date filled with operational, regulatory, and financial progress.

Clay SellOperationally, we reached collaboration frameworks for critical graphite supply and reactor components. We also agreed to explore the deployment of our Xe-100 SMR with subsidiaries of PPL Corporation in Kentucky and with Talen Energy in the PJM market. On the regulatory front, we received our Part 70 commercial fuel fabrication license from the Nuclear Regulatory Commission under an initial 40-year license. This establishes our TX1 and our planned TX2 facilities as the first new commercial fuel fabrication facilities licensed by the NRC in over 50 years. We also received our environmental assessment approval as part of Dow's construction permit application. For their advanced nuclear project in Seadrift, Texas. We are delighted that the NRC's review was completed ahead of schedule following a comprehensive independent analysis concluding with a finding of no significant impact, what you all know as a FONSI.

Clay SellEarlier this week, we announced the submittal of our application to enter the United Kingdom's generic design assessment process for our Xe-100 power plant to advance our commercial partnership with Centrica. This application is subject to acceptance and is intended to establish a regulatory pathway for licensing our new nuclear technologies, evaluating safety, security, safeguards, and environmental impact independent of site-specific applications to enable a future fleet-scale deployment in the UK. Now, these developments, along with our capital raising activities, support our strategic objectives to further secure our supply chain and continue strengthening relationships with our customers to commercialize and scale our technology. Our progress is made possible by our industry-leading technology and differentiated value proposition. I'll offer some background on these next and ask you to turn to slide 5.

Clay SellOur proprietary TRISO-X fuel is underpinned by decades of research and development. Each triso pebble is about the size of a billiard ball and is comprised of approximately 19,000 uranium fuel kernels individually encapsulated in layers of carbon and silicon carbide. Approximately 220,000 pebbles form the core of each Xe-100 reactor providing a more secure and efficient fuel source. The Department of Energy has called TRISO Fuel the most robust nuclear fuel on Earth.

Clay SellOur integrated fuel fabrication business is core to our business model. Once constructed, our first Advanced Nuclear Fuel Fabrication Facility in Oak Ridge, Tennessee, called TX-1, is expected to be North America's first purpose-built commercial advanced nuclear fuel fabrication facility. It is being built with a 50/50 cost share in partnership with the U.S. Department of Energy, helping to reduce the overall project risk. Fuel from the facility is expected to power our initial fleet of Xe-100 reactors. Now, turning to slide 6. The construction of TX-1 continues to progress. Full vertical construction began last September and is approximately 56% complete today. We expect to begin building out the interior in the third quarter of this year. And anticipate operations to commence by the first half of 2028. In addition to our TX-1 facility, we are simultaneously in the design stage for our second facility, TX-2, which will be located on the same site.

Clay SellWith the commercialization of TRISO-X fuel using our own manufacturing infrastructure, We are establishing a strong foundation for our integrated fuel fabrication business.

Clay SellMoving now to slide 7. Our Xe-100 SMR is a fourth-generation, high-temperature, gas-cooled nuclear reactor. It is designed to offer benefits over other technologies, including intrinsic safety features, a streamlined and scalable modular design, and the ability to provide both electricity and high temperature steam along with load following capabilities. With the Xe-100, we're unlocking a new range of applications for advanced nuclear, from powering data centers to providing steam for manufacturing. We are focused on advancing the initial deployment of our Xe-100 power plant in partnership with Dow. In parallel, we are moving forward with projects for subsequent Xe-100 deployments through partnerships with Amazon and Centrica. These projects make up our 11-gigawatt-plus commercial pipeline. Turning now to slide 8. I'd like to walk you through the licensing process for the Dow project. Last spring, we and Dow worked to file the construction permit application for this initial deployment of our reactors.

Clay SellThis application has two components: a safety review and an environmental review. The NRC has completed its draft safety evaluation report. And we are on track for the next safety review milestone to be completed by August of this year. Regarding the environmental review, the NRC completed its environmental assessment ahead of schedule, concluding with a finding of no significant impact, establishing an efficient process we expect to replicate for future projects. This project is expected to provide both electricity and high-temperature industrial steam to Dow's Seadrift operations, demonstrating the range of applications our technologies can address. It is expected to be the first grid-scale advanced nuclear reactor deployed to serve an industrial site in North America. We are committed to continuing to closely collaborate with the NRC and Dow to keep this project on schedule, and we expect final review of our construction permit to be complete in the fourth quarter of 2026, with issuance by the first quarter 2027.

Clay SellI'd like to now turn it over to Daniel Gross, our CFO, to discuss our financial results for the quarter in more detail.

Daniel GrossThank you, Clay. Let's turn to page 9. As this is our first earnings call since the IPO, I'd like to offer a little background on our primary source of revenue and grant income at the current stage of our development. In 2021, Xenergy was awarded $1.2 billion under the U.S. Department of Energy's Advanced Reactor Demonstration Program, or the ARDP. This program was created to accelerate the demonstration and deployment of advanced nuclear reactor technologies, and it provides us with a 50/50 public-private cost-sharing partnership for 3 things. First, finalizing and licensing our first Xe-100 design. Second, building our TX-1 fuel fabrication facility in Oak Ridge, Tennessee. And third, executing our first project with Dow in Seadrift, Texas.

Daniel GrossUnder ARDP, we've been reimbursed $508 million of federal cost share as of March 31st, 2026. Our current budget period under ARDP runs from March of 2025 through August of 2026. So in these months leading up to August, our team is working in close partnership with the Department of Energy to jointly develop a strategy for either a budget period extension or a continuation to the next scope of work. Here's how the accounting for ARDP works. On our income statement, cost reimbursements related to finalizing and licensing our first Xe-100 design are recognized as revenue, and cost reimbursements related to the Dow project are recognized as grant income. For TX1, we capitalize the construction costs as plant property and equipment, and we net out the associated ARDP cost reimbursements against our capital expenditures.

Daniel GrossBefore I walk you through our financials for Q1 of 2026, let me offer a quick note on our legal structure. We completed our IPO on April 27th, and prior to the IPO, our business operated as X-Energy Reactor Company LLC. And what you see reflected in the 10-Q are the financial statements of that entity. To facilitate the IPO, we created X-Energy Inc. as the parent holding company and the sole managing member of X-Energy Reactor Company, LLC. X-Energy Inc. is the company that's listed on NASDAQ under the ticker XE, and going forward, X-Energy Reactor Company's financials will be consolidated into X-Energy Inc. But because the IPO happened in April after the end of Q1, our financials as of March 31st show results for the predecessor entity and its consolidated subsidiaries. With that context, here are the numbers. In Q1 of 2026, total revenues and grant income came in at $43.4 million. That's comprised of $39.9 million of services revenue, uh, associated primarily with the Xe-100 design activities under ARDP, and $3.5 million of grant income associated with Dow's demonstration reactor under ARDP.

Daniel GrossCompared to Q1 of 2025, total revenues and grant income were up 109%. That increase was driven largely by higher services revenue from ARDP as we ramped up activity. Total operating expenses in Q1 of 2026 were $109.5 million. Which includes $65.4 million of direct costs and $44.1 million of selling, general, and administrative expenses, SG&A. Our total operating expenses increased 133% compared to Q1 of 2025, and this is primarily due to an increase in activity under the ARDP agreement, along with growth in employee headcount, contractor costs, and professional fees.

Daniel GrossIn Q1, the line called total other income expense net totaled $100.1 million and included a non-cash mark-to-market loss of $108.9 million due to the exercise of a warrant that was issued in 2024 to one of our investors. Under US GAAP, we remeasured the warrant liability to fair value prior to its exercise, which resulted in this mark-to-market loss during the first quarter.

Daniel GrossTurning to cash flow, net cash used in operating activities in Q1 of 2026 was $67.3 million, up 61% from Q1 of 2025. That increase reflects higher ARDP activity, corporate headcount growth and an increase in enterprise software costs and corporate contractors. Net cash used in investing activities in Q1 of 2026 was $166.0 million, and that was primarily driven by the purchase of $189.9 million of investment securities. These are essentially cash reserves held in fixed income securities that mature in more than 3 months. Net cash used in investing activities also included $43 million of capital expenditures, which was offset by $28.8 million of ARDP reimbursements for construction of facilities, including TX1.

Daniel GrossTurning to slide 10, I'd like to walk you through our capital structure and balance sheet. As of March 31, 2026, our total liquidity was $944 million. This was comprised of $224 million of cash and cash equivalents, $450 million of short-term investments, and $270 million of long-term investments. At the end of Q1, we had zero debt outstanding. As you know, we completed our initial public offering in late April, meaning that it was a subsequent event for Q1 financials. We issued and sold 50.9 million shares of our Class A common stock at an offering price of $23 per share. And this includes the exercise of the underwriters' overallotment option, oftentimes called the green shoe. Net proceeds of the IPO were approximately $1.1 billion, and this significantly strengthened our balance sheet and increased our total liquidity adjusted for IPO proceeds to approximately $2 billion. With that, I'll turn it back over to you, Clay.

Clay SellThank you, Daniel. Please turn to slide 11. We recognize that our projects are long-dated in nature and will take years to come online. Here we provide you with a roadmap of our project workstreams that extend into the early 2030s so that you can follow along with us on our progress. You will be noticing announcements from us from time to time as we progress through design, testing, regulation, procurement, construction, and other necessary steps required for project development. This illustrative logic will allow you to track how we plan to de-risk these projects and advance across the many milestones required to reach commercial operation dates. On slide 12, we've provided a snapshot of key near-term milestones that we are focused on delivering over the next 18 months. You'll note that we've already achieved important milestones this year for our TX1 commercial fuel license and Dow's Seadrift project, as I mentioned earlier.

Clay SellOur next near-term milestones for you to follow relate to construction progress on our TX1 fuel facility, Dow construction permit issuances, and Energy Northwest's construction permit application. And as we look to further scale and build our commercial pipeline, we also expect to announce our next 1-gigawatt project sometime in 2026. We're building a project pipeline that we're proud of, and it makes clear our strong role in the future of nuclear we're seeing today. Moving to slide 13, we believe that Xenergy offers a compelling value proposition. Our industry-leading technology is elegantly designed with intrinsic safety features and offers reliable, clean baseload energy to serve an unmatched range of applications. Our business model is differentiated in that we already have capital commitments from a solid base of customers and partners, along with cost-share support from the U.S. government.

Clay SellAnd our market positioning puts us in an excellent spot to meet growing power demand from AI data centers and industrial manufacturing. In closing, We're grateful for the dedication of our talented X-Energy employees and will continue to work hand in hand with the Department of Energy, regulatory agencies, and with partners to advance the commercialization of our technology at scale. And with that, we will now take your questions.

OperatorThank you. At this time, we will be conducting a question and answer session. To ask a question, please press star 1 on your telephone and wait for your name to be announced. To withdraw your question, please press star 1 again. Please stand by while we poll for questions.

OperatorYour first question today is from Marc Bianchi with TD Cowen. Your line is now open.

Marc BianchiHey, thanks very much and congrats on becoming public. I guess the first one I had was on the next 1-gigawatt project. The first one is just a clarification here on, on slide 12, site identified and JDA signed. That's your criteria for having something be a next gigawatt project. Is that correct? Or are you saying that you actually have a site and there is a JDA? You just haven't announced that yet.

Clay SellThe criteria for announcing this, Marc, is exactly as you said. Once we have the site identified, an agreement to develop the project in place with our customer, that's when we consider it in addition to our commercial pipeline. Yeah, great.

Marc BianchiThanks, Clay. And then, you know, related to that, we've got Talen and PPL that you've announced some discussions with more recently here. And is it more likely that it comes out of those, or are there, you know, several other discussions that are ongoing that you just haven't publicly shared, and if there's any way to provide more color on what that pipeline looks like, I'd be interested.

Clay SellYeah, happy to do it. As you know, we have a number of conversations, you know, well underway. We, for a set of reasons related, you know, for just, you know, some reasons between us and Talen and us and PPL, we decided to make early announcements, as on the front end of the site feasibility determining process with Talen and PPL. But with other customers, you know, we, we've made no public announcements. And I think the key thing for you to look for is when we come up and we will tell you, here's the site, here's the customer, we're in a joint development agreement. And quite frankly, we will clarify with you at that time hey, this is part of the Amazon pipeline or this is incremental and new pipeline that we're adding.

Marc BianchiOkay, that's great. Thanks, Clay. And then maybe one for Daniel on the financial performance in 1Q and sort of the expectation going forward. If I look at, you know, cash from operations is a use of about $67 million, and then if I take kind of the net of CapEx and grant reimbursements, it's another $14 million used, so kind of $80 million overall in the quarter. Is that sort of the quarterly cash use run rate, or how should we be thinking about that as we progress through '26 and beyond?

Daniel GrossYeah, I don't think it would be appropriate, Marc, for you to just take that trajectory or that slope for Q1 and straight-line it over the year. We are accelerating our construction activities. And we are onboarding additional headcount, particularly on the engineering side, to complete the design work. So I would not straight-line that. That said, we're not providing forward-looking guidance on exactly where those expenses will be in Q2.

Marc BianchiGot it. Thanks very much. I'll turn it back.

OperatorThank you. Our next question comes from the line of Jeremy Tonet with JPMorgan. Your line is now open.

Jeremy TonetHi, good morning.

Clay SellHi, Jeremy.

Jeremy TonetHi, I just wanted to build on the customer conversation a bit here. I was wondering if you could talk a bit more on the types of customers you're having these conversations with, where you see more interest, be it utilities, industrials, what are you in? What are some of the key elements that focus that they, you know, think about X-energy versus other, you know, competing technologies or even other SMRs? Just wondering if you could provide a little bit more color on that.

Clay SellYeah, it is hyperscaler-driven conversations, IPP-driven conversations to support Amazon or others. It is utility-driven conversations, and it is industrial heat-driven conversations. Today, largely in the three markets of our initial focus— U.S., Canada, and the UK— but, you know, there is certainly interest beyond that, but our focus today is on the near-term possibilities of the ilk I've just described in our three initial markets.

Jeremy TonetGot it. That makes sense. And I guess in these conversations, how do you frame the value proposition as it relates to where LCOE could fall out or otherwise? Just wondering if you could talk a bit about that. Granted, we're, you know, early here, but just any flavor on color you could provide.

Clay SellWell, you know, this really goes to how we determine the you know, the quality of our sponsors. As you know, in our business model, we are in the business of selling our technology, selling fuel, and selling associated services to a project sponsor that has the capability, the balance sheet, the need, and the expertise to bring these projects to fruition. And so, like, having sponsors of that quality is, is, you know, a key metric, but it's also really derivative of the markets in which they need the power and ensuring that the, the market has the industrial logic to support, you know, our first of a kind or early of a kind projects. You know, for example, in the Bonneville power market where we're building our second project with Energy Northwest and Amazon, that is to support a data center load in northern Oregon that is, you know, when you look at the forward projections for power prices in that region are on the high side vis-à-vis other regions in the United States.

Clay SellAnd so that's a— that can give you some level of guidance as to where our first projects will come in. And we fully anticipate that as we move down the cost curve and build more projects, our technology will be widely and economically attractive in other lower-cost markets around the country.

Jeremy TonetGot it. That makes sense. That's helpful. Thank you.

OperatorThank you. Our next question comes from the line of David Arcaro with Morgan Stanley. Your line is now open.

David ArcaroHey, thanks so much. Good morning and congratulations on the first quarter being public here. You know, going back maybe to the— your comments about the next 1-gigawatt project, I was just wondering what gives you the confidence that you can get that next one over the finish line for this year. You know, is this a single potential counterparty that seems to be, you know, very advanced with you in terms of discussions such that you could finalize that this year, or is it, you know, when you look at the pipeline, you've got a number of opportunities and you see the potential for one to filter up to the top this year?

Clay SellDavid, I'm not looking to make one single shot on goal and hit it. We've got multiple, multiple conversations underway. And we're confident at least one of those we'll be able to announce by the end of the year. I mean, you can really think of it in terms of a, of a business development funneling process so that we ensure our resources are going to the most credible, viable project that we can have confidence will, will get to the start line so it can get to the finish line.

David ArcaroExcellent. I got you. That's helpful. Um, and I was wondering if you could give an update on the Energy Northwest project and the timeline from here. It looked like the submission of the construction permit may have shifted. I wanted to check on that and just what the overall timeline looks like now relative to your expectations.

Clay SellSo Energy Northwest, we're largely in doing site engineering and preparation work to support the construction permit application. You know, it is our fast follower project. We did—. We are now indicating that the application will go in in the first half of '27. I should emphasize to you that is not within our control at Xenergy. You know, in our business model, it's under the control of our customers, in this case, Energy Northwest.

Clay SellBut certainly the work that we are doing will, will support, that, that submission. The final thing I want to emphasize is regulatory is not on the critical path for our projects. So the fact that it is a, that we're following it in the first half of '27 versus fourth quarter of '26 is, is, is not gonna impact the overall schedule. One thing, that I think we will benefit from. As we've guided to, we do expect to have a final construction permit issuance from the NRC in the first quarter of '27 on our first Dow project. So being able to incorporate all of the learnings from the NRC from that first Dow construction permit application and ensure those learnings are incorporated into the Energy Northwest application will give us and it will give our customer greater confidence that they can execute on an increasingly shorter regulatory review timeline.

David ArcaroYeah, absolutely. Okay, great. Thank you for that context. Very helpful.

OperatorThank you. Our next question comes from the line of Paul Zimbardo with Jefferies. Your line is now open.

Paul ZimbardoHi, good morning, team. Thank you very much.

Paul ZimbardoFirst, just to clarify—. Hi, good morning, good morning. To clarify, apologies, it wasn't crystal clear to me that the 1-gigawatt announcement you expect in 2026, is that part of the 11.5-gigawatt pipeline, or would that be incremental to that pipeline?

Clay SellWe will— when we announce projects and add them to the pipeline, we will be clear, Paul, on this is, this is part of the Amazon, uh, 5 gigawatts, or it is incremental, uh, to that. So we'll, we'll make that clear when we announce the projects.

Paul ZimbardoOkay, great. Now that, that is clear. Thank you. And then, uh, I want to touch on the UK and, and kind of two parts to it. You know, what's the regulatory path for Centrica approval we should be monitoring And just broadly, are there other UK opportunities beyond Centrica that we should be monitoring as well? Thank you.

Clay SellOkay, so, um, here's what is happening on Centrica. The UK government has announced an alternative route to the market process. They announced that in February this year, and Centrica and X-energy together put in our proposal to the government in March. I think we were the first one, uh, I know we were the first one, and I don't know if anyone has followed us into that process. We have received extraordinary level of encouragement and support, uh, from the highest levels of the UK government. So we are now in that process, and the goal of this process is for the UK government to identify the levels of support that will be appropriate and required to see this project come to fruition. And, and those discussions are underway, and when we get to a conclusion of that, we will make an announcement as to what the approach of the UK government is going to be, going to be in terms of supporting our project pre-FID and supporting the construction financing of the project.

Clay SellSo that's, that's one aspect of it as it relates to the ultimate financing of the projects. The second aspect relates to the regulatory approval. And as you saw this week, we filed, we initiated Phase 1 of the General Design approval process at the Office for Nuclear Regulation in the UK. So you can think of this as the beginning of a Part 52-like process to certify the design, but it's in 3 phases. And the first phase will complete in the next, you know, some time by the end of the year. And then we'll move into the subsequent phases that will further allow the regulator to get comfortable with our technology so that it can be licensed in the UK. We'll have an opportunity to pivot out of that process to either stay and do a full general design approval or pivot to a site-specific license approach, you know, over the course of the next couple of years. And so the important thing is, is that we are getting this process initiated, getting the regulator comfortable, and we'll have full optionality with our sponsor Centrica as to the exact licensing approach we want to take.

Clay SellFinally, I'll note we have been engaged with the regulator in the UK for the last couple of years in terms of early educational efforts, and so We start from a good place. And as you know, we remain highly enthusiastic about the unique opportunity that we have with such a stellar partner in Centrica to build a substantial fleet of reactors in what is, you know, honestly, a high-priced power market that needs this solution.

Paul ZimbardoIndeed. No, thank you for the comprehensive answers. Again, congrats on the IPO and good luck.

OperatorThank you. Thanks, Paul. Our next question comes from the line of Michael Sullivan with Wolfe Research. Your line is now open.

Michael SullivanHey, good morning. Congrats on the first call.

Michael SullivanUm, I was just maybe to start just on the, on the licensing, um, and approval side of things. Curious your thoughts on the, the Part 57 that the NRC recently introduced and if that could be relevant to you all and the potential implications.

Clay SellThanks, Michael. Maybe. We're evaluating that. It's still early days, but maybe. I have—. I'll tell you, I've been around the NRC for a long time, and I have—. I've never harbored as much enthusiasm possibilities of what is happening as I do today. I've been telling investors for some time, you know, this is, this is not the same NRC that you looked at 10 years ago. It's a very different. And so I think the opportunities to get these new technologies to the marketplace in an appropriate level of time with an appropriate level of regulation to ensure public health and safety. Is a, a really, really exciting opportunity. So we, we love, you know, the Part 53 initiative, the Part 57 initiative. We're, we're evaluating all of those, but I'll tell you, we're very comfortable also with the reformed, the highly reformed Part 50 process that we're executing against now. So, You know, good, good things are happening at the NRC.

Clay SellThis administration deserves a lot of credit for making them happen.

Michael SullivanOkay, great. Yeah, no, very helpful. And maybe just like on the supply chain fuel side, you know, it's good to see you got the commercial fuel license earlier this year. Can you give us any sense of, you know, where else in the supply chain you're looking to invest with some of the cash you have? And then just more broadly, like for the industry, how you're thinking about domestic, uh, HALEU production, uh, ramping?

Clay SellYeah, you know, the, the other areas— I mean, you can look at some of the previous announcements that we've made as it relates to the large steel forgings and the graphite lining of our reactor core. Those we, we've already made announcements, uh, we're continuing to ensure that we have, you know, that we have appropriate access to the capacity that our customer—. Customers will need to scale. And, and so that's, that's really an important part of our strategy going forward. And, and you should expect to see additional announcements from us as to what we are doing to secure aspects of the supply chain. Now, specifically on HALEU, Uh, I, I'll, I'll just, uh, remind the listeners, we've secured the first core of material from the Department of Energy for our first project at Dow. So first core for the first 4 units at Dow has been secured through a commitment with the Department of Energy for 7.6 tons of material.

Clay SellThe first 4 of that has been specifically identified to us The remaining 3.5 will be identified, you know, in the coming months. We are also in— we are engaged with enrichers in the UK and in the US as to how we can ensure that our future customers have access to the enrichment capabilities that will be required to fuel their reactors. I am, you know, I have a good degree of confidence that the enrichment supplies from Urenco, General Matter, from Centrus, you know, will be available to the marketplace in the early 2030s when we'll need it for our subsequent cores and our new projects.

Michael SullivanVery, very helpful. Thanks so much.

OperatorThank you. As a reminder, to ask a question at this time, please press star 1-1 on your touchtone telephone. Our next question comes from the line of Derek Soderberg with Cantor Fitzgerald. Your line is now open.

Derek SoderbergYeah. Hey, guys. Thanks for taking the questions. I'm curious on the fuel side, you know, how many reactors does TX1 support at steady state? Is it roughly a dozen or so? And then I'm wondering if projects sort of convert faster, when might you guys sort of move forward with the construction of TX2?

Clay SellThe answer to your first question is yes. It's— we say 11 reactors at steady state. You said approximately a dozen, so we'll call it even. We are— Derek, as I'll remind you, when we got our license, our fuel handling license for TX1, it also included our expansion facility TX2. And our expansion facility is 4 times the capacity of our first facility, so you can deduce that that would take us up to 55 reactors steady-state support from the full build-out of our facility in Oak Ridge. That facility is in the planning and design phases. So that we will be in a position to commence construction on that so that it will be available for our customers when we need it. And that's been our plan all along.

Derek SoderbergGot it. Got it. And then just on financing some of these new projects and financing projects going forward, will you guys take on any balance sheet risk or development risk, or is the plan really still to keep that exposure strictly to the technology and fuel layers? Thanks.

Daniel GrossYeah, our, our business model is for our customers to be taking on the balance sheet risk associated with the construction of X-Energy-related power plants. X-Energy's balance sheet exposure is limited to our fuel manufacturing facilities, TX1 and TX2, that you inquired about. And then the testing facilities that we are constructing prior to putting in service our first reactor in Seadrift, Texas.

Derek SoderbergPerfect. That's helpful. Thanks, guys.

Clay SellSure.

OperatorThank you. And I'm currently showing no further questions at this time. I'd now like to hand the call back over to Clay Sell for closing remarks.

Clay SellWell, I really appreciate everyone joining us today.

Clay SellWe're happy to be at this stage in our company's life. I enjoyed taking the questions. I hope you found the presentation useful. And we really look forward to sharing news and updates in the coming quarters, and we'll keep this show going. Thank you very much for participating with us today.

OperatorThis concludes today's conference. Thank you for your participation. You may now disconnect.