Key Takeaways:
The surge in AI data-center power demand is redirecting investor attention from SpaceX's blockbuster IPO to the nuclear energy stocks that could fuel the next phase of compute growth.
SpaceX's initial public offering, which sent shares up 6% on its first day of trading, has drawn fresh scrutiny to the company's prospectus claim that it has identified a $28.5 trillion total addressable market, more than 90% of which hinges on artificial intelligence. The catch, as SpaceX itself warned in its IPO filing, is that "energy supply is constrained globally due to the significant increase in demand for, and limited availability of, energy to power AI compute." That constraint is pushing investors toward small modular reactor developers Oklo and NuScale Power as potential beneficiaries of the AI infrastructure build-out.
"The economics of SMRs are a bit complex," Bank of America analysts wrote in a recent report, noting that "when compared to traditional, large-scale NPPs, SMRs require less land, shorter construction periods, and have enhanced safety features." The bank said advancements in SMR technology "could likely reshape nuclear power supply chains over the next decade."
Oklo, backed by OpenAI Chief Executive Officer Sam Altman, is targeting data center operators directly with its reactor designs, while NuScale is focused on grid-scale deployments through partnerships with electric utilities. Neither company has commercialized a single SMR system, though both maintain pipelines of prospective customers. The challenge is that SMR demonstration projects have faced cost overruns and delays, and renewable energy sources like solar and wind are becoming increasingly cost-competitive, potentially undercutting the economic case for small nuclear reactors.
Why AI needs nuclear power
The scale of the energy problem is difficult to overstate. AI data centers consume vastly more electricity than traditional computing facilities, and the pace of deployment is accelerating. Alphabet, Google's parent company, is already involved in the construction and rehabilitation of several nuclear energy sites, signaling that big tech sees atomic power as a viable solution for baseload generation without additional carbon emissions.
Conventional nuclear power plants, however, take a decade or more to build — far too slow to keep pace with AI's energy demands. SMRs, typically defined as reactors under 300 megawatts electric that can be factory-built and assembled on site, offer a faster alternative. HALEU, or high-assay low-enriched uranium — enriched to 19.75 percent compared with 3 percent to 5 percent for conventional reactor fuel — is the fuel type most SMR designs require, adding another layer of supply chain complexity.
The investment case and its risks
Oklo shares rose 2.6 percent and NuScale gained 0.64 percent in recent trading as the SpaceX IPO narrative broadened into a wider conversation about AI infrastructure. Both stocks remain highly speculative. NuScale trades on the promise of utility-scale deployments that have yet to materialize, while Oklo's direct-to-data-center model depends on winning contracts from hyperscale operators that have historically preferred to build their own power solutions.
For investors, the bull case rests on a simple premise: AI compute demand is growing faster than the grid can supply, and SMRs represent one of the few scalable, carbon-free baseload power sources that can be deployed on a timeline measured in years rather than decades. The bear case is equally straightforward — neither Oklo nor NuScale has proven its technology at commercial scale, and the cost trajectory of renewables continues to improve, narrowing the window for nuclear to compete on price.
SpaceX's own long-term solution — orbital data centers powered by solar energy — remains years away from commercialization, if it ever arrives. In the meantime, the terrestrial energy demands of AI will need to be met by whatever technology can deliver, and SMR developers are positioning themselves as the answer. Whether the market agrees will depend on whether these companies can move from pipeline to production before the window of opportunity closes.
This article is for informational purposes only and does not constitute investment advice.
