Centrus Energy Corp. (LEU) | The Buildout — AI Infrastructure
The Verdict
Centrus Energy is a U.S. supplier of nuclear fuel components and enrichment services. It sells separative work units, uranium, and enriched uranium product to utilities, and it is building domestic capacity to make HALEU, a fuel that advanced reactor designs need. The company is not an AI company and sells nothing that sits inside a data center; its role in the buildout is to supply fuel to the reactors that AI-driven electricity demand is helping revive.
| Market Cap | — |
| Revenue (TTM) | $474M |
| Revenue Growth | +8.5% |
| EBITDA Margin (TTM) | 3.6% |
| Net Cash | $691M |
| Earnings Beats | 4 of 7 |
| P/E (TTM) | — |
| EV/EBITDA (TTM) | — |
What We Like
- Backlog of $4.5B through 2040 — $3.7B LEU and $0.8B Technical Solutions — grew about $600M in the quarter on LEU and HALEU enrichment sales.
- The $900M DOE task order was signed July 1, 2026, with options at DOE's discretion for up to $170M.
- Unrestricted cash of $1,868.5M and total debt of $1,177.5M at June 30, 2026 — a net cash position of about $691M.
- HALEU offtakes are in place: a definitive X-energy agreement, an Oklo letter of intent, and multi-year contracts with Radiant and Antares, all structured with prepayments.
- Critical suppliers are about 75% contracted, up from roughly one-third in the prior quarter, against a 100% target for 2026.
What We’re Watching
- GAAP net income fell year over year in both 2026 quarters ($10.0M vs $27.2M; $16.8M vs $28.9M), and management says advanced technology costs will keep flowing through the income statement.
- Well over one-half of the LEU Centrus expects to deliver through 2027 was sourced under the TENEX Supply Contract, and the company says its other sources are not sufficient to replace it.
- Of the $3.0B contingent LEU and HALEU enrichment backlog, $2.4B is under definitive agreements; the Oklo arrangement is still a letter of intent.
- The $500M equity-and-warrants offering priced September 9, 2026 sits after the Q2 call, and management has given no 2027 guidance.
The thesis is mixed. The contracted-demand side is strengthening — backlog is growing, the DOE task order is signed, and the financing contingency on more than $3B of customer contracts has been met — while the reported-results side is weakening, with GAAP net income down year over year in both 2026 quarters and free cash flow negative as capital spending ramps. Execution milestones the company controls, such as HALEU production and supplier contracting, have tracked or beaten. The open question is whether the newest backlog converts at attractive economics, since pricing, delivery cadence, and take-or-pay terms are undisclosed.
Earnings Beat
Q2 2026 revenue was $176.1M, up 14% year over year. Gross profit fell to $49.9M from $53.9M, and GAAP net income fell to $16.8M from $28.9M. The quarter included $53.4M of uranium sales, which management calls opportunistic, and the company said it has met the financing contingency on more than $3B of customer contracts and removed all financial contingencies from the contingent LEU enrichment backlog.
| Metric | Q2 FY2026 | Q1 FY2026 | Q2 FY2025 | YoY |
|---|---|---|---|---|
| Revenue | $176M | $77M | $154M | +14.0% |
| Gross margin | 28.3% | 38.7% | 34.9% | -660bps |
| EBITDA | $13M | $3M | $37M | −64.4% |
| EPS | $0.77 | $0.45 | $1.60 | −52.0% |
| Backlog | $4.5B | $3.9B | n/a | — |
we plan to have our first centrifuge completed at our Oak Ridge facility sometime in 2026, an important accomplishment and milestone that demonstrates that our supply chain has come together.— Vexler, CEO, 2026-08-06
Management tone: Management stayed confident on HALEU and non-transparent on contract economics. Between the Q1 and Q2 2026 calls, they moved the HALEU line from a strategic option to contracted commercial agreements, put a first-centrifuge milestone back on the calendar for 2026, and raised Piketon hiring guidance for a second consecutive quarter. They declined to guide 2027 capital spend or fully ramped earnings power, and repeatedly cited NDAs when asked about pricing and delivery terms. The Q2 prepared remarks did not mention AI or hyperscalers.
Management Guidance
Management reaffirmed FY2026 revenue of $450–500M, having raised it from $425–475M at Q1, and held FY2026 capital spend at $350–500M with the pace expected to accelerate through the year. Operating commitments for 2026 include finalizing contracts with 100% of critical build-out partners, releasing a Certified for Construction package, at least 100 net new hires at Oak Ridge, and more than 175 net new hires at Piketon. Management declined to guide 2027 capital spend or fully ramped LEU and HALEU earnings power, and does not provide quarterly revenue guidance.
Trajectory
The audited series shows a lumpy, mix-driven revenue base. Trailing-twelve-month revenue is $473.9M, and the latest quarter's 14% growth came with $53.4M of uranium sales — opportunistic volume that lifted LEU cost of sales 36%. Gross profit fell year over year to $49.9M from $53.9M, and the code's trajectory signals show revenue decelerating with operating and EBITDA margins compressing. The compression runs through below-the-line build-out costs: $10.6M of advanced technology costs and $17.7M of stock-based compensation in the quarter. TTM EBITDA is $17.0M, or 3.6% of revenue, and TTM free cash flow is negative $222.1M as capital spending ramps.
The Model
The model projects FY+1 revenue of $480M and EBITDA of $33M (6.8%), rising to FY+2 revenue of $530M and EBITDA of $43M (8.1%). FY+1 sits near the company's FY2026 revenue guide of $450–500M and the $473.9M trailing-twelve-month base. The step-up assumes the contracted backlog converts as the Piketon build-out and HALEU offtakes move toward the 2029 commercial-production target; commercial HALEU deliveries are not expected until around 2029, beyond the projection window.
| Metric | FY2025 | Next FY (E) | Following FY (E) |
|---|---|---|---|
| Revenue | $449M | $480M | $530M |
| YoY Growth | — | +7.0% | +10.4% |
| EBITDA | $60M | $33M | $43M |
| EBITDA Margin | 13.4% | 6.8% | 8.1% |
Projections are the median of 5 independent model runs. The model’s revenue sits 13.2% above analyst consensus.
Management reaffirmed FY2026 revenue of $450–500M, having raised it from $425–475M at Q1, and held FY2026 capital spend at $350–500M with the pace expected to accelerate through the year. Operating commitments for 2026 include finalizing contracts with 100% of critical build-out partners, releasing a Certified for Construction package, at least 100 net new hires at Oak Ridge, and more than 175 net new hires at Piketon. Management declined to guide 2027 capital spend or fully ramped LEU and HALEU earnings power, and does not provide quarterly revenue guidance.
What Could Go Right — and Wrong
- The Oklo letter of intent converts to a definitive contract with disclosed volume, schedule, and prepayment terms.
- NNSA makes its sole-source award, converting the national-security position into funded backlog.
- The wait-and-see utility cohort signs dated LEU contracts for future periods.
- The first centrifuge completes on the 2026 target and the Piketon cascade stays on the 2029 goal.
- Updated cost-out figures from the Palantir, EPC, and supplier program exceed the roughly $300M identified in Q1.
- TENEX supply is disrupted; well over one-half of expected LEU deliveries through 2027 depend on it.
- HALEU offtake economics prove thinner than implied once the NDA-blocked terms are disclosed.
- Advanced technology costs and stock compensation keep the GAAP-versus-adjusted gap wide, delaying reported profitability.
- Another equity raise follows the September 2026 offering as capital spend runs at $350–500M with no 2027 guidance.
- The first centrifuge or the first Piketon cascade slips, pushing the 2029 commercial-production goal out.
Looking Ahead
Over the next twelve months the plan is to complete the first new centrifuge at Oak Ridge, release the Certified for Construction package, finalize the remaining critical-supplier contracts, and hit the FY2026 revenue and capital-spend guides. The Oklo letter of intent is expected to move toward a definitive contract, the NNSA sole-source procurement and the DOE options remain open, and the first Investor Day is set for December 2026 at Piketon. Commercial HALEU revenue is not expected until around 2029, so the near-term tests are execution and disclosure rather than new volume.
- 2026First centrifuge complete — Oak Ridge centrifuge targets the first-of-a-kind manufacturing milestone.
- 2026CfC package released — Certified for Construction package guides the Piketon expansion design.
- 2026Critical suppliers locked — Target of 100% contracted, from about 75% at Q2.
- December 2026First Investor Day — Piketon event to share strategy and long-term outlook.
- Not datedOklo LOI to definitive — Conversion would confirm HALEU volumes, schedule, prepayments.
- Not datedNNSA sole-source award — Would convert the national-security position into funded backlog.
Financials
Annual Summary
| Metric | FY2024 | FY2025 | TTM | YoY |
|---|---|---|---|---|
| Revenue | $442M | $449M | $474M | +1.5% |
| Gross Margin | 20.2% | 24.5% | 23.3% | +430bps |
| EBITDA | $59M | $60M | $17M | +2.2% |
| EBITDA Margin | 13.3% | 13.4% | 3.6% | +9bps |
| Net Income | $73M | $78M | $48M | +6.3% |
| Free Cash Flow | $33M | $31M | −$222M | — |
| Net Cash | — | — | — | — |
Key Ratios (Trailing)
- P/E TTM—
- EV/EBITDA TTM—
- EV/Revenue TTM—
- Price/FCF TTM—
- Gross Margin (TTM)23.3%
- EBITDA Margin (TTM)3.6%
- Net Margin (TTM)10.2%
- ROIC3.8%
- FCF Conversion-1306.5%
- SBC / Revenue4.1%
The Company
Centrus Energy supplies nuclear fuel components and enrichment services. Its LEU segment sells separative work units — the enrichment component of nuclear fuel, measured in SWU — along with natural uranium hexafluoride, uranium concentrates, uranium conversion, and enriched uranium product, mostly to utilities that run commercial nuclear plants. Its Technical Solutions segment produces HALEU, a higher-enrichment fuel that advanced reactor and fuel designs need, plus advanced manufacturing and engineering services for government and private customers. The company is not an AI company and sells nothing that sits inside a data center; its exposure to the buildout runs through the reactor demand that AI-driven electricity growth is helping revive, and that link is one step removed.
Centrus operates across two U.S. sites plus a headquarters. At Piketon, Ohio, it leases an enrichment and HALEU production facility from the Department of Energy, including 110,000 square feet of supporting office space, and runs an existing 16-centrifuge HALEU cascade. At Oak Ridge, Tennessee, it owns a 440,000-square-foot manufacturing facility on 72 acres where it makes centrifuge parts. Corporate headquarters is in Bethesda, Maryland, leased through October 2027, and all long-lived assets are in the United States. The company feeds its own build-out: centrifuges made at Oak Ridge are shipped to Piketon to be installed and started up.
Business Segments
Competitive Landscape
The FY2025 10-K names four competitors: Rosatom, which sells LEU through its TENEX subsidiary; Urenco; CNEIC; and Orano. Centrus's largest SWU supplier is TENEX, whose parent Rosatom is also a named competitor — a structural tension the filings carry. Management asserts a national-security position, saying Centrus is the only viable production-ready technology that can meet national security needs, and describes itself as the HALEU supplier and the go-to for HALEU. Those are company positions; the record also shows BWXT building centrifuge manufacturing capability and ASP Isotopes pursuing laser enrichment.
- Rosatom / TENEXNamed in the 10-K as a competitor; also Centrus's largest SWU supplier through its TENEX subsidiary.
- UrencoNamed in the 10-K as a competitor; a consortium owned or controlled by the British and Dutch governments and two German utilities.
- CNEICNamed in the 10-K as a competitor; a company owned by the Chinese government.
- OranoNamed in the 10-K as a competitor; also Centrus's second SWU supplier, with a supply agreement running through 2030.
- BWXTNamed in the neighbor material as building centrifuge manufacturing capability; not named as a competitor in Centrus filings.
Supply Chain
Centrus sits in the middle of the nuclear fuel cycle, buying enrichment and feed from a global supplier network and selling fuel components to utilities and the U.S. government. Its largest input is SWU from TENEX. Oklo and Fluor name Centrus directly in their own disclosures.
More on LEU: Earnings recap