{
  "@context": "https://frontierpicks.com/schemas/dossier.v1.json",
  "ticker": "FRMI",
  "name": "Fermi Inc.",
  "url": "https://frontierpicks.com/dossiers/FRMI/",
  "json_url": "https://frontierpicks.com/dossiers/FRMI.json",
  "status": "WATCHLIST",
  "current_conviction": "LOW",
  "archetype": {
    "code": "a5",
    "n": 5
  },
  "current_thesis": "Fermi Inc. shares are more likely to lag the S&P 500 over three months: a $200 million hyperscaler prepayment gives Project Matador a customer, but the 600-megawatt lease is unsigned and the 12 November 2026 10-Q flags going-concern doubt. On-site customer work targeted by 1 December 2026 is the next test.",
  "invalidation_trigger": "A daily close above $3.68, the 50-day moving average as of 2026-11-11, which would show the shares leading; or a signed definitive long-term lease for the full 600 megawatts together with project financing for the build.",
  "catalyst_date": null,
  "portfolio": null,
  "pick": null,
  "themes": [
    "ai-datacenter-infrastructure",
    "industrial-power-grid"
  ],
  "tags": [],
  "sources": [],
  "notes": [
    "Fermi was pre-revenue as of its third-quarter 2026 report; its value rests on signing leases at the Project Matador campus in Texas.",
    "Fermi's 10-Q for the quarter ended 2026-09-30 discloses substantial doubt about going concern, which management concludes its plans alleviate.",
    "Two Class I board seats are in dispute: neither nominee won a majority of shares outstanding at the 2026-10-30 annual meeting, and both serve until a successor is elected.",
    "Co-founder and former CEO Toby Neugebauer is the largest shareholder, is in a public dispute with the board and has been selling shares in the open market."
  ],
  "source_links": [
    {
      "title": "SEC EDGAR",
      "url": "https://www.sec.gov/Archives/edgar/data/2071778/000207177826000058/frmi-20260930.htm",
      "date": null
    },
    {
      "title": "Fermi Inc. - Form 8-K - FY2026",
      "url": "https://www.sec.gov/Archives/edgar/data/0002071778/000121390026118351/ea031197701ex99-1.htm",
      "date": "2026-11-12"
    },
    {
      "title": "Fermi Inc. (FRMI) Q3 2026 Earnings Call Transcript",
      "url": "https://www.fool.com/earnings/call-transcripts/2026/11/12/fermi-inc-frmi-q3-2026-earnings-call-transcript/",
      "date": "2026-11-12"
    },
    {
      "title": "Fermi Inc. - Form 8-K - FY2026",
      "url": "https://www.sec.gov/Archives/edgar/data/0002071778/000121390026115928/ea0310920-8k_fermi.htm",
      "date": null
    },
    {
      "title": "Fermi says an unnamed hyperscaler will prepay $200 million for 600 MW at Project Matador",
      "url": "https://startupfortune.com/fermi-says-an-unnamed-hyperscaler-will-prepay-200-million-for-600-mw-at-project-matador/",
      "date": null
    },
    {
      "title": "Fermi Paid $25M to Drop a 400 MW Lease Deadline on Its Loan",
      "url": "https://fourweekmba.com/ai-fermi-paid-25m-to-drop-a-400-mw-lease-deadline-on-its-loan/",
      "date": null
    },
    {
      "title": "Why Is Fermi Stock Gaining Thursday?",
      "url": "https://www.benzinga.com/markets/earnings/26/11/63199822/why-is-fermi-stock-gaining-thursday",
      "date": null
    }
  ],
  "evidence": [
    {
      "claim": "Third-quarter 2026 net loss of $141.6 million, or $0.22 per share, with no revenue; general and administrative expense of $142.2 million included $65.8 million of stock compensation.",
      "source": "Fermi 8-K Exhibit 99.1, 2026-11-12",
      "as_of": "2026-09-30"
    },
    {
      "claim": "The 10-Q says resources measured against forecast disbursements are not sufficient to meet obligations due within one year; management concludes its plans alleviate the substantial doubt.",
      "source": "Fermi 10-Q for the quarter ended 2026-09-30, filed 2026-11-12",
      "as_of": "2026-09-30"
    },
    {
      "claim": "Unrestricted cash of $286.3 million and restricted cash of $29.2 million against debt principal of $999.9 million ($958.4 million net of issuance costs).",
      "source": "Fermi 10-Q for the quarter ended 2026-09-30, filed 2026-11-12",
      "as_of": "2026-09-30"
    },
    {
      "claim": "The $444.9 million turbine warehouse equipment facility matures on 2027-08-10; its lenders waived potential defaults on a one-time basis on 2026-10-09.",
      "source": "Fermi 10-Q for the quarter ended 2026-09-30, filed 2026-11-12",
      "as_of": "2026-10-09"
    },
    {
      "claim": "Agreements with an undisclosed investment-grade hyperscaler: $200 million prepayment and $15 million early construction deal for an initial 600 megawatts from 2027; definitive lease not yet signed.",
      "source": "Fermi 8-K Exhibit 99.1, 2026-11-12",
      "as_of": "2026-11-12"
    },
    {
      "claim": "The TensorWave data-center lease signed in August 2026 and the related AMD credit-support agreement were terminated.",
      "source": "Fermi 8-K Exhibit 99.1, 2026-11-12",
      "as_of": "2026-11-12"
    },
    {
      "claim": "10% owner Toby Neugebauer sold 7,657,800 shares at $1.52–$2.04 (average $1.70) from 2026-11-03 to 2026-11-05.",
      "source": "SEC Form 4 filed 2026-11-05",
      "as_of": "2026-11-05"
    },
    {
      "claim": "Neither board nominee (Rick Perry, Jeffrey Stein) won a majority of shares outstanding at the 2026-10-30 annual meeting; Fermi alleges Neugebauer-affiliated holders breached a nomination agreement.",
      "source": "Fermi 8-K filed 2026-11-04",
      "as_of": "2026-11-04"
    }
  ],
  "view_changes": [],
  "frame": null,
  "filed_numbers": {
    "as_of": "2026-11-13",
    "sector": "Real Estate",
    "financials": {
      "status": "ok",
      "reason": null,
      "close_date": "2026-11-13",
      "latest_quarter": "2026-09-30",
      "figures": {
        "revenue": {
          "status": "not reported"
        },
        "gross_margin": {
          "status": "not reported"
        },
        "operating_margin": {
          "status": "not available"
        },
        "pretax_income": {
          "status": "not reported"
        },
        "net_income": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "four_quarters_end": "2026-09-30",
          "value_musd": -141.6,
          "four_quarters_musd": -489.3
        },
        "operating_cash_flow": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "first_end": "2025-12-31",
          "value_musd": -136.4
        },
        "capital_spending": {
          "status": "not available"
        },
        "free_cash_flow": {
          "status": "not available"
        },
        "diluted_share_change": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "base_end": "2025-09-30",
          "pct": 37.8
        },
        "cash": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "value_musd": 286.3
        },
        "debt": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "value_musd": 958.4,
          "composition": "long-term debt"
        },
        "net_cash": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "value_musd": -672
        },
        "deferred_revenue": {
          "status": "not reported"
        },
        "backlog": {
          "status": "not reported"
        },
        "receivables": {
          "status": "not reported"
        },
        "inventory": {
          "status": "not reported"
        },
        "equity": {
          "status": "ok",
          "end": "2026-09-30",
          "filed": "2026-11-12",
          "value_musd": 958.5
        },
        "market_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-11-05",
          "basis_filed": "2026-11-12",
          "value_musd": 1688.5
        },
        "enterprise_value": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-11-05",
          "basis_filed": "2026-11-12",
          "value_musd": 2360.6
        },
        "ev_sales": {
          "status": "not available"
        },
        "ev_ebit": {
          "status": "not meaningful"
        },
        "pe": {
          "status": "not meaningful"
        },
        "pb": {
          "status": "ok",
          "close_date": "2026-11-13",
          "basis_end": "2026-11-05",
          "basis_filed": "2026-11-12",
          "multiple": 1.8
        },
        "fcf_yield": {
          "status": "not available"
        }
      }
    },
    "short_interest": {
      "status": "ok",
      "settlement": "2026-10-15",
      "published": "2026-11-13",
      "short_pct_of_outstanding": 9.8,
      "days_to_cover": 2.7,
      "change_pct": -5.1
    },
    "insiders": {
      "status": "ok",
      "as_of": "2026-11-14",
      "windows": [
        {
          "days": 90,
          "status": "ok",
          "from": "2026-08-17",
          "bought_usd": 0,
          "sold_usd": 28651449.72,
          "bought_unpriced": 0,
          "sold_unpriced": 0
        },
        {
          "days": 365,
          "status": "ok",
          "from": "2025-11-15",
          "bought_usd": 0,
          "sold_usd": 103768568.96,
          "bought_unpriced": 0,
          "sold_unpriced": 0
        }
      ]
    }
  },
  "body_markdown": "## Current Thesis\nFermi Inc. shares are more likely to lag the S&P 500 over the next three months. A $200 million prepayment from an unnamed investment-grade hyperscaler gives the Project Matador campus in Texas a real customer. The definitive long-term lease is still unsigned, though. Fermi's own 10-Q, filed 2026-11-12, says its resources fall short of its obligations due within one year. The next test is whether the customer starts work on site by the 2026-12-01 target. A signed lease for the full 600 megawatts (MW), with financing for the build, would break this call.\n\nThe rating is low because the good news replaces a failed deal and adds no revenue yet. On 2026-11-12 Fermi reported a third-quarter net loss of $141.6 million, or $0.22 per share, with no revenue. In the same release it said the TensorWave data-center lease signed in August 2026 had been terminated, along with the related AMD credit-support agreement. Management said the $200 million wire was due by 2026-11-13. Fermi had not publicly confirmed receipt as of that date.\n\nThe price reflects a high chance that Matador stays without contracted revenue. The shares closed at $2.06 on 2026-11-12, 90.8% below the 52-week intraday high of $22.37 set on 2025-11-12.\n\n## Bull Case\n- **Investment-grade customer replaces a neocloud.** Fermi's 2026-11-12 release describes a $200 million prepayment and a $15 million early construction agreement for an initial 600 MW starting in 2027. On the 2026-11-12 call, the chairman said a further $90 million steel and building-materials agreement is being negotiated.\n- **Management gave dated near-term milestones.** On the 2026-11-12 earnings call, management said the customer plans to begin mobilizing on site by 2026-12-01. It targeted first power for the first building in late second quarter or early third quarter of 2027.\n- **A near-term lender deadline is gone.** On the same call, management said an amendment to its MUFG turbine financing removed a 2026-11-10 lease deadline and kept minimum principal payments at 5%. Management put the cost at about $25 million in fees and said the change avoids more than $55 million of payments over three quarters.\n- **The physical asset is large.** The 2026-11-12 release puts net property, plant and equipment at about $1.67 billion. The CEO cited 2.2 gigawatts of current capacity, and the release refers to permitted levels of about 6 gigawatts.\n\n## Bear Case\n- **The 10-Q flags going-concern doubt.** Fermi's 10-Q for the quarter ended 2026-09-30 says its resources \"are not sufficient to satisfy the Company's financial obligations as they become due within one year.\" Management concludes that its plans, including undrawn equipment financing and timing capital spending to tenant deals, alleviate that doubt.\n- **Debt is large against cash.** At 2026-09-30 Fermi held $286.3 million of unrestricted cash and $29.2 million of restricted cash, per the 10-Q. Debt principal was $999.9 million, or $958.4 million net of issuance costs. The $444.9 million turbine warehouse facility matures on 2027-08-10.\n- **Lenders already granted a waiver.** The 10-Q says turbine-facility lenders waived potential defaults on a one-time basis on 2026-10-09, tied to relocation of financed equipment and insurance requirements. The Yorkville promissory note expired undrawn on 2026-10-01.\n- **The lease is still not signed.** On the 2026-11-12 call, management gave no signing date and called talks \"very, very far along.\" TensorWave's lease missed its 2026-10-31 closing deadline before it was terminated.\n- **The founder is selling hard.** SEC Form 4 filings show 10% owner Toby Neugebauer sold 4,047,200 shares at an average $3.55 on 2026-10-13 to 2026-10-14 and 420,749 at $3.04 on 2026-10-20. He sold another 7,657,800 shares at an average $1.70 between 2026-11-03 and 2026-11-05.\n- **The governance fight is open.** Fermi's 2026-11-04 8-K says neither Class I nominee, Rick Perry or Jeffrey Stein, won a majority of shares outstanding at the 2026-10-30 meeting. The company says Neugebauer-affiliated holders breached a nomination agreement, and those holders dispute this.\n\n## Setup & Price Structure\nThe shares closed at $2.06 on 2026-11-12, up from $1.81 on 2026-11-11, in the session the hyperscaler agreements were announced. The 52-week closing low is $1.53, set on 2026-11-05, inside the window of the founder's 7,657,800-share sale. The 3-month change is −67.8%, from a $6.40 close on 2026-08-14.\n\nAs of 2026-11-12, the 50-day moving average was $3.63 and the 200-day moving average was $6.12. Both sit far above the last close. The founder's October sales at $3.04–$3.73 mark the range the shares held before the TensorWave lease failed. A return to that range would need a signed lease and a plan to fund the 600 MW build without heavy dilution. Management says it aims for \"little or no dilution\" and wants to fund the build with customer prepayments and project-level debt. The 10-Q counts 646,953,440 shares outstanding on 2026-11-05.\n\n## Catalyst Calendar\n\n- **~2026-12-01 (est.):** Target for the hyperscaler to begin mobilizing on site at Project Matador. Physical work by the customer before a lease is signed would show the 600-megawatt deal moving toward a definitive lease.\n- **~2027-03-31 (est.):** Fourth-quarter and full-year 2026 results and 10-K. Shows whether a definitive lease is signed, how the build will be funded, and whether the going-concern doubt remains.\n\n## Elapsed catalysts\n\n- **~2026-11-13 (est.):** Deadline for the hyperscaler's $200 million prepayment wire, per management on the 2026-11-12 call. A confirmed receipt shows the customer is committed and adds cash against $999.9 million of debt principal. A missed wire would repeat the TensorWave failure. *(passed)*\n\n## What Would Change Our Mind\n\nA daily close above $3.68, the 50-day moving average as of 2026-11-11, which would show the shares leading; or a signed definitive long-term lease for the full 600 megawatts together with project financing for the build.\n\n## Correlation Notes\nFermi trades with AI data-center and power names on broad sector days. On 2026-11-11, when the Nasdaq 100 rose 2.8% as CoreWeave and Nvidia climbed, the shares went from a $1.54 close to $1.81. On 2026-11-12 the shares rose on company news while Nvidia fell 5% on its chief executive's exit, per market reports that day. Most of the 3-month move comes from company events: the TensorWave lease, the board vote, the founder's sales and the hyperscaler package. Those events will decide the next three months more than the sector will. A sector-wide pullback in AI spending, like the post-midterm selloff reported on 2026-11-06, would add pressure on a pre-revenue company carrying $999.9 million of debt principal.",
  "first_seen": "2026-11-12",
  "last_analyzed": "2026-11-13T03:54:31+00:00",
  "last_synthesized": "2026-11-13",
  "date_modified": "2026-11-13",
  "license": "Content © FrontierPicks. Cite the canonical URL."
}