Fermi Inc Q2 2026 results reveal rapid investment and a tight funding position

Fermi Inc's second-quarter filing is less about conventional earnings and more about whether the company can finance and deliver Project Matador, its planned private-grid AI infrastructure campus in Texas.

The latest numbers show considerable physical investment. Property, plant and equipment reached $1,547.856 million at 30 June 2026, up from $935.295 million at the end of 2025. However, cash fell sharply, debt increased and the company remained pre-revenue.

Investors therefore have two competing signals to weigh. Fermi is assembling land, equipment and infrastructure at speed, but it must keep funding that work before tenants begin generating revenue.

The full details are available in the original company announcement.

Fermi's key Q2 2026 figures

Metric	Q2 or 30 June 2026	Comparison
Revenue	$0	Revenue-generating activities had not commenced
Q2 net loss	$25.806 million	$6.289 million in Q2 2025
Six-month net loss	$214.499 million	$6.367 million from inception to 30 June 2025
Cash and cash equivalents	$62.536 million	$408.529 million at 31 December 2025
Restricted cash	$29.195 million	$0 at 31 December 2025
Property, plant and equipment	$1,547.856 million	$935.295 million at 31 December 2025
Net debt carrying value	$520.091 million	$109.799 million at 31 December 2025
Six-month capital investment	$626.157 million	Property, plant and equipment purchases
Shares outstanding	638,115,075	629,839,790 at 31 December 2025

The Q2 net loss was $25.806 million, equivalent to $0.04 per share. General and administrative expenses were $26.759 million.

The first-half loss was much larger at $214.499 million. This included $118.724 million of share-based compensation and a $24.753 million loss connected with repaying the Macquarie term loan.

Interestingly, Fermi recorded a net share-based compensation gain of $15.257 million in Q2. This mainly reflected the reversal of previously recognised charges following executive departures. That accounting benefit helped make the second quarter look considerably less costly than the first half as a whole.

Project Matador is expanding the asset base

Fermi is developing Project Matador and its wider AI power infrastructure strategy in Carson County, Texas.

The company describes the initial campus as combining approximately 11 gigawatts of private-grid generation with large-scale AI data centre infrastructure. Subject to land purchases, options and additional permits, generation capacity could eventually expand to approximately 17 gigawatts.

The planned campus is expected to encompass approximately 8,400 acres and provide roughly 15 million square feet of AI infrastructure space. Its proposed power mix includes solar, gas and nuclear generation.

Those are substantial ambitions, but the balance sheet confirms that Project Matador is still firmly in development. All $1,547.856 million of property, plant and equipment consisted of land and construction in progress. No depreciable assets had been placed into service by 30 June, so no depreciation expense was recorded.

Fermi invested $626.157 million in property, plant and equipment during the first half. Preliminary site development started in 2025, while commercial operations for the first private-grid powered AI data centre campus are targeted to begin in 2027.

Vertical construction is expected to follow the definitive lease signed with Fermi's first tenant on 9 August 2026. That is an important operational step, although the filing makes clear that delivery, financing and satisfaction of lease conditions remain relevant uncertainties.

The main concern is liquidity

Fermi used $56.016 million of cash in operating activities during the first half and another $626.157 million in investing activities. Financing activities provided $365.375 million, but total cash, cash equivalents and restricted cash still declined by $316.798 million.

Management's going-concern assessment deserves close attention. A going concern is a business expected to meet its obligations and continue operating for at least the assessment period.

Before considering management's plans, Fermi said its available resources were insufficient to meet forecast financial obligations falling due within one year of the accounts being issued. This raised substantial doubt about its ability to continue as a going concern.

Management concluded that its mitigation plans alleviate that doubt. These plans include:

• $416.810 million of net proceeds from convertible senior notes issued in July 2026
• Undrawn committed equipment financing capacity
• Sequencing capital expenditure alongside definitive tenant agreements
• Securing project-level financing connected with tenant commitments
• Potentially deferring, reducing or renegotiating expenditure obligations
• Monetising equipment if required

The July convertible notes carried an aggregate principal amount of $431.250 million and a 5.00% coupon, with maturity in 2031. Approximately $34.500 million of the proceeds was used for capped-call transactions, which are arrangements designed to reduce potential dilution under certain conditions.

Management believes its plans are likely to be implemented successfully, but explicitly said there is no guarantee. If capital cannot be raised on the expected terms or timetable, Fermi may have to delay expenditure, amend purchase commitments or surrender pledged equipment. Any of those outcomes could extend Project Matador's development timeline.

Debt and commitments are increasing

Gross debt stood at $536.904 million at the end of June, compared with $148.986 million at the end of 2025. Net of issuance costs and discounts, debt was $520.091 million.

The largest facility was the Turbine Warehouse Equipment Financing, with $444.867 million outstanding and an effective interest rate of 12.2%. Fermi also had $77.348 million outstanding under high-voltage equipment financing and $14.689 million under a second turbine facility.

The company said it complied with all material debt covenants at quarter-end. However, these facilities carry interest, maturity and customer-agreement conditions that add pressure to the project timetable.

Fermi also had $142.649 million of unconditional purchase obligations for long-lead-time equipment. Approximately $128.100 million is expected to be funded through existing equipment financing facilities.

What looks positive for investors

The clearest positive is that Fermi is turning its plans into a sizeable base of physical assets. Project investment is advancing, equipment financing has been secured and a definitive first-tenant lease was signed after the quarter ended.

The July convertible-note issue also materially improved the company's available funding after the $62.536 million quarter-end cash position. Management has several additional liquidity levers, including undrawn facilities and the ability to sequence expenditure.

For more background on the listed company, see the dedicated Fermi Inc share page.

What could go wrong

Fermi had not generated revenue by 30 June 2026 and does not expect operating revenue until infrastructure is delivered to tenants. Its investment case therefore depends on construction, financing and commercial milestones rather than established earnings or cash flow.

Other material concerns include rising debt, substantial equipment commitments, exposure to higher construction costs and reliance on a limited number of major counterparties. Leadership changes and a proxy contest involving the former chief executive have also consumed resources and may distract management.

Several legal proceedings are outstanding. These include a securities class action, equipment-related disputes and a claim filed in July by former consultants seeking monetary relief alleged to exceed $415 million. Fermi is defending the matters, and possible losses were generally not estimable at the reporting date.

Tenant delivery and funding now take centre stage

This filing shows genuine progress in assembling Project Matador, but it also demonstrates the financial strain involved. The company is investing hundreds of millions of dollars before recording revenue, making access to capital central to the story.

The next important evidence will be whether Fermi can satisfy tenant lease conditions, secure project-level financing and begin vertical construction without stretching liquidity further than planned. Until operating facilities are delivered, investors are backing execution rather than current financial performance.