Fermi Surges 55% in Market Debut After USD 682m IPO

Fermi’s Bold Entry: 55% IPO Rally for a Zero-Revenue Energy AI REIT

Fermi (Nasdaq: FRMI) made one of the most dramatic market debuts in recent memory, climbing 55% from its USD 21 IPO price on its first day of trading. Yet this is far from a typical growth stock. Fermi is an early-stage company attempting to combine real estate, energy, and artificial intelligence infrastructure into a single integrated platform.

At the centre of its vision is Project Matador, a massive energy and data campus in Amarillo, Texas. The company plans to build 15 million square feet of data centre capacity, the equivalent of about 260 football fields, powered by a mix of natural gas, solar, battery storage, and four planned nuclear reactors. Over time, Fermi claims it can deliver up to 11 gigawatts of power, with the first gigawatt expected by 2026.

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Fermi’s Unusual Path to the Public Markets

What makes Fermi unusual is its corporate structure. The company has no revenue today and does not expect to generate any in the near term, yet it has launched as a real estate investment trust (REIT). REITs are typically reserved for mature, cash-generating property businesses, and they are required to distribute 90% of taxable income as dividends. That obligation could be difficult to satisfy given Fermi’s lack of current income.

Still, the timing is notable. The global AI boom is driving enormous demand for data centres, while access to reliable power has become the true bottleneck. By owning both the real estate and the energy infrastructure, Fermi believes it can offer a differentiated solution. The IPO raised USD 682.5 million, providing initial capital to advance the development. Political and branding ties to Donald Trump, along with support from high-profile backers such as former US Energy Secretary Rick Perry, may also give the company additional visibility.

The risks and challenges ahead 

The challenges, however, are significant. Constructing nuclear reactors and integrating diverse energy systems is costly, highly regulated, and prone to delays. Fermi itself acknowledges that its leadership team has limited experience in nuclear development. The company will require billions more in funding beyond its IPO to complete its ambitious build-out. With tenant revenue not expected until 2027, Fermi faces at least two years of cash burn before any inflows begin. This places considerable pressure on management to secure contracts, permits, and energy generation on schedule.