SMR

NuScale Power Corp. 10-Q Summary: Q3 2025

Business Context and Reporting Period

This filing covers the quarterly period ended September 30, 2025. NuScale Power Corp. is commercializing the NuScale Power Module (NPM), a small modular reactor (SMR) design. In May 2025, the U.S. Nuclear Regulatory Commission (NRC) finalized its review and approved the Standard Design Approval (SDA) for the 6-unit 77 MWe NPM design, enabling customers to proceed with construction licensing. The Company operates as a holding company with NuScale LLC as a consolidated variable interest entity.

Key Financial Metrics

Material Changes vs. Prior Period

• Revenue Surge: Revenue increased significantly due to engineering and licensing services for the RoPower project in Romania. Related party (Fluor) revenue accounted for 96% of Q3 2025 revenue.
• One-Time Expense: General and Administrative (G&A) expenses spiked by $502.2 million in Q3 2025. This was primarily driven by a $495.0 million one-time expense recognized for "Milestone Contribution 1" under the Partnership Milestones Agreement (PMA) with ENTRA1, triggered by a non-binding agreement with the Tennessee Valley Authority (TVA).
• Liability Increase: Current liabilities rose from $90.0 million to $445.6 million, largely due to the $346.5 million liability recorded for the PMA milestone contribution.
• Investment Income: Investment income increased to $5.8 million in Q3 2025 (from $2.0 million in Q3 2024) due to a stronger cash position and higher interest rates on short-term investments.
• Warrant Liabilities: There was no change in fair value of warrant liabilities in 2025, as all outstanding warrants were redeemed or exercised in late 2024.

Guidance, Outlook, and Risks

• Strategic Partnership: The PMA with ENTRA1 designates NuScale as the key supplier for future ENTRA1 energy projects. While Milestone Contribution 1 has been paid, future contributions (Milestone 2 and 3) are contingent on binding agreements and do not guarantee revenue generation.
• Liquidity: Management believes cash, cash equivalents, and investments ($691.8 million total) are sufficient to fund operations for the next 12 months. The Company raised $562.4 million net proceeds via its ATM program in the first nine months of 2025.
• Capital Constraints: The Company has a limited number of authorized Class A shares remaining (~20 million). Raising additional capital requires a shareholder vote to increase authorized shares, which is not guaranteed.
• Internal Controls: The Company disclosed a material weakness in internal controls over financial reporting related to IT general controls and insufficient personnel for financial reporting. Remediation plans are underway.
• Legal Proceedings: Several shareholder class actions were dismissed with prejudice or voluntarily dismissed in 2025. A Delaware Chancery lawsuit regarding corporate opportunity waivers was resolved via a mootness fee of $85,000.
• Trade Policy: Risks exist regarding U.S. trade policy changes and tariffs, which could increase costs for long-lead components manufactured overseas.

Investor Verification Checklist

• PMA Milestone Triggers: Verify the specific terms of the ENTRA1 PMA to understand the conditions for Milestone Contributions 2 and 3 and the risk of paying milestones without securing corresponding revenue contracts.
• Authorized Share Count: Confirm the timeline and likelihood of shareholder approval to increase authorized Class A shares, given the current limit of ~20 million remaining.
• Internal Control Remediation: Monitor progress on the remediation of the material weakness in financial reporting and IT controls to ensure future reporting reliability.
• RoPower Project Status: Track the Final Investment Decision (FID) for the Doicesti project in Romania, as this is the primary near-term revenue driver.
• Fluor Exchange Agreement: Review the November 2025 Exchange Agreement where Fluor agreed to exchange Class B units for Class A shares, including the 50% reduction in Tax Receivable Agreement (TRA) payments to Fluor.