Fermi Agrees to Develop 600 Megawatts at Matador, Reports $315.5 Million in Cash
Key Facts
Fermi reported third-quarter results on November 12, 2026, and agreements with an investment-grade hyperscale cloud customer to begin developing an initial 600 megawatts of capacity at its Matador project starting in 2027. The agreements include a $200 million advance payment tied to the proposed development and a separate $15 million agreement for early construction work and site preparation. However, the parties have not yet finalized a long-term lease, and the company has kept the customer’s identity confidential. Fermi said the project aims to meet data-center demand for sites with permitted power. The announcement sets out a new commercial path for the project, while final lease terms remain unresolved.
Chief Executive Lee McIntyre said hyperscale cloud customers want sites ready with permitted power, and that Matador is one of a few sites currently able to meet this demand. He added that converting the company’s pipeline of prospective customers into leases could fill its entire current capacity of 2.2 gigawatts. That possibility remains contingent on signing leases, while the company has not disclosed the identity of the customer in the new agreements. Fermi and the customer were also working to finalize a $90 million purchase agreement for structural steel and building materials. The agreement was still being finalized when the statement was issued on November 12.
The announcement coincided with Fermi terminating the data-center lease and services agreement it signed with TensorWave in August 2026, along with the related credit-support agreement from AMD. This points to a change in the project’s commercial and financing arrangements, alongside the new agreements with the unidentified cloud customer. The company did not provide further details in the statement about the terms of the TensorWave agreement’s termination. The new agreements include advance funding and early work, but do not replace the long-term lease, which remains under negotiation. Converting the announced initial capacity into a leased project depends on completing those arrangements.
Financially, Fermi said it remains in the pre-revenue development stage, with general and administrative expenses of $142.2 million in the third quarter. This included $65.8 million in non-cash stock-based compensation, in addition to $21.5 million in financial advisory fees settled through the issuance of common shares. Cash and restricted cash totaled $315.5 million at quarter-end, compared with net debt of $958.4 million on September 30, 2026. The company said net debt reflects a net increase in borrowings of $463 million during the quarter. The figures highlight the company’s financing position as it spends on developing assets that have yet to generate revenue.
Investment in property, plant and equipment totaled $133.4 million in the third quarter and $759.5 million in the nine months ended September 30, 2026. These investments raised the net book value of assets to about $1.67 billion at the end of September. The spending is part of the development phase, which the company said it remains in ahead of generating revenue. Meanwhile, the proposed customer advance payment and early-work agreement provide financial support tied to development of Matador and site preparation. However, the statement did not announce completion of the long-term lease or the materials purchase agreement, as both remained under negotiation or in finalization.
Fermi shares closed at $1.81 on November 11, 2026, compared with a close of $1.54 on November 10 and $1.66 on November 9. The company scheduled a conference to discuss its quarterly results for November 12 at 9 a.m. Eastern time. It said a replay of the conference would remain available for one year. It also said development of the initial 600 megawatts of capacity is scheduled to begin in 2027. Finalizing the long-term lease and securing the purchase agreement for steel and building materials remain among the items tied to moving the project into execution.