Fermi Inc (NASDAQ & LSE: FRMI) is having the kind of week that turns a normal stock chart into modern art: sharp gaps, headline-driven swings, and investors trying to separate what’s confirmed from what’s merely energetic speculation.
On December 18, 2025, FRMI closed at $8.34, down 7.98% on the day, after opening near $9.31 and trading as high as $9.33 and as low as $8.27—with roughly 7.52 million shares changing hands.
That move sits on top of an even bigger story: Fermi’s “first tenant” financing arrangement for its flagship Project Matador in Texas was terminated last week, triggering a brutal re-pricing of the stock and a fresh wave of analyst notes, media reports, and legal-firm investigations.
Below is what’s known as of 18.12.2025, what’s disputed, and what the market is likely to obsess over next.
What triggered the selloff: the $150 million funding pact that didn’t fund anything
The catalyst for FRMI’s collapse was the end of a headline-grabbing construction funding arrangement tied to Project Matador—Fermi’s planned 11-gigawatt “behind-the-meter” power and data campus concept in the Texas Panhandle.
Here’s the timeline disclosed in reporting tied to Fermi’s SEC filing and subsequent coverage:
- Sept. 19, 2025: Fermi signed a non-binding letter of intent (LOI) with an investment-grade rated prospective tenant for a potential lease at Project Matador.
- Nov. 3, 2025: The parties signed an Advance in Aid of Construction Agreement (AICA) under which the tenant could advance up to $150 million, subject to conditions, to help fund construction costs.
- Dec. 9, 2025: The LOI’s exclusivity period expired.
- Dec. 11, 2025: The tenant notified Fermi it was terminating the AICA. Importantly, no funds were drawn under the agreement.
Fermi said talks on a lease could continue, and it also began discussions with other potential tenants for 2026 power delivery once exclusivity ended.
The market reaction was immediate and savage. On Dec. 12, FRMI closed at $10.09 after a 33.84% daily drop on extremely heavy volume (about 63.34 million shares), according to historical pricing data. Reuters also reported the stock fell about 34% that day after the announcement.
Dec. 18’s new twist: Business Insider says Amazon; Fermi tells Reuters “categorically deny”
Today’s headline drama is about identity.
Business Insider reported that Amazon was the prospective tenant tied to the pulled funding, citing CEO Toby Neugebauer and describing an LOI that would have made Amazon an anchor tenant—while also saying negotiations were still “constructive.” Business Insider
Reuters, however, reported that Fermi denied Business Insider’s claims—specifically stating that “Fermi America and its CEO, Toby Neugebauer, categorically deny” the report, including the alleged comments. Reuters also noted Amazon did not respond to requests for comment. Reuters
That contradiction matters because the market is currently pricing FRMI like a binary riddle:
- If a top-tier hyperscaler is still engaged and a lease closes, the “anchor tenant” narrative revives fast.
- If the first tenant story unravels—or if pricing/terms don’t support future deals—the stock can stay trapped in “trust deficit” territory.
For now, the only clean takeaway is this: the AICA was terminated, and the identity of the first tenant is not confirmed by the company based on today’s Reuters reporting.
Management’s message: “We have never felt better,” CEO says locally
In a statement provided to Amarillo’s ABC 7 after the funding deal fell through, CEO Toby Neugebauer framed the development as a negotiation milestone rather than a collapse.
Two excerpts capture the tone:
- He said Fermi is “negotiating with the world’s leading companies… for behind-the-meter power at scale.” KVII
- He also argued that once exclusivity expired, multiple potential tenants could begin bidding on 2026 power, adding: “We have never felt better about our position…” KVII
That’s classic founder language—optimistic, high-velocity, and allergic to admitting anything is on fire. Markets, on the other hand, tend to be allergic to uncertainty when the business is still pre-revenue.
Why a single tenant headline hits so hard: Fermi is selling “power at AI scale,” not a normal REIT story
Fermi is often described in mainstream coverage as a data center real estate company or REIT-like model, but the investment pitch is more unusual: build power-first infrastructure (gas now, nuclear later, plus grid/solar/storage) to serve hyperscale AI and data center loads.
The company says Project Matador is expected to integrate the nation’s biggest combined-cycle natural gas project, a major new nuclear complex, utility grid power, solar, and battery storage—delivering power at gigawatt scale to AI customers.
This is why the “first tenant” matters disproportionately: for early-stage infrastructure stories, tenants are not just customers—they are proof of demand, financing leverage, and often the difference between “ambitious plan” and “bankable project.”
The Financial Times put it bluntly: shares cratered after the tenant withdrew the $150 million funding commitment, and analysts pointed to failed pricing negotiations—with Fermi reportedly refusing to compromise pricing to avoid weakening future deals.
The progress investors point to: power agreements, permits, and timelines into 2026
Even as the tenant story shook confidence, Fermi has stacked up several project updates that bullish investors cite as evidence the build-out is moving.
1) Xcel Energy subsidiary power agreement: up to 200 MW, starting January 2026
Fermi announced a definitive Electric Service Agreement (ESA) with Southwestern Public Service Company, a subsidiary of Xcel Energy, to supply up to 200 megawatts to Project Matador—starting with 86 MW in January 2026 and ramping over time.
2) Cooling system planning for gas + nuclear buildout
Fermi also announced a non-binding MOU with MVM EGI for a hybrid cooling solution supporting 6 GW of combined-cycle natural gas generation and four AP1000 nuclear units. It said construction of the first cooling tower is scheduled to begin in January 2026, with the full system completed by 2034 as the site scales.
3) Texas environmental process: preliminary approval for 6 GW clean natural gas
A Fermi-linked release described preliminary approval from the Texas Commission on Environmental Quality (TCEQ) for 6 GW of clean natural gas-based generation (part of the 11 GW campus), subject to further process and public input. The same material says initial gas generators were “already en route” and expected online in 2026. FERMI AMERICA+1
In short: there is real-world project motion here—agreements, permitting steps, and timelines. The stock isn’t collapsing because nothing is happening. It’s collapsing because the market suddenly doubts commercial conversion (LOIs → leases → revenue) and capital certainty.
Analyst forecasts on FRMI stock: targets get cut, but most ratings stay bullish
Because the stock price has fallen so far, analyst price targets now look like trampoline mathematics: even a reduced target can imply huge upside.
Here are the notable forecasts and notes circulating around this event window:
Evercore ISI: target cut to $20 from $37, Outperform maintained
Investing.com reported Evercore ISI lowered its price target to $20.00 from $37.00, while maintaining an Outperform rating after the AICA termination. The note described the development as “a clear negative,” applied about a 9.5x EV/EBITDA multiple to estimated 2028 EBITDA, and discounted back around 22%. Investing.com
UBS: Buy maintained, $30 target (per Investing.com)
A separate Investing.com report said UBS maintained a Buy rating and $30.00 price target, while acknowledging that delays converting the LOI into a definitive lease were already weighing on sentiment.
Consensus trackers: low-$30s averages, wide range
MarketBeat’s compiled view showed an average price target around $31.56 with a reported range topping out at $37 (and a much lower floor), reflecting the spread between “execution works” and “execution stalls.” MarketBeat
Insider Monkey, summarizing street coverage, described FRMI as a consensus buy among nine analysts, with a $20 to $39.20 range and a $30 median.
A reality check on “upside”
When a stock drops from the mid-teens toward single digits in days, target math becomes misleadingly seductive. The true forecast embedded in these targets is less “the stock will triple” and more “a lease closes, pricing holds, and the project financing path remains credible.”
Additional Dec. 18 coverage: Smartkarma commentary and a legal-firm investigation announcement
Two more items hit feeds on Dec. 18:
Smartkarma: “Unfathomable Progress” note (summary only)
Smartkarma posted a piece titled “Fermi America’s Unfathomable Progress,” referencing the Dec. 12 SEC filing and noting the stock trading around ~$9, while indicating its full analysis discusses the business model, tenant issues, and investor sentiment (full content gated). Smartkarma
Hagens Berman: investigation announcement
Hagens Berman issued a press release saying it opened an investigation into whether Fermi may have misled investors about the strength and terms of the first-tenant agreement, following the stock’s sharp decline. This is an allegation/investigation announcement, not a court finding—but it adds reputational pressure during a fragile period.
The big-picture risk investors keep circling: scale, capex, and time
Project Matador is pitched at world-scale size. That’s the hook—and the hazard.
The Financial Times described the campus as capable of delivering 11 GW and said the project could cost over $50 billion.
Meanwhile, Reuters reported Fermi raised $682 million in its IPO, valuing the company at roughly $12.46 billion at the offering price. Those numbers make the underlying question unavoidable:
Can Fermi finance and execute a multi-decade infrastructure build while converting early LOIs into revenue-producing leases fast enough to satisfy public-market patience?
That’s why “first tenant” news hits like a meteor. The market isn’t just pricing one deal—it’s pricing the credibility of the entire commercialization curve.
What to watch next for Fermi Inc stock (FRMI): the near-term catalysts that matter
If you’re tracking FRMI into year-end and early 2026, these are the specific items likely to move the stock more than broad AI hype:
- Definitive lease announcement(s)
The market wants a signed lease, not “constructive discussions.” Confirmation of tenant identity would also change the narrative, especially after today’s Amazon-report dispute. Reuters+1 - Additional tenant LOIs or capacity commitments for 2026
Fermi has said it began discussions with other potential tenants once exclusivity ended. Any disclosed progress there is headline fuel. - January 2026 ESA delivery milestones
The Xcel/SPS agreement starts at 86 MW in January 2026, ramping thereafter—an execution milestone investors can actually date on a calendar. - Permitting and public process updates
The TCEQ process and related approvals are “boring until they’re not.” Delays can ripple into timelines and cost of capital. FERMI AMERICA - Financing strategy and dilution risk
With a capital-intensive build, investors will watch for structured financing, partner capital, or any equity issuance that could dilute shareholders. - Next earnings / corporate updates
Fermi’s next earnings date is listed for Feb. 25, 2026 on at least one market data source, which could become the next major narrative checkpoint.
Bottom line on Dec. 18, 2025
FRMI has become a live experiment in how markets price the frontier where AI infrastructure demand meets infrastructure financing reality.
- The bear case is simple: no revenue yet, enormous capex, tenant concentration risk, and now a very public stumble in early commercialization—plus the reputational drag of investigation announcements.
- The bull case is also simple: if Fermi converts even one hyperscale anchor into a definitive lease and keeps power-delivery milestones on track into 2026, today’s stock price could look like a panic low relative to long-duration cash flow potential.
For now, the stock is trading less like a mature REIT and more like an early-stage, headline-sensitive infrastructure bet—where the next verified tenant update matters more than a dozen optimistic adjectives.
