New Scale Power (SMR) Q2 2025: NRC Approval Triggers 710% Revenue Surge, Readiness for First Major Order
New Scale Power’s second NRC-approved design and visible module production capacity have sharply increased commercial engagement, but the business remains pre-revenue from its core product as it navigates a critical inflection point in 2025. The company’s disciplined operating spend is set to rise as it invests in supply chain readiness and long-lead materials, with management signaling laser focus on closing its first U.S. customer contract this year. Execution on customer commitments and supply chain scaling will define New Scale’s transition from technology leader to commercial nuclear supplier.
Summary
- Regulatory Milestone Opens Doors: Dual NRC approvals and module production have accelerated customer engagement across utilities and hyperscalers.
- Supply Chain Investments Accelerate: Operating expenses will rise in the second half as New Scale preps for commercialization and potential orders.
- Critical Year for Commercial Validation: Securing a first hard contract in 2025 is pivotal for business model proof and capital discipline.
Performance Analysis
New Scale’s Q2 performance marks a significant inflection in revenue trajectory, with quarterly revenue jumping to $8.1 million from $1 million a year ago, driven by engineering and licensing fees tied to the ROE Power (Romania) project. While this revenue is not yet from core SMR (Small Modular Reactor) module sales, it demonstrates the company’s ability to monetize pre-commercial services and maintain positive cash flow in the interim.
Operating expenses rose modestly to $44.9 million, reflecting ongoing discipline but foreshadowing a step-up in spend as New Scale invests in long-lead materials and supply chain capacity. Total liquidity remains robust at $489.9 million, providing runway for commercialization efforts even as cash burn increases. The company has held operating expense growth to a tight range for six quarters but will deliberately ramp investment to enable delivery of its first customer plant.
- Revenue Mix Shift: All Q2 revenue was service-based, with no SMR module sales yet, underscoring the pre-commercial phase.
- Cash Position Supports Scale-Up: Ample liquidity enables risk-managed investment in manufacturing and supply chain readiness.
- Expense Discipline to Strategic Spend: Tight cost control is giving way to targeted spend increases as the business prepares for commercial orders.
New Scale’s current financials reflect a technology company on the cusp of commercial transition, with success now hinging on converting customer interest into contractual commitments and scaling manufacturing without overextending balance sheet risk.
Executive Commentary
"Our design approvals, combined with an established manufacturing ecosystem, a -to-date investment of approximately $2 billion to de-risk plant licensing and operation, and unmatched safety capabilities make New Scale the only near-term deployable SMR technology with 12 New Scale power modules currently in production."
John Hopkins, President and Chief Executive Officer
"We've maintained this plan over, I think it's been six quarters where we've held op-ex to plus or minus 5% or so. And now we're engaging a very focused and very methodical increase in op-ex in order to engage the supply chain and just get ready for the commercial contracts which we're anticipating."
Ramsey Hamaddy, Chief Financial Officer
Strategic Positioning
1. Regulatory and Technology Lead
New Scale remains the only SMR vendor with two NRC-approved designs, a critical differentiator that has catalyzed customer dialogue and increased credibility. The company’s use of conventional light-water reactor fuel, avoiding reliance on high-assay low-enriched uranium (HALEU), further de-risks deployment and financing, appealing to both utilities and hyperscalers seeking near-term, scalable nuclear power.
2. Business Model: OEM Technology Provider
New Scale’s model is to sell its power modules as an OEM (original equipment manufacturer) to InterOne, its exclusive commercialization partner, who develops, finances, owns, and operates the plants. This structure shields New Scale from direct project risk and capital intensity while focusing on technology delivery and module sales. InterOne manages customer PPAs (power purchase agreements), targeting hyperscalers, utilities, and government.
3. Supply Chain and Manufacturing Readiness
With 12 modules in production and Doosan’s capacity to produce up to 20 modules per year, New Scale is positioned to scale manufacturing rapidly if orders materialize. The company is investing in long-lead materials and supplier relationships, but remains disciplined to avoid speculative inventory buildup. The ability to show “steel in production” serves as a powerful marketing tool and proof of readiness.
4. Customer Pipeline and Market Focus
Customer engagement has intensified post-NRC approval, with active discussions spanning U.S. government (Department of Defense), utilities, and hyperscalers. Focus has shifted to larger, multi-module orders (12+ modules per site), reflecting the rising energy needs of data centers and AI. Internationally, Romania’s ROE Power project remains a flagship, but management is laser-focused on closing a U.S. contract in 2025.
5. Policy Tailwinds and Competitive Moat
Executive orders and bipartisan legislative support are accelerating regulatory timelines and supply chain investment, benefiting New Scale as the only near-term deployable SMR technology. Streamlined site-specific licensing is expected to further strengthen the company’s lead over competitors still in R&D or early licensing.
Key Considerations
New Scale’s Q2 underscores a pivotal moment as the company transitions from technology validation to commercial execution. The following strategic considerations will determine the trajectory:
Key Considerations:
- Contract Award Timing: Securing a first U.S. customer contract in 2025 is essential for business model validation and de-risking supply chain investments.
- Supply Chain Execution: The ability to ramp production without overextending capital or inventory risk will be critical as orders scale.
- Regulatory and Policy Leverage: New Scale’s head start in licensing positions it to capitalize on policy tailwinds, but execution risk remains if regulatory processes or customer funding slow.
- Capital Discipline vs. Commercial Urgency: Management must balance readiness investments with prudent cash management, especially as operating expenses rise in anticipation of contracts.
- Market Focus and Prioritization: With limited resources, New Scale is narrowing its focus to high-probability U.S. customers, aiming for fewer, larger deals rather than broad pursuit.
Risks
New Scale’s most acute risk is the timing and certainty of first commercial orders, as continued cash burn and supply chain investments without contract conversion could pressure liquidity and investor confidence. Delays in customer FIDs (final investment decisions), particularly at ROE Power and among U.S. prospects, could extend the pre-revenue period. Additionally, competitive technologies, regulatory changes, or supply chain bottlenecks may erode New Scale’s current lead if execution falters.
Forward Outlook
For Q3 and Q4 2025, New Scale signaled:
- Operating expenses will increase sequentially as supply chain and manufacturing investments ramp.
- No specific revenue guidance, but management expects continued service revenue from ROE Power and is targeting at least one hard U.S. contract by year-end.
For full-year 2025, management maintained a cautious stance, emphasizing:
- Disciplined cash management even as spend increases for commercialization readiness.
- Focus on closing U.S. customer contracts as the primary milestone.
Management highlighted several factors that could accelerate the outlook:
- Regulatory streamlining and executive orders supporting faster deployment and site-specific licensing.
- Surging demand from hyperscalers and data centers for scalable, carbon-free baseload power.
Takeaways
New Scale’s Q2 marks a transition from regulatory and technology validation to commercial execution, with the company’s fate now tied to its ability to land its first major U.S. contract and scale manufacturing efficiently.
- Commercial Inflection: The dual NRC approvals and visible production capacity have unlocked new customer engagement, but conversion to orders is the next critical step.
- Disciplined Readiness: Management is walking a fine line between investing for readiness and maintaining capital discipline, with a clear message that speculative build is off the table.
- Watch for U.S. Contract Closure: Investors should monitor progress toward a first U.S. contract, as this will be the true litmus test for business model scalability and risk profile.
Conclusion
New Scale Power enters the back half of 2025 with regulatory, manufacturing, and policy tailwinds, but remains in pre-revenue mode for its core product. The coming quarters will be defined by execution on customer commitments and prudent scaling of the supply chain. Success in landing a first major order will shift the narrative from promise to proof.
Industry Read-Through
New Scale’s progress signals a tipping point for the SMR sector, with regulatory clarity and visible manufacturing capacity now prerequisites for commercial traction. Traditional nuclear and emerging SMR competitors face rising pressure to accelerate licensing and supply chain partnerships, as hyperscaler and utility demand for clean baseload power grows. Policy tailwinds and customer urgency for 24-7, scalable energy solutions are likely to drive industry consolidation, with early movers like New Scale best positioned to capture share if execution matches ambition. The U.S. and allied markets remain the near-term battleground for SMR commercialization.