Fermi Surges 55% in Nasdaq Debut on AI Data Center Plans

Fermi Inc. (FRMI), a newly-formed data center and energy startup, saw its shares soar 55% in its first day of trading on the Nasdaq, signaling that Wall Street's appetite for artificial intelligence infrastructure plays remains insatiable. The company's stock closed at $32.53 after being priced at $21 in its initial public offering, a stunning debut for a firm with no revenue to its name.

The surge reflects intense investor optimism for Fermi's ambitious strategy to build one of the world's largest AI data center campuses. The company, which operates as a real estate investment trust (REIT), plans to develop a massive complex in the Texas Panhandle, aiming to provide 11 gigawatts of power from natural gas, solar, and nuclear sources by 2038. This ambitious plan comes as the AI industry faces a critical shortage of both data center space and the massive amounts of energy required to power it.

Fermi's and has attracted significant attention due to its high-profile co-founders, including former U.S. Energy Secretary Rick Perry, Toby Neugebauer, and Griffin Perry. The company's formation in January of this year highlights a swift move to capitalize on the booming demand for AI infrastructure.

However, the company's pre-revenue status presents a significant risk. According to its filings, Fermi reported a net loss of $6.4 million through June and does not expect to break ground on its first facilities until March of next year. The success of the IPO, despite the lack of current income, , though some analysts caution that such valuations could be signs of a developing market bubble.

As a REIT, Fermi is structured to disburse 90% of its profits to investors, a model that is unusual for funding the rapid expansion typical of technology startups. The company is not expected to pay dividends until it has leasable property, making its stock a pure-play bet on the future buildout of the digital infrastructure powering the AI revolution.