Fermi names Lee McIntire CEO after April ouster of co-founder Neugebauer
Fermi, a data-center and power startup co-founded by former U.S. Energy Secretary Rick Perry and energy billionaire Toby Neugebauer, signed AI cloud provider TensorWave as its first customer under a lease at the company’s Project Matador campus in Texas, The Wall Street Journal reported Thursday. The agreement covers 222 megawatts of power capacity at the site and is projected to generate approximately $6.5 billion in revenue over 15 years, according to the company.
The lease marks a commercial milestone for Fermi, which has yet to book any revenue and reported a widened net loss of $25.8 million for the most recent quarter. The company went public in October at a roughly $19 billion valuation but has since seen its market value drop below $5 billion.
Fermi also named board member Lee McIntire as chief executive this week. McIntire previously served as CEO at engineering firm CH2M Hill and at nuclear power startup TerraPower. He replaces Neugebauer, whom Fermi ousted as CEO in April. The ouster led to legal disputes and a call by Neugebauer, who is also a major shareholder, for changes including the possible sale of the company — an idea Fermi opposed.
“My wife, Melissa, and I have not sold a single [Fermi] share since the IPO,” Neugebauer said in a statement Thursday. “Given the last 100 days’ performance, we continue to believe that Fermi is grossly undervalued and reiterate our call for a strategic, full-value dual process and governance review.”
TensorWave, an AI cloud provider, agreed to the lease at Project Matador, a campus on former grazing land owned by the Texas Tech University System that covers an area more than half the size of Manhattan. The site will have a grid connection but plans large on-site power plants to directly feed data centers running AI workloads.
Fermi also said Hillcore Energy Capital will build, own and operate 2.6 gigawatts of power generation — mostly natural gas with some solar and battery storage — at Project Matador. Fermi would not be required to commit money or issue debt to build the plant but would have the option to buy it in a decade. Hillcore is owned by Canadian investment firm Hillcore Group and industrial contractor JV Driver Group.
Between Hillcore and Fermi’s own construction at the site, the company projects Project Matador could have 4.8 gigawatts of power within about 30 months, eventually growing to 17 gigawatts — an amount of generation greater than what some states require. The campus relies on what the industry calls “Bring Your Own Power,” or BYOP, a strategy of building on-site power plants to bypass grid constraints that have delayed data-center construction elsewhere.
Fermi Chairman Marius Haas told analysts Thursday that the company is “in a much stronger place” than it was three months ago. “The core question now is, ‘How fast can you deliver power in 27?’” Haas said. “Potential customers are running into roadblocks in other locations,” he added. “So they’re now all knocking on the door, coming and having the conversations with the team.”
Analysts at Mizuho Americas called the lease signing “a long-awaited catalyst” for the company. Fermi’s stock dropped 13.16 percent Thursday after gaining earlier in the week on the TensorWave announcement.
Fermi was founded last year with plans to build four nuclear reactors and a large fleet of natural-gas generation to power AI data centers, the Journal reported.