U.S. Nuclear Sector Experiences Significant Gains on Policy Support and Surging AI-Driven Demand

U.S. Policy Initiatives Propel Nuclear Energy Sector Revival Amid Rising Demand

U.S. equities saw notable activity in the nuclear energy sector during the second quarter of 2025, driven by a series of executive orders and policy actions from the U.S. Government. These directives, aimed at revitalizing the domestic nuclear industry, spurred a "surprise rally" across related stocks and commodities, as investors interpreted them as a strong commitment to expanding U.S. nuclear power capabilities.

The Event in Detail: Ambitious Targets and Strategic Focus

On May 23, 2025, President Trump signed executive orders initiating a comprehensive strategy to bolster the nation's nuclear energy infrastructure. The central objective is to quadruple domestic nuclear power generation capacity to 400 gigawatts (GW) by 2050. These policies focus on several key areas: reforming the Nuclear Regulatory Commission (NRC) to streamline the licensing process, accelerating nuclear reactor testing at the Department of Energy (DOE), fortifying the domestic nuclear industrial base, and promoting the deployment of advanced nuclear technologies, particularly Small Modular Reactors (SMRs).

Specific targets include an 18-month deadline for new reactor licensing decisions and the establishment of a 20-metric-ton high-assay low-enriched uranium (HALEU) fuel bank. Demonstrating commitment to SMRs, orders have been placed for their deployment at a DOE facility by November 2027 and at a military base by September 2028, with the government assuming regulatory and technical risks to validate the technology.

Analysis of Market Reaction: Broad-Based Gains and Corporate Engagement

The market's immediate response was decisively positive. Uranium spot prices experienced a significant ascent, climbing from approximately $63.50 per pound at the beginning of 2025 to around $82 per pound by late September. This represented a 24% increase between March and June 2025 alone. The Global X Uranium ETF (URA.P) posted gains exceeding 11% following the policy announcements.

Individual companies across the nuclear supply chain also saw substantial appreciation. Fuel companies such as Uranium Energy Corp (NYSE: UEC), Energy Fuels, and Centrus Energy (LEU) surged approximately 20%. Canadian miner Cameco Corporation (TSX: CCO, NYSE: CCJ) advanced nearly 10% after the executive orders and has seen its shares gain over 64% in 2025. Analysts continue to maintain a “Buy” rating on Cameco with a target price of $70.53. Other significant players like NexGen Energy Ltd. (TSX: NXE, NYSE: NXE) and Denison Mines Corp. (TSX: DML, NYSE: DNN) are also positioned for continued growth.

Nuclear technology developers witnessed similar enthusiasm. Nano Nuclear Energy, Oklo (OKLO), and NuScale Power (SMR) reported stock increases ranging from 19% to 30%. NuScale Power, a pioneer in SMR technology with the only U.S. NRC-certified SMR design, reported Q2 2025 revenue of $8.1 million, a substantial increase from $1.0 million year-over-year. Despite a net loss of $0.13 per share, slightly wider than analyst expectations, the company maintained robust cash reserves of $489.9 million. Its regulatory progress included receiving NRC Standard Design Approval for its uprated 77 MWe SMR design, and a historic August 2025 agreement with the Tennessee Valley Authority (TVA).

Centrus Energy, the sole U.S. producer of enriched uranium, secured a $110 million extension for its HALEU production through 2026. While its $700 million convertible debt offering to fund HALEU expansion introduces potential dilution risks, a growing backlog and partnerships, including one with Oklo, underscore its critical role. BWX Technologies (BWXT), with a $15 billion market cap, was selected for three projects under the DOE’s Reactor Pilot Program. Pre-revenue SMR innovator Oklo experienced a price target increase from Wedbush analysts to $55 from $45, despite a $28 million quarterly cash burn, buffered by $683 million in cash reserves. Its long-term success relies on timely licensing and commercialization of its Aurora reactor by 2027.

Notably, major technology companies are driving significant private sector investment. Microsoft (NASDAQ: MSFT) has a power-purchase agreement (PPA) to restart the Three Mile Island nuclear fission power plant, while Meta Platforms (NASDAQ: META) has a 20-year PPA with the Clinton fission plant. Amazon has led a $500 million investment in X-energy and intends to procure 5 GW of nuclear power. Google has also signed an agreement with Elementl Power for advanced reactor projects. These commitments represent nearly 30 GW of nuclear power, highlighting a strategic shift by corporations to secure reliable, carbon-free energy for their burgeoning AI and data center demands.

Broader Context & Implications: AI, Global Trends, and Enduring Challenges

The resurgence in nuclear power is underpinned by an unprecedented surge in electricity demand, primarily driven by the rise of AI. Global electricity demand is projected to nearly double by 2050, with data center power demand alone expected to rise by as much as 165% by 2030, necessitating significant new generation capacity. Nuclear energy is increasingly viewed as an essential baseload power source to meet this demand while supporting decarbonization goals.

Globally, investment in nuclear power generation grew at a Compound Annual Growth Rate (CAGR) of 14% between 2020 and 2024. This trend is expected to accelerate, with 31 countries, including major energy users like Amazon, Google, and Meta, pledging to triple global nuclear capacity by 2050. This private sector momentum, coupled with public support, positions the U.S. to potentially regain leadership in nuclear energy development, despite facing historical challenges from nations like China and Russia.

However, significant hurdles remain. The U.S. nuclear workforce would need to triple to meet 2050 demand, yet nuclear engineering graduates have decreased by 20% from 2015 peaks. Diminished industry know-how, supply chain disruptions, and regulatory complexities contribute to longer construction timelines and cost overruns, as exemplified by Georgia's Plant Vogtle, which took about 15 years to complete and cost over $35 billion, more than double initial projections.

Expert Commentary: Shifting Sentiment and Investment Confidence

Analysts generally view these developments as a significant catalyst for the sector. Wedbush analysts noted the executive orders were "expected to be a significant tailwind for the industry." Public sentiment has also shifted, with a recent Gallup Poll indicating 61% of Americans now support nuclear energy, a near-record high. This broad support, combined with increased engagement from Wall Street—evidenced by a doubling of participation at the Nuclear Energy Institute's annual financing summit—suggests growing confidence in the sector's long-term viability.

Looking Ahead: Regulatory Progress and New Capacity Announcements

Moving forward, the DOE is actively inviting proposals for advanced reactor testing, with a goal of having at least three advanced reactors operational by July 4, 2026. The NRC is also working to fast-track its review processes, aiming to decide on new reactor construction and operating license applications within 18 months. In early June 2025, New York Governor Kathy Hochul announced plans for a new nuclear power plant, marking the first major new commercial U.S. plant announcement in over 15 years, expected to add at least 1,000 MW of clean energy capacity. While these initiatives signal a sustained positive trajectory, stakeholders will continue to monitor challenges such as uranium supply constraints and the lengthy deployment timelines for many SMRs, which are not expected to be operational until the 2030s.