The New Gold Rush Is Nuclear Energy: How American Atomics Could Benefit from the AI Boom Driven by Microsoft, Amazon, and SAP

American Atomics: A Micro-Cap in a Mega-Market

Industry experts predict that the electricity demand of AI data centers will multiply in the coming years. Hyperscalers like Microsoft, Amazon, Google, and Meta are already investing hundreds of billions of US dollars in new infrastructure. At the same time, concerns are growing that existing power grids will struggle to keep pace with this growth. Can American Atomics position itself advantageously here?

The company is pursuing the goal of establishing a vertically integrated North American nuclear fuel supply chain. Under the motto "From Rock to Reactor", the company aims to cover (nearly) all stages of the value chain. Its strategic positioning encompasses a broad spectrum, ranging from exploration and mining through processing, conversion, and enrichment to the production of HALEU (High-Assay Low-Enriched Uranium) fuel, which is required for numerous next-generation reactors.

Recent company announcements attest to these successes. With the completion and submission of the NI 43-101-compliant technical report for the Lisbon Valley East project in the US state of Utah, an important milestone was achieved on the raw materials front. The report primarily describes the geological potential and recommends further drilling programs to verify the historical data.

Overall, the independent consultant assesses the uranium project's exploration target as promising. The report is based on historical mining data, according to which the surrounding Lisbon Valley area produced approximately 80 million pounds of U₃O₈ (uranium oxide) between 1950 and 1990.

At the same time, the appointment of Jolene Molitoris, former head of the US Federal Railroad Administration, underscores the company's ambition to establish a so-called "hub-and-spoke" logistics network on the Colorado Plateau. The goal is to establish a network that efficiently connects multiple uranium projects with downstream processing facilities.

This is complemented by the joint venture with CVMR, through which American Atomics aims to develop a modular facility for uranium processing, conversion, and, in the future, enrichment. This is intended to gradually turn the vision of a fully integrated North American nuclear fuel chain into reality. Currently, the company is valued at only about CAD 10 million.

Microsoft and SAP: Strong Results

Microsoft is among the first major technology companies to openly commit to nuclear energy as a long-term source of electricity. Energy has since become a strategic production factor. The software giant's agreement with Constellation Energy, one of the United States' leading energy companies, nearly two years ago received particular attention.

The deal involved bringing the decommissioned reactor at the Three Mile Island site back online, which is expected to happen next year. At that point, a 20-year power purchase agreement with the Pennsylvania-based plant will take effect. This secures large volumes of low-carbon baseload energy for Microsoft over the long term.

In the fourth quarter, growth accelerated with the Azure cloud platform, with currency-adjusted revenue growth reaching 43%. This exceeded experts' expectations and represents the highest quarterly growth since 2022. The data sends an important message, one that CEO Satya Nadella also emphasized. AI is beginning to generate revenue; Microsoft now has more than 30 million paying Copilot users, while cloud and AI services are already delivering tangible contributions to revenue and cash flow.

SAP's figures were also well received by the market. Despite a slight downward revision to the profit forecast, investors were largely impressed by progress in the cloud business and the AI transformation. On average, analysts expect the stock to have upside potential of a good 20%.

Amazon: AWS Strong, Significant Gains from Revaluation of Anthropic Stake

Amazon recently reported the strongest quarterly growth in its cloud division in several years and, at the same time, reassured investors regarding the multi-billion-dollar expansion of its AI infrastructure. The AWS cloud division increased revenue by 37% to USD 42.2 billion compared to the same period last year, with an operating profit of USD 16.6 billion, corresponding to a margin of 39.4%.

AWS plays a crucial role within the company. While the division generated about 20% of consolidated revenue, it accounted for nearly 60% of total operating profit. However, looking at consolidated net income, which came in at an exceptionally high USD 62.6 billion, presents a distorted picture, as USD 53.4 billion of that amount stems from the revaluation of the Anthropic investment.

Currently, the stock is trading at USD 284, valuing the company at USD 3 trillion. Similar to Microsoft, the average price target for the stock, at USD 323, is not too far from the current level.

The AI boom is not only transforming the tech industry but could also bring about a remarkable comeback for nuclear energy after decades of stagnation. American Atomics is positioning itself to capitalize on these opportunities with a plan to build a fully integrated North American nuclear fuel chain. The potential is enormous. Despite the euphoric sentiment surrounding Microsoft and Amazon, the key question remains whether the multi-billion-dollar investments in data centers can be justified in the long term with sufficiently high returns. Within the industry, some cloud giants are increasingly becoming "landlords" of the AI economy, which points to overcapacity. Will sentiment shift, or will we see seemingly endless growth?