“AI actually makes up the majority of our backlog that we've been talking about,” DeWitte said in an interview. This includes customers from the chip industry as well as data centers, he added. The company publicly announced that it was working with the hyperscalers Equinix and Prometheus Hyperscale. No deals with Big Tech companies have been announced yet.

But Wall Street analysts warn that the company and its rivals face regulatory and supply chain hurdles before they can produce anything close to the amount of energy needed to power artificial intelligence data centers.

In response to the high-profile global meltdowns at Three Mile Island in 1979, Chernobyl in 1986 and Fukushima in 2011, nuclear projects are subject to strict regulations. On average, it takes 80 months for the U.S. Nuclear Regulatory Commission to approve construction of nuclear power plants in the U.S., compared to an average of 54 months in the United Kingdom, according to research cited by Canaccord Genuity.

While a number of companies are developing SMRs – including Bill Gates' TerraPower – none have yet been deployed in the US, and lengthy licensing processes mean profitability isn't exactly in sight.

In Oklo's first earnings report since going public on Aug. 13, the company reported a net loss of about $53 million for the first six months of the year, wider than the loss of about $9 million in the same period last year.

Fuel is also a problem for companies in this space: Many SMRs, such as those from Oklo, NuScale and TerraPower, require a specific type called high-assay low enriched uranium, also known as HALEU, which is imported from Russia. There is little to no domestic supply as the West as a whole has refrained from establishing a HALEU supply chain. According to Canaccord Genuity, this is because enriched uranium is used in nuclear weapons.

“A developed Western HALEU supply chain is missing, particularly given efforts to limit enrichment due to proliferation concerns,” Canaccord Genuity analyst George Gianarikas wrote in a note to investors earlier this year.

Citing supply constraints and long and difficult licensing processes, Citi's Vikram Bagri recently lowered his price target on Oklo shares from $11 to $10.

“There are too many ifs in this process,” Bagri said. “It looks like new technologies and new nuclear power plants will only be introduced after 2030. After 2030, it remains to be seen who will be successful and how successful they will be, how many nuclear reactors we will see.”

But Seaport analyst Jeffrey Campbell sees Oklo's advantages in the emerging market, pointing to its ability to use “much cheaper” recycled fuel.

While building a conventional nuclear power plant can cost billions of dollars, the cost of commissioning one of its SMRs runs into a few hundred million dollars, according to Oklo.

For his part, DeWitte is optimistic about the future of the market — and Oklo's place in it. DeWitte cited increasing bipartisan support to reduce regulatory hurdles and increase domestic supply of HALEU. He said Oklo is unique because the company wants to own and operate its assets and sell energy directly to customers, rather than traditionally licensing its technology to utilities. DeWitte believes this will allow the company to put its reactors into operation more quickly.

“In today’s world where this opportunity is so enormous – diverse customers who need and want different things, a diverse ecosystem will emerge,” he said. He added: “You’re not going to see a winner take all.”

Laura Bratton is a reporter for Yahoo Finance. Follow her on X @LauraBratton5.

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