Key Takeaways
- • Fermi shares plunged 40% on Friday, December 12, 2025, after the data center REIT said a prospective tenant terminated a deal to help fund construction at its Texas Project Matador site, according to Reuters.
- • The terminated funding arrangement would have seen an undisclosed customer lease part of the Project Matador site and provide up to $150 million toward construction financing.
- • Fermi, co-founded by former U.S. Energy Secretary Rick Perry, listed in October at a $14.8 billion valuation and has yet to generate revenue.
- • The stock last traded at $9.08, 57% below its $21 IPO price, reflecting investor concern over a more cautious backdrop for AI-related infrastructure.
Summary
Shares of Fermi, a data center real estate investment company, plunged 40% on Friday after the firm disclosed that a prospective tenant had terminated a deal to help fund construction at its Project Matador site in Texas, according to Reuters. Under the terms of the scrapped agreement, the undisclosed customer would have leased part of the site and could have provided up to $150 million to finance construction.
Reuters reported that while both parties remain in discussions over a potential lease, the funding agreement itself has been scrapped. The development marks an early setback for the company, which was co-founded by former U.S. Energy Secretary Rick Perry and began trading in October at a valuation of $14.8 billion. Fermi has not yet brought in revenue.
The IPO was driven by strong AI-related demand, as investors sought companies providing the infrastructure the technology requires. However, the company is now navigating a more cautious environment for AI stocks, with some investors questioning how long the sector's rally can continue without clearer paths to profitability. The stock last traded at $9.08, 57% below its $21 initial public offering price.
Reuters reported that while both parties remain in discussions over a potential lease, the funding agreement itself has been scrapped. The development marks an early setback for the company, which was co-founded by former U.S. Energy Secretary Rick Perry and began trading in October at a valuation of $14.8 billion. Fermi has not yet brought in revenue.
The IPO was driven by strong AI-related demand, as investors sought companies providing the infrastructure the technology requires. However, the company is now navigating a more cautious environment for AI stocks, with some investors questioning how long the sector's rally can continue without clearer paths to profitability. The stock last traded at $9.08, 57% below its $21 initial public offering price.
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