Needham: Oklo's Meta deal gives it 'commercial validation'

Although Oklo Inc. (OKLO) saw its stock surge more than 240% in 2025 in no small part because of the Trump administration's aggressive push to revitalize the nuclear energy sector in the United States, one caveat to the renewed enthusiasm over the nuclear power industry is that the payoff is still years away.

Oklo, for instance, is not expected to have its first small modular reactor (SMR) online until the beginning of the next decade. In fact, there is not actually an active SMR in the US at all as of today.

Nonetheless, investors are betting on what could be tremendous long-term growth opportunities as nuclear energy is expected to play a vital role in powering the proliferation of AI data centers that is already starting to happen.

And after Oklo announced last week that it had signed a deal with Meta Platforms (META) to develop a 1.2 GW power campus in Pike County, Ohio for the tech giant's data centers in the region, Wall Street has grown even more bullish on the SMR startup's prospects.

Needham analysts, led by Sean Milligan, maintained a Buy rating on Oklo in a client note on Friday, calling the agreement with Meta "a major commercial win" for the company.

Milligan noted that the deal represents Oklo's "first firm commitment with a Tier 1 hyperscaler and most concrete commercial arrangement to date."

Terms of the deal were not disclosed, but Meta will prepay for power and provide funding that will support Oklo's Aurora powerhouse deployment.

Oklo broke ground in September on its first Aurora Powerhouse at the Idaho National Laboratory. Called the Aurora-INL, it is a sodium-cooled fast reactor that uses metal fuel – and was one of three projects awarded to Oklo under the government’s Reactor Pilot Program.

Although Milligan sees the Meta deal as a significant step forward for Oklo, he cautioned about potential hurdles given that the company is still not generating any profits.

"We view this as a meaningful positive for Oklo, providing commercial validation, pipeline visibility, and hyperscaler visibility, though execution risks remain given pre-revenue status and regulatory milestones ahead," he said.

Milligan is not alone in citing the potential for execution risks given how many years the project will take to complete. The plan is to incrementally deliver power and reach the full 1.2 GW target by 2034.

In his own client note on Friday, Goldman Sachs analyst Brian Lee maintained a Neutral rating on Oklo's shares, noting that the "deal adds potential upside but long path, execution risk, and licensing hurdles keep outlook in check."

However, Lee pointed to the fact that Meta is licensing other nuclear deals outside of Oklo, which Goldman views "as a positive across for the broader nuclear supply chain as well as incremental signs of traction to support SMR technology."

On Monday, UBS analyst Jon Windham also maintained his Neutral rating on Oklo, calling the Meta agreement "a significant positive for Oklo given Meta's ability to financially support development of Oklo's early-stage advanced reactor projects."

But Windham added that because of the long development timeline, UBS "remains cautious given early-stage execution risks."