Hadron Energy 2026 Q3 Earnings Call

Please go ahead. Thank you, operator, and good afternoon, everyone.

Thank you for joining Hadron Energy's third quarter 2026 earnings call. Presenting today are Sam Gibson, Hadron Energy's founder and Chief Executive Officer, and Rahul Shukla, our Chief Financial Officer. Before we begin, I remind everyone that this call may contain certain statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These include remarks about management's future expectations, beliefs, estimates, plans, and prospects. Such statements are subject to a variety of risks, uncertainties, and other factors that could cause actual results to differ materially from those indicated or implied by such statements. Such risks and other factors are set forth in our quarterly reports on Form 10-Q filed with the Securities and Exchange Commission. We do not undertake any duty to update such forward-looking statements.

It's now my pleasure to turn the call over to Hadron Energy's founder and CEO, Sam Gibson.

Rory, good afternoon, everyone, and thank you for joining our third quarter 2026 earnings call and our first quarterly update as a public company. Hadron's mission is to become the first company to deploy standardized factory-built microreactors at commercial scale. Remote communities, military installations, mission-critical facilities, and smaller data centers need reliable around-the-clock power at the point of use, often where grid expansion is slow or impractical. Halo is designed to address that need as a 10 MWe, factory-built, truck-transportable light-water micromodular reactor. In fact, we chose light water deliberately. It is used in all 94 commercial reactors operating in the U.S. today and has roughly 70 years of operating history with the US Navy. Halo is designed to use standard 5% low-enriched uranium, which is conventional pressurized water reactor fuel, rather than scarce HALEU or TRISO fuel.

We believe this approach offers an established regulatory framework, commercially available fuel, a mature supply chain, and technology familiar to the Nuclear Regulatory Commission. Our license is based on the applicable NRC frameworks, including 10 CFR Part 52 and the emerging Part 57. Collectively, these choices are intended to reduce the risk in licensing, engineering, and operations. Hadron intends to pursue a build-own-operate model, supplying electricity through long-term power purchase agreements. This is designed to generate recurring revenue its life, rather than relying on one-time reactor sales. Our initial target markets are remote applications, including rural communities, military installations, and smaller data centers. Our preliminary target power pricing estimates are $0.50, $0.35, and $0.15 per kilowatt-hour, respectively. These are planning estimates, not contracted prices or guaranteed returns. Early customer interest and feedback across these sectors are helping inform Halo's design and commercial strategy.

Since completing our business combination with GigCapital7 Corp. and listing on Nasdaq on May 26, we have focused on three priorities: strengthening engineering and production capabilities, advancing our regulatory path, and moving from drawings to physical demonstration hardware. The transaction provided approximately $31 million in gross cash proceeds from non-redeemed equity. With no outstanding debt, Hadron has raised approximately $40 million since its founding about two years ago. Licensing is a critical path item, and we began NRC engagement early. We submitted our principal design criteria white paper in April, which is under NRC review. In June, NRC staff issued a final safety evaluation approving our Quality Assurance Program Description for future applications. This is a first for a light-water microreactor and provides a reviewed quality framework covering activities from design through decommissioning.

Our NRC-reviewed regulatory engagement plan targets submission of our manufacturing license and combined operating license applications in 2028, with initial commercial deployment targeted for 2031 to 2032. Execution requires a team of experienced leaders across reactor design, safety and analysis, regulatory affairs, manufacturing, and operations. In August, Eric Williams joined as Executive Vice President of Engineering. In his prior role at TerraPower, he led an organization of more than 100 people and helped secure the first NRC construction permit for the Natrium reactor, with responsibilities spanning engineering, execution, regulatory affairs, quality, and manufacturing. Eric joins our Chief Nuclear Officer, Ross Ridenoure, whose career includes three prior CNO roles and nuclear operations leadership, alongside regulatory specialists, including Andrea Veil, a former NRC executive. We also added seven senior engineering leaders with more than 90 years of combined nuclear experience across core design, safety analysis, component design, structural engineering, and mechanical systems.

Their backgrounds include the Westinghouse AP1000, GE Hitachi's BWRX-300, NuScale's SMR, TerraPower's Natrium, Oak Ridge National Laboratory, and Naval Nuclear Propulsion Program. The additions include four licensed professional engineers and three PhDs. Commercial deployment requires more than a reactor design. Halo must be fueled, controlled, maintained, and operated by a qualified team. Our agreement with ConverDyn secures uranium conversion services from the only U.S. commercial provider and strengthens a critical domestic link in our nuclear fuel supply chain. Hadron's collaboration with Paragon Energy Solutions advances our instrumentation and control systems. We also selected GSE Solutions to deliver a full-scope, high-fidelity simulator that will support operator training and the basis for NRC operator licensing. Additionally, the U.S. Patent and Trademark Office has published our first patent application titled "Micro Integral Nuclear Reactor," covering the integral pressure vessel and transportable configuration central to Halo.

To establish our public company, we engaged with DLA Piper's government affairs team to support federal policy and deployment strategy, and CORE IR for investor relations. In October, H.C. Wainwright initiated equity research coverage of Hadron. On the commercial front, we have also established a framework with Smartland Energy, which includes a strategic investment in Hadron and contemplates potential Halo deployments across multiple projects, representing approximately 1.8 GW of behind-the-meter capacity. We are also in discussions with prospective customers in remote applications, military installations, and data centers. These opportunities remain preliminary and are subject to further agreements, licensing, and project development. They are not contracted backlog. Our priority is to convert the most promising engagements into defined, financeable commercial opportunities. As our next step, we are establishing a dedicated headquarters that will bring engineering, licensing, and executive leadership together. It will serve as our corporate engineering and demonstration facility.

We will not operate a fueled reactor at the facility and expect to announce its location and further details in the coming months. Our control room simulator is expected to come online in early 2027. It will display a real-time model of the Halo micro-reactor with stations for two reactor operators and a senior reactor operator. This simulator will help us test control strategies, develop the staffing model, and demonstrate how Halo is designed to operate. We also partnered with a manufacturing firm to fabricate a non-nuclear demonstration reactor, showcasing the reactor vessel and internal components. It will allow our engineers to verify fit, access, assembly, and rehearse the refueling sequence. Fabrication of this demonstration reactor is underway. Expected delivery in early 2027. Together, the simulator and demonstration reactor will form Hadron's demonstration center, where customers, partners, regulators, and investors can see the hardware and observe simulated plant operations.

Meeting the growing demand for firm on-site power is a defining challenge for our nation. The Department of Energy projects that the U.S. will need 200 GW of additional capacity by 2030. Data centers, advanced manufacturing, and defense installations are growing faster than the grid can support in many locations, while interconnection queues can stretch for years. Customers need reliable power at their sites without extensive new transmission and distribution infrastructure, while they increasingly value generation that produces no carbon emissions during operation. Hadron addresses this market demand. Our 10 MW Halo micro-reactor is intended to serve a remote community, military installation, or mid-sized data hall behind the meter, and multiple units could serve larger sites. Halo is designed for an operating cycle of up to six years between refuelings and an expected useful life of approximately 60 years.

Its footprint is measured in a few acres, and the system is being designed to provide electricity. Our commercialization strategy combines proven light-water engineering and established fuel technology to reduce first-of-a-kind risk, standardize factory-built reactors designed for truck transport with greater cost and schedule predictability, and an integrated model in which we design, build, own, and operate units to sell electricity and heat under long-term agreements. Hadron's long-term objective is fleet deployment. We will continue to focus on the specific regulatory requirements and approvals applicable to Halo as the regulatory environment evolves. I will now hand the call over to Rahul for an update on our financial position.

Thank you, Sam. As a nuclear technology company in the development phase, our investments are focused on engineering design, regulatory activities, and building the organizational capabilities required to achieve our commercialization milestones. As of September 30, 2026, Hadron had approximately $19.7 million in cash and cash equivalents, compared with $22.2 million as of June 30, 2026, with no outstanding debt. Our cash utilization during the third quarter was approximately $2.5 million. Third quarter operating expenses totaled approximately $6 million, including approximately $2.3 million non-cash stock-based compensation and equity award charges. These expenses reflect, in part, our continued recruitment of technical talent and the development and design of the Halo micro modular reactor. We are managing spend carefully and prioritizing regulatory and technical milestones that directly advance commercialization. Based on our current operating plan, we believe available liquidity will support planned operations.