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CENTRUS ENERGY $LEU Q3’26 — EARNINGS DISAPPOINT, BUT DOMESTIC NUCLEAR FUEL EXPANSION IS MOVING FORWARD Centrus delivered a weak quarter financially, with revenue declining 26%, an adjusted loss per share and operating income below expectations. But the bigger investment story is the company's progress towards expanding domestic uranium enrichment and HALEU production capacity. For me, this is increasingly an execution and capital deployment story rather than a conventional quarterly earnings story. THE NUMBERS 🔹 Revenue: $55.5M (Est. $55.3M) 🟢; −26% YoY 🔹 Adjusted Diluted EPS: −$0.46 (Est. −$0.39) 🔴 🔹 GAAP Diluted EPS: $1.41 🔹 Operating Loss: $29.7M (Est. $20.6M Loss) 🔴 🔹 Warrant Fair-Value Gain: $46.4M The difference between positive GAAP EPS and negative adjusted EPS is important. The $46.4M warrant fair-value gain contributed to reported profitability, but it doesn't represent recurring operating earnings. Underlying operating performance was considerably weaker than the GAAP EPS figure suggests. SEGMENT PERFORMANCE 🔹 LEU Revenue: $31.8M; −29% YoY 🔹 Technical Solutions: $23.7M; −21% YoY Both segments recorded declining revenue. That reinforces why I wouldn't interpret the positive GAAP earnings figure as evidence of improving core profitability. The timing of nuclear fuel deliveries and technical contracts can influence quarterly results, but the supplied figures don't establish how much of the decline reflects timing rather than underlying demand. FY26 OUTLOOK 🔹 Revenue: $450M–$500M (Est. $481M) 🟡 🔹 Planned Capital Deployment: $350M–$500M 🔹 Oak Ridge Hiring: At Least 100 Net New Employees 🔹 Piketon Hiring: At Least 175 Net New Employees; Previously 100 The revenue guidance midpoint of $475M sits slightly below consensus. More importantly, Centrus is committing substantial capital and expanding its workforce to support domestic enrichment capacity. This is a major investment phase, and the returns will depend on execution, funding arrangements and the timing of commercial production. HALEU & CENTRIFUGE EXPANSION 🔹 First New Centrifuge Shipped 🔹 HALEU Cascade: 16 Centrifuges 🔹 Manufacturing Supply Chain Completed Two Months Ahead of Schedule 🔹 First Certified-for-Construction Package Completed Ahead of Year-End Target These milestones are strategically important. HALEU, or high-assay low-enriched uranium, is a critical fuel requirement for many proposed advanced nuclear reactor designs. The United States is seeking to strengthen domestic nuclear fuel supply chains, creating a potential long-term opportunity for companies capable of delivering commercial enrichment capacity. Centrus is making tangible progress towards that objective. But manufacturing readiness and centrifuge shipment milestones are not the same as fully operational commercial-scale production. BACKLOG & COMMERCIAL OPPORTUNITY 🔹 LEU and HALEU Sales Commitments: $5.4B The size of the commitments is encouraging, but the qualification matters. These are contingent sales commitments, not $5.4B of guaranteed revenue. Actual conversion will depend on contract conditions, production capacity, customer requirements and delivery schedules. That distinction is particularly important when evaluating the company's future revenue potential. WHAT'S CHANGING Centrus is positioning itself within a strategically important part of the nuclear supply chain. Growing interest in nuclear energy, energy security and advanced reactors is increasing attention on domestic uranium enrichment. AI data-centre electricity demand adds to the broader nuclear investment thesis, but Centrus is a fuel-cycle company rather than a direct electricity generator. Its opportunity depends on enrichment demand, fuel procurement and the commercial development of nuclear projects. The company also faces a substantial execution challenge as it scales manufacturing and deploys capital ahead of future production revenue. MY TAKE I remain interested in Centrus because domestic uranium enrichment is strategically important and difficult to replicate. The barriers to entry are significant, and a successful expansion could create a valuable long-term position in the nuclear fuel market. But I wouldn't overlook the weak quarterly financial performance. Revenue declined, both operating segments contracted and adjusted EPS remained negative. The $46.4M warrant gain also makes headline GAAP profitability a poor indicator of underlying earnings quality. What encourages me is the operational progress: the first new centrifuge shipment, manufacturing supply-chain readiness and accelerated hiring. What concerns me is the gap between strategic opportunity and demonstrated commercial profitability. With $350M–$500M in planned capital deployment, investors need to understand how expansion will be financed and when new capacity can begin generating attractive cash returns. WHAT MATTERS NEXT I'm watching centrifuge manufacturing and deployment, HALEU production milestones, funding arrangements, backlog conversion and the company's ability to translate its strategic position into sustainable operating earnings. Centrus has a compelling long-term opportunity in domestic nuclear fuel supply. But the investment case ultimately depends on converting manufacturing progress and contingent commitments into operational capacity, recurring revenue and free cash flow.