Nuclear Energy Gets a Big Government Boost (Again)

**Tyler Crowe** (0:02)
Nuclear stocks are going nuclear today on Motley Fool Hidden Gems Investing.
Welcome to Motley Fool Hidden Gems Investing. I'm your host, Tyler Crowe, and today I'm joined by longtime Fool contributors, Matt Frankel and Jon Quast. Nuclear's been in the news lately, and so we're going to be diving into some recent announcements related to federal government incentives at getting into the nuclear industry and trying to drive that further. We're also going to take some listener questions related to the energy space as well. But there's a lot of headline news going on these days, not like giant earth shattering news, but a nice smorgasbord of news stories today. We had the Micron earnings recently. And what we want to do is just do a quick round the room of stories that we saw that were kind of interesting and why you think they matter. Jon, I want to start with you. What did you see recently? You were like, huh, that was interesting.

**Jon Quast** (0:56)
Well, yesterday, Qualcomm had its Investor Day presentation. Qualcomm, of course, a huge semiconductor company. And the thing that stood out to me was it's launching a data center platform. Now, Qualcomm is known as more of a mobile device player. It's Snapdragon chips are in a lot of mobile devices, and that's really where it's bread and butter is.
But saying that it's launching a data center platform now, and it's targeting about 15 billion in revenue by 2029
And for perspective, the company has about 45 billion in total trailing 12-month revenue right now. So adding 15 billion to that top line number is pretty significant. And I think what stands out to me is for investors, a lot of investors are starting to question, where are we in this AI infrastructure build out? Is it too late when it comes to data centers? And Qualcomm is a $200 billion company, and just now throwing its name in the ring as a contender in this space, just now getting in. So to me, that's a strong signal that maybe this AI data center build out still has a lot of legs to it because a huge player just jumped into the game.

**Tyler Crowe** (2:11)
Certainly with so many of these semiconductor industry companies with market caps now north of a trillion dollars, $200 billion, it almost sounds puny by comparison. So one of the questions I immediately had when we were discussing this pre-show was, does Qualcomm have the production capacity to support this? Or is it just shifting sales from one place to another? You know, scene story, like Micron says they're almost sold out for a couple years. Taiwan Semi says they're sold out.
Apple's raising prices on their products just because of high memory costs and semiconductor costs. I'm wondering if this is a lot of companies saying, we're getting into data centers with chips, but getting production lines up and running takes quite a bit of time.

**Jon Quast** (2:55)
Yeah, it does. I should have said in my opening statement here is that one of the reasons why Qualcomm believes it's not too late is because it really sees this agentic AI trend really just starting to inflect now.
And AI agents, basically, they can make 50 to 100 times as many inference requests as a human. That's kind of your big headline number, which means a lot more CPUs are needed now than what were needed before to make all this run. So there's really kind of a CPU bottleneck going on, maybe it's already been talked about a lot. But Qualcomm here, jumping into this ring with its data center CPU, the Dragonfly C1000 and announcing that Meta already signing up to be a customer of this product. So I think that's significant. That said, this particular data center product isn't supposed to reach production until 2028 And so that's a little bit out into the future there. Now that's not carrying the entire 15 billion target revenue number on its own, but it will play a part of that. So 2028 is kind of the target number for getting that thing off the ground. Now you look at players like Taiwan Semiconductor. This is a huge partner of Qualcomm.
It's saying that it's kind of constrained until at least 2027 So maybe there's a path where supply and demand start to balance out a little bit by the time Qualcomm is wanting to ramp this particular product. Of course, Qualcomm does have a good relationship there. But I think kind of the other things here to keep in mind is that there are some rumors that Qualcomm and others are actually exploring Samsung Foundry because Taiwan Semi can't meet all the demand that there is. And so maybe there's some ways that Qualcomm can get around some of these supply constraints and still meet its production goals.