X-Energy, Inc.

Previous wording

Unless otherwise indicated or the context otherwise requires, references in this section to the “Company,” “we,” “us,” “X-energy,” or “our” refer to the business of XERC for the period prior to the initial public offering and X-Energy, Inc. and its subsidiaries for all periods after the initial public offering.

Current wording

Unless otherwise indicated or the context otherwise requires, references in this section to the “Company,” “we,” “us,” “X-energy,” or “our” refer to the business of X-Energy Reactor Company, LLC (“XERC”) for the period prior to the initial public offering and X-Energy, Inc. and its subsidiaries for all periods after the initial public offering.

Previous wording

X-energy is a leading designer of advanced nuclear reactor technology (commonly referred to as small modular reactors, “SMRs”) and manufacturer of advanced nuclear fuels. We believe these scalable, power generation technologies help satisfy historically unprecedented electricity demand growth, driven by the development of artificial intelligence (“AI”) and associated data center infrastructure, industrial growth and reshoring of manufacturing, and broader electrification. We intend to continue developing our reactor and fuel technology with the goal of achieving commercial delivery of our first fleets of reactors by the early 2030s.

Current wording

X-energy is a leading designer of advanced nuclear reactor technology (commonly referred to as small modular reactors, “SMRs”) and manufacturer of advanced nuclear fuels. We believe these scalable, power generation technologies help satisfy historically unprecedented electricity demand growth, driven by industrial growth and reshoring of manufacturing, the development of artificial intelligence (“AI”) and associated data center infrastructure, and broader electrification. We intend to continue developing our reactor and fuel technology with the goal of achieving commercial delivery of our first fleets of reactors by the early 2030s.

Previous wording

Our flagship product, the Xe-100, is an advanced small modular High Temperature Gas-cooled Reactor (“HTGR”), and has been in development for nearly a decade. The Xe-100 reactor is designed to generate 80 megawatts of electric power or 200 megawatts of thermal output (heat), or a combination thereof. This reactor technology builds on more than 50 years of research and development by the global nuclear industry and the operating experience of previous HTGRs. The Xe-100 has several technological attributes that we believe make it advantaged compared to other sources of baseload generation. These include advanced safety features, virtually no direct greenhouse gas (“GHG”) emissions during generation, high thermal output, load-following capabilities, and modularity, all of which allow X-energy to more specifically meet a customer’s power and/or industrial heat needs. X-energy’s simple Xe-100 design directly translates into simplicity of project delivery through reduced supply chain complexity and labor intensity during construction, which we believe will lead to lower cost and faster deployment timelines when compared with conventional nuclear energy sources. X-energy has optimized the deployment of its Xe-100 into a four-reactor format that outputs 320 MWe (or 800 MWt). By deploying four independent reactor modules instead of a single unit, this optimized four-reactor configuration inherently delivers the high levels of reliability and redundancy required for both AI and industrial heat applications.

Current wording

Our flagship product, the Xe-100, is an advanced small modular High Temperature Gas-cooled Reactor (“HTGR”), and has been in development for nearly a decade. The Xe-100 reactor is designed to generate 80 megawatts of electric power or 200 megawatts of thermal output (heat), or a combination thereof. This reactor technology builds on more than 50 years of research and development by the global nuclear industry and the operating experience of previous HTGRs. The Xe-100 has several technological attributes that we believe make it advantaged compared to other sources of baseload generation. These include advanced safety features, virtually no direct greenhouse gas (“GHG”) emissions during generation, high thermal output, load-following capabilities, and modularity, all of which allow X-energy to more specifically meet a customer’s power and/or industrial heat needs. X-energy’s simple Xe-100 design simplifies project delivery through reduced supply chain complexity and labor intensity during construction, which we believe will lead to lower cost and faster deployment timelines when compared with conventional nuclear energy sources. X-energy has engineered the deployment of its Xe-100 into a four-reactor format that outputs 320 MWe (or 800 MWt). By deploying four independent reactor modules instead of a single unit, this four-reactor configuration can deliver high levels of reliability and redundancy required for both AI and industrial heat applications.

Previous wording

X-energy’s reactors use a tri-structural isotropic (“TRISO”) coated particle fuel in the form of a spherical ‘pebble’, called TRISO-X fuel. This pebble fuel consists of high-assay low-enriched uranium (“HALEU”) fuel kernels individually encapsulated in layers of silicon carbide and pyrolytic carbon, forming miniature containment systems that trap fission products. These particles are then embedded in a graphite matrix to make fuel pebbles that possess exceptional safety margins and compacts, enabling operations at very high temperatures. The HALEU fuel used in our TRISO-X pebble fuel is enriched to 15.5%, a higher energy density form than the less than 5% low-enriched uranium (“LEU”) fuel used in conventional nuclear reactors. TRISO-X fuel will be produced at our fuel fabrication facility in Oak Ridge, Tennessee. The first facility, known as TX-1, began construction in October 2024 and is expected to begin operations by the first half of 2028 (“TX-1”). Upon completion, it is expected to be North America’s first purpose-built commercial advanced nuclear fuel fabrication facility. In February 2026, TRISO-X received an initial 40-year Special Nuclear Material License under 10 CFR Part 70 from the NRC enabling TRISO-X to commercially manufacture X-energy’s TRISO-X fuel at TX-1 and we expect this license to also cover a second fuel fabrication facility (“TX-2”) if built as currently planned on the same site. The TX-1 facility will have sufficient production capacity to support the fuel fabrication needs of the first 11 Xe-100 reactors at steady state operations. We plan to construct TX-2 at the same site as TX-1 and expect TX-2 would support fuel for up to 44 Xe-100 reactors annually. The construction of our fuel fabrication facilities and transition to commercial fuel production operations will require the expansion of our workforce and operational capabilities and is expected to increase our costs in future periods.

Current wording

X-energy’s reactors use a tri-structural isotropic (“TRISO”) coated particle fuel in the form of a spherical ‘pebble’, called TRISO-X fuel. This pebble fuel consists of enriched uranium fuel kernels individually encapsulated in layers of silicon carbide and pyrolytic carbon, forming miniature containment systems that trap fission products. These particles are then embedded in a graphite matrix to make fuel pebbles that possess exceptional safety margins and compacts, enabling operations at very high temperatures. The high-assay low-enriched uranium (“HALEU”) fuel used in our TRISO-X pebble fuel in steady state reactor operations is enriched to 15.5%, a higher energy density form than the less than 5% low-enriched uranium (“LEU”) fuel used in steady state operations in conventional nuclear reactors. TRISO-X fuel will be produced at our fuel fabrication facilities in Oak Ridge, Tennessee and any other future locations. The first facility, known as TX-1, began site preparation for construction in October 2024 and began vertical construction in September 2025 (“TX-1”). Upon completion, we believe it will be North America’s first purpose-built commercial advanced nuclear fuel fabrication facility. In February 2026, TRISO-X received an initial 40-year Special Nuclear Material License under 10 CFR Part 70 from the Nuclear Regulatory Commission (“NRC”) enabling TRISO-X to commercially manufacture X-energy’s TRISO-X fuel at TX-1 and this license will also cover a second fuel fabrication facility (“TX-2”) currently planned on the same site. The TX-1 facility will have sufficient production capacity to support the fuel fabrication needs of the first 11 Xe-100 reactors at steady state operations. We plan to construct TX-2 at the same site as TX-1 and expect TX-2 will support fuel for up to 44 Xe-100 reactors annually. The construction of our fuel fabrication facilities and transition to commercial fuel production operations will require the expansion of our workforce and operational capabilities and is expected to increase our costs in future periods.

Previous wording

Dow is X-energy’s first customer to receive a reactor and is a global leader in the specialty chemicals industry. X-energy has partnered through a Master Project Development Agreement (“MPDA”) and Commercial Cooperation Agreement (“CCA”) with Dow to provide our services in support of a first-of-a-kind (“FOAK”) deployment of four Xe-100 reactors to provide power and industrial steam at Dow’s UCC Seadrift site in Texas. With the support and assistance of X-energy, Long Mott Energy, LLC, a wholly owned subsidiary of Dow, filed a Construction Permit Application (“CPA”) with the NRC in March 2025 which was docketed in May 2025 for an 18-month review period with an expected review completion by late 2026 and receipt of the CPA expected in the first quarter of 2027. Initial construction can commence after receipt of the CPA. We expect our first commercial delivery to occur in the early 2030s.

Current wording

Dow is expected to be X-energy’s first customer to receive a reactor and is a global leader in the specialty chemicals industry. X-energy has partnered with Dow through a Master Project Development Agreement (“MPDA”) and Commercial Cooperation Agreement (“CCA”) to provide our services in support of a first-of-a-kind (“FOAK”) deployment of four Xe-100 reactors to provide power and industrial steam at Dow’s UCC Seadrift site in Texas. With the support and assistance of X-energy, Long Mott Energy, LLC, a wholly owned subsidiary of Dow, filed a Construction Permit Application (“CPA”) with the NRC in March 2025 which was docketed in May 2025 for an 18-month review period with an expected review completion by late 2026 and receipt of the CPA expected in the first quarter of 2027. As part of the CPA process, in May 2026, the NRC completed its Environmental Assessment ahead of schedule and concluded with a Finding of No Significant Impact. We expect our first commercial reactor delivery to occur in the early 2030s.

Previous wording

Amazon made an equity investment in X-energy in 2024 and announced options to bring more than 5 GWe of new Xe-100 projects online across the U.S. by 2039. The first deployment under this 5 GWe total potential target is a project with Energy Northwest in central Washington. Amazon and Energy Northwest entered into a Carbon Free Development and Funding Agreement for an initial deployment of four reactors representing 320 MWe, with the potential to upsize the power capacity to 960 MWe. We expect operations of the reactor to commence in the early 2030s.

Current wording

Amazon made an equity investment in X-energy in 2024 and announced options to bring more than 5 GWe of new Xe-100 projects online across the U.S. by 2039. The first deployment under this 5 GWe total potential target is a project with Energy Northwest in central Washington. Amazon and Energy Northwest entered into a Carbon Free Development and Funding Agreement for an initial deployment of four reactors representing 320 MWe, with the potential to upsize the power capacity to 960 MWe. We expect operations of these reactors to commence in the early 2030s.

Previous wording

X-energy maintains a strong relationship with the DOE and in December 2020 was awarded an initial $1.2 billion as part of its selection as one of two awardees in the ARDP, the most substantial federal commitment ever made to deploying advanced nuclear technology. The cooperative agreement for the program, signed in February 2021 (the “ARDP Agreement”), provides 50/50 cost share of $2.4 billion of eligible costs ($1.2 billion reimbursement) through 2027, allowing X-energy to continue work toward design, licensing, commercialization, and construction of its first-of-a-kind commercial advanced nuclear plant and commercial TRISO-X fuel fabrication facility, while benefiting from decades of nuclear experience and knowledge within the DOE. We submit our budgets through an ongoing “budget period” basis tied to project milestones under the ARDP Agreement, and our current budget covers a budget period that began in March of 2025 and extends through August 2026. We submit non-competitive applications for an additional budget period within the contractual award timeline under the ARDP Agreement (“Continuation Applications”) to the DOE to extend funding into subsequent periods. Extensions beyond the current budget period are subject to DOE discretion and approval. Under the terms of the ARDP Agreement that rely on the Office of Management and Budget (OMB) guidance, the total extension of the award may not exceed three years (for a total period of performance of 10 years). Any additional extension would require an approval within DOE beyond the authority provided in the ARDP Agreement. If we are unable to obtain extensions and incur eligible costs beyond the currently approved period of performance, we would forgo reimbursement for such costs and may face de-obligation of unobligated funds at closeout. There can be no assurance that we will receive additional ARDP funding beyond the current budget period or that extensions will be granted.

Current wording

X-energy maintains a strong relationship with the DOE and in December 2020 was awarded an initial $1.2 billion as part of its selection as one of two awardees in the ARDP, the most substantial federal commitment ever made to deploying advanced nuclear technology. The cooperative agreement for the program, signed in February 2021 (the “ARDP Agreement”), provides 50/50 cost share of $2.4 billion of eligible costs ($1.2 billion reimbursement) through 2027, allowing X-energy to continue work toward design, licensing, commercialization, and construction of its first-of-a-kind commercial advanced nuclear plant and TX-1, its first commercial TRISO-X fuel fabrication facility, while benefiting from decades of nuclear experience and knowledge within the DOE. We submit our budgets through an ongoing “budget period” basis tied to project milestones under the ARDP Agreement, and our current budget covers a budget period that began in March 2025 and extends through March 2027. We submit non-competitive applications for an additional budget period within the contractual award timeline under the ARDP Agreement (“Continuation Applications”) to the DOE to extend funding into subsequent periods. Extensions beyond the current budget period are subject to DOE discretion and approval. Under the terms of the ARDP Agreement that rely on the Office of Management and Budget (OMB) guidance, the total extension of the award may not exceed three years (for a total period of performance of 10 years). Any additional extension would require an approval within DOE beyond the authority provided in the ARDP Agreement. If we are unable to obtain extensions and incur eligible costs beyond the currently approved period of performance, we would forgo reimbursement for such costs and may face de-obligation of unobligated funds at closeout. There can be no assurance that we will receive additional ARDP funding beyond the current budget period or that extensions will be granted.

Previous wording

In the U.S., growing power demand from data center buildout, industrial expansion, manufacturing reshoring, and broader electrification is creating use cases for scalable, firm, clean baseload power that we believe SMRs like the Xe-100 can uniquely deliver. AI-driven computing requirements are expected to drive U.S. data center electricity demand from approximately 108 TWh in 2020 to approximately 426 TWh by 2030, and SMRs are well-positioned to provide the 300 MWe to 1,000 MWe continuous power capacity these facilities typically require with a smaller physical footprint and modular scalability to meet site-specific needs. In addition, industrial companies face a near-term replacement cycle for aging fossil fuel-fired boilers that currently operate below capacity and require frequent maintenance, and X-energy's HTGR solution could offer a compelling decarbonization and reliability upgrade by providing both industrial steam and onsite power with an expected 95% capacity factor.

Current wording

In the U.S., growing power demand from industrial expansion, manufacturing reshoring, data center buildout, and broader electrification is creating use cases for scalable, firm, clean baseload power that we believe SMRs like the Xe-100 can uniquely deliver. Industrial companies face a near-term replacement cycle for aging fossil fuel-fired boilers that currently operate below capacity and require frequent maintenance, and X-energy’s HTGR solution could offer a compelling decarbonization and reliability upgrade by providing both industrial steam and onsite power with an expected 95% capacity factor. In addition, AI-driven computing requirements are expected to drive U.S. data center electricity demand, and SMRs are well-positioned to provide the continuous power capacity these facilities typically require with a smaller physical footprint and modular scalability to meet site-specific needs.

Previous wording

In addition, we believe current energy alternatives fall short. Solar and wind have low capacity factors (23% and 33% respectively per EIA) requiring costly, supply-constrained battery storage to achieve comparable reliability; fossil fuel generation requires backup during maintenance and faces challenges to meet government and customers climate targets; and traditional large-scale nuclear suffers from historical cost overruns and project delays while requiring more land and significantly larger safety zones (16 kilometers versus 400 meters) than HTGRs. The Xe-100's expected passive safety features, modular redundancy, online refueling, compact footprint, and virtually zero direct GHG emissions enable cost-effective co-location with emerging power demand hubs and flexible capacity scaling to match customer-specific requirements.

Current wording

In addition, we believe current energy alternatives fall short. Solar and wind generally have low capacity factors requiring costly firming infrastructure like natural gas generation or supply-constrained battery storage to achieve comparable reliability; fossil fuel generation requires backup during maintenance, faces challenges to meet government and customers’ climate targets, and has faced order backlogs, supply constraints and elevated costs; and traditional large-scale nuclear suffers from historical cost overruns and project delays while requiring more land and significantly larger safety zones (16 kilometers versus 400 meters) than HTGRs. The Xe-100’s expected passive safety features, modular redundancy, online refueling, compact footprint, and virtually zero direct GHG emissions enable cost-effective co-location with emerging power demand hubs and flexible capacity scaling to match customer-specific requirements.

Previous wording

Our business model is dependent on our commencing and expanding commercial operations. We currently anticipate initial customer deliveries to achieve mechanical completion in the early 2030s, which we expect to take place 1-2 years ahead of commencement of operations. Commencement of nuclear construction for these projects is dependent upon finalizing and achieving design maturity, producing fuel for customers, and supporting our customers in pursuing necessary permits and licenses from the NRC. Failure to complete any one of these tasks in a timely manner could result in us being unable to begin production in the anticipated timeframe.

Current wording

Our business model is dependent on our commencing and expanding commercial operations. We currently anticipate initial customer deliveries to achieve mechanical completion in the early 2030s, which we expect to take place 1-2 years ahead of commencement of operations. Commencement of nuclear construction for these projects is dependent upon finalizing and achieving design maturity, producing fuel for customers, and supporting our customers in pursuing necessary permits and licenses from the NRC and other agencies. Failure to complete any one of these tasks in a timely manner could result in us being unable to begin production in the anticipated timeframe.

Previous wording

We are developing a global network of potential customers and supply chain partners that we expect will play an integral role in bringing our technology to market. In the near term, TRISO-X and its customers will depend on the U.S. government for access to HALEU given the current inability to access global markets. The government and commercial enrichers are developing enrichment capabilities for future supplies. To the extent the U.S. government restricts our access to HALEU or otherwise fails to obtain sufficient HALEU for our needs, our ability to commence and expand commercial operations may be significantly impaired.

Current wording

We are developing a global network of potential customers and supply chain partners that we expect will play an integral role in bringing our technology to market. In the near term, TRISO-X and Dow will depend on the U.S. government and a limited number of commercial HALEU suppliers for access to HALEU. In the long term, commercial enrichers are developing enrichment capabilities for future supplies. To the extent the U.S. government restricts our access to HALEU or otherwise fails to obtain sufficient HALEU for our needs, or the commercial market for enrichment fails to materialize in the amounts and in the timeframe we require or at all, our ability to commence and expand commercial operations may be significantly impaired.

Previous wording

We operate in a capital intensive industry and expect to continue to incur operating losses for the foreseeable future as we continue to expand and develop, and may need to raise additional capital in the future. If we are unable to raise additional capital when needed, we may have to delay, scale back, or discontinue one or more of our projects. We may be required to cease operations or seek partners for our lines of business at an earlier stage than otherwise would be desirable and on terms that are less favorable than might otherwise be available. These measures may significantly alter our business plan and could cause significant delays in the development of our product candidates and ultimately our financial condition and ability to operate as a going concern.

Current wording

We operate in a capital intensive industry and expect to continue to incur operating losses for the foreseeable future as we continue to expand and develop, and may need to raise additional capital in the future. If we are unable to raise additional capital when needed, we may have to delay, scale back, or discontinue one or more of our projects. We may be required to cease operations or seek partners for our business at an earlier stage than otherwise would be desirable and on terms that are less favorable than might otherwise be available. These measures may significantly alter our business plan and could cause significant delays in the development of our business and ultimately our financial condition.

Previous wording

Our growth and future success are dependent on public support for nuclear power in the U.S. and other countries where we intend to market and sell our technology, including Canada, the U.K. and certain countries in Europe and Asia, among others. Electricity demand is accelerating and is driven by data center buildout from cloud computing providers, industrial growth and reshoring of manufacturing, and broader electrification (e.g., electric vehicle installed base). In order for our business model to succeed, we will depend on energy providers sourcing a larger percentage of energy from nuclear power facilities instead of sourcing energy from fossil fuel facilities. Additionally, the market for SMRs has not yet been established, as we are one of the pioneers in the industry. As we scale and continue to invest in the capabilities of our SMRs, our future revenue depends on a growing number of jurisdictions throughout the U.S. and globally to adopt SMRs as an always-on, carbon emissions-free alternative to other energy sources.

Current wording

Our growth and future success are dependent on public support for nuclear power in the U.S. and other countries where we intend to market and sell our technology, including Canada, the U.K. and certain countries in Europe and Asia, among others. Electricity demand is accelerating and is driven by data center buildout from cloud computing providers, industrial growth and reshoring of manufacturing, and broader electrification (e.g., electric vehicle installed base). Therefore, our business is also dependent on our customers’ need for electricity as well as public support for data center buildouts and industrial growth. In order for our business model to succeed, we will depend on energy providers sourcing a larger percentage of energy from nuclear power facilities instead of sourcing energy from fossil fuel facilities.

Previous wording

We are a development and design stage company that is preparing its flagship product for market, with substantial governmental support and collaboration from a team of commercial partners. As we develop the Xe-100, TRISO-X fuel and other aspects of our business, we have been, and expect to continue to be, adversely affected by price increases from our suppliers and logistics partners as a result of inflation as well as other factors such as increased development, labor and overhead costs.

Current wording

We are a development and design stage company that is preparing its flagship product for market, with substantial governmental support and collaboration from a team of commercial partners. As we develop the Xe-100, TRISO-X fuel and other aspects of our business, we have been, and expect to continue to be, adversely affected by price increases from our suppliers and logistics partners as a result of inflation as well as other factors such as increased development, labor and overhead costs. We also expect to increase our workforce as we continue to execute on our expected timelines which will increase our costs in future periods.

Previous wording

The Xe-100 and corresponding TRISO-X fuel are costly, complex and challenging to design and build. Sources of funding for the estimated cost include U.S. government funding, whether via the ARDP or other sources, and additional funding to be provided by X-energy’s designated partner under the ARDP. Currently, Dow is a sub-awardee and our designated partner under the ARDP. The ARDP grant is inclusive of three different components. First, for non-recurring engineering work related to the design of the Xe-100, X-energy is responsible for the funding of such engineering work and is eligible to receive 50% reimbursement for this funding through the ARDP program. Secondly, for TRISO-X fuel development and TX-1, X-energy is responsible for the funding and is eligible to receive 50% reimbursement for this funding through the ARDP program. These two ARDP-related programs are not tied to Dow’s funding requirements. Finally, for the construction of the Xe-100 plant, Dow is responsible for the funding of the Xe-100 plant at the Seadrift site and is eligible to receive 50% reimbursement for this funding through the ARDP program.

Current wording

The Xe-100 and corresponding TRISO-X fuel are costly, complex and challenging to design and build. Sources of funding for the estimated cost include U.S. government funding, whether via the ARDP or other sources, and additional funding to be provided by X-energy’s designated partner under the ARDP. Currently, Dow is a sub-awardee and our designated partner under the ARDP. The ARDP grant is inclusive of three different components. First, for non-recurring engineering work related to the design of the Xe-100, X-energy is responsible for the funding of such engineering work and is eligible to receive 50% reimbursement for this funding through the ARDP program. Second, for TRISO-X fuel development and construction of TX-1,

Previous wording

Dow’s current funding commitments are representative of a typical energy project development process. At present, Dow’s funding is released as project milestones are reached; however, X-energy has no financial obligation to construct the plant without Dow’s funding. As we are currently in preliminary design, X-energy is receiving revenues from Dow pursuant to our MPDA for services including engineering services related to the Seadrift site, NRC licensing activities, and other technology use typical of services rendered during this development phase. If project milestones are reached, Dow’s funding commitments are expected to increase, as Dow will need to fund long-lead procurement and engineering services years in advance of commercial operations. X-energy has no obligation to move forward with the project without funding from Dow. However, in advance of certain project milestones, X-energy’s costs will increase as we intend to fund select long lead-time procurement and engineering activities to support project timelines, which may subsequently be reimbursed by our customer or if a milestone is not achieved, utilized across other projects.

Current wording

Dow’s current funding commitments are representative of a typical energy project development process. At present, Dow’s funding is released as project milestones are reached; however, X-energy has no obligation to move forward with the project without funding from Dow. As we are currently in preliminary design, X-energy is receiving revenues from Dow pursuant to our MPDA for services including engineering services related to the Seadrift site, NRC licensing activities, and other technology use typical of services rendered during this development phase. If project milestones are reached, Dow’s funding commitments are expected to increase, as Dow will need to fund long-lead procurement and engineering services years in advance of commercial operations. However, in advance of certain project milestones, X-energy’s prepayments and purchase commitments will increase as we fund select long lead-time procurement items and engineering activities to support project timelines. We expect to be reimbursed or compensated for these payments and commitments by our customers, or, if a milestone is not met, to repurpose these items and activities for other projects.

Previous wording

If final investment decision is made, Dow is expected to continue to be responsible for the funding of the construction of the Xe-100 plant, which work is eligible under the ARDP grant for 50/50 cost share. If Dow does not make a final investment decision with respect to the Seadrift project, X-energy is under no obligation to continue funding to the Dow project or construction on the plant itself. However, in order to continue our participation in the ARDP program, we would need to identify another customer within a reasonable amount of time for the demonstration portion of the project, and failure to do so could result in significant delays, increased costs, and loss of revenue. We continue to work with our commercial partners to seek opportunities for cost reduction associated with ARDP work. Irrespective of ARDP funding, we nonetheless expect sustained and increased inflation in the future to directly impact our operating expenses, which could ultimately impact expected gross margins across our business.

Current wording

If a final investment decision is made, Dow is expected to continue to be responsible for the funding of the construction of the Xe-100 plant, which is eligible under the ARDP grant for 50/50 cost share. If Dow does not make a final investment decision with respect to the Seadrift project, X-energy is under no obligation to continue funding to the Dow project or construction on the plant itself. However, in order to continue our participation in the ARDP program, we would need to identify another customer within a reasonable amount of time for the demonstration portion of the project, and failure to do so could result in significant delays, increased costs, and loss of revenue. We continue to work with our commercial partners to seek opportunities for cost reductions associated with ARDP work. Irrespective of ARDP funding, we nonetheless expect sustained and increased inflation in the future to directly impact our operating expenses, which could ultimately impact expected gross margins across our business.

Previous wording

Our capacity for continued growth and ability to achieve and maintain profitability depends in large part on our ability to obtain and maintain regulatory approvals across multiple jurisdictions, including at the international, federal, state and local levels. The federal government, along with each state and local jurisdiction in which we operate, maintains distinct regulatory frameworks. These include laws and regulations that can directly or indirectly affect our operations and those of our customers, including matters related to real estate usage, environmental sustainability, employment and labor practices and community engagement. Our success will depend on our licensing team’s ability to continue to obtain and maintain regulatory approvals on commercially reasonable timelines. In addition, because our projects represent first-of-a-kind deployments, they may attract heightened scrutiny or opposition from local communities, non-governmental organizations, or advocacy groups, which could result in additional review, procedural challenges, or delays in obtaining regulatory approvals and increased costs or adverse outcomes.

Current wording

Our capacity for continued growth and the ability to achieve and maintain profitability depends in large part on our ability to obtain and maintain regulatory approvals across multiple jurisdictions, including at the international, federal, state and local levels. The federal government, along with each state and local jurisdiction in which we operate, maintains distinct regulatory frameworks. These include laws and regulations that can directly or indirectly affect our operations and those of our customers, including matters related to real estate usage, environmental sustainability, employment and labor practices and community engagement. Our success will depend on our licensing team’s and our customers’ ability to continue to obtain and maintain regulatory approvals on commercially reasonable timelines. In addition, because our projects represent first-of-a-kind deployments, they may attract heightened scrutiny or opposition from local communities, non-governmental organizations, or advocacy groups, which could result in additional review, procedural challenges, or delays in obtaining regulatory approvals and increased costs or adverse outcomes.

Previous wording

While we operate in an industry that is subject to, and benefits from, safety and environmental regulations, such regulations have generally become more stringent over time, particularly across developed markets. As a company in a highly regulated industry, our margins could be particularly and adversely impacted by increasingly stringent regulatory developments or regulatory scrutiny. Regulations on nuclear energy are subject to unknown and unpredictable change that could impact our ability to meet projected sales or margins. Moreover, our and our customers’ ability to obtain regulatory approvals and comply with applicable nuclear regulatory requirements may affect our ability to market our technologies and obtain approvals in other countries.

Current wording

While we operate in an industry that is subject to, and benefits from, safety and environmental regulations, such regulations have generally become more stringent over time, particularly across developed markets. As a company in a highly regulated industry, our margins could be particularly and adversely impacted by changing or increasingly stringent regulatory developments or regulatory scrutiny. Regulations on nuclear energy are subject to unknown and unpredictable change that could impact our ability to meet projected sales or margins. Moreover, our and our customers’ ability to obtain regulatory approvals and comply with applicable nuclear regulatory requirements may affect our ability to market our technologies and obtain approvals in other countries.

Previous wording

Our future growth is largely dependent on our ability to continue to capitalize on government policy support and corporate investment in the nuclear energy industry. Congress has successfully reinvigorated the U.S. nuclear industry with a concentration on four main legislative priorities: (1) the initiation of the Advanced Reactor Demonstration Program; (2) regulatory framework reform through the Nuclear Energy Innovation and Modernization Act (NEIMA) in 2019 and the Accelerating Deployment of Versatile, Advanced Nuclear for Clean Energy Act (ADVANCE ACT) in 2024; (3) enacting financial instruments such as Investment Tax Credits, Manufacturing Tax Credits and Production Tax Credits as included in the Inflation Reduction Act of 2022; and (4) expanding and deploying federal credit support through the DOE’s Loan Programs Office.

Current wording

Our future growth is largely dependent on our ability to continue to capitalize on government policy support and corporate investment in the nuclear energy industry. Congress has successfully reinvigorated the U.S. nuclear industry with a concentration on four main legislative priorities: (1) the initiation of the Advanced Reactor Demonstration Program; (2) regulatory framework reform through the Nuclear Energy Innovation and Modernization Act (NEIMA) in 2019 and the Accelerating Deployment of Versatile, Advanced Nuclear for Clean Energy Act (ADVANCE ACT) in 2024; (3) enacting financial instruments such as Investment Tax Credits, Manufacturing Tax Credits and Production Tax Credits as included in the Inflation Reduction Act of 2022; and (4) expanding and deploying federal credit support through the DOE’s Office of Energy Dominance Financing.

Previous wording

We were selected by the DOE as an awardee under the ARDP in 2020 for one of two “demonstration” projects in the United States, and it is particularly critical to our success. The ARDP is structured as a 50/50 cost-share between the DOE and its private sector awardee for eligible costs, intended to reduce first-of-a-kind reactor risks with the goal to attract follow-on customers both domestically and in the global marketplace. More specifically, through the ARDP, we are eligible to receive from the DOE approximately 50% of the cost of designing the Xe-100. We are also eligible to receive approximately 50% of the cost of TX-1, our first fuel fabrication facility. Subsequent fuel fabrication facilities are not eligible for reimbursement. Finally, our first customer to build a reactor, Dow, is eligible to receive 50% approximately of the cost to build the first Xe-100, which it will do at its Seadrift site in Texas. Congress has appropriated funding that was allocated towards our award, in total of approximately

Current wording

We were selected by the DOE as an awardee under the ARDP in 2020 for one of two “demonstration” projects in the United States, and it is particularly critical to our success. The ARDP is structured as a 50/50 cost-share between the DOE and its private sector awardee for eligible costs, intended to reduce first-of-a-kind reactor risks with the goal to attract follow-on customers both domestically and in the global marketplace. More specifically, through the ARDP, we are eligible to receive from the DOE approximately 50% of the cost of designing the Xe-100. We are also eligible to receive approximately 50% of the cost of TX-1, our first fuel fabrication facility. Subsequent fuel fabrication facilities are not eligible for reimbursement. Finally, our first customer to build a reactor, Dow, is eligible to receive approximately 50% of the cost to build the first Xe-100, which it will do at its Seadrift site in Texas. Congress has appropriated funding that was allocated towards our award, in total of approximately $1.1 billion, as well as recent additional appropriations of $3.1 billion to ARDP and other nuclear projects. While we have been notified that we were selected to receive an additional amount under the ARDP, any increase in the amount allocated to X-energy remains subject to execution of a subsequent contract award modification to the ARDP Agreement by the DOE’s contracting officer and continuation application approvals. If political support for the prioritization of the development of nuclear energy decreases, including due to policy changes by the current U.S. administration or future administrations or changing congressional funding priorities, we may be unable to secure continued government funding under the ARDP including any expected increase, which would adversely affect our business, development timeline, and financial condition.

Previous wording

We intend to offer customers a diversified suite of services throughout the life of a project / reactor, beginning approximately eight years prior to a plant’s commercial operation date. Our envisioned suite of services includes pre- and post-commercial operations date offerings, whereby we intend to provide customers with critical services related to the design, development, licensing, construction, fueling, operations and maintenance of the Xe-100. We expect that, as we refine our services offerings, first with Dow and the early Amazon and Centrica projects, the number of services we offer and the percentage of revenue we generate from our services offerings will grow. We anticipate that our services offerings will have high penetration rates across our future clients and will provide consistent, recurring revenues throughout the expected life of each reactor.

Current wording

We intend to offer customers a diversified suite of services throughout the life of a project / reactor, beginning prior to a plant’s commercial operation date. Our envisioned suite of services includes pre- and post-commercial operations date offerings, whereby we intend to provide customers with critical services related to the design, development, licensing, construction, fueling, operations and maintenance of the Xe-100. We expect that, as we refine our services offerings, first with Dow and the early Amazon and Centrica projects, the number of services we offer and the percentage of revenue we generate from our services offerings will grow. We anticipate that our services offerings will provide consistent, recurring revenues throughout the expected life of each reactor.

Previous wording

Immediately preceding the closing, as part of the Reorganization Transactions, XERC’s legacy Series A redeemable convertible preferred units, Series A-1 redeemable convertible preferred units, Series B redeemable convertible preferred units, Series C redeemable convertible preferred units, Series C-1 redeemable convertible preferred units, and Series D redeemable convertible preferred units converted into Common Units of XERC and were then exchanged for Class A common stock of X-Energy, Inc., equal to the number of Common Units previously held by each equity owner and was reclassified as permanent equity. Additionally, Class B Common Units, which primarily represented Profit Interest Units held by management and employees through Management LLC, were contributed to X-Energy, Inc. in exchange for Class A common stock, which shares remain subject to the same vesting conditions applicable to the corresponding Common Units immediately prior to such contribution.

Current wording

Immediately preceding the closing, as part of a series of organizational transactions, (collectively, the “Reorganization Transactions” which are described in Item 1 of Part I — “Financial Statements — Note 1 — Organization and Nature of Business”), XERC’s legacy Series A redeemable convertible preferred units, Series A-1 redeemable convertible preferred units, Series B redeemable convertible preferred units, Series C redeemable convertible preferred units, Series C-1 redeemable convertible preferred units, and Series D redeemable convertible preferred units converted into Common Units of XERC and were then ultimately exchanged for Class A Common Stock of X-Energy, Inc. Additionally, Class B Common Units, which primarily represented Profit Interest Units held by management and employees through X-Energy Management LLC (“Management LLC”), were contributed to X-Energy, Inc. in exchange for Class A Common Stock, which shares remain subject to the same vesting conditions applicable to the corresponding Common Units immediately prior to such contribution.

Previous wording

Continuing Equity Owners collectively refer to those Original Equity Owners that will own Common Units in XERC and our Class B common stock after the Reorganization Transactions. As part of the Reorganization Transactions, X-Energy Inc. issued to the Continuing Equity Owners shares of Class B common stock equal to the number of Common Units of XERC held by the Continuing Equity Owners resulting in an Up-C structure. Refer to Note 18 — Subsequent Eventsfor additional information.

Current wording

Continuing Equity Owners refers to certain direct and indirect owners of XERC prior to the Reorganization Transactions that own Common Units in XERC and our Class B common stock after the Reorganization Transactions. As part of the Reorganization Transactions, X-Energy, Inc. issued to the Continuing Equity Owners shares of Class B common stock equal to the number of Common Units of XERC held by the Continuing Equity Owners resulting in an Up-C structure. Refer to Item 1 of Part I — “Financial Statements — Note 1 — Organization and Nature of Business” for additional information.

Previous wording

At present, our revenues and grant income are generally derived from contract services performed for the U.S. Government and commercial entities. Our revenues are generally derived from cost-share agreements such as the Advanced Reactor Demonstration Program (“ARDP”) provided by the U.S. government and research and development, product development, and fuel services provided to other government agencies and commercial entities. A majority of our contracts with the U.S.

Current wording

At present, our revenues and grant income are generally derived from contract services performed for the U.S. Government and commercial entities. Our revenues are generally derived from cost-share agreements such as the Advanced Reactor Demonstration Program (“ARDP”) provided by the U.S. government and research and development, product development, and fuel services provided to other government agencies and commercial entities. A majority of our contracts with the U.S. government are generally subject to the Code of Federal Regulation (“CFR”) and are competitively priced based on estimated costs of providing the contractual goods or services. In the future, we expect to generate revenue through technology fees for the use of the design of the Xe-100 technology, project planning, assembly coordination, construction support, regulatory support, procurement support, long-term services to customers and the supply of fuel and associated services.

Previous wording

Interest expense consists of amortization of deferred financing costs.

Current wording

Interest expense, when incurred, consists of amortization of deferred financing costs.

Previous wording

Interest income is related to our investment of excess cash in money market funds and debt securities.

Current wording

Interest income is primarily related to our investment of excess cash in money market funds and debt securities.

Previous wording

Other income (expense), net consists of miscellaneous income and expenses such as mark-to-market gains and losses on various instruments, which mark-to-market gains and losses are detailed in Note 13 —Fair Value Measurementsof our condensed consolidated financial statements. Other income (expense), net also consists of the gain and losses on conversion of C-2 Notes and related reclassification of other comprehensive income, losses on extinguishment of debt, gains and losses on foreign currency transactions, and other miscellaneous expenses.

Current wording

Other income (expense), net consists of miscellaneous income and expenses such as mark-to-market gains and losses on various instruments, which mark-to-market gains and losses are detailed in Item 1 of Part I — “Financial Statements — Note 13 —Fair Value Measurements” of our condensed consolidated financial statements. Other income (expense), net also consists of the gains and losses on conversion of C-2 Notes and related reclassification of other comprehensive income, losses on extinguishment of debt, gains and losses on foreign currency transactions, and other miscellaneous expenses.

Previous wording

Interest expense decreased by $0.1 million or 100% for the three months ended March 31, 2026 compared to the comparable prior year period due to the settlement, maturity, redemption and conversion of substantially all of our outstanding debt in prior periods.

Current wording

Interest expense decreased by $0.4 million or 100% and $0.5 million or 100% for the three and six months ended June 30, 2026, respectively, compared to the comparable prior-year periods. This was due to the settlement, maturity, redemption, and conversion of all of our outstanding debt in prior periods.

Previous wording

Interest income increased by $3.5 million or 63% for the three months ended March 31, 2026 compared to the comparable prior year period due to interest on investments in held-to-maturity securities that were made in the fourth quarter of 2025.

Current wording

Interest income increased by $6.0 million or 121% and increased by $9.5 million or 91% for the three and six months ended June 30, 2026, respectively, compared to the comparable prior-year periods. This was due to interest on investments in held-to-maturity securities that were made since our capital raise in the fourth quarter of 2025.

Previous wording

We assess our liquidity in terms of our ability to generate adequate amounts of cash to meet current and future needs. Our expected primary uses of cash on a short-term and long-term basis are for working capital requirements, capital expenditures, and other general corporate services. Our primary working capital requirements are for project execution activities including purchases of materials, subcontracted services and payroll which fluctuate during the year, driven primarily by the timing and extent of activities required on new and existing projects. Management expects that future operating losses and negative operating cash flows may increase from historical levels because of additional costs and expenses related to the development of our technology and the development of market and strategic relationships with other businesses. Consequently, our continued existence is dependent upon our ability to obtain additional capital to support our ongoing operations.

Current wording

We assess our liquidity in terms of our ability to generate adequate amounts of cash to meet current and future needs. Our expected primary uses of cash on a short-term and long-term basis are for working capital requirements, capital expenditures, and other general corporate services. Our primary working capital requirements are for project execution activities including purchases of materials, subcontracted services and payroll which fluctuate during the year, driven primarily by the timing and extent of activities required on new and existing projects. Management expects that future operating losses and negative operating cash flows may increase from historical levels because of additional costs and expenses related to the development of our technology, procurement of long lead-time items and engineering activities, and the development of market and strategic relationships with other businesses. Consequently, our ability to execute our long-term business plan is dependent upon our ability to obtain additional capital to support our ongoing operations.

Previous wording

We have had, and expect that we will continue to have, an ongoing need to raise additional capital from outside sources to fund our operations and expand our business. If we are unable to raise additional capital when desired, or on acceptable terms, our business, financial condition, operating results and future prospects would be harmed, and we may not be able to continue to construct the TX-1 fuel fabrication facility or begin construction on TX-2 or other fuel fabrication facilities, support development of the Xe-100 plant or conduct other research and development or project and fulfill our current business plan, and therefore, we may need to delay or abandon these and other projects. A successful transition to attaining profitable operations depends upon achieving a level of revenue and grant income adequate to support us.

Current wording

We have had, and expect that we will continue to have, an ongoing need to raise additional capital from outside sources to fund our operations and expand our business. If we are unable to raise additional capital when desired, or on acceptable terms, our business, financial condition, operating results and future prospects could be harmed, and we may not be able to complete our TX-1 fuel fabrication facility construction and begin production or begin construction on TX-2 or other fuel fabrication facilities, support development of the Xe-100 plant or conduct other research and development or project and fulfill our current business plan, and therefore, we may need to delay, re-evaluate or discontinue these and other projects. A successful transition to attaining profitable operations depends upon achieving a level of revenue and grant income adequate to support us.

Previous wording

We had the following debt outstanding during the three months ended March 31, 2025 which were matured or converted during the year ended December 31, 2025 and were no longer outstanding during the three months ended March 31, 2026:

Current wording

We had the following debt outstanding during the three and six months ended June 30, 2025 which were matured or converted during the year ended December 31, 2025 and were no longer outstanding during the six months ended June 30, 2026:

Previous wording

Live Oak Credit Facility: On June 14, 2021, we entered into a credit agreement for a revolving credit facility (the “Live Oak Credit Facility”) with Live Oak Bank. The Live Oak Credit Facility was amended various times from the date of entering into the facility until the maturity. In accordance with the Live Oak Credit Facility’s stated terms, we settled the outstanding principal associated with the Live Oak Credit Facility with a payment of $4.1 million in

Current wording

Live Oak Credit Facility: On June 14, 2021, we entered into a credit agreement for a revolving credit facility (the “Live Oak Credit Facility”) with Live Oak Bank. The Live Oak Credit Facility was amended various times from the date of entering into the facility until the maturity. In accordance with the Live Oak Credit Facility’s stated terms, we settled the outstanding principal associated with the Live Oak Credit Facility with a payment of $4.1 million in October 2024. On October 31, 2024, with no outstanding borrowings, the facility matured. On May 9, 2025, we reestablished the facility, with an expiration date of December 1, 2025. As there were no draws on the facility during the year ended December 31, 2025, the facility matured on December 1, 2025.

Previous wording

Refer to Note 7 — Debt for additional information.

Current wording

Refer to Item 1 of Part I — “Financial Statements — Note 7 — Debt” for additional information.

Previous wording

Cash Flows Three Months Ended March 31, 2026 and March 31, 2025

Current wording

Cash Flows Six Months Ended June 30, 2026 and June 30, 2025

Previous wording

For the three months ended March 31, 2026, our operating activities used $67.3 million of net cash compared to $41.9 million for the three months ended March 31, 2025. The increase in cash used in operating activities is primarily driven by an increase in activity on the ARDP Agreement, an increase in corporate headcount, and an increase in enterprise software costs and corporate contractors during the three months ended March 31, 2026 compared to the three months ended March 31, 2025.

Current wording

For the six months ended June 30, 2026, our operating activities used $164.6 million of net cash compared to $61.8 million for the six months ended June 30, 2025. The increase in cash used in operating activities is primarily driven by an increase in activity on the ARDP Agreement, including deposits to vendors for long-lead materials, as well as increases in corporate headcount and corporate contractors during the six months ended June 30, 2026 compared to the six months ended June 30, 2025.

Previous wording

For the three months ended March 31, 2026, our investing activities used $166.0 million of net cash compared to $1.7 million for the three months ended March 31, 2025. The increase in net cash used in investing activities was primarily attributable to purchases of investments of $189.9 million, and a $31.7 million increase in capital expenditures related to the construction of facilities during the three months ended March 31, 2026. These increases in cash outflows were partially offset by proceeds from investment maturities of $38.1 million and a $19.3 million increase in reimbursements received during the period for capital expenditures qualifying under government grant programs.

Current wording

For the six months ended June 30, 2026, our investing activities used $239.6 million of net cash compared to $18.7 million for the six months ended June 30, 2025. The increase in net cash used in investing activities was primarily attributable to an increase in purchases of investments of $316.5 million, and a $70.7 million increase in capital expenditures related to the construction of facilities during the six months ended June 30, 2026. These increases in cash outflows were partially offset by an increase in proceeds from investment maturities of $130.9 million and a $35.3 million increase in reimbursements received during the period for capital expenditures qualifying under government grant programs.

Previous wording

For the three months ended March 31, 2026, financing activities used $1.1 million of net cash compared to $50.9 million of net cash provided by financing activities for the three months ended March 31, 2025. The net cash used in financing activities during the three months ended March 31, 2026 was primarily due to $1.5 million of cash paid for transaction costs related to our initial public offering. The net cash provided by financing activities during the three months ended March 31, 2025 was primarily due to the January 2025 issuance of Series C-1 preferred units of $53.4 million, offset by $2.5 million of cash paid for associated issuance costs.

Current wording

For the six months ended June 30, 2026, financing activities provided $1.1 billion of net cash compared to $50.4 million for the six months ended June 30, 2025. The net cash provided by financing activities during the six months ended June 30, 2026 was primarily due to $1.1 billion of net proceeds from our initial public offering. The net cash provided by financing activities during the six months ended June 30, 2025 was primarily due to the January 2025 issuance of Series C-1 preferred units of $53.4 million, offset by $2.5 million of cash paid for associated issuance costs.

Previous wording

In addition to our contractual obligations and commitments described under “Liquidity and Capital Resources,” we lease real estate for office space. These leases are classified as operating leases with various expiration dates through 2037. See Note 8 —Leases more information regarding our lease commitments.

Current wording

In addition to our contractual obligations and commitments described under “Liquidity and Capital Resources,” we lease real estate for office space. These leases are classified as operating leases with various expiration dates through 2037. See Note 8 —Leasesof the Notes to Consolidated Financial Statements in the audited consolidated financial statements of the Company for the year ended December 31, 2025 included in the Company’s prospectus dated April 23, 2026, filed with the SEC on April 27, 2026 for more information regarding our lease commitments.