LEU's Q2 Earnings Beat, Revenues up Y/Y on Strong Uranium Sales

Revenues rose 14% year over year to $176.1 million and surpassed the consensus mark of $146 million. 

Centrus Energy’s Margins Contract on Higher Costs

Total cost of sales rose 25.4% to $126.2 million, resulting in a 7% year-over-year decline in gross profit to $49.9 million. Gross margin contracted to 28.3% from 34.9% in the prior-year quarter.

Advanced technology costs increased to $10.8 million from $3.3 million as Centrus Energy supported its uranium enrichment expansion. Selling, general and administrative expenses nearly doubled to $26.2 million, primarily reflecting higher stock-based compensation.

Operating income dropped to $10.4 million from $33.5 million, while operating margin narrowed to 5.9% from 21.7%. 

Centrus Energy’s Segment Performance in Q2

The Low-Enriched Uranium segment revenues increased 22% year over year to $153.4 million. Uranium revenues totaled $53.4 million in the reported quarter compared with no uranium revenues in the prior-year period. Separative work units (SWU) revenues declined 20% year over year to $100 million as sales volumes fell 23%, partly offset by a 3% increase in the average selling price. 

Low-Enriched Uranium segment’s cost of sales rose 36% to $101.8 million, mainly due to higher uranium volumes.  SWU costs decreased as a result of a 23% decline in the volume of SWU sold, partially offset by a 13% increase in the average unit cost of SWU sold.

Technical Solutions revenues declined 21% year over year to $22.7 million. The decrease primarily reflected a $5.9 million reduction in revenues generated from the DOE’s High-Assay, Low-Enriched Uranium (HALEU) operation contract, while the remaining change was related to other contracts.

Cost of sales for the segment was $24.4 million compared with $25.6 million in the year-ago quarter. The decrease was mainly due to a $1.9 million decline in costs incurred under the HALEU Operation Contract, while the remaining change was generally attributable to other contracts. The segment recorded a gross loss of $1.7 million against a gross profit of $3.2 million a year earlier.

Centrus Energy Advances U.S. Expansion Plans

Centrus Energy signed a $900 million HALEU enrichment award with the DOE and selected Geiger Brothers as the construction contractor for its major enrichment expansion. The company also expects to complete its first new centrifuge in Oak Ridge, TN, by the end of 2026.

Centrus Energy’s Backlog & Capital Position as of Q226 End

Centrus Energy’s total backlog was $4.5 billion as of June 30, 2026, which extends through 2040. The Low-Enriched Uranium segment accounted for approximately $3.7 billion, including $3 billion of contingent LEU and High-Assay, Low-Enriched Uranium sales commitments. Of the contingent commitments, $2.4 billion was covered by definitive agreements. These contracts support the potential construction of new LEU and HALEU production capacity at the company’s Piketon, OH, facility.

Technical Solutions backlog totaled roughly $800 million. However, the proposed DOE budget for fiscal 2027 does not include additional funding for operation of the existing HALEU cascade, which represents most of Technical Solutions’ backlog. Separately, DOE has stated that it does not currently plan to exercise further options under the HALEU Operation Contract. 

Cash and cash equivalents totaled $1.87 billion at quarter-end. Operating activities used $16.7 million during the first six months of 2026, while capital expenditures increased sharply to $94.8 million from $5.7 million a year earlier.

Centrus Energy Maintains 2026 Revenue Outlook

Centrus Energy continues to expect 2026 revenues between $450 million and $500 million. Total capital deployment is projected in the range of $350-$500 million, reflecting increased investment in centrifuge manufacturing and the broader industrial buildout.

The company raised its Piketon hiring target to at least 175 net new employees from the prior goal of 100. It continues to expect at least 100 net new hires in Oak Ridge, completion of a Certified-for-Construction package and finalized contracts with all partners identified as critical to the expansion.

LEU Stock’s Price Performance

The company’s shares have lost 19.2% in the past year against the industry’s 71.7% growth.

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Centrus Energy’s Zacks Rank

LEU currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

A Quick Look at LEU’s Peer Performance in Q2

Cameco Corporation CCJ reported earnings per share of 13 cents, missing the Zacks Consensus Estimate of 26 cents per share. Earnings declined 75% year over year. Quarterly revenues came in at CAD 814 million ($588 million), topping expectations despite declining 7% year over year.

Uranium revenues were reported at CAD 659 million ($469 million), down 7% year over year. An 18% decline in sales volumes was offset by a 15% increase in the Canadian dollar average realized price to CAD 93.13 per pound due to the impact of market-priced contracts on its portfolio. The Fuel Services segment’s revenues were down 6% to CAD 152 million ($108 million) due to an 18% decrease in sales volume, offset by a 13% increase in realized price.

Uranium Stocks Awaiting Results

Ur-Energy Inc. URG is scheduled to release second-quarter 2026 results on Aug. 10. The Zacks Consensus Estimate for Ur-Energy’s bottom line is pegged at a loss of four cents per share, in line with the year-ago quarter. The consensus estimate for Ur-Energy’s top line is pegged at $13.43 million, indicating 28.7% growth from the prior-year reported figure.

Uranium Energy Corp. UEC is expected to release fourth-quarter fiscal 2026 results soon. The Zacks Consensus Estimate for Uranium Energy’s bottom line is pegged at a loss of four cents per share, an improvement from the loss of seven cents reported in the year-ago quarter. The consensus estimate for Uranium Energy’s revenues is pegged at $9 million. 

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