The Next Phase of the AI Boom May Not Come From Chipmakers

If you're following the artificial intelligence (AI) industry, you'll find that most of the talk about companies that aren't involved in creating AI programs directly is focused on chipmakers like Nvidia and Taiwan Semiconductor Manufacturing.

However, I think that the next phase of the AI boom will see nuclear energy stocks take center stage.

Image source: Getty Images.

See, it takes an incredible amount of power to run a data center or train a new AI program. According to the International Energy Agency (IEA), power consumption from data centers today amounts to 1.5% of total global electricity. And it's grown at a rate of 12% per year over the past five years.

That energy consumption growth is set to accelerate to 30% percent a year in the IEA's base case projection.

Point blank, we have a power problem, and nuclear energy is one possible solution to it.

AI is going nuclear

The Department of Energy reports that nuclear plants can operate at full capacity 92% of the time, which makes them one of the most reliable sources of electricity. It also avoids about 430 million metric tons of carbon dioxide emissions, or the equivalent of 95 million cars on the road each year.

Tech companies like Microsoft and Alphabet are aware of this fact and have been contracting with nuclear energy producers to resurrect old plants for the purpose of powering their data centers. More on that in a moment. And new small modular reactors (SMRs) allow for data centers to have their own independent nuclear power grid.

The Nuclear Energy Index is up 88% compared to the same time last year, and I think this is just getting started. So, let's look at three of the leaders in the nuclear-AI surge.

Contellation Energy is partnering with some big AI names

Constellation Energy (NASDAQ: CEG) is America's largest nuclear energy producer and its largest producer of green energy. The Baltimore-based heavyweight in the industry makes an obvious choice for tech giants looking to save a buck by splitting an atom.

That's likely why Microsoft selected Constellation to be its partner in resurrecting the Three Mile Island plant in Pennsylvania as the Crane Clean Energy Center. The $3 billion deal will also see Microsoft purchase electricity from the plant for the next 20 years.

The Department of Energy also pitched in to the tune of $1 billion, which it has loaned to Constellation. The plant is slated to start soon, in either 2028 as projected by Constellation or potentially in 2027.

But just as Microsoft is far from the only horse in the AI race, Constellation isn't the only power company breathing new life into America's nuclear capacity.

NextEra has a place in the next era of nuclear energy

NextEra Energy (NYSE: NEE), another major nuclear energy player in the United States, was tapped by Alphabet to bring Iowa's Duane Arnold Energy Center, Iowa's only nuclear power plant, back online by 2029.

The $1.6 billion deal will see Alphabet buy electricity from the plant over the next 25 years and establishes a long-term partnership between NextEra and Alphabet to explore the deployment of more nuclear energy projects across the country.

Alphabet seems particularly interested in expanding its energy access. In December 2025, it acquired Intersect, a data center energy infrastructure company, for $4.75 billion in cash. So it's a good partner for NextEra to have if it's aiming to expand its nuclear operations.

Finally, nuclear power plants need fuel. And uranium, the yellow rock with unstable atoms, is that fuel.

Cameco has exposure to almost the entire nuclear fuel cycle

Cameco (NYSE: CCJ), based in Vancouver, is the world's second-largest uranium producer behind only Kazakhstan's state-run Kazatomprom. It produced 17% of all the world's uranium supply in 2024, compared to its Kazakh rival's 19%.

What's more, the company has some of the highest-quality uranium reserves on the planet. Its Cigar Lake Mine is the world's highest-grade uranium mine, and McArthur River is the largest high-grade uranium mine globally. That means Cameco's uranium needs less refining to be usable as fuel than the competition's.

Finally, consider that Cameco holds a 49% stake in Westinghouse, an engineering company that produces the AP1000, the most advanced nuclear reactor on the market today. That sets Cameco up with exposure to almost the entire nuclear fuel cycle. And the U.S. government recently committed $80 billion to acquire several new AP1000 reactors.

Put all that together, and you have a strong contender for an investment in the AI-driven nuclear renaissance.

Clean energy, clean AI, clean conscience

While chips and data centers are the most obvious infrastructure needs for AI, don't forget that we will need to power those chips and data centers somehow. And it seems that big tech is betting on atomic power, a very efficient and relatively clean way to do it.

Will you follow suit?

James Hires has positions in Alphabet and Cameco. The Motley Fool has positions in and recommends Alphabet, Cameco, Constellation Energy, Microsoft, NextEra Energy, Nvidia, and Taiwan Semiconductor Manufacturing. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.