Nano Nuclear Energy Inc. (NNE)

Item
2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

You
should read the following discussion and analysis of our financial condition and results of operations of the unaudited financial statements
and related notes included elsewhere in this Report. Data as of and for the year ended September 30, 2025 has been derived from our audited
consolidated financial statements. Data as of and for the three and nine months ended June 30, 2026 and 2025 has been derived from our
unaudited condensed consolidated financial statements appearing in this Report.

The
following discussion contains forward-looking statements, such as those relating to our plans, objectives, expectations, intentions,
and beliefs, which involve significant risks, uncertainties and assumptions. Our actual results could differ materially from those discussed
in these forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, those
identified below and those discussed in the section titled “Cautionary Note Regarding Forward-Looking Statements” in this
Report.

In
particular, readers should note that in this Report, we provide our current estimated timelines for advancing and commercially launching
our business lines, including key assumptions and variables. Based on our management’s experience, expertise and communications
with applicable regulators and other stakeholders (such as third-party contractors), we believe we have a sufficient basis to provide
reasonable timing estimates for our efforts, and our expectation is that we will meet such timing for our proposed business lines. However,
readers are cautioned that our business plans are evolving and remain subject to the completion of ongoing technical, regulatory, and
operational preparations, which are inherently uncertain and risky given the nature of our business and may be affected by factors beyond
our control. Accordingly, no assurances can be given that we will be able to progress and commercially launch our several business lines
as currently anticipated, or that such progress or commercial launches will occur in the timeframes we anticipate, if at all. For further
information, please see the “Cautionary Note Regarding Forward-Looking Statements” and the “Risk Factors” section
of this Report and in our Annual Report on Form 10-K for the year ended September 30, 2025, which was filed on December 18, 2025.

All
references to “we,” “us,” “our” and the “Company” refer to NANO Nuclear Energy Inc.,
a Nevada corporation and its consolidated subsidiaries unless the context requires otherwise.

Overview

We
are a nuclear energy and technology company developing smaller, simpler, and safer advanced clean energy solutions, utilizing proprietary
reactor designs, intellectual property and research methods to build the sustainable energy solutions of the future. Led by a world class
scientific and management team, our business plan involves comprehensive engagement across every sector of the nuclear power and energy
industry, traversing the path from sourcing raw materials through to developing cutting edge advanced nuclear microreactors. Our dedication
extends further, encompassing ambitions within the commercial nuclear fuel transportation sector, of the nuclear energy fuel supply chain,
technology development, and nuclear consulting services.

To
date, we have not generated material revenues. For the three and nine months ended June 30, 2026 and the year ended September 30,
2025, our net loss was approximately $10.1 million, $25.8 million and $40.1 million, respectively, and our accumulated deficit as of
June 30, 2026 and September 30, 2025 was approximately $83.3 million and $57.5 million, respectively.

We
are principally focused on the following four business lines as part of our development strategy:

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ITEM
7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The
following discussion should be read in conjunction with our consolidated financial statements and the related notes contained elsewhere
in this Report and in our other Securities and Exchange Commission filings. The following discussion may contain predictions, estimates,
and other forward-looking statements that involve a number of risks and uncertainties, including those discussed under “Risk Factors”
and elsewhere in this Report. These risks could cause our actual results to differ materially from any future performance suggested below.

Overview

We are a nuclear energy and technology company, developing smaller, simpler, and
safer advanced clean energy solutions, utilizing proprietary reactor designs, intellectual property, and research methods, to contribute
towards a sustainable future. Led by a world class scientific and management team, our business plan involves comprehensive engagement
across all sectors of the nuclear power and energy industry, spanning the value chain from sourcing raw materials to the development of
cutting-edge advanced nuclear microreactors. Our dedication extends further, encompassing strategic initiatives within the commercial
nuclear fuel transportation sector, the nuclear energy fuel supply chain, technology development, and nuclear consulting services.

Currently,
we are in the pre-revenue stage and are principally focused on four business lines as part of our development strategy, including our
micro nuclear reactor business, our nuclear fuel processing business, our nuclear fuel transportation business, and our nuclear consultation
services business.

Our
mission is to become a commercially focused, diversified and vertically integrated nuclear energy company that will capture market share
in the very large and growing nuclear energy sector. To implement our plans, since our founding in 2022, our management has had constant
communications with key U.S. government agencies, including the DOE, the INL and ORNL, which are a part of the DOE’s national nuclear
laboratory system. Our company also maintains important collaborations with leading researchers from the Cambridge Nuclear Energy Centre
and The University of California, Berkeley.

Overview
of Operational Plan and Estimated Timelines for Corporate Achievements

We
continue to benefit from a global nuclear energy renaissance driven by several long term, sustainable growth trends and significant regulatory
tailwinds. These include growth in AI data centers, industrial reshoring, and broader electrification, all driving a significant need
for clean and reliable power, energy sustainability and independence, and climate mandates requiring reliable zero-emissions energy.
All of this comes in an era of unprecedented bipartisan legislative and policy support in the U.S. for nuclear energy. Equally important,
there is broad recognition that advanced reactors like the ones we are developing will be critical to future clean energy infrastructure.

Over the next twelve months, we will
continue to progress the development of our advanced reactors and our vertically integrated business plan, with estimated
expenditures to be approximately $65 million. This allocation comprises approximately $43 million dedicated to the research,
development, quality assurance, licensing, and physical test work of our microreactors and other technologies, such as our ALIP
technology and fuel transportation system. A further amount of approximately $12 million will be allocated to the development of our
planned HALEU fuel processing facilities alongside LIST, the related-party uranium enrichment company with whom we collaborate and
in which we have made a strategic investment. The remaining approximately $10 million is earmarked for miscellaneous costs essential
to propelling the progress of our microreactors, encompassing the support of current personnel engaged in executive, finance,
accounting, and other administrative functions. We may also utilize our cash resources raised in 2024 and 2025 for acquisitions of
complementary businesses or assets. As such, and for a variety of other factors, our estimated expenditures may differ substantially
from the above estimates and we find it desirable or necessary to utilize cash resources faster than we currently plan.

In early April 2025, we signed a strategic
collaboration with UIUC to construct the first KRONOS MMR™ research reactor on the university’s campus. In mid-April 2025,
we launched a recruitment initiative focused on the Midwest region to support our plans to construct, demonstrate and gain regulatory
approval for full-scale KRONOS MMR™ in both the United States and Canada. In late April 2025, the NRC issued its final
Safety Evaluation (SE) approving the Fuel Qualification Methodology Topical Report (FQM TR) for the advanced fuel design to be used in
our KRONOS MMR™. In July 2025, we announced that we will provide critical engineering and environmental services for our planned
construction and deployment activities at UIUC for the KRONOS MMR™. We anticipate submitting our construction permit application
to the NRC in early 2026, and receiving the construction permit in 2027. However, there can be no assurance that we will be able to meet
this anticipated timeline, as the submission is subject to the completion of ongoing technical, regulatory, and operational preparations,
which may be affected by factors beyond our control. Notwithstanding the foregoing, this is expected to be the first construction permit
for a microreactor issued in the United States. The permit application will not incur any government fees, as the KRONOS MMR™ reactor,
due to its location at UIUC, qualifies for a fee exemption under applicable regulations due to its use for research purposes.

We have already made material progress
with the KRONOS MMR™, including affirming the collaboration for this project with UIUC; however, we have not yet determined a definitive
timeline for demonstration, licensing and commercial launch of this reactor, but when considering construction timelines, licensing timeframes,
sourcing key materials and fuel, we estimate the early 2030s for commercial readiness.

With respect to the LOKI MMR™ system,
we are still in the process of assessing and developing demonstration, licensing and commercial launch timelines for this reactor. We
also plan on providing nuclear service support and consultation services for the expanding and resurgent nuclear energy industry in 2026,
both domestically and internationally.

With respect to our ZEUS reactor, we are
examining slight modifications of the design to create an even smaller, more mobile reactor system, allowing for an increased number of
applications which do not overlap with our other reactors, KRONOS and LOKI. The solid core concept permits a degree of simplicity, and
fewer working parts, than other reactor types – we are working on exploiting these inherent advantages to provide this product in
the market.

Given our corporate emphasis on the
KRONOS MMR™ reactor and the fact that all of our reactor designs, except for the ODIN™ reactor, are within
the high-temperature gas-cooled reactor family, we are considering strategic alternatives for ODIN. In September 2025, we signed a letter
of intent for the proposed sale of our ODIN™ microreactor design and all associated intellectual property to Cambridge Atom
Works, our commercial collaborator for the ODIN™ project. This transaction is intended to monetize our investment in the
project to date and enable us to allocate more time and resources to the KRONOS MMR™ reactor and our other designs
and technologies.

Readers are cautioned that no assurances
can be given that we can meet successfully the above-mentioned timelines. We are examining strategic acquisitions to expand our business
and consultancy services. We have commenced several material discussions with potential targets for such acquisitions, but as of the date
of this Report, we have not entered into any definitive agreements for such acquisitions.

Moreover, the outlined expenditures and
the anticipated timelines for execution of our plans discussed above and throughout this Management’s Discussion and Analysis of
Financial Condition and Results of Operations are estimations only. These are inherently subject to change due to certain factors, including
adjustments in the microreactor development plan and uncertainties associated with the governmental licensing approval process. Given
that these elements may exceed our initial expectations or lie beyond our control, we cannot guarantee the accuracy of the actual expenditures
and timelines.

As of the date of this Report, we have
not generated any revenues. We have incurred accumulated net losses of $57,500,857 since inception through September 30, 2025.

Factors
and Trends Affecting Our Business and Results of Operations

Our
Ability to Develop Our Microreactors

Our results of
operations and our long-term prospects are significantly influenced by factors and trends related to the development,
commercialization, and regulatory advancement of our microreactors. KRONOS™ reactor is our lead reactor program and is being
designed as an advanced, high-temperature microreactor intended for deployment in industrial environments, defense applications, and
other off-grid settings requiring resilient, emissions-free power. The following factors and trends have impacted, and we expect
will continue to impact, our KRONOS development program and our operating results.

Development of
the KRONOS™ reactor is affected by the evolving regulatory framework for advanced non-light-water reactors. The U.S. Nuclear Regulatory
Commission (“NRC”) continues to refine guidance applicable to microreactor licensing, including siting, emergency planning,
fuel qualification, and security requirements. Changes in NRC expectations, the need for additional data or analysis, or delays in regulatory
review may impact our development timelines and costs. In addition, university-based demonstration efforts, including our ongoing collaboration
with the University of Illinois Urbana–Champaign (“UIUC”), will require coordination with federal and state agencies,
which may introduce uncertainties in scheduling and scope.

KRONOS™ reactor
development relies on strategic collaborations with academic institutions and research organizations. Our work with UIUC includes
analyses of siting suitability, infrastructure requirements, and potential demonstration pathways. Such partnerships provide access
to technical expertise and research infrastructure but may be influenced by academic scheduling, funding availability, or
institutional priorities. Delays or changes in partner capacity could affect program timelines.

KRONOS™ technology
incorporates materials and components that require specialized fabrication processes, including high-temperature alloys, advanced
coatings, and precision-engineered reactor structures. Global supply-chain conditions, vendor qualification requirements, and the
availability of domestic manufacturing capacity will affect development costs and timelines. Government incentives for advanced
reactor supply chains may reduce uncertainties, but broader economic factors—including inflationary pressures, material cost
volatility, and logistics constraints—may continue to impact the program.

The LOKI MMR™ reactor originated
as a compact, transportable nuclear microreactor design. The reactor is designed for versatility across terrestrial, marine, and space
applications. It is engineered to deliver on the order of 1 MWth to around 5 MWth of power, making it suitable for remote deployments,
off-grid energy needs, critical infrastructure support, and other distributed energy use-cases

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