I guess it's kind of technically not referring directly to racism. They are technically white people who are also technically nationalists.
Nationalist - "a person who strongly identifies with their own nation and vigorously supports its interests, especially to the exclusion or detriment of the interests of other nations."
-the google first result definition
White Person - "White is a racialized classification of people and a skin color specifier, generally used for people of European ancestry, although the definition can vary depending on context, nationality, and point of view."
-the google first result definition
So you could have people who were nationalistic for other reasons, such as economics, manufacturing, self sustaining infrastructure, military power... who also happen to be a white person.
For the sake of argument, semantically, not wrong.
It should be noted that a nation is not a race.
The fact that there are a significant number of racist white people who call themselves white nationalists just ruins the term for the rest of the white people who are also nationalists without the racism.
I assume Nazis like the term because they support a "white nation" and are not treating white and nationalist as two grammatically distinct terms. Kind of a racist double entendre.
Just another example of Nazi's adopting something and ruining it for everyone else.