Revenue increased 25% year over year to $60.8
million
Record NdPr production of 563 metric tons, a
36% sequential increase
Second best quarterly REO production of 12,213
metric tons, a 10% increase year over year
NdPr sales volumes more than doubled year over
year to 464 metric tons
Magnetics division makes first metal
deliveries, generating $5.2 million in revenue and positive
Adjusted EBITDA
Received third $50 million customer prepayment
on April 1
Intensifying engagement from industry and
government
MP Materials Corp. (NYSE: MP) (“MP Materials” or the “Company”),
today announced financial and operational results for the three
months ended March 31, 2025.
“MP Materials delivered strong execution across both our
Materials and Magnetics divisions in the first quarter, marked by
record NdPr oxide production and the initial sales of magnetic
precursor materials,” said James Litinsky, Founder, Chairman, and
CEO of MP Materials. “Given recent events, it is now undeniable
that the United States must reshore critical industries like rare
earth magnetics — something we have been building toward since day
one.” Litinsky continued, “With rapidly intensifying engagement
from both industry and government, MP Materials is leading this
effort — underscoring our growing strategic and economic importance
at a pivotal moment for American industrial policy.”
First Quarter 2025 Consolidated Financial Highlights
For the three months ended
March 31,
2025 vs. 2024
(in thousands, except per share data,
unaudited)
2025
2024
Amount Change
% Change
Financial Measures:
Total revenue
$
60,810
$
48,684
$
12,126
25
%
Net income (loss)
$
(22,648
)
$
16,489
$
(39,137
)
N/M
Adjusted EBITDA(1)
$
(2,696
)
$
(1,233
)
$
(1,463
)
(119
)%
Adjusted Net Loss(1)
$
(19,898
)
$
(7,492
)
$
(12,406
)
(166
)%
Diluted EPS
$
(0.14
)
$
(0.08
)
$
(0.06
)
(75
)%
Adjusted Diluted EPS(1)
$
(0.12
)
$
(0.04
)
$
(0.08
)
(200
)%
N/M = Not meaningful.
(1)
See “Use of Non-GAAP Financial Measures” below for the definitions
of Adjusted EBITDA, Adjusted Net Income (Loss) and Adjusted Diluted
EPS. See tables below for reconciliations of non-GAAP financial
measures to their most directly comparable GAAP financial measures.
First Quarter 2025 Consolidated Review
Total revenue increased 25% year over year to $60.8 million,
primarily as a result of higher production of separated products,
resulting in a greater mix of NdPr oxide and metal revenue in the
current period. Additionally, during the three months ended March
31, 2025, we began recognizing revenue from the sales of magnetic
precursor products, with no comparable revenue in the prior year
period. These were offset by the decrease in rare earth concentrate
revenues, impacted by the ramp-up in midstream operations, as a
significantly higher portion of REO produced is refined and sold as
NdPr oxide and metal.
Adjusted EBITDA declined by $1.5 million year over year to
$(2.7) million, driven mainly by higher cost of sales due to an
increase in separated product sales, as well as slightly higher
general and administrative expenses. Cost of sales was primarily
impacted by higher production costs related to a greater mix of
refined product sales compared to the prior year period. Separated
product production costs are currently elevated on a per-unit basis
given the currently low utilization of the refining facilities as
we ramp to normalized production levels. The increase in cost of
sales was partially offset by lower sales of REO in concentrate as
well as a lower inventory reserve recorded in the quarter, which
decreased by $2.8 million when compared to the prior year period.
Selling, general, and administrative expenses were impacted in part
by increased employee headcount to support our downstream
expansion. Adjusted EBITDA was also favorably impacted by the
initial sales of magnetic precursor products, which drove a $3.2
million year over year improvement in the Magnetics Segment
Adjusted EBITDA.
Adjusted Net Loss increased by $12.4 million year over year to
$(19.9) million, mainly due to higher interest expense from the
2030 convertible notes, as well as slightly lower interest income.
Also impacting the comparison was higher depreciation expense
resulting from an increase in capital assets placed into service
over the last year and the lower Adjusted EBITDA. These changes
were partially offset by a higher income tax benefit primarily due
to a higher pre-tax loss in the current quarter.
Net loss increased by $39.1 million year over year to $(22.6)
million, primarily due to a $46.3 million non-cash gain in the
first quarter of 2024 associated with the early extinguishment of a
portion of convertible notes due in 2026, as well as the factors
driving the higher Adjusted Net Loss discussed above. Also
impacting the comparison was a $7.0 million non-cash gain in the
current quarter from changes in fair value of the derivative
instrument related to the redemption feature included in the
portion of the 2030 convertible notes that were issued in December
2024.
Diluted earnings per share (“EPS”) decreased by $0.06 year over
year to a diluted loss per share of $(0.14), in line with the
change in net income (loss) discussed above. Adjusted Diluted EPS
decreased by $0.08 to $(0.12) in line with the increase in Adjusted
Net Loss discussed above.
First Quarter 2025 Segment Financial Highlights
For the three months ended
March 31,
2025 vs. 2024
(in thousands, unaudited)
2025
2024
Amount Change
% Change
Segment Financials:
Revenue
Materials Segment
$
55,619
$
48,684
$
6,935
14
%
Magnetics Segment
5,191
—
5,191
N/M
Total revenue
$
60,810
$
48,684
$
12,126
25
%
Segment Adjusted EBITDA(1)
Materials Segment
$
3,758
$
7,339
$
(3,581
)
(49
)%
Magnetics Segment
493
(2,707
)
3,200
N/M
Total Segment Adjusted EBITDA
$
4,251
$
4,632
$
(381
)
(8
)%
Corporate and other(2)
(6,947
)
(5,865
)
(1,082
)
(18
)%
Adjusted EBITDA(3)
$
(2,696
)
$
(1,233
)
$
(1,463
)
(119
)%
N/M = Not meaningful.
(1)
Segment Adjusted EBITDA is management’s measure of profit or loss
required by GAAP in assessing segment performance and deciding how
to allocate the Company’s resources. See “Segment Information”
below for further information.
(2)
Corporate and other is not considered a reportable segment, and is
presented solely to reconcile the total of Segment Adjusted EBITDA
to Adjusted EBITDA on a consolidated basis. Corporate and other
represents costs incurred at the corporate level that are not
allocated to the operating segments, specifically relating to
executive compensation, investor relations, other corporate costs,
and unallocated shared service functions such as legal, information
technology, human resources, finance and accounting and supply
chain.
(3)
See “Use of Non-GAAP Financial Measures” below for definition. See
table below for a reconciliation of Adjusted EBITDA to its most
directly comparable GAAP financial measure, net income or loss.
First Quarter 2025 Materials Segment Financial and
Operational Results
For the three months ended
March 31,
2025 vs. 2024
(unaudited)
2025
2024
Amount Change
% Change
Revenue:
(in thousands)
Rare earth concentrate
$
30,115
$
40,076
$
(9,961
)
(25
)%
NdPr oxide and metal
24,321
8,327
15,994
192
%
Other revenue
1,183
281
902
321
%
Total Materials Segment revenue
$
55,619
$
48,684
$
6,935
14
%
Segment Adjusted EBITDA(1)
$
3,758
$
7,339
$
(3,581
)
(49
)%
Key Performance Indicators(2):
(in whole units or dollars)
Rare earth concentrate
REO Production Volume (MTs)
12,213
11,151
1,062
10
%
REO Sales Volume (MTs)
6,264
9,332
(3,068
)
(33
)%
Realized Price per REO MT
$
4,808
$
4,294
$
514
12
%
Separated NdPr products
NdPr Production Volume (MTs)
563
131
432
330
%
NdPr Sales Volume (MTs)
464
134
330
246
%
NdPr Realized Price per KG
$
52
$
62
$
(10
)
(16
)%
(1)
See “Segment Information” below for further information.
(2)
See “Key Performance Indicators” below for definitions and further
information.
First Quarter 2025 Materials Segment Review
Materials Segment revenue increased 14% to $55.6 million year
over year, driven by a $16.0 million increase in NdPr oxide and
metal sales due to a 246% increase in NdPr Sales Volumes, partially
offset by a 16% decline in realized pricing. The increased sales
volumes were driven by the continued transition to production of
midstream products, primarily NdPr oxide. Also impacting the
results was a $10.0 million decline in rare earth concentrate
revenue due to a 33% decline in REO Sales Volumes from the
accelerating ramp in midstream product production, where REO
produced, which could otherwise have been sold as rare earth
concentrate, was instead used to produce separated rare earth
products. REO Production Volumes increased 10% year over year to
12,213 metric tons primarily due to higher recoveries from the
continued implementation of Upstream 60K optimizations.
Materials Segment Adjusted EBITDA decreased by $3.6 million year
over year to $3.8 million, driven mainly by higher Materials
Segment cost of sales (“Segment COS”) due to production costs
associated with the higher proportion of separated rare earth
products sold in the most recent period. Segment COS for the three
months ended March 31, 2025, benefited from lower per-unit
production costs of separated products, which still remain
temporarily elevated as we ramp our refining capacity, as well as a
lower reserve on certain of our work in process and finished goods
inventories, which decreased by $2.8 million when compared to the
prior year period, as well as the 45X tax credit, which was $2.8
million higher in the current year period.
First Quarter 2025 Magnetics Segment Financial
Results
For the three months ended
March 31,
2025 vs. 2024
(in thousands, unaudited)
2025
2024
Amount Change
% Change
Revenue:
Magnetic precursor products
$
5,191
$
—
$
5,191
N/M
Segment Adjusted EBITDA(1)
$
493
$
(2,707
)
$
3,200
N/M
N/M = Not meaningful.
(1)
See “Segment Information” below for further information.
First Quarter 2025 Magnetics Segment Review
Revenues in the magnetics segment were $5.2 million in the
quarter as the initial magnetic precursor product deliveries began
in March. There were no corresponding sales in the prior year
period. The initial sales also drove the year-over-year increase in
the Magnetics Segment Adjusted EBITDA.
MP MATERIALS CORP. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE
SHEETS
March 31, 2025
December 31, 2024
(U.S dollars in thousands, except share
and per share data, unaudited)
Assets
Current assets
Cash and cash equivalents
$
198,343
$
282,442
Short-term investments
560,814
568,426
Total cash, cash equivalents and
short-term investments
759,157
850,868
Accounts receivable
69,719
18,874
Inventories
133,084
107,905
Income taxes receivable
23,805
23,672
Government grant receivable
19,205
19,799
Prepaid expenses and other current
assets
17,903
10,204
Total current assets
1,022,873
1,031,322
Non-current assets
Property, plant and equipment, net
1,278,830
1,251,496
Operating lease right-of-use assets
9,629
8,680
Inventories
20,338
19,031
Intangible assets, net
7,071
7,370
Other non-current assets
29,383
15,659
Total non-current assets
1,345,251
1,302,236
Total assets
$
2,368,124
$
2,333,558
Liabilities and stockholders’
equity
Current liabilities
Accounts and construction payable
$
20,867
$
23,562
Accrued liabilities
69,141
64,727
Current portion of long-term debt
67,346
—
Deferred revenue
75,335
56,880
Other current liabilities
15,518
18,850
Total current liabilities
248,207
164,019
Non-current liabilities
Long-term debt, net of current portion
842,415
908,729
Deferred revenue
69,474
43,120
Operating lease liabilities
6,390
5,798
Deferred government grant
22,029
20,087
Deferred investment tax credit
25,178
25,502
Deferred income taxes
80,695
85,309
Other non-current liabilities
37,625
26,114
Total non-current liabilities
1,083,806
1,114,659
Total liabilities
1,332,013
1,278,678
Commitments and contingencies
Stockholders’ equity:
Preferred stock ($0.0001 par value,
50,000,000 shares authorized, none issued and outstanding in either
period)
—
—
Common stock ($0.0001 par value,
450,000,000 shares authorized, 178,695,379 and 178,445,570 shares
issued, and 163,445,597 and 163,195,788 shares outstanding, as of
March 31, 2025, and December 31, 2024, respectively)
18
18
Additional paid-in capital
965,487
961,434
Retained earnings
297,654
320,302
Accumulated other comprehensive income
(loss)
(1
)
173
Treasury stock, at cost, 15,249,782 shares
for both periods
(227,047
)
(227,047
)
Total stockholders’ equity
1,036,111
1,054,880
Total liabilities and stockholders’
equity
$
2,368,124
$
2,333,558
MP MATERIALS CORP. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
For the three months ended
March 31,
(U.S. dollars in thousands, except
share and per share data, unaudited)
2025
2024
Revenue
$
60,810
$
48,684
Operating costs and expenses:
Cost of sales (excluding depreciation,
depletion and amortization)
48,831
35,594
Selling, general and administrative
24,166
21,267
Depreciation, depletion and
amortization
21,384
18,385
Start-up costs
976
1,287
Advanced projects and development
474
4,206
Other operating costs and expenses
(income), net
(243
)
377
Total operating costs and expenses
95,588
81,116
Operating loss
(34,778
)
(32,432
)
Interest expense, net
(7,615
)
(2,857
)
Gain on early extinguishment of debt
—
46,265
Other income, net
15,218
12,657
Income (loss) before income
taxes
(27,175
)
23,633
Income tax benefit (expense)
4,527
(7,144
)
Net income (loss)
$
(22,648
)
$
16,489
Earnings (loss) per share:
Basic
$
(0.14
)
$
0.09
Diluted
$
(0.14
)
$
(0.08
)
Weighted-average shares
outstanding:
Basic
163,764,345
174,556,850
Diluted
163,764,345
186,791,826
MP MATERIALS CORP. AND
SUBSIDIARIES
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
For the three months ended
March 31,
(U.S. dollars in thousands,
unaudited)
2025
2024
Operating activities:
Net income (loss)
$
(22,648
)
$
16,489
Adjustments to reconcile net income (loss)
to net cash used in operating activities:
Depreciation, depletion and
amortization
21,384
18,385
Accretion of discount on short-term
investments
(5,691
)
(8,493
)
Gain on early extinguishment of debt
—
(46,265
)
Stock-based compensation expense
7,353
7,467
Change in fair value of derivative
instrument
(6,997
)
—
Amortization of debt issuance costs
1,033
913
Lower of cost or net realizable value
reserve
3,164
5,991
Deferred income taxes
(4,558
)
7,144
Other
65
276
Decrease (increase) in operating
assets:
Accounts receivable
(50,845
)
(11,571
)
Inventories
(31,103
)
(20,943
)
Government grant receivable
(6,364
)
(1,617
)
Prepaid expenses, other current and
non-current assets
(7,100
)
(3,243
)
Increase (decrease) in operating
liabilities:
Accounts payable and accrued
liabilities
(1,786
)
(7,633
)
Deferred revenue
44,809
—
Deferred government grant
2,723
1,489
Other current and non-current
liabilities
(6,637
)
485
Net cash used in operating activities
(63,198
)
(41,126
)
Investing activities:
Additions to property, plant and
equipment
(30,467
)
(51,838
)
Purchases of short-term investments
(364,680
)
(390,608
)
Proceeds from sales of short-term
investments
23,164
22,954
Proceeds from maturities of short-term
investments
354,613
460,110
Proceeds from sale of property, plant and
equipment
1,666
—
Proceeds from government awards used for
construction
—
96
Net cash provided by (used in) investing
activities
(15,704
)
40,714
Financing activities:
Proceeds from issuance of long-term
debt
—
747,500
Payment of debt issuance costs
—
(15,125
)
Payments to retire long-term debt
—
(428,599
)
Purchase of capped call options
—
(65,332
)
Repurchases of common stock
—
(200,764
)
Principal payments on debt obligations and
finance leases
(1,361
)
(811
)
Tax withholding on stock-based awards
(3,642
)
(3,949
)
Net cash provided by (used in) financing
activities
(5,003
)
32,920
Net change in cash, cash equivalents and
restricted cash
(83,905
)
32,508
Cash, cash equivalents and restricted cash
beginning balance
283,603
264,988
Cash, cash equivalents and restricted
cash ending balance
$
199,698
$
297,496
Reconciliation of cash, cash
equivalents and restricted cash:
Cash and cash equivalents
$
198,343
$
296,468
Restricted cash, current
815
692
Restricted cash, non-current
540
336
Total cash, cash equivalents and
restricted cash
$
199,698
$
297,496
Reconciliation of GAAP Net
Income (Loss) to
Non-GAAP Adjusted
EBITDA
For the three months ended
March 31,
(in thousands, unaudited)
2025
2024
Net income (loss)
$
(22,648
)
$
16,489
Adjusted for:
Depreciation, depletion and
amortization
21,384
18,385
Interest expense, net
7,615
2,857
Income tax expense (benefit)
(4,527
)
7,144
Stock-based compensation expense(1)
7,353
7,467
Initial start-up costs(2)
772
1,173
Transaction-related and other costs(3)
2,816
3,797
Accretion of asset retirement and
environmental obligations(4)
373
231
Loss (gain) on disposals of long-lived
assets, net(4)
(616
)
146
Gain on early extinguishment of
debt(5)
—
(46,265
)
Other income, net(6)
(15,218
)
(12,657
)
Adjusted EBITDA
$
(2,696
)
$
(1,233
)
(1)
Principally included in “Selling, general and administrative”
within our unaudited Condensed Consolidated Statements of
Operations.
(2)
Included in “Start-up costs” within our unaudited Condensed
Consolidated Statements of Operations and excludes any applicable
stock-based compensation, which is included in the “Stock-based
compensation expense” line above. Primarily relates to certain
costs incurred in connection with the commissioning and starting up
of our initial magnet-making capabilities at Independence prior to
the achievement of commercial production. These costs include labor
of incremental employees hired in advance to work directly on such
commissioning activities, training costs, costs of testing and
commissioning the new circuits and processes, and other related
costs. Given the nature and scale of the related costs and
activities, management does not view these as normal, recurring
operating expenses, but rather as non-recurring investments to
initially develop our magnet-making capabilities. Therefore, we
believe it is useful and necessary for investors to understand our
core operating performance in current and future periods by
excluding the impact of these start-up costs. To the extent
additional start-up costs are incurred in the future to expand our
separations and magnet-making capabilities after initial
achievement of commercial production (e.g., significantly expanding
production capacity at an existing facility or building a new
separations or magnet manufacturing facility), such costs would not
be considered an adjustment for this non-GAAP financial measure.
(3)
Pertains to legal, consulting, and advisory services, and other
costs associated with specific transactions, including litigation
matters, potential acquisitions, mergers, or other investments. For
the three months ended March 31, 2025, amount is principally
included in “Selling, general and administrative” within our
unaudited Condensed Consolidated Statements of Operations. For the
three months ended March 31, 2024, amount is principally included
in “Advanced projects and development” within our unaudited
Condensed Consolidated Statements of Operations.
(4)
Included in “Other operating costs and expenses (income), net”
within our unaudited Condensed Consolidated Statements of
Operations.
(5)
Pertains to the gain recognized on the repurchase of $480.0 million
aggregate principal amount of our 0.25% unsecured senior
convertible notes due 2026 (the “2026 Notes”) in March 2024.
(6)
Principally comprised of interest and investment income and changes
in fair value of derivative instruments.
Reconciliation of GAAP Net
Income (Loss) to
Non-GAAP Adjusted Net
Loss
For the three months ended
March 31,
(in thousands, unaudited)
2025
2024
Net income (loss)
$
(22,648
)
$
16,489
Adjusted for:
Stock-based compensation expense(1)
7,353
7,467
Initial start-up costs(2)
772
1,173
Transaction-related and other costs(3)
2,816
3,797
Loss (gain) on disposals of long-lived
assets, net(4)
(616
)
146
Gain on early extinguishment of
debt(5)
—
(46,265
)
Change in fair value of derivative
instrument(6)
(6,997
)
—
Tax impact of adjustments above(7)
(578
)
9,701
Adjusted Net Loss
$
(19,898
)
$
(7,492
)
(1)
Principally included in “Selling, general and administrative”
within our unaudited Condensed Consolidated Statements of
Operations.
(2)
Included in “Start-up costs” within our unaudited Condensed
Consolidated Statements of Operations and excludes any applicable
stock-based compensation, which is included in the “Stock-based
compensation expense” line above. Primarily relates to certain
costs incurred in connection with the commissioning and starting up
of our initial magnet-making capabilities at Independence prior to
the achievement of commercial production. These costs include labor
of incremental employees hired in advance to work directly on such
commissioning activities, training costs, costs of testing and
commissioning the new circuits and processes, and other related
costs. Given the nature and scale of the related costs and
activities, management does not view these as normal, recurring
operating expenses, but rather as non-recurring investments to
initially develop our separations and magnet-making capabilities.
Therefore, we believe it is useful and necessary for investors to
understand our core operating performance in current and future
periods by excluding the impact of these start-up costs. To the
extent additional start-up costs are incurred in the future to
expand our separations and magnet-making capabilities after initial
achievement of commercial production (e.g., significantly expanding
production capacity at an existing facility or building a new
separations or magnet manufacturing facility), such costs would not
be considered an adjustment for this non-GAAP financial measure.
(3)
Pertains to legal, consulting, and advisory services, and other
costs associated with specific transactions, including litigation
matters, potential acquisitions, mergers, or other investments. For
the three months ended March 31, 2025, amount is principally
included in “Selling, general and administrative” within our
unaudited Condensed Consolidated Statements of Operations. For the
three months ended March 31, 2024, amount is principally included
in “Advanced projects and development” within our unaudited
Condensed Consolidated Statements of Operations.
(4)
Included in “Other operating costs and expenses (income), net”
within our unaudited Condensed Consolidated Statements of
Operations.
(5)
Pertains to the gain recognized on the repurchase of $480.0 million
aggregate principal amount of our 2026 Notes in March 2024.
(6)
Included in “Other income, net” within our unaudited Condensed
Consolidated Statements of Operations and pertains to the change in
fair value of the redemption feature included in the portion of the
2030 Notes that were issued in December 2024.
(7)
Tax impact of adjustments is calculated using an adjusted effective
tax rate, which excludes the impact of discrete tax costs and
benefits, to each adjustment. The adjusted effective tax rates were
17.4%, and 28.8% for the three months ended March 31, 2025 and
2024, respectively.
Reconciliation of GAAP Diluted
Loss per Share to
Non-GAAP Adjusted Diluted
EPS
For the three months ended
March 31,
(unaudited)
2025
2024
Diluted loss per share
$
(0.14
)
$
(0.08
)
Adjusted for:
Stock-based compensation expense
0.04
0.04
Initial start-up costs
—
0.01
Transaction-related and other costs
0.02
0.02
Gain on early extinguishment of debt
—
(0.27
)
Change in fair value of derivative
instrument
(0.04
)
—
Tax impact of adjustments above(1)
—
0.06
2026 Notes if-converted method(2)
—
0.18
Adjusted Diluted EPS
$
(0.12
)
$
(0.04
)
Diluted weighted-average shares
outstanding(3)
163,764,345
186,791,826
Assumed conversion of 2026 Notes(3)
—
(12,234,976
)
Adjusted diluted weighted-average
shares outstanding(3)
163,764,345
174,556,850
(1)
Tax impact of adjustments is calculated using an adjusted effective
tax rate, which excludes the impact of discrete tax costs and
benefits, to each adjustment. The adjusted effective tax rates were
17.4% and 28.8% for the three months ended March 31, 2025 and 2024,
respectively.
(2)
For the three months ended March 31, 2024, since the 2026 Notes
were dilutive for purposes of computing GAAP diluted loss per share
but antidilutive for purposes of computing Adjusted Diluted EPS,
within this reconciliation, we have included this adjustment to
reverse the impact of applying the if-converted method to the 2026
Notes in the computation of GAAP diluted loss per share.
(3)
For the three months ended March 31, 2024, since the 2026 Notes
were dilutive for purposes of computing GAAP diluted loss per share
but antidilutive for purposes of computing Adjusted Diluted EPS,
the adjusted diluted weighted-average shares outstanding exclude
the potentially dilutive securities associated with the 2026 Notes.
Conference Call Details
MP Materials will host a conference call to discuss these
results at 2:00 p.m. Pacific Time, Thursday, May 8, 2025. To join
the conference call on a listen-only basis, participants should
dial 1-888-788-0099 and international participants should dial
1-646-876-9923 and enter the conference ID number: 91748027092 as
well as the passcode: 131443. The live audio webcast along with the
press release and accompanying slide presentation, will be
accessible at investors.mpmaterials.com. A recording of the webcast
will also be available following the conference call.
About MP Materials
MP Materials (NYSE: MP) is America’s only fully integrated rare
earth producer with capabilities spanning the entire supply
chain—from mining and processing to advanced metallization and
magnet manufacturing. We extract and refine materials from one of
the world’s richest rare earth deposits in California and
manufacture the world’s strongest and most efficient permanent
magnets. Our products enable innovation across critical sectors of
the modern economy, including transportation, energy, robotics,
defense, and aerospace. More information is available at
https://mpmaterials.com/.
Join the MP Materials community on X, YouTube and LinkedIn.
We routinely post important information on our website,
including corporate and investor presentations and financial
information. We intend to use our website as a means of disclosing
material, non-public information and for complying with our
disclosure obligations under Regulation FD. Such disclosures will
be included in the Investors section of our website. Accordingly,
investors should monitor such portion of our website, in addition
to following our press releases, Securities and Exchange Commission
filings and public conference calls and webcasts.
Forward-Looking Statements
This press release contains certain statements that are not
historical facts and are forward-looking statements for purposes of
the safe harbor provisions under the United States Private
Securities Litigation Reform Act of 1995. Forward-looking
statements may be identified by the use of the words such as
“estimate,” “plan,” “shall,” “may,” “project,” “forecast,”
“intend,” “expect,” “anticipate,” “believe,” “seek,” “will,”
“target,” or similar expressions that predict or indicate future
events or trends or that are not statements of historical matters.
These forward-looking statements include, but are not limited to,
statements regarding engagement with industry and the government
and outcomes related to this engagement, the price and market for
rare earth materials, the continued demand for rare earth materials
and the market for rare earth materials generally, future demand
for electric vehicles and magnets, estimates and forecasts of the
Company’s results of operations and other financial and performance
metrics, including NdPr oxide production and shipments, expected
NdPr oxide production and shipments, the Company’s share repurchase
program, the expected cash flows of the early production of
magnetic precursor products in Stage III and associated expected
magnetic precursor products prepayments and timing thereof, the
expected timing for receipt of the 48C tax credits, the expected
capital expenditures in Stage II and Stage III, the Company’s
ability to control costs and expenses, the Company’s Upstream 60K
strategy, including statements regarding the timing, costs and
ability to increase REO production, and the Company’s Stage II and
Stage III projects, including the Company’s ability to achieve run
rate production of separated rare earth materials and production of
commercial metal and magnets. Such statements are all subject to
risks, uncertainties and changes in circumstances that could
significantly affect the Company’s future financial results and
business.
Accordingly, the Company cautions that the forward-looking
statements contained herein are qualified by important factors that
could cause actual results to differ materially from those
reflected by such statements. These forward-looking statements are
subject to a number of risks and uncertainties, including changes
in trade policy in the United States, China or other countries,
including the implementation of new tariffs, and the material
adverse impact on the Company’s business and results of operations
as a result of these changes in trade policy; the increased
importance of markets outside of China and the Company’s ability to
sell additional rare earth products in these markets; uncertainties
relating to our commercial arrangements with Shenghe Resources
(Singapore) International Trading Pte. Ltd., (“Shenghe”) an
affiliate of Shenghe Resources Holding Co., Ltd., a global rare
earth company listed on the Shanghai Stock Exchange, including
relating to our recent decision to cease shipments of rare earth
concentrate to China; uncertainties regarding our ability to resume
shipments to, or renew our offtake agreement with, Shenghe;
potential changes in China’s political environment and policies;
potential changes in China’s political environment and policies;
uncertainties relating to significant political, trade, and
regulatory developments; uncertainties related to the outcome of
engagement with industry and government; fluctuations and
uncertainties related to demand for and pricing of rare earth
products; changes in domestic and foreign business, market,
financial, political and legal conditions; changes in demand for
neodymium-iron-boron (“NdFeB”) permanent magnets; the effects of
competition on the Company’s future business; risks related to the
Company’s Upstream 60K strategy, including delays in completion,
unexpected costs and expenses and timing for obtaining regulatory
approvals; risks related to the rollout of the Company’s business
strategy, including Stage II and Stage III, and the timing of
achieving expected business milestones in Stage II and Stage III;
risks related to the Company’s Stage II operations and the
Company’s ability to achieve run rate production of separated rare
earth materials; risks related to the Company’s long-term agreement
with General Motors, including the Company’s ability to produce and
supply NdFeB magnets; risks related to expected sales of separated
NdPr oxide due to various risks, including demand and pricing for
separated NdPr oxide; risks related to the Company’s ability to
develop magnetic precursor products in Stage III, including
production delays; risks related to the Company entering into
agreements with customers for prepayment of magnetic precursor
products, including NdPr metal; risks associated with the terms of
the 3.00% unsecured senior convertible notes due March 2030 (the
“2030 Notes”); risks related to the share repurchase program and
whether it will be fully consummated or will enhance long-term
stockholder value; risks related to current and future governmental
and environmental laws, regulations, licenses or legal
requirements; and those risk factors discussed in the Company’s
filings with the Securities and Exchange Commission, including
Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q,
Current Reports on Form 8-K and other documents filed by the
Company with the Securities and Exchange Commission.
If any of these risks materialize or the assumptions prove
incorrect, actual results could differ materially from the results
implied by these forward-looking statements. The Company does not
intend to update or revise publicly any forward-looking statements,
whether as a result of new information, future events or otherwise,
except as required by law. In light of these risks, uncertainties
and assumptions, the forward-looking events discussed in this
earnings release may not occur.
Use of Non-GAAP Financial Measures
This press release references certain non-GAAP financial
measures, including Adjusted EBITDA, Adjusted Net Income (Loss),
and Adjusted Diluted EPS, which have not been prepared in
accordance with GAAP. MP Materials defines Adjusted EBITDA as GAAP
net income or loss before interest expense, net; income tax expense
or benefit; and depreciation, depletion and amortization; further
adjusted to eliminate the impact of stock-based compensation
expense; initial start-up costs; transaction-related and other
costs; accretion of asset retirement and environmental obligations;
gain or loss on disposals of long-lived assets; gain or loss on
early extinguishment of debt; other income or loss; and other items
that management does not consider representative of our underlying
operations. MP Materials defines Adjusted Net Income (Loss) as GAAP
net income or loss excluding the impact of stock-based compensation
expense; initial start-up costs; transaction-related and other
costs; gain or loss on disposals of long-lived assets; gain or loss
on early extinguishment of debt; change in fair value of derivative
instruments; and other items that management does not consider
representative of our underlying operations; adjusted to give
effect to the income tax impact of such adjustments. MP Materials
defines Adjusted Diluted EPS as GAAP diluted earnings or loss per
share excluding the per share impact, using adjusted diluted
weighted-average shares outstanding as the denominator, of
stock-based compensation expense; initial start-up costs;
transaction-related and other costs; gain or loss on disposals of
long-lived assets; gain or loss on early extinguishment of debt;
change in fair value of derivative instruments; and other items
that management does not consider representative of our underlying
operations; adjusted to give effect to the income tax impact of
such adjustments. In addition, when appropriate, we include an
adjustment to reverse the impact of applying the if-converted
method to our 2026 Notes if necessary to reconcile between GAAP
diluted earnings or loss per share and Adjusted Diluted EPS. When
applicable, adjusted diluted weighted-average shares outstanding
reflect the anti-dilutive impact of our capped call options entered
into in connection with the issuance of our 2030 Notes.
MP Materials’ management uses Adjusted EBITDA, Adjusted Net
Income (Loss), and Adjusted Diluted EPS to compare MP Materials’
performance to that of prior periods for trend analyses and for
budgeting and planning purposes. MP Materials believes Adjusted
EBITDA, Adjusted Net Income (Loss), and Adjusted Diluted EPS
provide useful information to management and investors regarding
certain financial and business trends relating to MP Materials’
financial condition and results of operations. MP Materials’
management believes that the use of Adjusted EBITDA, Adjusted Net
Income (Loss), and Adjusted Diluted EPS provides an additional tool
for investors to use in evaluating projected operating results and
trends. MP Materials’ method of determining these non-GAAP measures
may be different from other companies’ methods and, therefore, may
not be comparable to those used by other companies and MP Materials
does not recommend the sole use of these non-GAAP measures to
assess its financial performance. Management does not consider
non-GAAP measures in isolation or as an alternative or to be
superior to financial measures determined in accordance with GAAP.
The principal limitation of non-GAAP financial measures is that
they exclude significant expenses and income that are required by
GAAP to be recorded in MP Materials’ financial statements. In
addition, they are subject to inherent limitations as they reflect
the exercise of judgments by management about which expense and
income are excluded or included in determining these non-GAAP
financial measures. In order to compensate for these limitations,
management presents reconciliations of such non-GAAP financial
measures to the most directly comparable GAAP financial
measures.
Segment Information
The Company’s reportable segments, which are primarily based on
the Company’s internal organizational structure and types of
products, are its two operating segments—Materials and Magnetics.
Prior period amounts have been recast to conform to this segment
reporting structure, which was modified during the fourth quarter
of 2024.
The Materials segment operates the Mountain Pass Rare Earth Mine
and Processing Facility located near Mountain Pass, San Bernardino
County, California, which produces refined rare earth products as
well as rare earth concentrate and related products. The Magnetics
segment operates a rare earth metal, alloy and magnet manufacturing
facility in Fort Worth, Texas (“Independence”), where the Company
produces and sells magnetic precursor products and anticipates
manufacturing NdFeB permanent magnets by the end of 2025.
Segment Adjusted EBITDA is management’s primary segment measure
of profit or loss required by GAAP in assessing segment performance
and deciding how to allocate the Company’s resources. Segment
Adjusted EBITDA is calculated as segment revenues less significant
segment expenses, specifically, cost of sales (excluding
depreciation, depletion and amortization and stock-based
compensation expense) and selling, general and administrative
expenses (excluding stock-based compensation expense), as well as
certain other operating expenses (referred to as “other segment
items”). Significant segment expenses and other segment items also
exclude certain costs that are non-recurring, non-cash or are not
related to the segments’ underlying business performance.
Key Performance Indicators
REO Production Volume is measured in MTs, the Company’s
principal unit of sale for its concentrate product. This measure
refers to the REO content contained in the rare earth concentrate
we produce and, beginning in the second quarter of 2023, includes
volumes fed into downstream circuits for commissioning and starting
up our separations facilities and for producing separated rare
earth products, a portion of which is also included in our KPI,
NdPr Production Volume. REO Production Volume is a key indicator of
the mining and processing capacity and efficiency of the Company’s
upstream operations.
REO Sales Volume for a given period is calculated in MTs. A
unit, or MT, is considered sold once we recognize revenue on its
sale as determined in accordance with GAAP. REO Sales Volume is a
key measure of the Company’s ability to convert its concentrate
production into revenue. REO Sales Volume includes both traditional
concentrate as well as roasted concentrate.
Realized Price per REO MT for a given period is calculated as
the quotient of: (i) the Company’s rare earth concentrate sales,
which are determined in accordance with GAAP, for a given period
and (ii) the Company’s REO Sales Volume for the same period.
Realized Price per REO MT is an important measure of the market
price of the Company’s concentrate product.
NdPr Production Volume for a given period is measured in MTs,
the Company’s principal unit of sale for its NdPr separated
products. NdPr Production Volume refers to the volume of finished
and packaged NdPr oxide produced at Mountain Pass for a given
period. NdPr Production Volume is a key indicator of the separating
and finishing capacity and efficiency of the Company’s midstream
operations.
Our NdPr Sales Volume for a given period is calculated in MTs
and on an NdPr oxide-equivalent basis (as further discussed below).
A unit, or MT, is considered sold once the Materials segment
recognizes revenue on its sale, whether sold as NdPr oxide or NdPr
metal, as determined in accordance with GAAP. For these NdPr metal
sales, the MTs sold and included in NdPr Sales Volume are
calculated based on the volume of NdPr oxide used to produce such
NdPr metal. We utilize an assumed material conversion ratio of
1.20, such that a sale of 100 MTs of NdPr metal would be included
in this KPI as 120 MTs of NdPr oxide-equivalent. NdPr Sales Volume
is a key measure of our ability to convert our production of
separated NdPr products into revenue. In the future, NdPr Sales
Volume for the Materials segment is expected to include sales made
to the Magnetics segment.
NdPr Realized Price per kilogram (“KG”) for a given period is
calculated as the quotient of: (i) our Materials segment NdPr oxide
and metal sales, which are determined in accordance with GAAP, for
a given period and (ii) our NdPr Sales Volume for the same period.
NdPr Realized Price per KG is an important measure of the market
price of our NdPr products. In the future, NdPr Realized Price per
KG for the Materials segment is expected to include sales made to
the Magnetics segment.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20250508065482/en/
Investors: IR@mpmaterials.com
Media: Matt Sloustcher media@mpmaterials.com
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