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    MOS
    Earnings call· Dec 2025(Q4 FY25)

    MOSAIC Q4 FY25 earnings call MOS

    Feb 25, 2026 Source

    Executive summary

    The Mosaic Company Q4 FY25 — Phosphate Production Recovery & Cost Savings Drive 2026 Outlook

    The Mosaic Company navigated a challenging Q4 FY25 marked by soft U.S. phosphate demand and rising sulfur costs, impacting cash flow and net debt. Despite these headwinds, the company is focused on operational stability, cost reduction, and strategic capital allocation, positioning for improved phosphate production and significant working capital release in FY26. Management remains optimistic about global agricultural fundamentals and the long-term potential of its Biosciences segment.

    Highlights

    5

    • Phosphate production expected to reach at least 7 million tonnes in 2026, with Bartow and Louisiana facilities running at 80%+ operating factor.

    • Achieved $150 million cost savings objective ahead of schedule in 2025, with another $100 million targeted for 2026.

    • Mosaic Biosciences doubled net sales to $68 million in 2025 and expects to double again in 2026 with 8-10 new product launches.

    • Divested noncore assets (Patos de Minas, Taquari, Carlsbad pending) expected to generate $170 million in proceeds and reduce asset retirement obligations by $60 million.

    • International DAP market showing price increases over 5 weeks, with netbacks at a premium to NOLA prices, allowing for strategic pivot.

    Concerns

    5

    • Fourth quarter demand weaker than expected due to U.S. phosphate demand, pressured by affordability challenges and government support uncertainty.

    • Working capital reduced cash flow by $960 million in 2025 and contributed to an $829 million increase in net debt.

    • Sharp increase in sulfur prices since December expected to create a $250 million headwind to Q1 FY26 EBITDA compared to prior year.

    • Idled Arax and Fospar operations in Brazil due to margin pressure from high sulfur prices, impacting full-year sales volume guidance for Mosaic Fertilizantes.

    • CapEx expected to be around $1.5 billion in 2026, higher than 2025, due to a confluence of required gyp stack and clay settling area expansions.

    Guidance & targets

    12
    CategoryTargetConfidence
    Phosphate production
    at least 7 million tonnes
    high materiality
    High
    Potash production
    around 9 million tonnes
    high materiality
    High
    Cost savings
    $100 million
    medium materiality
    High
    Mosaic Biosciences net sales growth
    doubling net sales
    medium materiality
    High
    Capital expenditures
    around $1.5 billion
    high materiality
    Medium
    Long-term capital expenditures
    approximately $1 billion
    high materiality
    High
    Long-term ARO and environmental reserve cash spending
    about $200 million
    medium materiality
    High
    Free cash flow generation
    above the minimum dividend
    high materiality
    High
    Working capital release
    $300 million to $500 million
    high materiality
    High
    EBITDA to cash flow from operations conversion rate
    meaningful improvement
    medium materiality
    High
    Q1 FY26 EBITDA headwind from sulfur prices
    roughly $250 million
    high materiality
    High
    Mosaic Fertilizantes sales volumes
    not providing guidance
    medium materiality
    Low

    Segment performance

    4
    SegmentRevenueYoYQoQMargin
    U.S. Phosphate Business
    Invested time and money across assets to set up for reliably strong production. Bartow facility had an extended turnaround and production was adjusted due to soft U.S. demand.
    P2O5 production improved during the yearPhosphate fertilizer production rose through the yearQ4 production: 1.7 million tonnes
    		————
    Potash
    Expect to achieve record production at Esterhazy in 2026.
    International sales volume set a record last yearFull operating rates at Esterhazy since December fatalityHydroFloat project ramping up
    		————
    Mosaic Fertilizantes (Brazil)
    Delivered cost improvements through increased mine production and elimination of high-cost imported rock. Idled Arax and Fospar due to margin pressure from sulfur prices.
    Rock output reached near record levels in 2025Blended rock cost per tonne: $97 (lowest since 2021)
    		———almost $50 million
    Mosaic Biosciences
    Capitalizing on R&D investments, expanding commercialization in Americas, China, and India. Future product launches expected to provide pathway to higher margins.
    5 new products launched in 202560+ registrationsselling into 16 countries
    		$68 milliondoubled—40s (gross margins)

    Operational metrics

    37
    Ma'aden equity valuation
    $2.1 billion
    current

    Our position in Ma'aden equity is currently valued at about $2.1 billion.

    Notes raised
    $900 million
    November 2025

    In November 2025, we successfully raised $900 million through 3-year and 5-year notes.

    North America fertilizer assets operating factor
    81%
    target

    To get to kind of the 8 million tonne rate, you need an operating factor of 80 -- low 80s, 81% of our overall fertilizer assets in North America.

    ARO and environmental reserves cash spend
    $408 million
    FY25

    The $408 million is the total cash spend for ARO and environmental reserves.

    Excess rock inventory release potential
    $170 million - $180 million
    over next few quarters

    The potential is with increased production rates to release that roughly $170 million, $180 million of excess rock inventory.

    Mosaic Fertilizantes volume outlook
    10 million to 10.8 million tonnes
    FY25 outlook

    Last year, coming into the year, you guys were sort of looking at 10 million to 10.8 million tonnes in volumes.

    Phosphate production run rate
    1.7 million to 1.8 million tonnes
    per quarter

    Analyst's question about current expectation for phosphate production per quarter.

    EBITDA margin per tonne
    $108
    Q4 FY25

    Today, at $444 [stripping margin], the EBITDA margin per tonne was $108.

    Breakeven stripping margin
    $330
    Q4 FY25

    That per se suggests if you just take $444 less $108, that $330 would have been the breakeven point at Q4.

    Breakeven stripping margin (normalized)
    $280
    normalized

    I would say these 2 lines are kind of $50 above what they should be. So that puts us at $280 breakeven.

    Breakeven stripping margin (with cost dilution)
    $250
    normalized with cost dilution

    And if you add the cost dilution that we expect in going for 8 million tonnes, like we should be around $250 per tonne of stripping margin breakeven.

    Cash cost of conversion
    $112improvement of approximately $20 per tonne compared with high-water mark earlier in the year
    Q4 FY25

    Fourth quarter cash cost of conversion was $112 per tonne, which is an improvement of approximately $20 per tonne compared with the high-water mark earlier in the year. This improvement is structural, not one-off.

    Cash cost of production
    $75
    FY25

    In potash, our cash cost of production averaged $75 per tonne in 2025 and would have been within our Analyst Day target range if not for the extension of Colonsay, which carries higher costs.

    Cost savings objective
    $150 millionahead of schedule
    FY25

    We achieved our $150 million cost savings objective ahead of schedule in 2025.

    Working capital reduction impact on cash flow
    $960 million
    FY25

    Working capital reduced cash flow by $960 million for the year and contributed to an $829 million increase in net debt.

    Net debt increase
    $829 million
    FY25

    Working capital reduced cash flow by $960 million for the year and contributed to an $829 million increase in net debt.

    Excess phosphate inventory
    240,000 tonnesversus prior year
    end of FY25

    We exited 2025 with about 240,000 tonnes of excess inventory in phosphates versus the prior year.

    Potential working capital release from excess phosphate inventory
    $140 million
    over next few quarters

    At current inventory values, this represents roughly $140 million of potential working capital release over the next few quarters from demand recovery alone.

    Sulfur price increase impact on quarterly expense
    $10 million
    per quarter

    Every $10 increase in sulfur prices adds approximately $10 million of quarterly expense.

    Faustina ammonia production increase
    50%more available than 2025
    FY26

    We expect 50% -- up to 50% more production out of that facility going into 2026 now that it's up and running.

    Faustina ammonia contribution to portfolio
    35% to 40%
    FY26

    That will consume a larger percentage of our portfolio as consumed -- or as produced ammonia. And that is going to be 35% to 40% of the portfolio versus much less than that, which we would have been exposed to market on.

    Phosphate stripping margin
    $444
    Q4 FY25

    So realized stripping margins in the fourth quarter were $444 per tonne.

    Phosphate stripping margin (current sulfur prices)
    $400
    current

    If you correct for the current sulfur prices compared to the $306 that was recorded in the fourth quarter, you would have somehow $400 per tonne of stripping margins.

    Breakeven point for phosphate performance (normalized)
    $250
    normalized

    And if you add the cost dilution that we expect in going for 8 million tonnes, like we should be around $250 per tonne of stripping margin breakeven.

    EBITDA impact from idle Arax/Fospar
    $10 million
    ongoing

    Currently the expenditures are hitting -- although we are saving on CapEx and other things, the expenditures are continuing to hit EBITDA at a rate of around $10 million per month.

    Phosphate production
    1.7 million tonnes
    Q4 FY25

    We produced 1.7 million tonnes in the fourth quarter even with an extended turnaround at our Bartow facility as well as deliberate steps to adjust production amid soft U.S. demand.

    Florida rock production
    highest level in 3 years
    FY25

    In phosphate, we delivered strong rock production last year, with Florida reaching its highest level in 3 years

    Miski Mayo mining production
    record mining production
    FY25

    and record mining production at Miski Mayo.

    Brazilian rock output
    near record levels
    FY25

    In fact, rock output in Brazil reached near record levels in 2025.

    U.S. phosphate shipment decline
    14%, 15%
    FY25

    Last year, the drop of this 14%, 15% of shipment of phosphate in the North American market, majority of them happened in fall application

    U.S. phosphate shipment
    below 9 million tonnes
    FY22

    Basically, the changes is really in the U.S. market. That was down to below 9 million tonnes in 2022

    U.S. phosphate shipment
    10 million tonnes
    FY23

    recovered in '23 to 10 million tonnes

    U.S. phosphate shipment
    10 million tonnes
    FY24

    '24 10 million tonnes.

    U.S. phosphate shipment
    8.5 million tonnes
    FY25

    And then we see a major drop last year, 8.5 million tonnes.

    Total cash outlays for CapEx, ARO, environmental reserves
    modestly higherthan prior year
    FY26

    Taken together, as Bruce mentioned, total cash outlays for CapEx, ARO and environmental reserves are expected to be modestly higher than the prior year.

    Cash spending on ARO and environmental reserves decline
    $50 million
    FY26

    At the same time, cash spending on asset retirement obligations and environmental reserves are expected to decline by roughly $50 million, partially offsetting the increase

    Long-term ARO and environmental reserves cash spending
    $200 million
    by 2030

    with ARO and environmental reserves steadily edging down to approximately $200 million.

    Industry KPIs

    2
    MetricValueDetails
    Volume vs price splitdirectional
    Productivity cost savings program$100 millionUSD

    Product announcements

    2
    ProductTypeDetails
    5 new productslaunch
    8 to 10 new product launchesroadmap

    Deals & partnerships

    2
    nullsale of noncore assets

    Part of a capital allocation program to focus attention and capital where it matters. Includes Patos de Minas and Taquari.

    nullsale of noncore asset

    Part of a capital allocation program to focus attention and capital where it matters. Refers to the Carlsbad transaction.

    Capital programs

    4
    Palmeirante blending facilitycompleted

    Benefit: 1 million tonne blending capacity

    In 2025, we expanded our Brazil distribution capacity with the completion of a 1 million tonne blending facility in Palmeirante in the fast-growing agriculture region in northern Brazil.

    Gyp stack expansionsunderway

    We have a gypsum stack at New Wales, a gypsum stack at Bartow, a gypsum stack in Louisiana, all happening in 2026.

    Clay settling area expansionsunderway

    We have 2 clay settling areas, one winding down and another one being built at Four Corners.

    Tailings dam (Tapira)underway

    We have a tailings dam at Tapira.

    Risks & headwinds

    5
    U.S. phosphate demand weaknessQ4 FY25, impacting FY25 overall

    down 14-15% in North America for FY25

    Mitigation: Emerging spring inquiries, global ag fundamentals solid, ability to pivot sales to international markets.

    Sulfur price spikeQ4 FY25, well into H1 FY26

    expected $250 million headwind to Q1 FY26 EBITDA; every $10 increase adds $10 million quarterly expense

    Mitigation: Idled Arax and Fospar (lowest margin operations), focus on increasing phosphate production for better fixed cost absorption, expectation for sulfur prices to moderate.

    Brazil credit constraintsongoing, expected to be challenging in 2026

    Mosaic Fertilizantes Q4 EBITDA almost $50 million despite significant curtailment and margin compression

    Mitigation: Prudent sales decisions to avoid credit risk, focus on business quality, long-term optimism due to expanding planted acreage and rising crop yields.

    Working capital impact on cash flowFY25

    reduced cash flow by $960 million for FY25; contributed to an $829 million increase in net debt

    Mitigation: Expected $300-500 million working capital release in FY26 from demand recovery and higher phosphate production.

    CapEx increase in 2026FY26

    $1.5 billion

    Mitigation: Partially offset by $50 million decline in ARO/environmental reserve spending; CapEx expected to trend down to $1 billion by 2030.

    What to watch in Q1 FY26

    5

    Phosphate production operating factor

    Q2 FY26
    CurrentBartow & Louisiana 80%+, Riverview mid-70s, New Wales in turnaround
    TargetNew Wales approaching 80% after turnaround

    Why it matters

    Achieving target operating factors at all facilities is key to reaching 8 million tonnes of phosphate production and improving cost absorption.

    New Wales is in a turnaround as we speak. We expect as they come out of turnaround into quarter 2 that they will be approaching that 80%.

    Q&A highlights

    5

    Will Mosaic be able to pass through higher sulfur costs to farmers, and will farmers accept these prices given affordability challenges, or will they forgo DAP applications?

    Bruce Bodine acknowledged farmer affordability challenges but noted that stripping margins above $300/tonne are still constructive. He expects sulfur prices to moderate after Q1. Jenny Wang highlighted that international DAP prices are rising and are at a premium to NOLA, indicating a disconnect from the U.S. market and allowing Mosaic to pivot sales.

    “I don't know that we'll be able to pass-through as much as maybe historically in a tight market given the affordability issues. But we do see, at least for us, anything above a stripping margin above $300, we still see very constructive being in the middle of the cost curve.”

    asked by Patrick Fischer · answered by Bruce Bodine

    2 min read6 chapters

    Detailed Narrative

    01

    Market Conditions & Outlook

    Despite a tough Q4 FY25 driven by weak U.S. phosphate demand, global agricultural fundamentals remain solid. U.S. demand is emerging for spring planting, while global potash shipments are expected to approach record levels in FY26. China's continued restriction on phosphate exports and increasing demand for lithium iron phosphate batteries are creating supportive supply/demand dynamics for phosphate.

    02

    Operational Stability & Cost Management

    Mosaic made significant progress in restoring operational stability, particularly in U.S. phosphate production, with facilities like Bartow and Louisiana achieving 80%+ operating factors. The company achieved its $150 million cost savings target in FY25 and aims for another $100 million in FY26 through technology-enabled initiatives and supply chain optimization.

    03

    Brazil Operations & Market Dynamics

    Credit constraints in Brazil continue to challenge the market, leading to a more conservative approach to sales volumes and the idling of lower-margin operations (Arax and Fospar). However, management remains committed to the Brazilian market, citing expanding planted acreage and rising crop yields as long-term drivers. The platform demonstrated resilience by generating nearly $50 million in EBITDA in Q4 FY25 despite significant curtailments and margin compression.

    04

    Mosaic Biosciences Growth

    Mosaic Biosciences is highlighted as a promising growth story, doubling net sales to $68 million in FY25 and expecting to double again in FY26. The business benefits from Mosaic's global market access and customer relationships, with 5 new products launched in FY25 and 8-10 anticipated in FY26, expanding registrations to over 60 in 16 countries.

    05

    Capital Allocation & Portfolio Reshaping

    The company continues to reallocate capital for stronger returns, divesting noncore assets like Patos de Minas, Taquari, and Carlsbad (pending), which are expected to generate $170 million in proceeds and reduce asset retirement obligations by $60 million. Strategic alternatives for selected Brazilian assets and monetization of Florida land holdings are also being pursued to unlock further value.

    06

    Ma'aden Equity Valuation

    Mosaic's position in Ma'aden equity is currently valued at approximately $2.1 billion, demonstrating significant value generated from past capital allocation decisions.

    AI-generated summary of the company’s earnings call. Not investment advice.