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    MP
    Earnings call· Jun 2026(Q2 FY26)

    MP Materials Corp. / DE Q2 FY26 earnings call MP

    Aug 6, 2026 Source

    Executive summary

    MP Materials Q2 FY26 — Strong Production Growth and Strategic Heavy Rare Earth Deal

    MP Materials delivered a strong Q2 FY26, marked by significant NdPr production and sales growth, alongside a strategic long-term gadolinium supply agreement. The company is advancing its heavy rare earth separation capabilities and magnet manufacturing, with commercial magnet shipments expected to commence in Q4. Despite sequential EBITDA pressure from planned maintenance and startup costs, MP is focused on scaling production, optimizing processes, and building a resilient domestic supply chain for critical materials, including through initiatives like Project Swarm for autonomous systems.

    Highlights

    5

    • NdPr production increased 41% year-over-year to 840 metric tons, meeting expectations despite a planned shutdown.

    • NdPr sales volumes more than doubled year-over-year, up 127%, exceeding 1,000 metric tons for the second consecutive quarter.

    • Secured a long-term, 9-figure agreement to supply gadolinium oxide to a leading U.S. aerospace and defense manufacturer.

    • Materials segment revenue plus PPA income reached $113.2 million, contributing to a $45 million year-over-year improvement in adjusted EBITDA.

    • Magnetics precursor production generated adjusted EBITDA margins exceeding 40%, highlighting future earnings potential.

    Concerns

    3

    • Consolidated adjusted EBITDA declined modestly sequentially due to costs associated with a planned biannual plant shutdown and the Magnetics segment's transition ahead of commercial magnet revenue.

    • Magnetics revenue declined slightly sequentially due to a higher proportion of costs attributable to magnet production startup versus precursor product production.

    • Expected minimal PPA income from stockpiled NdPr in Q3 due to market pricing hovering at $110 per kilogram.

    Guidance & targets

    10
    CategoryTargetConfidence
    NdPr production volume growth
    Significant volume growth
    medium materiality
    High
    Full-year Capital Expenditure
    $500 million to $600 million
    high materiality
    High
    NdPr production
    exceed 1,000 metric tons
    medium materiality
    High
    Realized NdPr oxide sales pricing
    high 90s per kilogram
    medium materiality
    High
    PPA income per kilogram
    roughly $10 per kilogram
    medium materiality
    High
    Materials segment sales volumes
    flattish
    medium materiality
    Medium
    Commercial magnet shipments start
    begin commercial shipments in the fourth quarter
    high materiality
    High
    Terbium and Dysprosium production start
    produce terbium and dysprosium later this year
    medium materiality
    High
    Samarium first production
    first production in 2028
    medium materiality
    High
    Gadolinium separation project completion
    similar time line [to samarium, i.e., 2028]
    medium materiality
    High

    Segment performance

    2
    SegmentRevenueYoYQoQMargin
    Materials
    Achieved production objectives despite an extended planned plant shutdown in April. Customer demand continues to outpace production growth.
    NdPr production: 840 metric tons (up 41% YoY)NdPr sales: exceeded 1,000 metric tons (up 127% YoY)
    		$113.2 million—essentially flat$32.5 million adjusted EBITDA
    Magnetics
    Start-up and customer qualification activities at Independence continue to advance. Delivered magnets to GM for in-vehicle qualification testing. Revenue decline driven by higher costs attributable to magnet production startup versus precursor product production.
    		——declined slightlyPrecursor production generated adjusted EBITDA margins exceeding 40%

    Operational metrics

    11
    Consolidated Revenue and PPA Income
    $126.1 millionmore than doubling last year's revenue
    Q2 FY26

    Driven primarily by 127% increase in sales volumes of NdPr.

    Consolidated Adjusted EBITDA
    $28.5 million$41 million improvement year-over-year
    Q2 FY26

    Declined modestly sequentially due to planned biannual plant shutdown and Magnetics transition costs.

    Adjusted Diluted EPS
    loss of $0.01improve $0.12
    Q2 FY26

    Year-over-year improvement.

    NdPr Oxide and Metal on hand
    650 metric tons
    as of June 30, 2026

    Includes material in transit, at toll processors, or waiting for shipment.

    Prepaid Revenue for Magnetic Precursor Products
    $46 million
    as of Q2 FY26

    Once fully recognized, metal production capacity will be dedicated to finished magnets.

    Heavy Rare Earth Intensity
    steadily reducing
    ongoing

    Achieved through Grain Boundary Diffusion technology and other process innovations across each stage of production.

    Flotation Reagent Cost
    modestly higher direct cost
    future

    Expected to sustain current performance, positively impact reclaimed water quality, and provide greater supply chain resiliency.

    Pre-flot Process Implementation
    by 2028
    future

    Expected to improve concentrate quality, lower operating costs, improve uptime, and achieve higher finished product quality.

    Chlor-alkali Recommissioning Benefits
    positive results
    Q2 FY26 (early indication)

    Already seeing positive results in crystallizer performance from bringing additional brine pre-treatment online. Expected benefits to build progressively through 2027.

    NdPr supply constraint
    —
    foreseeable future

    Management believes NdPr is the binding constraint for rare earth magnets globally, despite other magnet facilities coming online.

    Robotics magnet demand
    100%
    future

    Producing 30-40 million humanoid robots annually would consume 100% of global rare earth magnet production, including China.

    Industry KPIs

    2
    MetricValueDetails
    Ore grade recovery drilling by deposit—
    Production sales volume by metal and by mine840 metric tonsmetric tons

    Orderbook & backlog

    1
    Prepaid revenue for magnetic precursor products$46 millionQ2 FY26

    modestly declining basis quarter-to-quarter

    Will be recognized over the next 3-4 quarters; once fully recognized, metal production capacity will be dedicated to finished magnets.

    Product announcements

    3
    ProductTypeDetails
    Terbium and Dysprosiumlaunch
    Samariumroadmap
    Gadolinium separation projectroadmap

    Deals & partnerships

    3
    a leading U.S. aerospace and defense manufacturerLong-term supply agreement for gadolinium oxide.sizable 9-figure deal in totalover multiple years

    Locked-in economics, opportunity to grow volumes over time.

    U.S. and allied drone manufacturersIndustrial coordination initiative to aggregate and standardize future magnet demand for autonomous systems.

    Participants sign subscription agreements to secure future manufacturing capacity while preserving flexibility for innovation. Aims to standardize magnetic grades around DOW preferred grades.

    ApplePartnership on magnet recycling, magnet production, and joint development.

    Continues to advance.

    Capital programs

    6
    10X facilityunderway
    Funding: Department of War supporting the development of 10X

    Benefit: next phase of America's domestic magnet manufacturing platform

    Foundation work underway, long lead production equipment ordered, vertical construction beginning shortly. Learnings from Independence and customer feedback incorporated into design. Vertical construction officially started during the call.

    Heavy rare earth separation circuit (Dy Tb)commissioning
    Spent to date: achieved mechanical completion of our first heavy rare earth separation circuit in May

    Benefit: Production of terbium and dysprosium.

    Team focused on punch list completion, equipment checkouts, and initial commissioning activities. Preparing to introduce feed imminently.

    Chlor-alkali recommissioningunderway

    Benefit: Improved crystallizer performance, operational benefits.

    Achieved several important milestones, including bringing additional brine pre-treatment online.

    Recycling facilitygroundbreaking
    Spent to date: finished clearing land and demolition of previously retired assets
    Start: this month

    Benefit: Expanded area for magnet recycling and additional heavy rare earth separation and finishing.

    Marks another important step in expanding products and value-added capabilities at Mountain Pass.

    Gadolinium separation projectplanning
    Spent to date: moving forward with engineering and procurement

    Benefit: Gadolinium separation.

    Following technical success of extended pilot campaign and securing long-term commercial arrangement.

    Samarium programplanning
    Spent to date: advancing both engineering and procurement

    Benefit: Samarium production.

    Committed in agreements with the Department of War to begin production in 2028.

    Risks & headwinds

    4
    Consolidated adjusted EBITDA declined modestly sequentially.Q2 FY26

    declined modestly

    Mitigation: Primarily reflected costs associated with planned biannual plant shutdown at Mountain Pass and the transition period of Magnetics ahead of commercial magnet revenue. These are temporary and part of scaling.

    Expected minimal PPA income from stockpiled NdPr.Q3 FY26

    roughly $10 per kilogram (PPA income), market pricing hovering at about $110 per kilogram (market price)

    Mitigation: Due to market pricing hovering at $110 per kilogram in early Q3. This is a market condition.

    Real disruption in the industrial supply chain, particularly aerospace, due to scarcity and allocations.Current

    Honeywell Aerospace lost 1/4 of their value today in what they referenced on their call was $15 million upstream in the supply chain.

    Mitigation: MP Materials is proactively building a resilient domestic supply chain and forming strategic partnerships (e.g., Project Swarm) to address these issues.

    Broader domestic shortage of specialized talent (engineers, metallurgists, trades).Ongoing

    enormous onshoring construction boom happening

    Mitigation: Company focuses on making itself an attractive employer, empowering people, and leveraging its momentum and mission to attract talent.

    What to watch in Q3 FY26

    5

    Commercial magnet shipments start

    Q4 FY26
    Currentexpected to begin in the fourth quarter
    TargetInitial commercial deliveries

    Why it matters

    Marks a significant milestone in the Magnetics segment's ramp-up and commercialization, crucial for future revenue and profitability.

    we continue to expect to begin commercial shipments in the fourth quarter, followed by a steady production ramp.

    Q&A highlights

    5

    Is this the first of many defense contracts? How will pricing work (spot vs. fixed)? What is the significance of gadolinium being the first mineral?

    Ryan Corbett confirmed it's a long-term, 9-figure deal with locked-in economics, not spot-price linked, and expects more such deals. Gadolinium was a logical choice to maximize economics from the SEG product after Dy/Tb separation, with samarium and yttrium also being future opportunities. Jim Litinsky added that controlled scarcity and supply chain disruptions in aerospace highlight the criticality of these materials.

    “Importantly, to your point on spot prices, we've locked in economics on this contract. And so I think, importantly, this speaks to our ability to continue to drive incremental value out of the world-class Mountain Pass asset...”

    asked by Lawson Winder · answered by Ryan Corbett

    2 min read6 chapters

    Detailed Narrative

    01

    Operational Progress and Expansion

    MP Materials achieved 41% year-over-year growth in NdPr production to 840 metric tons despite a planned plant shutdown. The company is actively commissioning its heavy rare earth separation circuit for Dy Tb, targeting product shipment to Independence later this year, and has broken ground on a new recycling facility. These initiatives are part of a broader strategy to expand its product portfolio and enhance long-term earnings power.

    02

    Magnetics Segment Development

    The Magnetics segment is advancing customer qualification activities at Independence, with commercial shipments expected to begin in Q4 FY26. Construction of the 10X facility is accelerating, with foundation work underway and vertical construction imminent. The company is leveraging learnings from Independence and customer feedback for the 10X design, aiming to build the next phase of domestic magnet manufacturing.

    03

    Strategic Partnerships and Demand

    MP Materials secured a significant 9-figure, multi-year agreement to supply gadolinium oxide to a U.S. aerospace and defense manufacturer, expanding its heavy rare earth portfolio. The company also launched Project Swarm, an initiative to aggregate and standardize future magnet demand from U.S. and allied drone manufacturers, securing future manufacturing capacity for emerging companies.

    04

    Financial Performance and Capital Allocation

    The Materials segment generated $113.2 million in revenue plus PPA income and $32.5 million in adjusted EBITDA, a $45 million year-over-year improvement. Consolidated adjusted EBITDA was $28.5 million, a $41 million year-over-year improvement. The company ended the quarter with $1.45 billion in cash and short-term investments, fully funding its long-term capital plan.

    05

    Long-term Vision and Innovation

    Management emphasized building capabilities over decades, investing patiently, and forming strategic partnerships. They highlighted the structural shift towards resilient domestic production of critical materials, driven by the deployment of AI into the physical economy. The company is focused on continuous innovation in magnet production, including reducing heavy rare earth intensity through Grain Boundary Diffusion technology and process improvements, to meet evolving market demands and maintain a competitive edge.

    06

    Talent and Supply Chain Resilience

    The company acknowledges the human capital challenge in rebuilding the critical material supply chain but emphasizes its focus on attracting and retaining talent since its inception. MP Materials has proactively prepared its supply chain for resilience, particularly regarding reagents, to mitigate impacts from geopolitical events like export bans.

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