"Foot the bill for US rare earth self-sufficiency: MP Materials (MP.US) sacrifices sales to China resulting in Q3 losses, magnetic plant achieves first batch production by year-end."

MP Materials, a rare earth company, announced on Thursday that its losses in the third quarter have expanded due to its agreement to stop selling to Chinese customers, but its performance still exceeded Wall Street expectations. This performance reflects the company's strategic shift from relying on overseas sales to becoming a major rare earth mining and processing company as well as a magnet manufacturer in the United States. Rare earth magnets are widely used in the automotive, electronics, and defense industries. MP Materials owns the only rare earth mine in the United States and is building a magnet manufacturing plant in Oklahoma. According to the financial report, the company reported a quarterly loss of $41.8 million (24 cents per share), compared to a loss of $11.2 million (16 cents per share) in the same period last year. Excluding one-time items, MP Materials reported a loss of 10 cents per share, while analysts had expected a loss of 18 cents per share. Revenue was $53.55 million, down 15% year-on-year, slightly below analysts' expectations of $54.92 million. It is worth noting that the company did not record sales revenue from rare earth concentrate this quarter. This type of sales has been its main source of income for many years, but a investment agreement reached in July with the U.S. Department of Defense has prohibited future shipments. However, MP Materials recorded $21.9 million in sales revenue for magnet precursor products this quarter, which are essentially the basic materials for manufacturing magnets. With the increase in production of separated products over the past 12 months, sales of neodymium-praseodymium oxide and metals brought in $11.7 million in revenue growth. The company expects commercial magnet sales from the Oklahoma factory to start by the end of the year. In order to produce magnets, MP Materials needs to build a so-called "heavy rare earth" processing plant. The company plans to commission this plant in mid-2026, with raw materials coming from ore mined at its California mines as well as purchased from third parties. The factory aims to produce 200 tons of dysprosium and terbium per year - two key heavy rare earth elements required for magnet manufacturing. As of the end of the third quarter, MP Materials had total cash, cash equivalents, and short-term investments of $1.94 billion.