MP Materials Corp.

Hello, and welcome to the MP Materials second quarter 2025 earnings call. We ask that you please hold all questions until the completion of the formal remarks, at which time you'll be given instructions for the question and answer session. Also, as a reminder, this conference is being recorded. If you have any objections, please disconnect at this time. With that, I would like to turn the call over to Martin Sheehan, Head of Investor Relations. Mr. Sheehan, you may begin.

Thank you, operator, and good afternoon, everyone. Welcome to the MP Materials second quarter 2025 earnings conference call. With me today from MP Materials are Jim Latinsky, founder, chairman, and chief executive officer, Michael Rosenthal, founder and chief operating officer, and Ryan Corbett, chief financial officer. As a reminder, today's discussion will contain forward-looking statements relating to future events and expectations that are subject to various assumptions and caveats. Factors that may cause the company's actual results to differ materially from these statements are included in today's presentation, earnings release, and in our SEC filings. In addition, we have included some non-GAAP financial measures in this presentation. Reconciliations to the most directly comparable GAAP financial measures can be found in today's earnings release and the appendix to today's slide presentation. Any reference in our discussion today to EBITDA means adjusted EBITDA and tons means metric tons. Finally, the earnings release and slide presentation are available on our website. With that, I'll turn the call over to Jim. Jim.

Thank you, Martin. And good afternoon, everyone. When we gathered on the first quarter call in May, I said we had reached an inflection point. The rare earth supply chain, long built on a single point of failure, had cracked. I said that Humpty Dumpty was not getting put back together again and that this moment would be transformational and remembered. Today, it is clear that what has emerged in its place is something fundamentally new and MP is squarely at the center of it. The strategic partnerships we announced with the Department of Defense and Apple, building on our foundational relationship with General Motors, have fundamentally transformed MP. These agreements validate the mission we have pursued since day one and mark a new chapter, not only for our company, but for the country. This is a moment of strength for all our stakeholders, our shareholders, our customers, our employees, and the United States of America. With the non-market externalities that were once outside of our control now largely addressed, our focus is firmly on execution. Let me briefly walk through the DoD and Apple agreements, and then I will turn to some operational highlights from the second quarter, beginning on slide four. I will not rehash every detail of the DoD agreement. You can find our July webcast on our website and YouTube, and the agreements are filed with the SEC. But I want to emphasize that we view this partnership as a win win win a win for MP shareholders, a win for us commercial and national security interests and a win for taxpayers, the DOD partnership rests on three pillars first. DoD made a transformational investment in MP consisting of $400 million in convertible preferred equity, along with a $150 million low interest loan to fund the build out and expansion of our heavy rare earth separation circuit. The DoD also received a warrant, which when exercised and combined with the preferred equity post conversion would make them our largest shareholder, positioned to benefit from the upside they helped enable through an incredibly well-structured partnership. Second, a $110 per kilogram price floor for all products containing NDPR. This mechanism counters non-market forces that have historically suppressed the development of a secure domestic supply chain. It ensures our shareholders earn a fair return on our past investments, as well as the significant investments we will make to scale this mission and bring the supply chain home for good. Included in this commitment is some upside sharing with DoD if, as we suspect to occur over time, prices go materially above 110. Third, we are accelerating the build out of independence and constructing a new tenant X facility which together will expand our US magnet manufacturing capacity from 1000 to 10,000 metric tons annually. Given the warp speed nature of the build out and the mission we have been tasked with, the DoD has committed to purchase 100% of the output from the new facility on a cost plus basis, including a $140 million minimum EBITDA guarantee. We expect to syndicate a large portion of this output to commercial customers at Improved Economics, creating meaningful upside potential, some of which we will share with DoD. On the heels of the DoD announcement, we signed a landmark agreement with Apple. While the timing may make these two agreements appear related, that was really a coincidence. This partnership is the result of five years of quiet technical collaboration with Apple and reflects our methodical approach to building win-win customer relationships. Apple is one of the world's most sophisticated supply chain managers and one of the largest and most experienced users of rare earth magnets, making it an ideal customer and a powerful validation of MPs capabilities. Apple embodies everything we hoped for in a flagship commercial partner to follow GM. They will be the foundational customer for our commercial recycling business, anchored by the construction of a dedicated recycling circuit at Mountain Pass and the expansion of Independence. This long-term contract will result in over $500 million in contracted magnet purchases beginning in 2027. We expect the economics to reflect attractive returns on our capital and significant commitments to this partnership. Apple will also provide $200 million in milestone-based prepayments over the coming years, supporting the build-out of both the recycling circuit and independence. importantly apple will leverage its global supply chain to provide post consumer and post industrial magnet feedstock this significantly accelerates mps entry into recycling at scale with substantial potential upside. recycled feedstock should reduce unit production costs and over time, the ability to recover more material at mountain pass could expand our production profile beyond current targets. I want to recognize the extraordinary efforts of our team, whose execution over the past several years has earned us the right to enter into these transformative partnerships. I also want to acknowledge General Motors, whose early commitment to our mission helped catalyze this moment. Turning to operations, our materials and magnetic segments continued to deliver strong execution. In our material segment, we achieved 6% sequential growth in NDPR oxide production despite a planned biannual plant shutdown in April. This result was consistent with our expectations and more than double last year's output. Our upstream operations also delivered the second highest quarterly REO production in the history of Mountain Pass with record recoveries driven by ongoing optimization work. In our magnetic segment, we expanded both NDPR metal production and sales volumes, which led to significant revenue growth and EBITDA generation. At Independence, we are now consistently producing magnets that meet our customers demanding specifications for EV traction motors, a critical milestone. The next step is transferring this capability from trial production to scale production. Commissioning at the factory is accelerating. Momentum is building as we progress toward commercial magnet production later this year. Michael will provide a detailed operational update in a few minutes after Ryan covers our second quarter results.