{"id":2724,"date":"2025-08-02T13:40:35","date_gmt":"2025-08-02T13:40:35","guid":{"rendered":"https:\/\/thetradingdictionary.com\/index.php\/2025\/08\/02\/albemarle-swings-to-profit-lowers-spending-amid-prolonged-lithium-slump\/"},"modified":"2025-08-02T13:40:35","modified_gmt":"2025-08-02T13:40:35","slug":"albemarle-swings-to-profit-lowers-spending-amid-prolonged-lithium-slump","status":"publish","type":"post","link":"https:\/\/thetradingdictionary.com\/index.php\/2025\/08\/02\/albemarle-swings-to-profit-lowers-spending-amid-prolonged-lithium-slump\/","title":{"rendered":"Albemarle Swings to Profit, Lowers Spending Amid Prolonged Lithium Slump"},"content":{"rendered":"<\/p>\n

Albemarle (NYSE:ALB)<\/a>, one of the world\u2019s largest lithium producers, is cutting costs and narrowing its capital investment plans as it adjusts to ongoing weakness in lithium prices, even as demand from electric vehicle and energy storage sectors holds up better than expected.<\/strong><\/p>\n

The Charlotte-based company reported a second-quarter profit of US$22.9 million, a significant turnaround from the US$188.2 million loss it posted a year ago. <\/p>\n

While total revenue fell 7 percent to US$1.33 billion, the figure still came in ahead of Wall Street\u2019s US$1.22 billion estimate, buoyed by stronger-than-expected results in its specialties division and disciplined cost management.<\/p>\n

\u201cOur job is just to keep working on the things that are in our control, because we don\u2019t really have a clear line of sight to where pricing is going,\u201d Chief Financial Officer Neal Sheorey told investors Thursday.<\/p>\n<\/p>\n

Sheorey said Albemarle has reached its US $400 million annualized cost-savings and productivity target, citing measures such as supply chain restructuring and improved operations at lithium conversion and mining sites.<\/p>\n

The company now expects to spend between US$650 million and US$700 million in capital expenditures for the full year, narrowing its previous guidance of US$700 million to US$800 million. <\/p>\n

With lower spending and continued operational execution, Albemarle said it expects to achieve positive free cash flow for 2025\u2014so long as current lithium prices, which have hovered around US$9 per kilogram, persist.<\/p>\n<\/p>\n

\n

Lithium prices down, but demand remains resilient <\/h3>\n

Lithium prices have come off their historic highs of 2021\u20132022, when a global EV boom and constrained supply sent costs soaring above US$70 per kilogram.<\/p>\n

But that surge spurred rapid supply growth, and by late 2022, the market entered a surplus. Prices have since declined sharply and now sit near levels that are not considered economically viable for many new or greenfield projects.<\/p>\n

Despite the pricing downturn, Sheorey emphasized that demand for lithium has not collapsed. During the company\u2019s earnings call, he maintained that demand has held up better than expected this year, pointing to robust growth in China and Europe that is offsetting a more subdued US market. <\/p>\n

\u201cThe outlook in North America is less certain, particularly in the United States due to the potential impact of tariffs and the removal of the 30D tax credit in September,\u201d Sheorey said, adding that the US accounts for only about 10 percent of global electric vehicle sales.<\/p>\n

In contrast, EV sales in China rose 41 percent year-to-date, including a 44 percent jump in battery electric vehicles spurred by recent subsidies, while Europe also showed double-digit growth.<\/p>\n

Still, Sheorey cautioned that pricing remains under pressure. \u201cWe continue to expect the full-year EBITDA margin [for energy storage] to average in the mid-20 percent range assuming our $9 per kilogram price scenario,\u201d <\/p>\n

According to Albemarle\u2019s internal analysis, the market could return to balance as early as next year if current price levels persist. \u201cNew project development has begun to slow, while demand continues to be robust,\u201d the company said. It estimates that demand growth could outstrip supply growth by up to 10 percent per year between 2024 and 2030.<\/p>\n

Much of the company\u2019s current optimism stems from performance at its integrated production and processing facilities, particularly due to strong volumes from Albemarle\u2019s Wodgina mine and the Salar yield improvement project. <\/p>\n

With lithium demand expected to more than double by 2030, Albemarle is betting that its investments in operational excellence and global reach will pay off once the market stabilizes.<\/p>\n<\/div>\n

Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.<\/strong><\/p>\n<\/p>\n

This post appeared first on investingnews.com<\/div>\n

<\/p>\n","protected":false},"excerpt":{"rendered":"

Albemarle (NYSE:ALB), one of the world\u2019s largest lithium producers, is cutting costs and narrowing its capital investment plans as it adjusts to ongoing weakness in lithium prices, even as demand from electric vehicle and energy storage sectors holds up better than expected. The Charlotte-based company reported a second-quarter profit of US$22.9 million, a significant turnaround…<\/p>\n","protected":false},"author":1,"featured_media":2725,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[],"class_list":["post-2724","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-investing"],"_links":{"self":[{"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/posts\/2724","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/comments?post=2724"}],"version-history":[{"count":0,"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/posts\/2724\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/media\/2725"}],"wp:attachment":[{"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/media?parent=2724"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/categories?post=2724"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/thetradingdictionary.com\/index.php\/wp-json\/wp\/v2\/tags?post=2724"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}