Can MP Materials Realistically Turn Profitable in Q4? Breaking Down the Feasibility

MP Materials Corp. MP is charting a path toward profitability starting in the fourth quarter of 2025—but is this goal achievable given the headwinds it’s facing? The company has suffered eight consecutive quarters of adjusted losses, painting a picture of an organization in transition as it pursues downstream expansion initiatives. Most recently, MP Materials posted profitability in Q3 2023, but since then has grappled with red ink as it ramped up production of separated rare earth oxides, particularly neodymium-praseodymium (NdPr) oxide.

The Cost Challenge: Why Expansion Has Been Expensive

The shift toward separated products has proven costly. Unlike rare earth concentrates, separated products demand intensive processing—chemical reagents, skilled labor, facility maintenance and specialized consumables all drive up expenses. The numbers tell the story: MP Materials’ cost of sales nearly doubled year-over-year, climbing to $192.6 million from $92.7 million in 2023. By 2024, costs consumed 94% of revenues, a dramatic jump from the 37% ratio recorded in 2023.

The company’s expansion hasn’t slowed. As of the first nine months of 2025, cost of sales remained elevated, up 10% versus the year-ago comparison. Production of magnetic precursor products—specifically NdPr metal—at the Independence Facility has intensified these pressures. Simultaneously, workforce expansion to support downstream operations has inflated selling, general and administrative (SG&A) expenses by 5% in 2024 and 25% in the first three quarters of 2025.

Why Profitability Is Achievable: Tailwinds Building

Despite these near-term strains, several catalysts suggest MP Materials’ return to profitability is achievable. First, the United States Department of War’s Price Protection Agreement, which commenced October 1, 2025, locks in revenue stability and cushions margin compression. Second, NdPr production volumes are steadily rising as process optimization matures and ramp-up efforts advance. Higher output, expanded sales volumes and stronger pricing dynamics are positioned to reinforce financial performance moving into 2026 and beyond.

How Competitors Are Managing the Transition

Energy Fuels UUUU, the major U.S. uranium producer, commenced separated NdPr production in 2024 following upgrades at its White Mesa Mill. Heavy rare earth oxide production is targeted for Q4 2026. Energy Fuels’ cost of sales surged 108% to $34.6 million (89% of revenue) in the first nine months of 2025, reflecting elevated extraction costs for lower-grade Heavy Mineral Sand at the tail end of Kwale mine operations. Overall operating expenses jumped 106% year-over-year to $117.8 million, driven by a 214% increase in exploration, development and processing expenses plus a 115% uptick in SG&A costs. Like MP Materials, Energy Fuels posted adjusted losses across all 2025 quarters.

USA Rare Earth Inc. USAR is constructing a rare earth sintered neo magnet (NdFeB) manufacturing facility in Stillwater, Oklahoma, slated to begin production in early 2026. The company also possesses mineral extraction rights to the Round Top Mountain deposit near Sierra Blanca, Texas, though mining has not commenced. USA Rare Earth has generated zero revenues to date and continues recording operational losses. Operating expenses surged 245% to $33.4 million in the nine-month 2025 period, while adjusted loss per share deteriorated to $2.83 from 15 cents year-over-year.

Valuation & Market Sentiment

MP Materials’ stock price has skyrocketed 263.2% year-to-date, substantially outpacing the broader industry’s 34.8% advance. The company trades at a forward 12-month price-to-sales ratio of 24.69X, commanding a premium relative to the industry median of 1.44X.

Analyst consensus forecasts 10 cents per share earnings for Q4 2025—a marked turnaround from the prior-year quarter’s 12-cent loss. Full-year 2025 estimates remain at a 21-cent-per-share loss, reflecting early-year challenges. However, 2026 earnings are projected at 69 cents per share, signaling meaningful recovery. Estimate revisions have stabilized for 2025 and 2026, suggesting limited surprises are anticipated.

MP Materials presently carries a Zacks Rank #3 (Hold) rating, reflecting a balanced risk-reward profile as the company executes its transformation strategy.