USA Rare Earth Reports $91 Million Net Loss Amid Development Phase and Financing Activities

USA Rare Earth, Inc. reported a net loss of $91.0 million for the six months ending June 30, 2025, a significant increase from the previous year's loss of $8.3 million. The company's financial performance was heavily impacted by a non-cash fair value loss on financial instruments amounting to $74.4 million. The total cash used in operating activities for the same period was $18.2 million, compared to $8.3 million in the prior year. The company continues to operate without generating revenue, as it is still in the development phase of its Stillwater Facility and Round Top Project.

In terms of operational changes, USA Rare Earth completed a merger that provided approximately $30.9 million in cash, which was utilized for transaction costs and prepayments. The company also closed a $75 million private investment in public equity (PIPE) financing on May 2, 2025, which included the issuance of 8.55 million shares of common stock and warrants. This financing is expected to support the company's working capital and general corporate purposes. Additionally, the company has entered into Forward Purchase Agreements with investors, resulting in cash proceeds of $20.8 million.

The company has seen an increase in selling, general, and administrative expenses, which rose by $9.3 million for the six months ended June 30, 2025, primarily due to merger-related transaction bonuses, legal services, and litigation settlements. Research and development expenses also increased by $0.5 million, reflecting higher consulting fees related to feasibility studies. As of June 30, 2025, USA Rare Earth had $121.8 million in cash and cash equivalents, bolstered by the recent financing activities.

Looking ahead, USA Rare Earth aims to establish a vertically integrated domestic rare earth magnet supply chain, which is critical for various industries, including defense and automotive. However, the company acknowledges the substantial risks associated with its operations, including the need for additional capital to achieve its strategic goals. The management has expressed confidence in its ability to raise funds and control costs, but there remains significant uncertainty regarding the company's ability to continue as a going concern over the next twelve months. The company is also focused on meeting milestones related to its Stillwater Facility and Round Top Project to generate future revenues.