Albemarle reports Q1 sales drop as lithium prices remain under pressure
Albemarle, the world's largest lithium producer, is maintaining its 2025 outlook despite posting disappointing first-quarter results amid ongoing challenges in the global lithium market, the company announced.
The US-based chemicals giant reported first-quarter net sales of $1.1 billion, a 21% decline from the same period last year, primarily driven by a 34% drop in lithium prices. The company recorded a narrow profit of $41 million, though adjusted earnings showed a loss of $0.18 per share.
Despite these headwinds, Albemarle's CEO Kent Masters said the business "continues to perform in line with our outlook considerations", highlighting strong year-over-year improvements in its Specialties and Ketjen divisions, which saw adjusted EBITDA increases of 30% and 76% respectively.
The company's planned $1.3 billion lithium refinery in South Carolina remains on hold due to depressed market conditions. "We've been wanting to build this Western supply chain. The economics just aren't there to build that plant out," Masters told Reuters. "The math doesn't work today."
Lithium prices have plummeted 74% over the past two years, according to Benchmark Mineral Intelligence, largely due to oversupply from Chinese producers.
Albemarle believes it can weather the current market turbulence, citing ongoing cost reduction efforts that have achieved approximately 90% of its targeted $350 million in improvements. The company also noted that lithium's classification as a critical mineral has exempted it from recent tariffs that Washington imposed on trading partners.
Cash flow from operations reached $545 million, bolstered by a $350 million customer prepayment received in January, while capital expenditures fell by $397 million compared to the prior year.
