Albemarle Misses Q1 Profit Estimates Amid Lower Lithium Prices
Albemarle, the world's largest producer of lithium for electric vehicle batteries, fell short of profit estimates in the first quarter, impacted by lower lithium prices. The company reported an adjusted profit of $0.26 per share, missing analysts' expectations of $0.27 per share.
The decline in electric vehicle demand has contributed to a global drop in lithium prices, which have fallen more than 80% since March, according to Benchmark Mineral Intelligence. This trend has led many lithium producers, including Albemarle, to cut production and reduce their workforce.
Albemarle's largest business segment, focused on lithium-ion batteries for electric vehicles, reported an adjusted core profit of $198 million, significantly down from $1.57 billion in the same period last year. Prices in this segment fell by 89%.
Despite this, Albemarle's overall revenue reached $1.36 billion, slightly surpassing analysts' expectations of $1.31 billion. The company also reported $90 million in productivity and restructuring cost savings during the first quarter, with a goal of achieving $280 million in productivity benefits for the year.
Albemarle's CEO, Kent Masters, highlighted the company's agility in challenging market conditions, noting solid volumetric growth and cost reduction efforts. The company previously announced job cuts and deferred spending on a U.S. refinery project as part of a broader plan to save $750 million in cash flow. Albemarle plans to discuss its results and future outlook in a conference call.
