USA Rare Earth Reports $7.9 Million Net Income for Fiscal Year 2024

USA Rare Earth, Inc., formerly known as Inflection Point Acquisition Corp. II, has reported its financial performance following its recent business combination with USA Rare Earth, LLC. For the fiscal year ending December 31, 2024, the company recorded a net income of $7.9 million, primarily driven by dividend income from marketable securities held in a trust account, which amounted to $12 million. This marks a significant increase from the previous fiscal year, where the company reported a net income of $6.7 million. The increase in income is attributed to higher dividend earnings and changes in the fair value of forward purchase agreements, despite incurring operating costs of approximately $4.1 million.

The business combination, finalized on March 13, 2025, has positioned USA Rare Earth as a key player in the domestic rare earth magnet supply chain. The company is focused on developing a manufacturing facility in Stillwater, Oklahoma, with plans to produce rare earth sintered neo magnets. The facility is expected to have an initial production capacity of 1,200 tons per annum (tpa), with plans to scale up to 4,800 tpa in subsequent phases. The company aims to commence commercial production by 2026, contingent on securing necessary feedstock and customer agreements.

Operationally, USA Rare Earth is in the process of establishing its supply chain, with a focus on sourcing rare earth materials from both domestic and international suppliers. The company has entered into a long-term agreement to secure 60% of its feedstock needs from a vertically integrated producer, which is expected to support its initial production phases. As of December 31, 2024, the company employed 29 individuals and is actively seeking to expand its workforce to meet production demands.

Looking ahead, USA Rare Earth faces several challenges, including the need to secure additional financing to support its operations and the potential volatility in the prices of neo magnets and feedstock materials. The company has acknowledged that its future success will depend on its ability to generate revenue from its operations, achieve profitability, and navigate the competitive landscape dominated by established players, particularly in China. The management has expressed optimism about the growth potential in the rare earth magnet market, driven by increasing demand from sectors such as electric vehicles and renewable energy technologies.