Albemarle Corp.: Q2 FY2026 earnings call

What management said about Q2 FY2026, from the documents filed with the SEC on 5 August 2026: press release. Guidance figures: 3 raised, 1 lowered, 1 new, 20 kept. The quarter’s numbers.

Read the filing

Key takeaways

• Net sales rose 31% on higher prices: Net sales were $1.7 billion, up 31% from $1.3 billion, driven by higher pricing in Energy Storage and Specialties and higher Specialties volume. Source
• Adjusted EBITDA up 155% to $858M: Adjusted EBITDA was $858 million, up 155%, or 49.2% of net sales against 25.3% a year earlier. Management attributed the increase mainly to pricing in both segments, Specialties volumes and cost and productivity gains. Source
• Energy Storage sales up 78% on price: Energy Storage net sales were $1.3 billion, up 78%. Sales volume was 65 kilotons LCE against 59, and average realized price was $19.53 per kg LCE against $12.17. Source
• Cost savings reached $100 million: Year-to-date run-rate cost and productivity improvements reached $100 million, tracking toward the high end of the full-year $100 to $150 million target. Source
• Talison CGP3 fire on June 9: A fire at Talison CGP3 occurred on June 9. Management expects minimal impact to Energy Storage sales volume, in part because Wodgina output is better than planned. Source
• Specialties guidance increased: Full-year Specialties net sales guidance increased to $1.4 to $1.6 billion from $1.3 to $1.5 billion, and adjusted EBITDA guidance to $275 to $325 million from $225 to $275 million. Source
• Capex guidance reduced to about $500M: Full-year 2026 capital expenditures are expected to be about $500 million, down 15% from 2025. The prior guidance was $550 to $600 million. Source

“We continue to see resilient demand fundamentals across our core markets, including energy storage, electric vehicles, and semiconductors.”

Kent Masters, Chairman and CEO

Guidance

What changed from last quarter

• Guidance raised: Specialties full-year net sales and adjusted EBITDA ranges were increased on stronger pricing and volume year to date. Source
• Guidance lowered: Full-year 2026 capital expenditure forecast reduced to approximately $500 million from $550 to $600 million. Source
• New guidance: Full-year Energy Storage sales volume range of 225 to 235 kilotons LCE was stated; the prior release said volumes were approximately flat. Source
• New: A fire at Talison CGP3 occurred on June 9, delaying the CGP3 ramp, which management expects to have minimal impact on Energy Storage sales volume. Source
• New: The diluted share count assumption now includes conversion of the preferred stock, moving from about 118 million to about 136 million. Source
• Guidance kept: Total corporate net sales and adjusted EBITDA scenario ranges are the same as in the first-quarter release at each lithium price level. Source

Results and growth drivers

• Net sales rose 31% on higher prices: Net sales were $1.7 billion, up 31% from $1.3 billion, driven by higher pricing in Energy Storage and Specialties and higher Specialties volume. Source
• Net income and diluted EPS reported: Net income attributable to Albemarle was $480 million, or $3.52 per diluted share, against $22.9 million in the prior-year quarter. Adjusted diluted income per share was $3.75 against $0.11. Source
• Adjusted EBITDA up 155% to $858M: Adjusted EBITDA was $858 million, up 155%, or 49.2% of net sales against 25.3% a year earlier. Management attributed the increase mainly to pricing in both segments, Specialties volumes and cost and productivity gains. Source
• Gross profit and operating income higher: Gross profit was $590.3 million against $196.9 million a year earlier. Operating income was $452.9 million against $47.5 million. Source

Energy Storage and Specialties segments

• Energy Storage sales up 78% on price: Energy Storage net sales were $1.3 billion, up 78%. Sales volume was 65 kilotons LCE against 59, and average realized price was $19.53 per kg LCE against $12.17. Source
• Energy Storage adjusted EBITDA up 229%: Energy Storage adjusted EBITDA was $723 million, up $504 million or 229%. Higher lithium pricing was partly offset by higher CORFO commissions. Source
• Specialties net sales up 20%: Specialties net sales were $423 million, up $72 million or 20%, reflecting volumes up 8% and pricing up 11%. Source
• Specialties adjusted EBITDA up 61%: Specialties adjusted EBITDA was $118 million, up $45 million or 61%, mainly from higher volumes and favorable bromine and derivatives pricing. Source
• Jordan bromine venture running as planned: Operations at the Jordan Bromine Company joint venture are in line with expectations, though it continues to navigate geopolitical tensions in the region. Source

“reflecting improved pricing, continued strength in Specialties, disciplined cost and productivity execution”

Kent Masters, Chairman and CEO

Costs, margins and pricing

• Cost savings reached $100 million: Year-to-date run-rate cost and productivity improvements reached $100 million, tracking toward the high end of the full-year $100 to $150 million target. Source
• Strategic cost initiative fees excluded: Adjusted results exclude $19.0 million of mainly consulting fees for the strategic cost savings initiative, recorded in selling, general and administrative expenses. Source
• Middle East cost escalations managed: Specialties results reflected proactive management of cost escalations driven by the conflict in the Middle East. Source
• Effective tax rate 21.3%: The effective income tax rate was 21.3% for the quarter, or 19.1% on an adjusted basis. Source

Operations and the Talison fire

• Talison CGP3 fire on June 9: A fire at Talison CGP3 occurred on June 9. Management expects minimal impact to Energy Storage sales volume, in part because Wodgina output is better than planned. Source
• Wodgina offsets CGP3 ramp delay: Increased Wodgina volumes are expected to partly offset the delayed CGP3 ramp within the 225 to 235 kilotons LCE sales volume range. Source
• Kemerton Train 1 restructuring charges: Restructuring charges and asset write-offs were $7.3 million in the quarter and $33.2 million for the half, after Kemerton Train 1 was placed into care and maintenance. Source
• Energy Storage production to rise: Energy Storage production volumes are expected to increase year over year in 2026. Source

Guidance and scenario assumptions

• Specialties guidance increased: Full-year Specialties net sales guidance increased to $1.4 to $1.6 billion from $1.3 to $1.5 billion, and adjusted EBITDA guidance to $275 to $325 million from $225 to $275 million. Source
• Capex guidance reduced to about $500M: Full-year 2026 capital expenditures are expected to be about $500 million, down 15% from 2025. The prior guidance was $550 to $600 million. Source
• Lithium price scenario ranges unchanged: Total company and Energy Storage scenario ranges are the same as in the first-quarter release at each of the three lithium price levels. Source
• Interest expense guidance kept: Interest and financing expense for 2026 is expected at $120 to $140 million, following the first-quarter debt reduction actions. Source
• Diluted share count assumption changed: Diluted weighted-average shares are now about 136 million, assuming conversion of the preferred stock. The first-quarter release assumed about 118 million. Source

Demand and end markets

• Management sees resilient core demand: Management said it continues to see resilient demand fundamentals in energy storage, electric vehicles and semiconductors. Source
• Specialties volume growth assumed: Specialties assumptions reflect modest volume growth in key end markets led by semiconductors, oil and gas, flame retardants and pharmaceuticals. Source
• Softness expected in two end markets: Expected softness in automotive and petrochemicals partly offsets the Specialties volume growth assumed. Source
• Bromine market stabilization assumed: Second-half Specialties assumptions include stabilization in the bromine market, with continued uncertainty including the situation in the Middle East. Source
• Pricing and cost assumptions in scenarios: Scenarios assume spodumene pricing at 10% of the lithium carbonate equivalent price, while other costs are held constant. Source

Cash, balance sheet and shareholder payments

• Operating and free cash flow in quarter: Quarter operating cash flow was $710 million and free cash flow was $638 million, an 83% conversion helped by Talison dividend timing and working capital benefits. Source
• First-half operating cash flow higher: First-half cash from operations was $1.1 billion, up $518 million. Capital expenditures were $170 million, down $132 million. Source
• Liquidity about $3.2 billion: Estimated liquidity at June 30 was about $3.2 billion, including $1.6 billion of cash, $1.5 billion under the revolver and $78 million under other credit lines. Source
• Net debt ratio about 0.5: Total debt was $1.9 billion. The net debt to adjusted EBITDA ratio, as defined in the credit agreement, was about 0.5. Source
• Long-term debt reduced: Long-term debt was $1.80 billion at June 30, against $3.12 billion at December 31, 2025, after the first-quarter debt paydown. Source
• Dividends paid to shareholders: First-half dividends paid were $95.4 million to common shareholders and $83.4 million to mandatory convertible preferred shareholders. Source

Portfolio changes and sales

• Ketjen refining stake sold: The company sold a controlling stake in Ketjen's refining catalyst solutions business on March 2, 2026. Its earnings and the retained PCS business are now equity income in Corporate. Source
• Eurecat and Refining Solutions divested: In the first quarter the company divested its controlling interest in Refining Solutions and its 50% stake in Eurecat, with a net loss of $52.7 million recorded. Source
• Business sale proceeds in first half: Proceeds from sale of businesses, net of cash sold, were $525.2 million in the first six months of 2026. Source

Coming up, as management said on 5 August 2026

• Ketjen contributions expected immaterial: Management expects the adjusted EBITDA and equity income contributions from the Ketjen refining catalyst and PCS businesses to be immaterial after the transaction. Source

Figures management reported

Risks management discussed

• Operational: The June 9 fire at Talison CGP3 delayed the CGP3 ramp, which management said is partly offset by Wodgina volumes. Source
• External: The Jordan Bromine Company joint venture continues to operate amid geopolitical tensions in the region, and the Middle East situation is listed as an uncertainty. Source
• Demand: Expected softness in automotive and petrochemicals is assumed to partly offset Specialties volume growth. Source
• Financial: The adjusted effective tax rate depends on lithium market prices and geographic income mix. Source
• Regulatory: Higher CORFO commissions partly offset the benefit of higher lithium pricing to Energy Storage adjusted EBITDA. Source

Earlier plans management reported on

• On track: Management said year-to-date improvements of $100 million are tracking toward the high end of the full-year target. Source
• Delayed: Management reports a delay in the Talison CGP3 ramp caused by the June 9 fire. Source
• Met: Management described the debt reduction actions from the first quarter of 2026 as completed. Source

Other quarters

• Q1 FY2026 earnings call
• Q4 FY2025 earnings call
• Q3 FY2025 earnings call
• Q2 FY2025 results

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.