Sociedad Química y Minera de Chile (SQM) Q1 2025 earnings summary

Executive summary

• Record first quarter 2025 lithium sales volumes, up 27% year-over-year, driven by strong EV and energy storage demand, especially in China and Europe.

• Revenues for Q1 2025 were US$1,037 million, down 4.4% year-over-year; net income was US$138 million, rebounding from a prior-year tax-driven loss.

• Iodine business delivered another strong quarter with record average prices amid tight supply and steady demand.

• Specialty plant nutrition sales volumes grew at a healthy pace; potassium volumes and revenues were lower due to strategic production shifts.

• Long-term fundamentals and growth strategy remain intact despite complex pricing and market environment.

Financial highlights

• Adjusted EBITDA for Q1 2025 was US$360 million (34.7% margin), down 11% year-over-year.

• Gross profit for Q1 2025 was US$305 million, a 7% year-over-year decline; gross margin was 29.4%.

• Lithium segment contributed 41% of LTM gross profit; iodine 42%; SPN 13%.

• Maintained strong operating cash flow and robust balance sheet, supporting ongoing investments and growth plans.

• Dividend policy set at 30% of 2025 net income, with no interim dividends planned for Q1.

Outlook and guidance

• Lithium sales volumes for Q2 2025 expected to be similar or slightly lower than Q1, with realized prices anticipated to decline due to market oversupply.

• Annual lithium volume guidance revised to 150,000–180,000 tons for 2025, about 10,000 tons lower than previous guidance due to bushfire impacts and equipment constraints.

• Global lithium market demand expected to grow 15–17% in 2025; supply expected to grow at a similar rate.

• Iodine demand projected to grow 1–2% in 2025; prices expected to remain high.

• Potassium sales volumes expected to decline by 50% in 2025 compared to 2024.