William Peterson

William Peterson of JPMorgan Chase & Co. requested details on the market growth and shipment assumptions underlying the 2025 guidance across aerospace, packaging, auto, and industrial markets. He also asked for clarification on the impact of scrap spreads and foreign exchange on the 2025 and 2028 outlooks.

Answer

CFO Jack Guo outlined market assumptions: stable aerospace volume with weaker mix, continued weakness in automotive, improvement in TID (especially in North America), and continued growth in packaging. CEO Jean-Marc Germain added that the Valais facility's recovery would also help TID in Europe. Regarding scrap, Germain stated the impact is mainly a 2025 event and a North American issue, with the company assuming tight spreads will persist but not worsen. He also noted the guidance assumes the dollar remains at current strong levels.

William Peterson asked for a detailed breakdown of the market-driven factors causing the significant shortfall from the original 2024 guidance, beyond the known flood and Muscle Shoals impacts. In a follow-up, he requested details on the flood's financial impact split by segment, the status of the 2024 free cash flow guidance, and the potential for impacts to extend into 2025.

Answer

CEO Jean-Marc Germain attributed the €80-€100 million negative variance to a sharp decline in North American industrial markets, a worsening automotive outlook, and aerospace demand shifting out due to OEM supply chain issues. CFO Jack Guo later clarified the flood's EBITDA impact is roughly two-thirds on the AS&I segment and one-third on A&T. He withdrew the 2024 free cash flow guidance due to timing uncertainties around working capital but noted some flood-related costs and offsetting insurance proceeds will carry into 2025.

William Peterson sought more context on the Q3 revenue guidance decline, asking about the influence of competition, deal pushouts, and policy. He also asked for quantification of the margin uplift from new chargers manufactured in Asia.

Answer

CEO Rick Wilmer attributed the conservative Q3 guidance primarily to the significant disruption from the ongoing sales and marketing reorganization. CFO Mansi Khetani added that a higher magnitude of deal pushouts in Q2 informed the prudent Q3 outlook. Regarding new hardware, Rick Wilmer stated the cost reduction from Asian manufacturing would be 'fairly significant,' with further margin gains expected from next-generation products in fiscal 2027.

William Peterson asked about the potential impact of U.S. tariffs on the company's cost structure and Asian manufacturing strategy, and questioned the strategic rationale for remaining in the challenging European market.

Answer

An executive, likely Richard Wilmer, noted that ChargePoint does not manufacture in China and has existing U.S. operations, providing flexibility to shift production if tariffs make it cost-effective. Richard Wilmer also affirmed the company's commitment to Europe, citing long-term prospects and the competitive advantage of serving multinational customers across both continents.

William Peterson of JPMorgan Chase & Co. asked about the slight delay in commencing piloted flights and the potential for the hybrid powertrain, developed with Anduril, to be used in future civil passenger aircraft.

Answer

CEO Adam Goldstein attributed the 'modest delay' in piloted flights to unforeseen complexities with integrating the extensive flight test instrumentation system, but stated the first flight is now imminent. Regarding the hybrid powertrain, Goldstein confirmed the company is actively considering its potential for future civil applications beyond its initial defense focus.

William Peterson of JPMorgan Chase & Co. asked if Archer's Agility Prime contracts would be modified due to the new Anduril partnership and inquired about the pace of FAA compliance document submissions, asking if it was slower than expected.

Answer

CEO Adam Goldstein explained that the focus has shifted from Agility Prime to larger programs because the DoD concluded pure-eVTOLs were not the right configuration, leading Archer to develop a hybrid vehicle. Regarding the FAA, Goldstein stated the working relationship is strong and that the recent focus on safety of flight preparations for the first piloted flight is generating data for submission. He characterized the submission process as 'lumpy' and expects the number of completed documents to increase throughout the year.

William Peterson inquired about the potential impact of a proposed tax bill on the 45V hydrogen tax credit, the Texas facility, and the broader U.S. green hydrogen industry. He also asked for an update on the electrolyzer order pipeline and the timing of final investment decisions (FIDs).

Answer

CEO Andy Marsh acknowledged the uncertainty around the 45V tax credit but noted the inclusion of a safe harbor provision for projects starting construction in 2025 was a positive. He confirmed a strategic focus on Europe, which was planned even before the tax bill news. Regarding the electrolyzer pipeline, Marsh stated that while many projects are progressing, some of the larger FIDs might slip from 2025 into 2026 due to their scale.

William Peterson asked for a broader view on the primary drivers for the Applications business over the next few years, considering the revised growth outlook for Material Handling and challenges in other areas like stationary power and mobility.

Answer

CEO Andrew Marsh explained that the company is laser-focused on Material Handling because its value chain is fully established, unlike mobility or stationary power. He argued that the recent restructuring addresses customer concerns about Plug's financial health, which he believes will actually help accelerate growth in this core market. The revised growth outlook is intended to set achievable expectations.

William Peterson of JPMorgan Chase & Co. asked about the expected gross margin exit rate for Q4, the outlook for fuel business margins, and the remaining steps to close the DOE loan.

Answer

CFO Paul Middleton projected a Q4 gross margin improvement directionally consistent with the Q2-to-Q3 jump, driven by volume, pricing, and plant leverage. He noted fuel margins should also improve meaningfully. Regarding the DOE loan, CEO Andrew Marsh stated there are no 'tall poles' and they have a clear schedule to close before a change in administration. Middleton added they are also pursuing project-level equity partners in a parallel process.

William Peterson inquired about the expected gross margin exit rate for Q4, with a specific focus on the fuel business, and asked what steps remain for closing the DOE loan.

Answer

CFO Paul Middleton projected that Q4 gross margin improvement would be directionally consistent with the trend seen from Q2 to Q3, driven by higher sales volume and pricing benefits. CEO Andy Marsh stated there is a clear, scheduled path to close the DOE loan before any administration change, with no major obstacles remaining. Middleton also mentioned a parallel process to secure project-level equity partners.

Asked about the expected gross margin exit rate for Q4, specifically for the fuel business, and the remaining steps for closing the DOE loan.

Answer

Q4 gross margin improvement is expected to be directionally consistent with Q3's gains. Fuel margins are also expected to improve meaningfully due to pricing and efficiency. The company is confident in closing the DOE loan before the administration change, seeing no major hurdles, and is also pursuing parallel project-level equity financing.

William Peterson asked for an outlook on Stage 2 production and sales volumes for the second quarter and the back half of the year, and also inquired about the company's efforts in 'thrifting'—reducing or eliminating the use of heavy rare earths in magnets for various applications.

Answer

COO Michael Rosenthal indicated that MP Materials targets a slight increase in NdPr production in Q2 versus Q1, with further growth expected in Q3, suggesting a continued positive trajectory. CEO Jim Litinsky confirmed that a significant R&D focus is on thrifting heavy rare earths, highlighting the company's IP development and the structural cost advantage provided by its vertically integrated model, which allows for efficient recycling of manufacturing scrap (swarf).

William Peterson sought an update on the timeline for the Midstream segment to achieve gross margin positivity. He also asked about the company's capacity to support additional OEM agreements and if there were active discussions with companies in emerging markets like robotics or eVTOL.

Answer

CFO Ryan Corbett confirmed that the company is still tracking towards achieving gross profit in NdPr production by the end of Q1, consistent with prior commentary. He also stated that while the immediate Magnetics focus is on executing for General Motors, conversations with other potential customers across automotive, robotics, and eVTOL have picked up meaningfully as they seek a trustworthy Western supplier.

William Peterson asked for insights on end-market demand trends amid flat NdPr pricing and requested more detail on the customers requesting samples from the midstream operations, including their geography and markets.

Answer

CEO James Litinsky characterized the market as 'bouncing around the bottom' and noted that recently announced stimulus in China could have a positive, though lagged, impact on demand. He also mentioned a recent anecdotal uptick in customer inquiries. Regarding customers, Litinsky revealed that MP now sells directly to three of the five largest non-Chinese global OEMs, highlighting that these major players are now actively engaging further up the supply chain.

William Peterson from JPMorgan Chase & Co. asked for guidance on the Q2 shipment profile and sought more detail on the canceled Weirton transformer project and the broader demand for grain-oriented electrical steel (GOS).

Answer

CFO Celso Goncalves guided for a slight uptick in Q2 shipments from Q1's 4.1 million tons. CEO Lourenco Goncalves explained the Weirton project was halted due to a partner's hesitation on location and size, but affirmed that GOS demand remains 'red hot' and Cliffs will remain the key supplier to its partner's future plant.

William Peterson of JPMorgan Chase & Co. asked about specific pockets of demand weakness beyond automotive, the current state of customer inventories, and the status of infrastructure projects and the plate market.

Answer

Executive Lourenco Goncalves attributed broad market weakness primarily to high interest rates impacting consumer affordability for large purchases like cars and homes, stating that demand will recover quickly once rates come down. He also noted that infrastructure projects are hindered by both red tape and high financing costs, which he expects to be corrected in the coming year.

William Peterson sought reassurance on the DOE loan process and asked for clarification on the assumptions behind the $4-5 million tariff impact, the source of the $10 million in CapEx efficiencies, and how the 2026 CapEx reduction target with Delta accounts for the current tariff environment.

Answer

CEO Badar Khan described the engagement with the DOE LPO as "very productive" and "business as usual." Regarding tariffs, he explained the $4-5 million impact is based on a mix of ~10% and ~32% tariff rates on imported equipment not already in inventory. The $10 million in CapEx efficiencies are from ongoing operational improvements like better construction pricing and increased use of prefabricated skids. He confirmed the 30% CapEx reduction target for the new Delta architecture, starting in H2 2026, is a separate initiative that builds on these existing efficiencies.

William Peterson inquired about the status of the $1.25 billion DOE loan, including the timing of the next drawdown and potential risks, as well as the availability of alternative non-dilutive financing. He also asked for details on the full-year 2025 guidance, seeking to understand the key drivers and risks for revenue and profitability.

Answer

CEO Badar Khan affirmed confidence in the DOE loan, describing it as a legally binding contract on strongly performing assets, and noted the first advance was received in January. CFO Paul Dobson added that EVgo is actively pursuing complementary non-dilutive financing like project debt, citing positive reception from banks. Regarding guidance, Khan highlighted that the business relies on total EVs in operation (VIO), not new sales. Dobson clarified that the guidance range reflects variability in throughput, LCFS pricing, and contract timing, with G&A expected to increase modestly from the Q4 run-rate.

William Peterson of JPMorgan Chase & Co. inquired about the closing conditions and potential political risks for the Department of Energy (DOE) loan, and asked about near-term growth drivers, particularly the factors behind the implied sequential growth deceleration in Q4 guidance and the outlook for the eXtend business.

Answer

CEO Badar Khan expressed high confidence in closing the DOE loan, stating the conditions are largely within EVgo's control and a lengthy close is not expected. Khan also noted that throughput is expected to continue growing from Q3 to Q4. CFO Paul Dobson added that the updated guidance reflects continued momentum, with potential variability in energy costs and G&A investments for the DOE loan being the main factors for the range.

William Peterson from JPMorgan Chase & Co. inquired about the impact of extra shipping days and potential demand pull-forward in Q1 on the Q2 outlook, and sought an explanation for intersegment eliminations.

Answer

CEO Leon Topalian acknowledged some initial demand pull-forward but stated order entry rates have remained strong, highlighting that the structural backlog is at an all-time high. CFO Stephen Laxton confirmed a 95-day quarter contributed to volume and noted that rising intersegment eliminations are expected given the strong pricing environment and broad-based backlog growth.

William Peterson inquired about the downstream business, asking if pricing for joist and deck has bottomed and about pricing trends for other products. He also asked about market support for the recent plate price hike and its effect on the Brandenburg mill's ramp-up.

Answer

Executive John Hollatz noted that while the warehouse market moderated, the joist and deck business remains healthy with strong backlogs. Executive Brad Ford stated that lean inventories and strong bookings support the plate price increase. For the Brandenburg mill, Ford highlighted a 100% increase in Q4 production and expressed confidence in achieving consistent positive EBITDA by mid-2025.

William Peterson questioned if Q4 seasonality could be more severe than historical averages and if Q1 could see a better-than-seasonal rebound. He also requested an update on Nucor's decarbonization efforts, including its investments in NuScale and Helion, and its carbon capture project.

Answer

CEO Leon Topalian avoided speculation on future quarters but stated they do not expect seasonality to be more severe than last year, noting tailwinds from infrastructure spending are still to come. On decarbonization, he and executive Greg Murphy detailed a multifaceted strategy, including advancing investments in SMR and fusion energy with NuScale and Helion, and moving forward with the ExxonMobil carbon capture project at their Louisiana DRI facility to create ultra-low carbon raw materials.

William Peterson from JPMorgan Chase & Co. asked about the outlook for profitability at the Trail operations for the remainder of the year, particularly regarding byproduct contributions. He also inquired about the potential impact of the upcoming Canadian presidential election on the mining industry.

Answer

CFO Crystal Prystai explained that Trail's strong Q1 profitability resulted from embedded cash flow initiatives and processing a byproduct-rich stockpile, benefits that will continue through the year. CEO Jonathan Price added that he expects a positive outlook for the Canadian mining industry regardless of the election outcome, as both political sides are supportive of the resources sector.

William Peterson asked for a high-level overview of the 2025 growth projects, focusing on controllable factors versus external risks and the key requirements for a sanction decision on Zafranal. He also inquired about the run-rate cost impact from recent union negotiations and the expected cost trajectory for QB2.

Answer

CEO Jonathan Price explained that while studies and engineering are in Teck's control, permitting is an external factor requiring heavy engagement. He reiterated that all projects must meet compelling financial metrics (IRR, cash flow) to be sanctioned. CFO Crystal Prystai addressed costs, suggesting low single-digit inflation for labor and stating that QB2's unit cost per pound will decline throughout the year as production ramps up, describing it as a "tale of two halves."

William Peterson inquired about Kaiser's margin progression and the cadence implied by its full-year guidance, the shipment and contract dynamics in the Packaging segment, the resilience of the Automotive segment amid potential market softness, and the current status of the inventory destocking cycle within commercial Aerospace.

Answer

Executive Keith Harvey explained that Q1 margin strength was aided by a metal lag tailwind following an accounting method change, but the core business performed as expected. He reiterated the long-term goal of returning to mid-20% margins, driven by new investments, metal supply normalization, and aerospace recovery. For Packaging, Harvey noted that the new line qualification in Q2 will lead to a strong shipment ramp in the second half of 2025, with new contracts accelerating growth into 2026. He expressed confidence in the Automotive segment due to its focus on high-demand light truck and SUV platforms. Regarding Aerospace, Harvey stated the destocking cycle is about halfway complete, with aircraft build rates beginning to ramp up as anticipated.

William Peterson inquired about the key assumptions for scrap spreads and tariffs within the 2025 EBITDA guidance, particularly for the packaging segment. He also sought more detail on the aerospace market's inventory correction, asking when customer buying might resume and if shipment declines could reverse by year-end. Lastly, he asked about the packaging segment's Q4 pricing, the status of legacy contract renewals, and potential pricing tailwinds.

Answer

Keith Harvey (executive) explained that the 2025 guidance assumes scrap spreads remain at the lower end of their improvement range, consistent with late 2024, and does not include any potential benefits from new tariffs, which he views as neutral to positive for Kaiser. Regarding aerospace, he noted that while destocking is impacting 2025 shipments, strong contracts provide stability, and he expects demand to pick up in the second half as OEM production rates increase. For packaging, he clarified that the Q4 pricing dip was due to mix and that the shift to higher-value coated products will drive a 20-25% conversion revenue increase in 2025 on a minimal shipment increase, with the full margin benefit materializing in late 2025 and into 2026.

William Peterson asked for details on the packaging segment's Q3 shipment performance and Q4 outlook, the ramp-up timeline for the new roll coat line, the status of the metal sourcing strategy amidst tight scrap spreads, and the performance of the automotive segment.

Answer

CEO Keith Harvey explained that packaging was in 'catch-up mode' in Q3 but has a strong Q4 outlook. He detailed that the new coating line is in hot commissioning, with qualifications starting in early 2025 and a full ramp-up expected by the end of Q1 or early Q2. On metal sourcing, Harvey noted that while the strategy is being implemented, compressed scrap spreads are currently limiting the financial benefit. For automotive, he highlighted that Kaiser's focus on North American light trucks and SUVs has allowed the segment to outperform the broader market.

Asked about the leaching program, inquiring about the cause of a modest Q1 production decline and the key steps to reach the year-end run rate target. He also followed up on the supply chain for leaching inputs, asking if goals can be met with non-China or U.S.-based sources.

Answer

The path to the 300 million-pound run rate involves scaling existing technologies like 'leach everywhere' and 'deep raffinate drilling'. To go beyond that, they are testing new technologies like heat injection and new additives. Regarding the supply chain, the company is ensuring robust sources for additives that do not rely on China, with some products being available in the U.S.

Asked about the potential impact of U.S. tariffs on copper markets and Freeport, and for details on the recent performance and future targets for the leaching initiative.

Answer

Freeport would benefit from a U.S. price premium from tariffs as its U.S. production is sold domestically; the main concern is the potential impact on global growth and inflation. The Q4 leaching performance was in line with the plan, and the targeted increase to a 300 million pound run rate is driven by scaling up existing initiatives like deep raffinate injection.

William Peterson asked about the potential impact of U.S. tariffs on copper markets and Freeport's operations, and also requested more detail on the innovative leach program's Q4 performance and the drivers for its 2025 production target.

Answer

President and CEO Kathleen Quirk noted that since Freeport sells its U.S. production domestically, it could benefit from a U.S. price premium, but the main concern is the potential impact of tariffs on global growth and inflation. On leaching, she explained the 2025 target of a 300 million pound run rate is driven by scaling initiatives like deep raffinate injection and accessing new areas of stockpiles.

William Peterson of JPMorgan Chase & Co. asked about the outlook for downstream margins in Q2, particularly whether higher lagged steel input costs in the fabrication business might compress margins despite price stabilization.

Answer

EVP & CFO Theresa Wagler did not provide specific margin guidance but outlined key drivers. She noted that while fabrication faces higher input costs from rising steel prices due to its inventory position, this can also support higher product pricing. She emphasized that higher volumes, which are expected, are highly accretive to fabrication margins due to significant operating leverage.

William Peterson of JPMorgan Chase & Co. asked about Sinton's profitability in Q3, the profitability of the new coating lines, and the status of the biocarbon project ahead of its planned start.

Answer

CFO Theresa Wagler confirmed Sinton was not EBITDA positive in Q3 due to outage costs but is expected to be in Q4. She stated the new lines' full financial benefit will be realized in 2025. Regarding biocarbon, she said the project is on track for a Q1 2025 start and will be integrated into steel production as a raw material substitute, not as a product commanding a specific premium.

William Peterson requested additional details on Alcoa's government engagement strategy regarding tariffs in the U.S. and Canada, and asked for an assessment of the current marginal cost support level for global alumina prices.

Answer

President and CEO William Oplinger described extensive engagement with both U.S. and Canadian governments, directly and via the U.S. Aluminum Association, stating the message about the need for Canadian aluminum is being heard. He also noted that with over 80% of Chinese refineries being unprofitable at current prices, there is a strong support level for alumina, reinforced by high bauxite prices.

William Peterson inquired about the San Ciprian refinery restart decision in the context of high alumina prices and asked for details on the source and cadence of the remaining savings in the profitability program.

Answer

CEO William Oplinger stated the refinery restart depends on securing a key permit for the residue disposal area. CFO Molly Beerman provided a detailed breakdown of the profitability program, noting progress at Warrick and Alumar, overachievement on raw materials, and a slower-than-expected pace for savings from the Kwinana curtailment, which are now targeted for late 2025.

William Peterson from JPMorgan Chase & Co. questioned the slight year-over-year decline in seats flown and its impact on Passenger margins. He also asked about the long-term competitive differentiators for Blade's New York business and whether the heavy maintenance in the Medical segment should be considered seasonal.

Answer

Chief Financial Officer Will Heyburn explained the lower seat count resulted from a conscious strategy to optimize flight schedules for profitability, which improves margins as incremental seats on profitable flights have nearly 100% contribution. Founder & CEO Rob Wiesenthal added that Blade's incumbent infrastructure, including exclusive passenger terminals, provides a durable competitive advantage in New York. Regarding maintenance, both executives clarified it is time-based, not seasonal, and the cadence is unusually high in H1 2025 due to the specific lifecycle of purchased aircraft, with 2026 expected to be below average.

William Peterson questioned the scope of defense applications, asking if they include combat missions and about the impact of changes in the Agility Prime program. He also asked about the timeline implications of beginning TIA flight testing within 12 months, specifically for a U.S. service launch.

Answer

Executive Chairman Paul Sciarra positioned the defense opportunity as a significant modernization of the Army's large, aging rotorcraft fleet. He described Agility Prime as a successful stepping stone and noted Joby's demonstrated hybrid platform aligns with the government's priority for longer range. Regarding the timeline, he stated that beginning TIA flight testing means Joby is in the 'home stretch' with the 'finish line of type certification in our sights,' emphasizing strong momentum with the FAA.

William Peterson of J.P. Morgan inquired about the potential impact of U.S. tariffs on shipments from Canada and the company's outlook on the lithium supply/demand balance for the coming years, including the role of government policy.

Answer

President and CEO Keith Phillips explained that a potential 10% tariff on critical minerals would be paid by the U.S. importer, who could divert shipments to other global locations to avoid it. Regarding the market, Phillips expressed near-term uncertainty for 2025 but long-term bullishness, citing the industry's volatility and new demand drivers like energy storage. He noted that while 30D tax credits might disappear, a potential Trump administration could strongly support domestic projects like Carolina Lithium under a 'national energy security' theme.

William Peterson asked for more details on the defense opportunity, including battery format, the Korean site's production capacity, and expansion potential. He also sought an update on EV development agreements, asking what issues remain and what milestones to expect.

Answer

CEO Raj Talluri confirmed the Korean factory has capacity for current defense needs and can expand as demand becomes clearer through the year-long qualification process. Regarding EV partnerships, he stated that work is actively progressing. Materials from EV makers are now in the Malaysia facility, where the team is working to produce cells to demonstrate the architectural advantages, with further updates anticipated later in the year.

Questioned the defense opportunity regarding battery format, production capacity at the Korean site, and expansion potential. Also asked for an update on the EV development agreements, including remaining steps and key milestones for the year.

Answer

The Korean factory currently has capacity for defense applications and space to expand as demand becomes clearer through the year-long qualification process. For EV, development work is actively ongoing in a dedicated space in the Malaysia factory using materials from EV partners, with updates expected this year.

William Peterson asked about the EX-1M sampling program, seeking details on how many top smartphone OEMs have received samples, the initial feedback, and their geographic concentration. He also questioned the potential scale of production volumes for 2025.

Answer

CEO Raj Talluri confirmed high demand for samples but declined to name specific customers. CFO Farhan Ahmad added that the two disclosed strategic partners are top-5 OEMs prominent in China's premium smartphone market. Regarding volume, Raj Talluri explained that the ramp will follow a lengthy qualification process, starting small in late 2025 and building through 2026.

William Peterson of JPMorgan Chase & Co. asked for key milestones for the smartphone market over the next year, including sampling cadence and the potential for more formal agreements. He also inquired about the new Fortune 200 IoT deal's financial impact and later asked for drivers of the guided second-half revenue growth.

Answer

CEO Raj Talluri outlined the smartphone qualification process, with samples from Malaysia shipping in Q3, leading to a potential high-volume ramp in the latter half of 2025. He described the IoT deal as a milestone-based agreement for an established product. CFO Farhan Ahmad added that the IoT customer will pay a premium for energy density and explained that H2 revenue growth will be driven by both the Routejade business and new Malaysia revenue, though margins may be impacted by new factory depreciation.

William Peterson inquired about the near-term graphite electrode spot pricing environment in relation to needle coke costs, seeking expectations for the order book. He also asked about the drivers for recent cost reductions and the potential impact of government changes on GrafTech's battery market strategy.

Answer

CEO Timothy Flanagan acknowledged the challenging spot market, noting that electrode prices have declined while needle coke prices have been more stable, but he anticipates an eventual rebound in both. Flanagan and CFO Rory O'Donnell attributed significant cost improvements to a combination of variable cost controls, procurement strategies, and the full-year effect of prior cost-saving initiatives. Regarding the battery market, COO Jeremy Halford and CEO Timothy Flanagan emphasized that the strategic need for a domestic supply chain for automakers is a powerful driver that persists regardless of the political landscape.