Executive Summary

Q2 2025 net sales were $131.8M, with sales volume up 12% YoY to 28.6k MT and capacity utilization at 65%; adjusted EBITDA turned positive at $3.5M (GAAP EBITDA $3.4M) amid a 13% YoY reduction in cash COGS/MT, though GAAP net loss widened to $86.9M on a $43M non‑cash tax valuation allowance .
Versus consensus: revenue modestly beat ($131.8M vs $130.4M*), EPS was materially better than expectations (−$0.34 vs −$1.00*), and EBITDA exceeded (GAAP EBITDA $3.4M vs −$1.4M*); sequential pricing rose 2% to ~$4,200/MT, aided by stronger U.S. mix (positive surprise) . Values marked with * are from S&P Global.
Guidance updates: raised full‑year 2025 cash COGS/MT decline to 7–9% (from mid‑single digit); capex ~$40M maintained; sales volume growth ~10% YoY maintained/refined; working capital expected to be favorable to FY cash flow .
Strategic actions: U.S. sales volume +38% YoY in Q2 and +32% YTD, mix shift supporting ASP resilience; management reiterated a 15% price increase on uncommitted 2025 volume .
Potential trading catalysts: U.S. tariff backdrop and preliminary 93.5% anti‑dumping duties on Chinese anode materials (combined ~160% tariffs) could benefit Western graphite supply chains; company later regained NYSE compliance and approved a 1‑for‑10 reverse split (post‑quarter) .

What Went Well and What Went Wrong

What Went Well

Volume and utilization improvements: “We grew sales volume by 12% YoY…highest level since Q3 2022” and utilization at 65% .
Cost execution: Cash COGS/MT down 13% YoY in Q2; full‑year decline raised to 7–9% reflecting “strong execution of our initiatives to enhance our cost structure” .
Positive EBITDA: “Generated positive EBITDA…reflecting continued progress on our path to normalized levels of profitability” .
U.S. mix shift: U.S. sales volume +38% YoY in Q2; sequential ASP +2% to ~$4,200/MT due to mix optimization .

What Went Wrong

Pricing headwinds: Weighted‑average realized price ~$4,200/MT was down 12% YoY due to LTA roll‑off and persistent competitive pressures (especially Chinese exports) .
GAAP loss widened: Net loss increased to $86.9M from $14.8M YoY, including a $43M non‑cash deferred tax valuation allowance; gross profit was near breakeven .
Cash flow drag from interest and inventory build: Operating cash outflow of $53.2M, including $39M cash interest (semi‑annual notes $34M), and planned H1 inventory build; adjusted FCF −$53.3M .

Financial Results

Metric	Q2 2024	Q1 2025	Q2 2025
Net Sales ($USD Millions)	$137.3	$111.8	$131.8
Net Loss ($USD Millions)	$(14.8)	$(39.4)	$(86.9)
Diluted EPS ($USD)	$(0.06)	$(0.15)	$(0.34)
EBITDA ($USD Millions, GAAP)	$12.7	$(4.9)	$3.4
Adjusted EBITDA ($USD Millions)	$14.5	$(3.7)	$3.5
Gross Profit ($USD Millions)	$4.0	$(1.7)	$0.1
Gross Margin (%)	2.9% (3.976/137.327)	−1.5% (−1.709/111.839)	0.05% (0.062/131.840)
Interest Expense ($USD Millions)	$15.6	$29.8	$25.4
Income Tax (Expense)/Benefit ($USD Millions)	$(0.6)	$7.2 benefit	$(51.2)

KPIs and Operating Metrics

KPI	Q2 2024	Q1 2025	Q2 2025
Sales Volume (k MT)	25.5	24.7	28.6
Production Volume (k MT)	26.8	28.5	29.4
Capacity Utilization (%)	60%	63%	65%
Weighted‑Avg Realized Price ($/MT)	—	~$4,100	~$4,200
Cash COGS per MT ($/MT)	$4,315	$3,652	$3,754
Net Cash Used in Operating Activities ($USD Millions)	$(36.9)	$(32.2)	$(53.2)
Adjusted Free Cash Flow ($USD Millions)	$(43.8)	$(40.3)	$(53.3)

Capital Structure and Liquidity (Quarter‑End)

Metric	Q1 2025	Q2 2025
Total Liquidity ($USD Millions)	$421	$367
Cash and Equivalents ($USD Millions)	$214	$159
Revolver Availability ($USD Millions)	$107	$108
Delayed Draw Term Loan Availability ($USD Millions)	$100	$100
Gross Debt ($USD Millions)	$1,125	$1,125
Net Debt ($USD Millions)	~$911	~$966

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Cash COGS per MT (YoY change)	FY 2025	Mid‑single digit % decline	7–9% decline	Raised
Sales Volume (YoY growth)	FY 2025	Low‑double digit % increase	~10% increase	Maintained/Refined
Price Action	2025 uncommitted volume	+15% price increase announced	+15% price increase reiterated	Maintained
Capex	FY 2025	~$40M	~$40M	Maintained
Working Capital Impact	FY 2025	Favorable to full‑year cash flow	Favorable to full‑year cash flow	Maintained
Tariffs impact on cash costs	FY 2025	—	<1% cash cost impact expected	New/Clarified

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4 2024, Q1 2025)	Current Period (Q2 2025)	Trend
Pricing & Mix	Pricing “unsustainably low”; announced +15% 2025 price on uncommitted volume; non‑LTA ASP ~$3,900/MT in Q4’24	Weighted‑avg price ~$4,200/MT; +2% seq; focus on U.S. mix; plan to push prices higher	Stabilizing; gradual improvement via mix
U.S. market share	Shifting mix to higher‑priced regions; emphasis on U.S.	U.S. sales volume +38% YoY; Americas >50% revenue; tariffs supportive	Strengthening
Cost structure	23% YoY cash COGS/MT decline in 2024; mid‑single digit decline guided for 2025	13% YoY cash COGS/MT decline in Q2; FY 2025 guidance raised to 7–9% decline	Improving
Tariffs/macro	Expect flat near‑term electrode demand; watch global trade/tariffs	Section 232 tariffs seen supporting U.S. steel; tariffs <1% impact on cash costs	Mixed, with U.S. tailwinds
EAF adoption	Decarbonization tailwinds; EAF shift longer‑term	EAF >51% ex‑China; ~72% in U.S.; >20Mt new U.S. EAF capacity planned/online	Structural positive
Needle coke / anode	Interest in EV supply chain; vertical integration via Seadrift	Preliminary 93.5% anti‑dumping duties; combined ~160% tariffs on Chinese anode imports; positioning to partner	Strategic opportunity developing
Safety & ops	Footprint optimization; level‑loading production	Best safety performance on track; level‑loading; energy optimization	Operational execution up

Management Commentary

“We grew sales volume by 12% YoY…our highest level since Q3 2022…generated positive EBITDA” and “capacity utilization rate increased to 65%” .
“Our weighted average price was approximately $4,200 per metric ton…increase of nearly 8% vs Q4’24 non‑LTA pricing,” driven by U.S. mix shift .
“We now anticipate a 7%–9% year‑over‑year decline in our Cash COGS per metric ton for 2025…using the midpoint…~$3,950” .
Tariffs: “We expect higher Section 232 tariffs will support an increase in steel production within the United States…tremendous opportunity for GrafTech” .
Strategic posture: “We remain bullish on…shift towards electric arc furnace steelmaking…well‑positioned to capitalize” .
Western EV supply chain: “Preliminary anti‑dumping tariffs of 93.5%…combined tariff of 160% on Chinese anode material…we are well‑positioned to be a valuable strategic partner” .

Q&A Highlights

U.S. exposure and share gains: Americas now “a little bit more than 50%” of revenue; U.S. share up 31% YoY; management expects robust U.S. demand under current tariff landscape .
Pricing outlook: Competitive environment persists due to Chinese oversupply; signs of stabilization with ASP +8% vs Q4’24 non‑LTA; hope for recovery in H2’25 and into 2026 .
Needle coke/anode trajectory: Near‑term needle coke pricing flat; medium‑term uplift possible as Western supply chains stand up; no new needle coke projects announced beyond Seadrift expansion .
EBITDA trajectory: FY 2025 likely at or slightly above break‑even EBITDA; H2 costs up on seasonality, tariffs, less LCM reserve benefit; negotiations in Q4 could influence 2026 .
Government partnerships: Management sees potential for public‑private partnerships (e.g., DoD) to catalyze Western critical mineral supply chains; remained non‑committal on specifics .

Estimates Context

Metric	Q2 2025 Actual	Q2 2025 Consensus	Surprise
Revenue ($USD Millions)	$131.8	$130.4*	Beat (+$1.4M)
Diluted EPS ($USD)	$(0.34)	$(1.00)*	Beat (+$0.66)
EBITDA ($USD Millions, GAAP)	$3.4	$(1.4)*	Beat (+$4.8M)

Values marked with * are retrieved from S&P Global.

Implications: Consensus likely underestimated the degree of mix‑driven ASP stabilization and near‑term cost progress; raised full‑year cash COGS guidance (7–9% decline) and U.S. share gains suggest potential upward revisions to H2 EBITDA, while GAAP EPS will remain sensitive to non‑cash tax valuation dynamics and interest expense .

Key Takeaways for Investors

Volume recovery and utilization improvements are tangible; near‑term profitability inflecting via cost actions, but pricing remains the swing factor; watch U.S. mix and contract negotiations in Q4 .
The raised 2025 cash COGS guidance (7–9% decline) is a material positive for EBITDA resilience; sequential cost seasonality in H2 and interest burden remain headwinds for FCF .
U.S. tariffs and growing EAF share underpin demand in GrafTech’s strongest region; continued mix shift is a controllable lever for ASP and margin stabilization .
Western EV supply chain policy actions (anode tariffs) create optionality for needle coke/graphitization participation; monitor potential public‑private partnerships and capital needs .
Balance sheet/liquidity are adequate near‑term (Q2 liquidity $367M; no major maturities until Dec 2029), but net debt remains high; interest outflows drive FCF volatility .
Post‑quarter corporate actions (regained NYSE compliance; 1‑for‑10 reverse split) reduce listing risk and may affect trading dynamics/float perception .
Tactical setup: Into H2’25, catalysts include pricing negotiations, tariff developments, and evidence of European recovery; risk remains from global oversupply and non‑cash tax valuation impacts .

Notes:

All document‑based figures and quotes are cited to company filings and materials.
Consensus figures are from S&P Global and marked with an asterisk.

GRAFTECH INTERNATIONAL LTD (EAF)·Q2 2025 Earnings Summary