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Intrepid Potash, Inc. (IPI)·Q3 2025 Earnings Summary

Executive Summary

  • Q3 2025 revenue rose to $53.2M, beating S&P Global consensus of $50.1M by ~6% on higher realized pricing in potash and Trio; adjusted EPS of $0.11 missed the $0.18 consensus as non‑GAAP add‑backs (notably a $2.24M asset sale gain) elevated GAAP EPS to $0.28 but did not flow to adjusted results . Consensus values marked with “” come from S&P Global.
  • Segment mix was favorable: Potash gross margin improved on 15% higher volumes and +7% pricing; Trio posted a sharp margin inflection on +29% realized price, though volumes were seasonally light; Oilfield Solutions was a drag with water sales down sharply y/y after a record frac job last year .
  • Management guided Q4 potash volumes of 50–60k tons at $385–$395/t and Trio 80–90k tons at $372–$382/t; 2025 CapEx trimmed to $30–$34M (from $32–$37M in Q2) with ~$5M for HB AMAX work; cash was ~$74M with no revolver borrowings as of Oct 31 .
  • Narrative/catalysts: constructive fertilizer pricing, visible Trio productivity and margin tailwinds into 2026 (70–75k t/quarter production cadence), offset by lower near‑term oilfield water activity and potash production constraints into 2026 pending HB AMAX progress; capital return remains deferred pending sustained, repeatable FCF .

What Went Well and What Went Wrong

  • What Went Well

    • Realized pricing captured: “We delivered another quarter of solid financial results… third quarter net income of $3.7M and adjusted EBITDA of $12.0M” with price increases fully realized in potash and Trio, driving higher gross margins y/y .
    • Trio execution: Production 70k tons, COGS/t $257 (vs $272 LY; $235 Q2), gross margin $4.4M (vs $0.6M LY); management expects 2026 production 70–75k t/quarter and continued cost improvements .
    • Potash profitability: 62k t sold (+15% y/y) at $381/t (+7% y/y), segment GM up ~$2.2M y/y on volume and pricing; COGS/t improved to $340 (vs $348 LY; $337 Q2) despite weather‑driven production delays .

  • What Went Wrong

    • Oilfield Solutions slump: Sales fell to $2.7M (-$7.6M y/y) with a $0.06M gross deficit on lower water sales and lapping the largest frac job in company history last year; Q4 expected to remain slow .
    • Adjusted EPS miss vs S&P: Adjusted EPS $0.11 vs ~$0.18* consensus on mix, seasonality, and normalization of non‑operating items (notably a $2.24M asset sale gain excluded from adjusted EPS); GAAP diluted EPS was $0.28 . Consensus from S&P Global.*
    • 2026 potash headwinds: Above‑average 2025 HB rainfall and lack of an AMAX brine pool reduce 2026 potash production/absorption; management still targets 270–280k tons, implying 5–7% higher potash COGS/t next year (partially offset by Trio gains) .

Financial Results

Headline Results and Estimate Comparison

MetricQ3 2024Q2 2025Q3 2025S&P Consensus (Q3 2025)*
Revenue ($M)$57.5 $71.5 $53.2 $50.1*
Diluted EPS (GAAP)$(0.14) $0.25 $0.28 n/a
Adjusted EPS (non‑GAAP)$(0.02) $0.45 $0.11 $0.178*
Gross Margin ($M)$7.7 $14.3 $10.6 n/a
Adjusted EBITDA ($M)$10.0 $16.4 $12.0 n/a
  • Revenue beat: $53.2M vs $50.1M*, ~+6% . Consensus from S&P Global.*
  • Adjusted EPS miss: $0.11 vs ~$0.178*; GAAP EPS $0.28 benefited from items excluded in adjusted EPS . Consensus from S&P Global.*

Segment Performance and KPIs

MetricQ1 2025Q2 2025Q3 2025
Potash Sales ($M)$43.6 $34.0 $32.5
Potash Sales Volumes (k tons)103 69 62
Potash Avg Net Realized Price ($/t)$312 $361 $381
Potash Gross Margin ($M)$2.5 $4.9 $6.3
Trio Sales ($M)$49.8 $33.2 $18.1
Trio Sales Volumes (k tons)110 70 36
Trio Avg Net Realized Price ($/t)$345 $368 $402
Trio Gross Margin ($M)$10.4 $8.1 $4.4
Oilfield Solutions Sales ($M)$4.4 $4.3 $2.7
Oilfield Gross Margin ($M)$1.7 $1.3 $(0.06)
Company Gross Margin ($M)$14.6 $14.3 $10.6
Adjusted EBITDA ($M)$16.6 $16.4 $12.0

Additional cost KPIs:

  • Potash COGS/t: $340 in Q3’25 vs $337 in Q2’25 vs $348 in Q3’24 .
  • Trio COGS/t: $257 in Q3’25 vs $235 in Q2’25 vs $272 in Q3’24 .

Balance sheet and cash flow:

  • Cash & equivalents: $77.2M at 9/30; ~$74M as of 10/31; no borrowings on $150M revolver (Aug’27 maturity) .
  • Operating cash flow: $(4.0)M in Q3; $46.9M YTD (2024 YTD benefited from a one‑time $45M XTO payment) .

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Potash sales volumesQ4 2025n/a50–60k tons New
Potash avg net realized priceQ4 2025n/a$385–$395/t New
Trio sales volumesQ4 2025n/a80–90k tons New
Trio avg net realized priceQ4 2025n/a$372–$382/t New
CapExFY 2025$32–$37M (Q2 update) $30–$34M Lowered
Potash productionCY 2026270–280k tons 270–280k tons (reiterated) Maintained
Trio productionCY 2026n/a285–295k tons (implied by 70–75k t/quarter) New
LiquidityPoint‑in‑timen/a~$74M cash, $0 drawn on $150M revolver (10/31) Update

Earnings Call Themes & Trends

TopicPrevious Mentions (Q1’25 and Q2’25)Current Period (Q3’25)Trend
Potash pricing and demandQ1: price strength emerging; Q2: supportive market, summer fill +$20/t; tight global balance; Jansen delay to mid‑2027 Pricing captured in Q3; constructive U.S. ag with soybean trade developments; potash at similar levels to 2023 Stable to positive
Trio production/unitsQ1: strong run‑rate, COGS/t $235; Q2: 70k t, COGS/t $235; margin step‑up 70k t in Q3; COGS/t $257 on premium mix; 2026 production 70–75k t/quarter; 5–7% unit cost improvement expected Improving
HB AMAX projectQ1: permitting/July sample well planned Q2: no brine found; evaluate injection well/pipeline; production outlook reduced Q3: permits expected by Q1’26; injection well ~$5–6M plus pipeline; staging over years
Weather/productionQ2: above‑avg rain → 2026 harvest impact; shift 15k tons to 2026 Q3: reaffirm 2026 potash 270–280k t; expect 5–7% potash COGS/t increase in 2026 Headwind but manageable
Oilfield waterQ1–Q2: steady contributor; Q2 GM $1.3M Q3: slump on lower activity, lapping record job; Q4 likely slow; YTD mostly consistent with history Soft near term
Capital returnsQ2: focus on durability; cash building, framework discussed with board Q3: continue reinvestment priority; capital returns considered after durable, repeatable FCF Deferred, monitored

Management Commentary

  • CEO framing: “We delivered another quarter of solid financial results… adjusted EBITDA of $12.0 million” and “Trio® continues to be a clear standout… improved production, lower unit costs, and significant margin improvements” .
  • Market outlook: “U.S. agriculture… showing signs of improvement… we remain constructive on sales volumes and pricing” .
  • Operations and 2026 setup: “We now forecast our quarterly Trio production… 70,000–75,000 tons for 2026… offset [to] modestly lower 2026 potash production guidance” .
  • Cost/consistency focus: “We’re still not pleased with where we are… continue to take costs out… move down the cost curve… Trio team… dramatic improvements” .

Q&A Highlights

  • Capital allocation: Returns remain a board‑level focus, but management prioritizes reinvestment until structural, repeatable FCF is achieved; cash balance provides flexibility .
  • HB AMAX pathway and capex: Injection well ~$5–6M and a few million for pipeline; permitting expected by Q1’26; capex staged over multiple years .
  • Demand/order book: Q4 order books for both potash and Trio look strong; potash mix/geography insulates against a slower Corn Belt start .
  • 2026 cost absorption: Lower potash volumes imply 5–7% higher potash COGS/t in 2026, partially offset by Trio improvements .
  • Oilfield outlook: Q4 water activity expected to remain subdued vs 1H; some improvement vs Q3 but slower environment likely into early 2026 .

Estimates Context

  • S&P Global consensus for Q3 2025: Revenue $50.1M*, Primary EPS $0.178*. Actual revenue $53.2M beat by ~6%; Adjusted EPS $0.11 missed by ~$0.07; GAAP diluted EPS $0.28 benefited from non‑recurring items excluded from adjusted EPS . Values retrieved from S&P Global.*
  • Implications: Street may lift revenue run‑rate and Trio pricing assumptions, but adjust EPS trajectory modestly lower near‑term given oilfield softness and 2026 potash cost absorption unless offset by Trio volume/cost gains .

Key Takeaways for Investors

  • Mix and pricing drove a clean revenue beat; the adjusted EPS miss is explainable by normalization of gains and seasonal Trio volumes—underlying Trio unit economics are improving into 2026 .
  • Q4 setup is constructive: visible pricing ranges and strong order books in both potash and Trio should sustain margins in the seasonally stronger quarter .
  • 2026 risk/reward: modest potash COGS/t inflation (5–7%) is largely offset by structurally higher Trio volumes/lower costs; watch AMAX permitting milestones by Q1’26 .
  • Oilfield Solutions is a near‑term drag; management expects a slower environment into early 2026—model less contribution vs 1H’25 .
  • Balance sheet optionality (cash ~$74M, undrawn revolver) supports continued reinvestment; capital returns likely contingent on demonstrating multi‑quarter FCF durability .
  • Trading lens: positive bias into Q4 on price/volume visibility and Trio momentum; headline risk from oilfield softness and any potash price wobble appears manageable given diversified mix .

References: All figures and quotes are sourced from Intrepid’s Q3’25 8‑K and press release, the Q3’25 earnings call, and prior‑quarter releases/calls as cited in the tables and text above. Consensus values marked with “*” are from S&P Global.