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Origin Materials, Inc. (ORGN)·Q1 2025 Earnings Summary

Executive Summary

  • Q1 2025 revenue was $5.4M, down 21% YoY and down from $9.2M in Q4 2024, as Origin intentionally reduced its supply chain activation program; net loss widened to $26.4M due to a $16.6M non-cash impairment charge .
  • Management pushed out the commercial-scale PET cap revenue ramp by 1–3 quarters, cut 2026 revenue guidance to $50–$70M (from $110–$140M), introduced 2027 revenue guidance of $150–$210M, and reiterated run-rate Adjusted EBITDA positive by late 2026 .
  • Qualification cycles for PET caps are taking 1–2 years (vs prior 6–12 months assumption), particularly at large customers; first pilot launch remains on track for Q3 2025 in the U.S. with limited distribution .
  • Company ended Q1 with $83M in cash, equivalents and marketable securities, and is pursuing 50–70% equipment financing plus incremental corporate debt in 2H 2025; consensus estimates for Q1 were not available via S&P Global, limiting beat/miss assessment .
  • Potential stock catalysts: magnitude of guidance cut and revenue timing delay; execution on Q3 pilot, qualification completions by mid-2026, throughput gains (lines 2–3 ~2x, lines 4+ ~3x line 1) and debt financing milestones .

What Went Well and What Went Wrong

  • What Went Well

    • Signed a strategic customer agreement with a multibillion-dollar packaging company to co-develop large-format PET closures (ready-to-drink, wine, spirits), expanding TAM beyond 1881 beverage caps .
    • Throughput improvements: lines 2–3 expected to roughly double and lines 4+ to roughly triple output versus line 1; two PET extruders ordered to improve line margins .
    • Demand indicators robust: >20 companies qualifying/pre-qualifying caps (six Fortune 500); >65 new customer inquiries in six weeks; first customer pilot qualified and on track for Q3 2025 .

  • What Went Wrong

    • PET cap qualification taking 1–2 years at larger customers, driving a 1–3 quarter delay in commercial revenue and a major 2026 revenue guidance cut to $50–$70M from $110–$140M previously .
    • Macroeconomic/tariff uncertainty: plan now assumes a 10% tariff on equipment imported from Europe; deployment schedule updated, pushing CapFormer 5–8 production starts into 1H 2026 (~three months post FAT) .
    • Financials deteriorated on impairment: $16.6M non-cash impairment tied to a biomass conversion contract manufacturing agreement drove higher OpEx and a wider net loss .

Financial Results

P&L summary and sequential/YoY comparison (oldest → newest)

MetricQ1 2024Q3 2024Q4 2024Q1 2025
Revenue ($USD Millions)$6.825 $8.202 $9.222 $5.430
Net Loss ($USD Millions)$(13.913) $(36.763) $(13.522) $(26.441)
Net Loss per Share, Diluted ($)$(0.10) $(0.26) $(0.09) $(0.18)
Operating Expenses ($USD Millions)$18.135 $32.466 $16.216 $32.736
Adjusted EBITDA ($USD Millions)$(12.905) $(11.954) $(11.055) $(11.010)

Notes: Q1 2025 OpEx includes a $16.6M impairment, which widened GAAP losses despite slightly improved Adjusted EBITDA YoY .

Revenue mix

MetricQ1 2024Q3 2024Q4 2024Q1 2025
Products Revenue ($USD Millions)$6.822 $8.202 $9.222 $5.430
Services Revenue ($USD Millions)$0.003 $0.000 $0.000 $0.000

Balance sheet / KPIs

MetricQ3 2024Q4 2024Q1 2025
Cash, Cash Equivalents & Marketable Securities ($USD Millions)$113.4 $102.9 $83.0
Shares Outstanding (Millions)145.9 148.6 149.5

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueFY 2026$110M–$140M $50M–$70M Lowered significantly
RevenueFY 2027N/A$150M–$210M New guide introduced
Run-rate Adjusted EBITDA Timing20261H 2026 By back end of 2026 Delayed
CapFormer DeploymentLines 5–8Eight lines online by YE 2025 (implied) FAT for lines 5–8 in Q4’25–Q1’26; production ~3 months after FAT Later production start
Pilot LaunchQ3 2025First products as soon as late Q2/Q3 2025 (prior commentary) Q3 2025 pilot confirmed; caps qualified, pending bottling Maintained/clarified
Tariff Assumption2025–2026Not specified10% tariff on EU equipment New assumption

Earnings Call Themes & Trends

TopicQ3 2024 (Q-2)Q4 2024 (Q-1)Q1 2025 (Current)Trend
Qualification timelineCommercial production by YE’24; revenue ramp Q1’25; strong pipeline Revenue “in earnest” with lines 2–4 in Q3’25, meaningful by Q4’25 Qualification taking 1–2 years at large customers; revenue delayed 1–3 quarters; pilot Q3’25 Slower than hoped at large accounts
Throughput/technologyFAT achieved; 98% efficiency; 8–12B caps/year for first 8 lines Line 8 ~2x output of line 1; continuous improvement Lines 2–3 ~2x; lines 4+ ~3x line 1; exploring further gains Improving
Financial outlookRun-rate EBITDA positive 1H’26 Run-rate EBITDA positive by end of 2026; 2026 rev $110–$140M Run-rate EBITDA positive by back end of 2026; 2026 rev cut to $50–$70M; 2027 added $150–$210M Pushed out, 2026 revenue reduced
Tariffs/supply chainNot emphasizedMacro noted; adapting plans Assumes 10% EU equipment tariff; geographic diversification; multi-sourcing, inventory strategies New headwind, mitigations in place
Financing strategyNo equity required; debt to fund lines Debt for equipment + working capital; maintain cash floor Equipment financing 50–70% + corporate debt in 2H’25; $83M cash/securities Consistent plan; executing
Origin 1 / FuranicsOM1 operated “on demand” to cut burn OM1 lower run-rate; focus on caps OM1 operated intermittently; strategic de-emphasis continues Secondary to caps strategy

Management Commentary

  • Strategic focus: “We are committed to doing the work to qualify caps with our key prospective customers… The alignment between ourselves and our customers is strong” .
  • On guidance reset: “We are deferring the expected start of commercial-scale PET cap revenue generation by between one and three quarters… now expect revenue of $50M–$70M in 2026 and $150M–$210M in 2027” .
  • On qualification realities: “PET cap qualification is more likely to take one to two years… single iteration cycle can take months” .
  • On tariffs and deployment: “Revised plan assumes a 10% tariff on equipment imported from Europe… Lines 5–8 expected to complete FAT in Q4 2025 and Q1 2026; production starting ~three months after FAT” .
  • On unit economics: “We continue to anticipate the payback period for the average CapFormer line… to be less than 18 months” .

Q&A Highlights

  • Why revenue decline and OM1 usage: management intentionally turned down Origin 1 to conserve working capital and focus on caps; intermittent operations continue .
  • Qualification issues: variability across customers and bottling lines drives iterative design changes (e.g., adding knurling), extending timelines .
  • EBITDA breakeven and tariffs: current 10% EU equipment tariff assumed; not expected to materially change line ROIC or 2026 run-rate profit goal under current rates .
  • Financing details: targeting 50–70% loan-to-value equipment financing; balance via corporate debt to maintain cash; equity considered minimal/backup if needed .
  • Geismar land: sold 35 of ~180 acres; remainder for sale .

Estimates Context

  • S&P Global consensus for Q1 2025 was unavailable: the S&P Global feed returned no active consensus for revenue or EPS (Primary EPS Consensus Mean, Revenue Consensus Mean showed no estimates; only actuals populated), implying insufficient analyst coverage for a formal beat/miss assessment (values via S&P Global).*
  • Implication: buyside/ sellside models will need to realign to the revised 2026–2027 revenue trajectory and later start of commercial revenues, with focus shifting to qualification milestones and pilot execution .
Q1 2025 vs ConsensusActualConsensus
Revenue ($USD Millions)$5.430 N/A*
EPS, Diluted ($)$(0.18) N/A*
Adjusted EBITDA ($USD Millions)$(11.010) N/A*

*Values retrieved from S&P Global.

Key Takeaways for Investors

  • The core issue is timing: large-customer qualifications take 1–2 years, pushing the commercial revenue ramp and forcing a major 2026 revenue guidance cut to $50–$70M from $110–$140M; 2027 introduced at $150–$210M .
  • Execution watchlist for 2H’25–mid-’26: (i) Q3 pilot launch on time, (ii) factory acceptance tests for lines 2–4 in Q2–Q3 and lines 5–8 in Q4–Q1’26, (iii) 50–70% equipment financing and corporate debt closes, and (iv) qualification completions by mid-2026 .
  • Technology/throughput trajectory remains favorable (lines 2–3 ~2x, lines 4+ ~3x line 1), with PET extrusion vertical integration to improve margins and <18-month line payback targeted .
  • Balance sheet provides runway ($83M cash/securities), but timing slips elevate dependency on debt execution and disciplined cash management as lines are deployed .
  • Tariff exposure (assumed 10% on EU equipment) is being mitigated via geographic diversification, multi-sourcing, and inventory strategies; further tariff increases would prompt re-evaluation .
  • Origin 1 and furanics remain secondary near-term; management is prioritizing caps to reach run-rate profitability by late 2026 .
  • Stock narrative likely hinges on visible customer milestones (pilot on shelf, named customers, qualification completions) and financing progress; the guidance cut sets a lower bar but raises scrutiny on timeline execution .

Additional Documents Reviewed (Q1 2025 window)

  • 8-K furnishing Q1 2025 press release (Item 2.02)
  • Earnings release schedule PR (May 1)