In the rapidly evolving world of rare earth elements (REEs), two companies stand out as pivotal players: MP Materials (MP) and Lynas Rare Earths Limited (LYSDY). Both firms are at the forefront of efforts to diversify global supply chains, particularly as demand surges for critical minerals essential in electric vehicles, defense technologies, and advanced electronics. With China historically dominating this market, MP and Lynas are carving out significant roles that could reshape the industry landscape.
MP Materials, headquartered in Las Vegas, Nevada, holds the distinction of being the only fully integrated rare earth producer in the United States. The company’s operations span the entire supply chain—from mining and processing rare earth oxides to advanced metallization and magnet manufacturing. Its Mountain Pass facility in California is central to this integrated approach, especially in producing Neodymium-Praseodymium (NdPr), a rare earth element critical for high-strength permanent magnets used in electric vehicle motors, wind turbines, robotics, and defense systems.
In the first quarter of 2025, MP Materials reported revenues of $60.8 million, marking a 25% increase year-over-year. Its NdPr production soared to a record 563 metric tons, a staggering 330% increase compared to the same quarter last year. Additionally, the company produced 12,213 metric tons of rare earth oxides, a 10% year-over-year rise, thanks to higher recoveries from ongoing optimization projects.
However, despite these production gains, MP reported a loss of 12 cents per share in Q1 2025, wider than the previous year’s 4-cent loss. This was influenced by elevated production costs, selling, general and administrative expenses, and increased interest expenses. Further complicating matters, on April 17, 2025, MP halted shipments of rare earth concentrate to China due to tariffs and export controls imposed by the Chinese government. This move cut off a revenue stream that accounted for roughly half of MP’s Q1 income.
In response, MP is focusing on expanding sales of separated rare earth products to markets outside China, including Japan and South Korea. The company also signed a Memorandum of Understanding (MoU) with Saudi Arabian mining firm Maaden to explore developing a fully integrated rare earth supply chain in Saudi Arabia, signaling ambitions to broaden its global footprint.
A landmark development for MP came with a $500 million long-term contract to supply Apple Inc. with rare earth magnets manufactured entirely from recycled materials in the United States. This deal not only launches MP’s recycling platform but also scales up its magnet production business. Apple and MP have collaborated over the past five years to develop advanced recycling technology that ensures recycled rare earth magnets meet Apple’s stringent quality standards.
Adding to its strategic momentum, MP has entered a public-private partnership with the U.S. Department of Defense (DoD) to accelerate the establishment of a domestic rare earth magnet supply chain. The DoD’s multibillion-dollar investment package includes funding for a second domestic magnet manufacturing facility, dubbed the 10X Facility, scheduled for commissioning in 2028. This facility aims to boost MP’s U.S. magnet manufacturing capacity to an estimated 10,000 metric tons, serving both defense and commercial sectors.
Meanwhile, Lynas Rare Earths Limited, based in Perth, Australia, has built a reputation as an ethical and environmentally responsible rare earth producer. Its operations are anchored by the Mt Weld mine in Western Australia, considered one of the world’s premier rare earth deposits. Lynas processes its concentrate at facilities in Kalgoorlie, Australia, and Kuantan, Malaysia, with plans underway to build a new Rare Earths Processing Facility in Texas to separate pre-processed mixed rare earths.
In its fourth-quarter fiscal 2025 results, Lynas achieved record NdPr production of 2,080 metric tons, surpassing the 2,000-ton milestone for the first time. Total rare earth oxide production reached 3,212 tons. Sales revenues grew 38% year-over-year to AUD 170.2 million (approximately $110.6 million), reflecting strong demand and progressive commissioning of assets under its Lynas 2025 capital project.
Notably, Lynas began commercial production of separated Heavy Rare Earths (HRE) outside China for the first time in decades, producing Dysprosium Oxide and Terbium Oxide at its Malaysian facility in May and June 2025, respectively. The company also signed MoUs with Kelantan Menteri Besar (MB) Inc to develop rare earth deposits and supply mixed rare earth carbonate to its Malaysian plant, and with Korea’s JS Link to collaborate on a new magnet manufacturing facility in Malaysia.
The Mt Weld Expansion Project is progressing as planned, expected to increase production capacity and efficiency while enhancing sustainability. Stage 2 commissioning is anticipated in the first quarter of fiscal 2026, with teams working closely to ensure a smooth ramp-up.
From a financial perspective, analysts’ estimates paint a nuanced picture. MP Materials is forecast to post a fiscal 2025 loss of 43 cents per share, an improvement from a prior estimate of a 53-cent loss. The company is projected to swing to a profit in fiscal 2026, with earnings estimated at 71 cents per share. In contrast, Lynas is expected to see steady growth, with fiscal 2026 earnings estimated at 16 cents per share—a 167% increase year-over-year—and further growth anticipated in fiscal 2027.
Stock market performance this year reflects these dynamics. MP Materials’ shares have surged an impressive 311%, significantly outperforming Lynas’ 79% gain. However, MP currently trades at a forward 12-month price-to-sales ratio of 24.73, a steep premium compared to Lynas’ 11.58 ratio and the industry average of 1.24. This valuation gap suggests investors are pricing in MP’s growth potential but also recognizing its higher risk profile.
July 2025 brought more good news for MP Materials. The U.S. Department of Defense awarded the company a contract that included a $400 million investment in preferred stock and a $150 million loan to expand processing capabilities. The DoD also committed to purchasing all NdPr oxide production from MP’s new facility, guaranteeing a minimum price and a stable revenue stream. Following this announcement, MP shares jumped 50% in a single trading session, with trading volumes soaring to seven times the norm.
Shortly thereafter, Apple’s $500 million investment to source American-made rare earth magnets from MP further boosted investor confidence. Apple’s involvement includes establishing a cutting-edge rare earth recycling line at Mountain Pass and advancing magnet materials and processing technologies. This partnership not only underscores MP’s strategic importance but also aligns with broader sustainability goals.
MP’s stock has now more than doubled over the past month, forming a classic high-tight flag pattern—a technical indicator often associated with strong upward momentum. Deep-pocketed options traders have been actively purchasing December $75 call options, indicating bullish sentiment toward MP’s stock performance into the year-end.
Choosing between MP Materials and Lynas is no easy task. Both companies hold Zacks Rank #3 (Hold), reflecting a cautious but optimistic outlook. MP’s integrated U.S.-based operations, strategic partnerships with the DoD and Apple, and aggressive capacity expansions position it as a compelling growth story, albeit with elevated costs and near-term losses. Lynas, with its ethical production practices, steady operational growth, and expanding footprint in Asia and the U.S., offers a more measured but potentially more stable investment opportunity.
For investors eyeing the rare earth sector’s future, Lynas’s cheaper valuation and strong growth projections might currently make it the more attractive choice. However, MP’s remarkable stock performance and groundbreaking deals suggest it could be the high-reward play for those willing to accept higher risk.
As global demand for rare earth elements intensifies, driven by the green energy transition and technological innovation, both MP Materials and Lynas Rare Earths are set to play pivotal roles. Their ongoing developments, strategic partnerships, and production milestones will be critical to watch in the coming years.
