USA Rare Earth, Inc. USAR remains in the early stages of commercial growth and continues to face losses as operations scale. While revenue generation has started following the acquisition of Less Common Metals, higher operating expenses tied to expansion, acquisitions and workforce growth are pressuring the company’s profitability.
In the first quarter of 2026, USAR’s cost of product revenues was $5.59 million, which was 98.1% of total revenues. In the same period, its selling, general and administrative expenses surged to $21.2 million from $7 million in the year-ago quarter due to a rise in legal & consulting costs, higher headcount & recruiting fees, and other costs.
USA Rare Earth’s research and development expenses rose to $14.2 million compared with $1.7 million reported in the year-ago quarter due to an increase in higher employee-related and development costs. As a result, the company reported a loss of 34 cents per share for the quarter.
However, USAR has achieved a key milestone with the commissioning of Phase 1a of its commercial magnet production line at the Stillwater facility in Oklahoma. The development enables USAR to start fulfilling customer orders for sintered neodymium-iron-boron (NdFeB) permanent magnets in the second quarter of 2026.
Although USA Rare Earth is making progress in scaling operations, persistent cost pressures and ongoing losses remain key concerns. The company’s ability to balance growth investments with improving revenues and cost discipline will be key to overcoming profitability pressures.
