Lithium Argentina AG (NYSE:LAR) stock fell Tuesday after the company reported third-quarter earnings below Wall Street expectations.
The lithium producer reported earnings of 8 cents per share, missing the analyst estimate of 9 cents.
However, higher production and sales volumes boosted revenue at its flagship Cauchari-Olaroz operation in Argentina.
Lithium Argentina Reports Higher Production And Revenue
Cauchari-Olaroz Stage 1 produced 9,550 tonnes of lithium carbonate in the third quarter, up 3% from the previous quarter.
Revenue rose 6% sequentially to $184 million. An 18% increase in sales volumes helped offset a 10% decline in realized lithium prices.
The operation posted a 67% cash operating margin and generated $95 million in operating cash flow.
Adjusted EBITDA reached $113 million, while cash climbed to approximately $312 million.
The operation distributed $100 million to joint venture partners during the third quarter. Another $30 million was distributed after quarter-end, bringing total distributions during 2026 to approximately $230 million.
Cauchari-Olaroz generated approximately $350 million in adjusted EBITDA over the past 12 months.
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Lithium Argentina Eyes Major Production Expansion
The company plans to expand Cauchari-Olaroz through its Stage 2 project, potentially adding 45,000 tonnes of annual capacity.
The expansion would lift total annual capacity to approximately 85,000 tonnes.
The project carries an estimated after-tax net present value (NPV) of $3.1 billion and a 28.5% internal rate of return.
These estimates assume lithium prices of $18,000 per tonne, operating costs of $5,000 per tonne and initial capital spending of approximately $1 billion.
Lithium Argentina also plans to accelerate a 10,000-tonne modular direct lithium extraction expansion. It targets production in 2028, subject to regulatory approvals.
Ganfeng Partnership Targets 150,000 Tonnes
Lithium Argentina completed its joint venture with Ganfeng, combining three lithium projects under the PPG platform.
Ganfeng holds a 67% stake, while Lithium Argentina owns 33%.
PPG targets annual production of 150,000 tonnes, with estimated operating costs of $5,000 per tonne.
A 2025 scoping study valued the project at $8 billion on a 100% basis, assuming lithium prices of $18,000 per tonne.
The partners have invested approximately $1.8 billion across the projects.
Management expects RIGI approval by year-end, potentially clearing the way for engineering, permitting and financing activities.
Together, Cauchari-Olaroz Stage 2 and PPG represent approximately $4.1 billion in project NPV attributable to Lithium Argentina’s ownership interests.
The company plans to pursue phased expansions while maintaining financial flexibility and prioritizing shareholder returns.
LAR Price Action: Lithium Argentina shares were down 6.42% at $4.15 at the time of publication on Tuesday, according to Benzinga Pro data.
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