What changed in this filing

/stocks — the workspaceLOADING

Item 1. Financial Statements

2026-08-10 compared with 2026-05-14 · 370 added, 289 removed, 579 unchanged (53% of the section changed)

7 unchanged sentences

Inventories 50,138 18,535

Prepaid expenses and other current assets 6,621 3,151

Prepaid expenses 12,347 2,865

Other assets, current 73,687 286

Total current assets 1,672,589 385,375

5 unchanged sentences

Operating lease right-of-use assets 2,151 321

Other non-current assets 207 176

Deferred arrangement costs 912,091 —

Other assets, non-current 255 176

Total assets $ 2,998,827 $ 694,999

3 unchanged sentences

Accrued liabilities 31,679 14,073

Contract liabilities 10,377 10,500

Contract liabilities, current 1,328 10,500

Note payable — 1,849

8 unchanged sentences

Deferred tax liability 15,665 16,715

Contract liabilities, non-current 9,602 —

Total liabilities 451,508 191,808

15 unchanged sentences

USA Rare Earth, Inc.

Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income

Three Months Ended March 31,

Condensed Consolidated Statements of Operations and Comprehensive Loss

Three Months Ended June 30, Six Months Ended June 30,

(In thousands, except per share)

1 unchanged sentence

Cost of revenue 7,404 — 12,996 —

Gross profit 106 —

Gross loss ( 1,583 ) — ( 1,477 ) —

Operating expenses:

4 unchanged sentences

Loss from operations ( 46,314 ) ( 8,804 ) ( 82,989 ) ( 17,522 )

Other (expense) income, net:

Interest and dividend income 11,970 187

Other income (expense), net

Interest income 370 765 472 952

Dividend income 14,581 — 26,449 —

Grant income 240 — 446 —

(Loss) gain on fair market value of financial instruments, net 22,418 ( 134,662 ) ( 21,135 ) ( 74,362 )

Interest expense and other loss, net ( 593 ) ( 87 )

Total other (expense) income, net ( 31,970 ) 60,400

(Loss) income before income taxes ( 68,645 ) 51,682

Interest expense and other expense, net ( 3,771 ) ( 12 ) ( 4,364 ) ( 99 )

Total other income (expense), net 33,838 ( 133,909 ) 1,868 ( 73,509 )

Loss before income taxes ( 12,476 ) ( 142,713 ) ( 81,121 ) ( 91,031 )

Benefit from income taxes ( 513 ) — ( 1,090 ) —

Net (loss) income ( 68,068 ) 51,682

Net loss ( 11,963 ) ( 142,713 ) ( 80,031 ) ( 91,031 )

Net loss attributable to non-controlling interest ( 1,630 ) ( 207 ) ( 2,709 ) ( 357 )

Net (loss) income attributable to USA Rare Earth, Inc.

Net loss attributable to USA Rare Earth, Inc.

$ ( 10,333 ) $ ( 142,506 ) $ ( 77,322 ) $ ( 90,674 )

Other comprehensive (loss) income, net of tax

Other comprehensive loss, net of tax

Foreign currency translation adjustments ( 727 ) — ( 1,057 ) —

Comprehensive (loss) income attributable to USA Rare Earth, Inc.

Comprehensive loss attributable to USA Rare Earth, Inc.

$ ( 11,060 ) $ ( 142,506 ) $ ( 78,379 ) $ ( 90,674 )

Net (loss) income per share attributable to USA Rare Earth, Inc.:

Basic $ ( 0.34 ) $ 0.75

Diluted ( 0.34 ) 0.58

Net loss per share attributable to USA Rare Earth, Inc.:

Basic and diluted $ ( 0.05 ) $ ( 1.54 ) $ ( 0.37 ) $ ( 0.99 )

Number of shares used in per share calculations:

Basic 196,479 64,463

Diluted 196,479 83,079

Basic and diluted 230,081 92,769 213,347 91,598

See Accompanying Notes to Condensed Consolidated Financial Statements

3 unchanged sentences

Condensed Consolidated Statements of Mezzanine Equity

Three Months Ended March 31,

Shares Amount Shares Amount

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Shares Amount Shares Amount Shares Amount Shares Amount

(In thousands)

3 unchanged sentences

USARE LLC Convertible Preferred unit dividends

— — — — — — 84 1,082

Issuance of preferred stock, net of issuance costs — — — — — — 2,279 11,745

2 unchanged sentences

Deemed dividend and accretion to redemption value

— 733 — 11,569 — 1,442 — 11,676

— — ( 1,519 ) ( 18,724 ) — — ( 1,519 ) ( 18,724 )

Ending balance 1,224 $ 10,347 3,714 $ 25,242 1,224 $ 10,347 3,714 $ 25,242

13 unchanged sentences

Condensed Consolidated Statements of Stockholders' Equity

Three Months Ended March 31,

Shares Amount Shares Amount

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

Shares Amount Shares Amount Shares Amount Shares Amount

(In thousands)

3 unchanged sentences

Shares issued in reverse merger recapitalization — — — — — — 21,679 2

Conversion of 12 % Series A Cumulative Convertible Preferred Stock

— — 2,610 — — — 2,610 —

Investor warrants exercised — — 3,051 1 10 — 3,051 1

Conversion of Earnout liability

10,100 1 — — 10,100 1 — —

PIPE financing

— — 8,550 1 69,767 7 8,550 1

Government grant program 16,133 1 — — 16,133 1 — —

Other issuances

462 — 26 — 606 — 26 —

Ending balance 244,671 $ 24 96,189 $ 10 244,671 $ 24 96,189 $ 10

4 unchanged sentences

Deemed dividend - preferred accretion to redemption value ( 733 ) ( 11,569 ) ( 1,442 ) ( 11,676 )

Conversions of 12 % Series A Cumulative Convertible Preferred Stock

— 18,724 — 18,724

Common stock issuance

Warrant exercises

— 38,469 255 38,469

PIPE financing — — 1,499,993 —

PIPE financing costs — — ( 51,003 ) —

Earnout liability — ( 99,639 )

Government grant program 451,394 — 451,394 —

Conversion of earnout liability 215,827 — 215,827 ( 99,639 )

Forward purchase agreement — 269 — 50

10 unchanged sentences

Beginning balance

$ — $ ( 17,187 ) $ — $ —

Forward purchase agreements prepayment — — — ( 20,389 )

6 unchanged sentences

Shares issued in reverse merger recapitalization — — — ( 16,954 )

Net (loss) income attributable to USA Rare Earth, Inc.

Dilution of non-controlling interest — ( 24 ) — ( 24 )

Other 1 — 1 —

Net loss attributable to USA Rare Earth, Inc.

( 10,333 ) ( 142,482 ) ( 77,322 ) ( 90,650 )

14 unchanged sentences

Condensed Consolidated Statements of Cash Flows

Three Months Ended March 31,

Six Months Ended June 30,

(In thousands)

Cash flows from operating activities:

Net (loss) income $ ( 68,068 ) $ 51,682

Adjustments to reconcile net (loss) income to cash used in operating activities

Net loss $ ( 80,031 ) $ ( 91,031 )

Adjustments to reconcile net loss to cash used in operating activities

Equity-based compensation expense 11,003 1,282

2 unchanged sentences

Amortization of right of use assets

Loss (gain) on fair market value of financial instruments 43,553 ( 60,300 )

Foreign currency transactions ( 139 ) —

Loss on fair market value of financial instruments 21,135 74,362

Other non-cash adjustments 14 2,099

20 unchanged sentences

Payment of securities issuance costs ( 51,003 ) ( 8,281 )

Payment of issuance cost for PIPE financing

Proceeds from issuance of common stock under PIPE financing 1,500,000 75,000

Payment of deferred government loan costs ( 27,745 ) —

Proceeds from exercise of warrants

Repayment of revolving credit facility ( 1,849 ) —

Financed leases ( 70 ) —

Payments on financed leases ( 140 ) —

Net cash provided by financing activities 1,419,331 129,565

Effect of exchange rate differences on cash and cash equivalents ( 330 ) —

Net change in cash and cash equivalents 1,389,719 6,590

Cash and cash equivalents, beginning of year 359,925 16,761

Cash and cash equivalents, end of period $ 1,749,644 $ 23,351

Supplemental disclosure of cash flow information:

Cash paid for interest $ 35 $ —

Purchases of property and equipment in accounts payable and other accrued liabilities 7,965 —

USARE LLC Convertible Preferred unit dividends — 3,042

Finance right of use assets obtained in exchange for finance lease liabilities — 1,233

Non-cash lease liabilities arising from obtaining right of use assets 209 427

Effect of exchange rate differences on cash, cash equivalents and restricted cash ( 1,175 ) —

Net change in cash, cash equivalents and restricted cash 1,234,444 105,030

Cash, cash equivalents and restricted cash, beginning of year 359,925 16,761

Cash, cash equivalents and restricted cash, end of period $ 1,594,369 $ 121,791

See Accompanying Notes to Condensed Consolidated Financial Statements

10 unchanged sentences

conversion of oxides into metals, alloys and strip-cast;

and production of sintered neodymium-iron-boron (“NdFeB”) permanent magnets, which the Company refers to as neo magnets.

This capability should address the supply-chain vulnerabilities created by China’s current dominance of rare earth processing, and metal and magnet manufacturing.

and production of sintered neodymium-iron-boron (“NdFeB”) permanent magnets, which the Company refers to as “neo magnets.” This capability should address the supply-chain vulnerabilities created by China’s current dominance of rare earth processing, and metal and magnet manufacturing.

During the year ended December 31, 2025, the Company completed two significant transactions:

19 unchanged sentences

however, the Company believes the disclosures included are adequate to make the information presented not misleading.

The March 31, 2026 unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and the notes thereto in the 2025 Annual Report.

The June 30, 2026 unaudited Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and the notes thereto in the 2025 Annual Report.

The unaudited Condensed Consolidated Financial Statements include all adjustments (consisting of normal recurring adjustments) which, in the opinion of management, are necessary for a fair presentation of the Company’s financial condition, results of operations and cash flows for the periods presented.

5 unchanged sentences

References to a year refer to the Company’s fiscal years ended on December 31 of the specified year.

Reclassifications

Certain prior period amounts have been reclassified in the Condensed Consolidated Balance Sheets and certain notes to the Condensed Consolidated Financial Statements to conform to the current period presentation.

These reclassifications had no effect on the Company’s previously reported financial position, results of operations and comprehensive loss, mezzanine and stockholders' equity, net loss per share, or cash flows.

Principles of Consolidation

9 unchanged sentences

For a detailed description of the Company’s Significant Accounting Policies, please refer to the Company’s 2025 Annual Report.

Recently Adopted Accounting Pronouncemen t

In December 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2025-10, Government Grants (Topic 832):

Accounting for Government Grants Received by Business Entities .

This ASU applies to business entities that receive government grants and addresses the accounting for cash and non-monetary grants, including forgivable loans, while excluding tax abatements, income tax credits, and exchange transactions.

The ASU requires recognition of government grants when there is reasonable assurance that the entity will comply with the conditions attached to the grants and the grants will be received.

The amendments permit income‑related grants to be presented as either other income or a reduction of related expenses, and asset‑related grants to be recorded as deferred income or as a reduction of the asset’s cost basis.

This ASU is effective for fiscal years beginning after December 15, 2028, and interim periods within those fiscal years, with early adoption permitted.

The ASU permits adoption using a modified prospective, modified retrospective, or full retrospective transition method.

The Company early adopted the ASU effective January 1, 2026, using the modified prospective approach.

Under this transition method, the guidance is applied to transactions occurring on or after the adoption date, and prior-period amounts are not adjusted.

Adoption of the standard did not have a material impact on the Company’s financial position, results of operations, cash flows, or related disclosures.

USA Rare Earth, Inc.

| Q2'2026 Quarterly Report (Form 10-Q) | 7

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

Recently Issued Accounting Pronouncements Not Yet Adopted

In November 2024, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2024-03, Income Statement – Reporting Comprehensive Income (Topic 220):

In November 2024, the FASB issued ASU 2024-03, Income Statement – Reporting Comprehensive Income (Topic 220):

Disaggregation of Income Statement Expenses .

11 unchanged sentences

The Company is currently evaluating the impact of adopting this ASU on its financial reporting disclosures.

In December 2025, the FASB issued ASU 2025-10, Government Grants (Topic 832):

Accounting for Government Grants Received by Business Entities .

The ASU requires recognition of government grants when there is reasonable assurance that the entity will comply with the conditions attached to the grants and the grants will be received.

This ASU is effective for fiscal years beginning after December 15, 2028, and interim periods within those fiscal years, with early adoption permitted.

The ASU may be applied using a modified prospective, modified retrospective, or full retrospective approach.

The Company is currently evaluating the impact of adopting this ASU on its financial reporting disclosures.

USA Rare Earth, Inc.

| Q1'2026 Quarterly Report (Form 10-Q) | 7

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

In December 2025, the FASB issued ASU 2025-11, Interim Reporting (Topic 270):

14 unchanged sentences

A financial instrument’s level within the fair value hierarchy is based on the lowest level of any input that is significant to the fair value measurement.

Level 1 and Level 2 Fair Value of Financial Instruments on a Recurring Basis

The following table presents the Company’s Level 1 and Level 2 financial assets measured at fair value on a recurring basis, including pricing category, amortized cost, gross unrealized gains and losses, and fair value.

The Company has no Level 1 and Level 2 financial liabilities measured on a recurring basis.

March 31, 2026

December 31, 2025

Pricing Category Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value

USA Rare Earth, Inc.

| Q2'2026 Quarterly Report (Form 10-Q) | 8

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

Money Market Funds

During February 2026, the Company began investing a portion of its cash balances in institutional floating-Net Asset Value (“NAV”) prime money market funds.

The fair value of the Prime money market funds approximates their carrying amounts due to the highly liquid, short-term nature of the underlying financial assets.

Any minor unrealized gains or losses resulting from daily NAV fluctuations are recorded within Other income (expense), net on the Condensed Statement of Operations and Comprehensive Loss.

Level June 30,

(In thousands)

Money market funds Level 1 $ — $ 353,841

Government money market funds Level 1 755,518 —

Prime money market funds Level 1 728,455 —

Total money market funds (included in Cash and cash equivalents) $ 1,483,973 $ 353,841

Level 3 Fair Value of Financial Instruments on a Recurring Basis

4 unchanged sentences

Earnout liability $ — $ 108,671

Warrant liability 26,491 19,534

Total earnout and warrant liabilities $ 171,571 $ 128,205

USA Rare Earth, Inc.

| Q1'2026 Quarterly Report (Form 10-Q) | 8

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

Warrant liabilities

Series A Warrant 40,690 19,534

Government Grant Warrant 323,499 —

Total Warrant liabilities 364,189 19,534

Total $ 364,189 $ 128,205

Level 3 Valuation and Reconciliation

Earnout Liability

The Company valued the earnout liability using a Monte Carlo simulation which includes Level 3 unobservable inputs.

The Company valued the earnout liability using a Monte Carlo simulation model which includes Level 3 unobservable inputs.

The following table summarizes the significant inputs used to value the earnout liability as of the dates indicated.

In the second quarter of 2026, all contingent conditions required for the conversion of earnout shares were satisfied, and the shares were subsequently distributed to their holders at a fair value of $ 215.8 million on the date of conversion.

2026 December 31,

3 unchanged sentences

Remaining term (in years) (1) 5.2

(1) As of June 30, 2026, all earnout shares had been distributed and there were no shares outstanding.

USA Rare Earth, Inc.

| Q2'2026 Quarterly Report (Form 10-Q) | 9

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

The following table presents the reconciliation of the earnout liability measured at fair value on a recurring basis for the dates indicated.

2026 December 31,

Three Months Ended June 30,

Six Months Ended June 30,

2026 2025 2026 2025

(In thousands)

1 unchanged sentence

Establishment of liability at March 13, 2025 — — — 99,639

Change in estimated fair value (1)

Unrealized loss in estimated fair value (1)

70,747 53,775 107,156 368

Conversion of earnout shares (2)

( 215,827 ) — ( 215,827 ) —

Balance, end of period $ — $ 100,007 $ — $ 100,007

(1) Change in estimated fair value is recognized in (Loss) gain on fair market value of financial instruments, net in the Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income.

Warrant Liability

The Company valued the Series A Warrant liability using a Monte Carlo simulation which includes Level 3 unobservable inputs.

(1) The “Unrealized loss in estimated fair value” is recognized in (Loss) gain on fair market value of financial instruments, net in the Condensed Consolidated Statements of Operations and Comprehensive Loss.

(2) In the second quarter of 2026, all contingent conditions required for the conversion of earnout shares were satisfied, and the shares were subsequently distributed to their holders.

The amount represents the fair value of the earnout liability on the date of conversion.

Series A Warrant Liability

The Company valued the Series A Warrant liability using a Monte Carlo simulation model which includes Level 3 unobservable inputs.

The following table summarizes the significant inputs used to value the Series A Warrant liability as of the dates indicated.

7 unchanged sentences

Put term (in years) 3.7 4.2

USA Rare Earth, Inc.

| Q1'2026 Quarterly Report (Form 10-Q) | 9

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

The following table presents the reconciliation of the Series A Warrant liability measured at fair value on a recurring basis for the dates indicated.

2026 December 31,

Three Months Ended June 30,

Six Months Ended June 30,

2026 2025 2026 2025

(In thousands)

1 unchanged sentence

Establishment of liability at March 13, 2025 — — — 40,652

Change in estimated fair value (1)

Unrealized loss in estimated fair value (1)

14,199 35,758 21,343 29,581

Warrant exercises

1 unchanged sentence

Balance, end of period $ 40,690 $ 53,715 $ 40,690 $ 53,715

USA Rare Earth, Inc.

| Q2'2026 Quarterly Report (Form 10-Q) | 10

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

Government Grant Warrant Liability

The Company valued the Government Grant Warrant liability using a Black-Scholes-Merton simulation model which includes Level 3 unobservable inputs.

The following table summarizes the significant inputs used to value the Government Grant Warrant liability as of the dates indicated.

See Note 13, “Government Grants – U.S.

Department of Commerce CHIPS Act Awards,” for additional information related to the Government Grant Warrant liability.

Share price $ 21.58 $ 27.98

Exercise price $ 17.17 $ 17.17

Expected volatility 79.4 % 79.7 %

Risk-free rate 4.4 % 4.4 %

Dividend yield — % — %

Put term (in years) 9.9 10.0

The following table presents the reconciliation of the Government Grant Warrant liability measured at fair value on a recurring basis for the dates indicated.

Three and Six Months Ended June 30, 2026

(In thousands)

Balance, beginning of period $ —

Establishment of liability at June 3, 2026 430,862

Unrealized gain in estimated fair value (1)

Balance, end of period $ 323,499

(1) The “Unrealized gain in estimated fair value” is recognized in (Loss) gain on fair market value of financial instruments, net in the Condensed Consolidated Statements of Operations and Comprehensive Loss.

Other Financial Information

7 unchanged sentences

Total inventories $ 50,138 $ 18,535

Prepaid and Other Current Assets

The following table presents prepaid expenses and other current assets as of the dates indicated.

USA Rare Earth, Inc.

| Q2'2026 Quarterly Report (Form 10-Q) | 11

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

Prepaid Expenses and Other Assets, Current

The following table presents prepaid expenses and other assets, current as of the dates indicated.

2026 December 31,

(In thousands)

Prepaid expenses

Prepaid insurance $ 2,037 $ 728

Grants receivable 1,053 —

Other receivables — 286

Engineering and consulting costs 70 2,137

1 unchanged sentence

Other 1,341 —

Total prepaid and other current assets $ 6,621 $ 3,151

Total prepaid expenses $ 12,347 $ 2,865

Other assets, current

Restricted cash (1)

Other 9,465 286

Total other assets, current $ 73,687 $ 286

(1) Restricted cash represents funds held in escrow and legally restricted pursuant to the terms of the escrow agreement, which requires the amounts to be reserved for the development of the Blacksburg, South Carolina property.

USA Rare Earth, Inc.

14 unchanged sentences

Lab equipment 5,111 3,724

Automobiles 51 —

Leasehold improvements 1,278 795

15 unchanged sentences

The following table presents depreciation expense related to the Company’s property, plant and equipment and amortization expense related to the Company’s finance lease right‑of‑use assets for the periods indicated.

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

(In thousands)

6 unchanged sentences

Notes to Condensed Consolidated Financial Statements (Unaudited)

Goodwill and Other Intangible Assets

The following table presents the changes in the carrying amount of goodwill as of the dates indicated.

2026 December 31,

(In thousands)

Balance, beginning of period $ 134,848 $ —

Goodwill recognized in connection with the acquisition of Less Common Metals Ltd.

Balance, end of period $ 134,848 $ 134,848

Goodwill is not amortized and is tested for impairment annually and when events or changes in circumstances indicate that it is more likely than not that an impairment may exist.

The Company’s annual goodwill impairment test is performed as of October 1.

The Company may first perform a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying value.

If the qualitative assessment indicates potential impairment, or if the Company elects not to perform a qualitative assessment, a quantitative impairment test is performed.

In the quantitative test, the carrying value of the reporting unit is compared to its estimated fair value.

If the carrying value exceeds fair value, an impairment charge is recognized for the excess, limited to the carrying amount of goodwill.

Other Intangible Assets

The following table presents the Company’s other intangible assets, by major class, as of the dates indicated.

March 31, 2026 December 31, 2025

June 30, 2026 December 31, 2025

Gross Carrying Amount Accumulated Amortization Net Carrying Amount Gross Carrying Amount Accumulated Amortization Net Carrying Amount

6 unchanged sentences

The following table presents amortization expense related to the Company’s other intangible assets for the periods indicated.

There was no intangible amortization for the three months ended March 31, 2025.

Three Months Ended March 31, 2026

There was no intangible amortization for the three and six months ended June 30, 2025.

Three Months Ended June 30, 2026

Six Months Ended June 30, 2026

(In thousands)

2 unchanged sentences

Supplier relationships 849 1,699

Know-how 238 476

Total amortization of other intangible assets $ 1,356 $ 2,713

USA Rare Earth, Inc.

| Q1'2026 Quarterly Report (Form 10-Q) | 12

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

Amortization of Intangible Assets

The following table presents estimated future amortization expense of finite‑lived intangible assets as of March 31, 2026.

The following table presents estimated future amortization expense of finite‑lived intangible assets as of June 30, 2026.

Year Ending December 31, Finite-lived Intangible Assets

(In thousands)

2026 (remaining nine months) $ 4,071

2026 (remaining six months) $ 2,715

2031 and thereafter 41,472

Total estimated amortization $ 65,899

USA Rare Earth, Inc.

| Q2'2026 Quarterly Report (Form 10-Q) | 14

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

Accrued Liabilities

4 unchanged sentences

Construction in progress

Financing costs 2,167 —

Asset retirement obligation (1)

3 unchanged sentences

The following table presents the ARO activity for the periods indicated.

2026 December 31,

There were no ARO valuation adjustments for the three and six months ended June 30, 2025.

Three Months Ended June 30, 2026

Six Months Ended June 30, 2026

(In thousands)

Balance, beginning of period $ 689 $ 700

Obligations arising from acquisition — 605

Accretion — 82

Foreign currency translation 1 ( 10 )

Balance, end of period $ 690 $ 690

Contract Liabilities

The Company’s contract liabilities consist of customer deposits and deferred revenue when cash payments are received in advance of the Company’s performance.

As of June 30, 2026, the Company evaluated its remaining performance obligations associated with its contract liabilities.

The related revenue is expected to be recognized as performance obligations are satisfied over the remaining contract terms, with amounts expected to be recognized within the next 12 months classified as contract liabilities, current and amounts expected to be recognized thereafter classified as contract liabilities, non-current.

2026 December 31,

(In thousands)

Contract liabilities, current $ 1,328 $ 10,500

Contract liabilities, non-current 9,602 —

Total contract liabilities $ 10,930 $ 10,500

USA Rare Earth, Inc.

2 unchanged sentences

Notes to Condensed Consolidated Financial Statements (Unaudited)

Contract Liabilities

The Company’s contract liabilities, which consist of customer deposits and deferred revenue, when cash payments are received in advance of the Company’s performance.

As of March 31, 2026, the Company evaluated its remaining performance obligations under its contract liabilities.

The Company’s contract liabilities primarily consist of short‑term arrangements with original expected durations of one year or less, and related revenue is expected to be recognized over the next year.

The following table presents the activity related to contract liabilities for the dates indicated.

2026 December 31,

There was no contract liability activity for the three and six months ended June 30, 2025.

Three Months Ended June 30, 2026

Six Months Ended June 30, 2026

(In thousands)

1 unchanged sentence

Contract liabilities related to acquisition — ( 26 )

Revenue recognized — ( 21 )

Revenue recognized related to amounts included in balance, beginning of period ( 798 ) ( 798 )

Cash received, excluding amounts recognized as revenue during the period 1,341 1,345

8 unchanged sentences

The following table presents interest expense related to the Company’s notes payable for the periods indicated.

Three Months Ended March 31,

There was no interest expense related to the Company’s notes payable during the three months ended June 30, 2026 and 2025.

Six Months Ended June 30,

(In thousands)

4 unchanged sentences

(2) The Barclays Trade Loan was repaid in full on February 13, 2026.

Variable Interest Entity

Round Top Mountain Development

Round Top Mountain Development, LLC (“RTMD”) is a variable interest entity (“VIE”), has mining rights at Round Top Mountain in the State of Texas, and is developing processing technology to process the rare earth minerals to be mined at Round Top Mountain.

Supplemental Cash Flow Information

Cash and Non-cash Transactions

Six Months Ended June 30,

(In thousands)

Cash Transactions

Cash paid for interest $ 103 $ —

Non-cash Transactions

Purchases of property and equipment in accounts payable and other accrued liabilities $ 3,169 $ —

USARE LLC Convertible Preferred unit dividends — 3,042

Finance right of use assets obtained in exchange for finance lease liabilities — 1,233

Non-cash lease liabilities arising from obtaining right of use assets 2,000 427

Issuance of Government Grant Warrants 430,862 —

USA Rare Earth, Inc.

2 unchanged sentences

Notes to Condensed Consolidated Financial Statements (Unaudited)

Reconciliation of Cash, Cash Equivalents and Restricted Cash

The Condensed Consolidated Statements of Cash Flows explain the changes in the total of cash and cash equivalents, and restricted cash.

The following table presents a reconciliation of cash and cash equivalents, and restricted cash reported for each period within the Condensed Consolidated Balance Sheets and the Condensed Consolidated Statements of Cash Flows that sum to the total of such amounts.

2026 June 30,

2025 December 31,

(In thousands)

Cash and cash equivalents $ 1,530,147 $ 121,791 $ 359,925

Restricted cash (included in Other assets, current) 64,222 — —

Cash, cash equivalents and restricted cash $ 1,594,369 $ 121,791 $ 359,925

Variable Interest Entity

Round Top Mountain Development

Round Top Mountain Development, LLC (“RTMD”) is a variable interest entity (“VIE””), has mining rights at Round Top Mountain in the State of Texas, and is developing processing technology to process the rare earth minerals to be mined at Round Top Mountain.

On May 17, 2021, the Company completed the acquisition of 80 % of the equity interests of RTMD, pursuant to a contribution agreement among the Company, Texas Mineral Resources Corp.

2 unchanged sentences

This acquisition resulted in the consolidation of RTMD and the recognition of a noncontrolling interest representing TMRC’s equity interest.

Under the amended and restated limited liability company agreement of RTMD, in the event that TMRC does not fund its share of mandatory capital contributions called for by the Company as the manager of RTMD, the Company is obligated to cover the shortfall by making additional capital contributions to RTMD (or in the event that the Company does not fund, the capital call will be withdrawn).

On March 4, 2026, the Company entered into a definitive Agreement and Plan of Merger with TMRC.

On August 7, 2026, the Company closed the acquisition of TMRC, to which the Company acquired 100 % of the outstanding shares of TMRC.

The transaction is valued at approximately $ 73.9 million based on the closing price of the Company’s common stock on the August 7, 2026.

The aggregate merger consideration consists of approximately 3.8 million shares of the Company’s common stock, with cash paid in lieu of fractional shares.

Subsequent to the closing, the Company will be the sole operator and 100 % economic beneficiary of the “Round Top Project,” which consists of our operations and rights related to Round Top Mountain and the Round Top Mountain heavy rare earth element (“HREE”) metals deposit (the “Round Top Deposit”).

The transaction is intended to secure full ownership control of the project, and streamline operations, governance and decision-making.

Under the amended and restated limited liability company agreement of RTMD, prior to the above forementioned acquisition of TMRC, in the event that TMRC does not fund its share of mandatory capital contributions called for by the Company as the manager of RTMD, the Company is obligated to cover the shortfall by making additional capital contributions to RTMD (or in the event that the Company does not fund, the capital call will be withdrawn).

If the Company does fund the capital contribution, additional equity interests in RTMD will be issued to the Company and TMRC will be proportionally diluted in accordance with the terms of the amended and restated limited liability company agreement.

TMRC’s failure to fund its share of mandatory capital contributions called under the agreement during the three months ended March 31, 2026 has caused the Company’s ownership interest in RTMD to be increased by 30 basis points.

TMRC’s failure to fund its share of mandatory capital contributions called under the agreement during the six months ended June 30, 2026 has caused the Company’s ownership interest in RTMD to be increased by 40 basis points.

USA Rare Earth, Inc.

| Q2'2026 Quarterly Report (Form 10-Q) | 17

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

The following table presents the ownership percentages of the Company and TMRC and the changes in ownership percentages as of the dates indicated.

6 unchanged sentences

18.3 % 18.7 % ( 40 )

Texas Mineral Resources Corp.

On March 4, 2026, the Company entered into a definitive Agreement and Plan of Merger with TMRC, pursuant to which the Company is expected to acquire 100 % of the outstanding shares of TMRC in an all‑stock transaction.

The acquisition will eliminate TMRC’s minority ownership interests in RTMD and establish the Company as the sole operator and 100 % economic beneficiary of the “Round Top Project,” which consists of our operations and rights related to Round Top Mountain and the Round Top Mountain heavy rare earth element (“HREE”) metals deposit (the “Round Top Deposit”).

The transaction is intended to secure full ownership control of the project, and streamline operations, governance and decision-making.

The transaction is valued at approximately $ 72.3 million based on the closing price of the Company’s common stock on March 4, 2026.

The aggregate merger consideration consists of approximately 3.8 million shares of the Company’s common stock, with cash paid in lieu of fractional shares.

The ultimate value of the consideration will depend on the Company’s stock price at closing.

USA Rare Earth, Inc.

| Q1'2026 Quarterly Report (Form 10-Q) | 15

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

The following table presents the assets and liabilities of RTMD that are included in the Company’s Condensed Consolidated Balance Sheets as of the dates indicated.

2 unchanged sentences

Cash and cash equivalents $ — $ 38

Prepaid expenses and other current assets 104 106

Prepaid expenses 100 106

Operating lease right-of-use assets 418 321

2 unchanged sentences

Equipment deposits 63 —

Other non-current assets 27 27

Other assets, non-current 28 27

Total assets $ 18,646 $ 18,032

4 unchanged sentences

Total liabilities $ 4,003 $ 852

RTMD did not record depletion expense for the mineral interests for the three months ended March 31, 2026 and 2025.

RTMD’s creditors have no recourse against the Company for the RTMD consolidated liabilities included within the Company’s Condensed Consolidated Balance Sheets as of March 31, 2026 and December 31, 2025.

RTMD did not record depletion expense for the mineral interests for the three and six months ended June 30, 2026 and 2025.

RTMD’s creditors have no recourse against the Company for the RTMD consolidated liabilities included within the Company’s Condensed Consolidated Balance Sheets as of June 30, 2026 and December 31, 2025.

The assets of the consolidated VIE can only be used to settle the obligations of the consolidated VIE and not the obligations of the Company.

Mineral Rights

The Company acquired two mineral rights leases and an associated groundwater lease in Hudspeth County, Texas as part of the acquisition of RTMD.

Mineral property acquisition costs, including acquired intangibles, licenses, and lease payments, are capitalized at cost.

The net carrying value of mineral rights was $ 17.3 million at March 31, 2026 and December 31, 2025.

Impairment losses are recorded on mineral rights when indicators of impairment are present and the carrying amount exceeds the associated estimated future undiscounted cash flows.

As of March 31, 2026 and December 31, 2025, the Company determined that no impairment indicators were present with respect to its mineral rights.

USA Rare Earth, Inc.

| Q2'2026 Quarterly Report (Form 10-Q) | 18

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

Commitments and Contingencies

4 unchanged sentences

As the Company's mining activities have not yet commenced, the Company has made, and expects to make, expenditures to comply with applicable environmental laws and regulations.

The ultimate amount of reclamation and site-restoration costs to be incurred for future mining operations is unknown and uncertain as of March 31, 2026.

USA Rare Earth, Inc.

| Q1'2026 Quarterly Report (Form 10-Q) | 16

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

The ultimate amount of reclamation and site-restoration costs to be incurred for future mining operations is unknown and uncertain as of June 30, 2026.

From time to time, the Company may become subject to legal proceedings, claims or litigation arising in the ordinary course of business.

9 unchanged sentences

During the first quarter of 2026, the Company proposed to settle the matter.

The Company determined that the proposed settlement consideration, consisting of cash, cash payments in lieu of equity awards, and interest, was both probable and reasonably estimable and, accordingly, recorded an estimated loss contingency of approximately $ 0.4 million in the accompanying Condensed Consolidated Statement of Operations and Comprehensive (Loss) Income.

Subsequent to March 31, 2026 and through the date of this Report, the settlement agreement has not been finalized.

Subsequent to June 30, 2026 and through the date of this Report, the settlement agreement has not been finalized.

Any settlement, if consummated, will not constitute an admission of liability by the Company.

Balance Sheet Components and Lease Activity

The following table presents the Company's finance and operating lease right‑of‑use assets and lease liabilities as reflected in the accompanying Condensed Consolidated Balance Sheets as of the dates indicated.

2026 December 31,

(In thousands)

Finance leases, included in property, plant and equipment, net

$ 982 $ 1,043

Operating lease right-of-use assets 473 321

Total $ 1,455 $ 1,364

Finance leases, current $ 286 $ 283

Finance leases, non-current 519 592

Total finance lease liabilities 805 875

Operating leases, current 232 137

Operating leases, non-current 244 185

Total operating lease liabilities 476 322

Total lease liabilities $ 1,281 $ 1,197

MP Materials Corp.

On May 22, 2026, MP Materials Corp., MP Magnetics LLC, and MP Mine Operations LLC (collectively, “Plaintiffs”) filed an action in the Business Court of Texas, Eighth Division against USA Rare Earth, Inc., its Director of Magnet Operations, Kevin Elkins, and FOM Technologies Inc.

26-BC08A-0018), alleging misappropriation of trade secrets under the Texas Uniform Trade Secrets Act, breach of contract, tortious interference, and unjust enrichment.

Plaintiffs seek a temporary and permanent injunction against further alleged use and possession of their allegedly protected technology, unspecified monetary damages, and attorneys’ fees.

The Company disputes the allegations and intends to vigorously defend against such claims.

USA Rare Earth, Inc.

2 unchanged sentences

Notes to Condensed Consolidated Financial Statements (Unaudited)

The following table presents the Company's finance and operating lease activity for the periods indicated.

Three Months Ended March 31,

(In thousands)

Finance Leases

Right-of-use assets acquired $ — $ 1,233

Amortization expense 61 6

Interest expense 9 1

Cash paid (1)

Operating Leases

Right-of-use asset acquired $ 209 $ 163

Amortization of ROU Assets

Lease expense 62 36

Cash paid (1)

(1) Cash paid for amounts included in the measurement of lease liabilities.

On December 17, 2025, the Company entered into a lease for office and warehouse space in Wheat Ridge, Colorado, to support the Company’s research and development activities.

8 unchanged sentences

A right‑of‑use asset and lease liability were recognized as of April 1, 2026.

Remaining Lease Terms and Discount Rates

The following table presents the weighted‑average remaining lease terms (in years) and weighted‑average discount rates used in the measurement of right‑of‑use assets as of the dates indicated.

2026 December 31,

Finance Leases

Remaining lease term (years) 2.75 3.00

Discount rate 4.40 % 4.40 %

Operating Leases

Remaining lease term (years) 2.00 2.25

Discount rate 4.80 % 4.30 %

USA Rare Earth, Inc.

| Q1'2026 Quarterly Report (Form 10-Q) | 18

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

Maturities of Lease Liabilities

The following table presents future minimum lease payments under non‑cancelable finance and operating leases on an undiscounted cash flow basis as of March 31, 2026.

Year Ending December 31, Finance Leases Operating Leases

(In thousands)

2026 (remaining nine months) $ 236 $ 184

Total lease payments 855 501

Imputed interest ( 50 ) ( 25 )

Present value of lease liabilities $ 805 $ 476

Purchase Commitments

2 unchanged sentences

Capital equipment commitments are generally fulfilled within one year, with certain long lead time items extending beyond one year.

As of March 31, 2026, the Company had open equipment purchase orders of $ 0.4 million which will be fulfilled later than one year from the reporting date.

As of June 30, 2026, the Company had open equipment purchase orders of $ 14.7 million which will be fulfilled later than one year from the reporting date.

Mezzanine and Stockholders' Equity

1 unchanged sentence

Shares Outstanding

Class of Stock Authorized Par Value March 31,

Class of Stock Authorized Par Value June 30,

2026 December 31,

8 unchanged sentences

Total authorized 800,000

(1) The liquidation value was $ 9.6 million and $ 8.9 million on March 31, 2026 and December 31, 2025, respectively.

(1) The liquidation value was $ 10.3 million and $ 8.9 million on June 30, 2026 and December 31, 2025, respectively.

$ 1.50 Billion Private Investment In Public Equity (“PIPE”)

1 unchanged sentence

The Company issued 69.8 million shares of common stock on January 28, 2026 for gross proceeds of $ 1.50 billion and received net proceeds of $ 1.45 billion after deducting financing costs.

The net proceeds are included in Cash and cash equivalents , and the 69.8 million shares issued are reflected in Common stock and Additional paid-in capital on the accompanying Condensed Consolidated Balance Sheet.

The net proceeds are included in Cash and cash equivalents , and the 69.8 million shares issued are reflected in Common stock and Additional paid-in capital .

Department of Commerce CHIPS Act Agreements

On June 3, 2026, in connection with the Company's CHIPS Act agreements with the U.S.

Department of Commerce (the “Dept.

of Commerce”), the Company issued 16,132,790 shares of common stock and warrants to purchase 17,600,584 shares of common stock.

See Note 13, “Government Grants – U.S.

Department of Commerce CHIPS Act Awards,” for additional information regarding these instruments and the related accounting.

USA Rare Earth, Inc.

5 unchanged sentences

The following table presents stock‑based compensation expense for the periods indicated.

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

Incentive Plan 2026 2025 2026 2025

9 unchanged sentences

Total $ 6,064 $ — $ 11,003 $ 1,282

(1) In the three months ended March 31, 2025, USARE LLC recorded equity-based compensation for issuance of its Class A Units to certain consultants pursuant to existing bonus agreements.

In the three months ended March 31, 2025, USARE LLC recorded the forfeiture of equity-based compensation of the Company’s former CEO.

Unrecognized Stock-Based Compensation Costs

Stock‑based compensation costs related to unvested restricted stock units and performance restricted stock units are recognized on a straight‑line basis over the remaining requisite service period of each award.

The following table presents unrecognized stock‑based compensation costs and weighted‑average service periods as of March 31, 2026.

Unrecognized Compensation Costs Weighted-Average Service Period

(In thousands) (In years)

Restricted stock units $ 29,687 1.28

Performance restricted stock units 365 (1)

Total unrecognized compensation costs $ 30,052

(1) Performance restricted stock units vest upon achievement of specified performance conditions and have no deterministic service period.

Three Months Ended March 31,

(1) In the six months ended June 30, 2025, USARE LLC recorded equity-based compensation for issuance of its Class A Units to certain consultants pursuant to existing bonus agreements.

In the six months ended June 30, 2025, USARE LLC recorded the forfeiture of equity-based compensation of the Company’s former CEO.

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

(In thousands, except percentages)

(Loss) income before income taxes $ ( 68,645 ) $ 51,682

Loss before income taxes $ ( 12,476 ) $ ( 142,713 ) $ ( 81,121 ) $ ( 91,031 )

Benefit from income taxes ( 513 ) — ( 1,090 ) —

Effective tax rate 1.3 % — %

The Company is subject to taxation in the United States, United Kingdom, France, and various state jurisdictions.

The Company is subject to taxation in the United States, the United Kingdom, France, and various state jurisdictions.

The Company’s effective tax rate of 1.3 % is calculated quarterly based upon current assumptions relating to the full year’s estimated operating results and various tax-related items.

2 unchanged sentences

The difference between the effective tax rate of 1.3 % and the U.S.

federal statutory rate of 21.0 % for the three months ended March 31, 2026 was due to changes in the valuation allowance, which entirely offsets the Company's net deferred tax assets in the United States, and the amortization of the identifiable intangible assets accounted for in purchase accounting.

As of March 31, 2026, the Company determined that, based on an evaluation of all available positive and negative evidence, including cumulative losses and the Company's latest forecasts, it was more likely than not that the Company's deferred tax assets in the United States would not be realized and, therefore, the Company continued to record a valuation allowance.

federal statutory rate of 21.0 % for the six months ended June 30, 2026, respectively, was due to changes in the valuation allowance, which entirely offsets the Company's net deferred tax assets in the United States, and the amortization of the identifiable intangible assets accounted for in purchase accounting.

As of June 30, 2026, the Company determined that, based on an evaluation of all available positive and negative evidence, including cumulative losses and the Company's latest forecasts, it was more likely than not that the Company's deferred tax assets in the United States would not be realized and, therefore, the Company continued to record a full valuation allowance.

USA Rare Earth, Inc.

2 unchanged sentences

Notes to Condensed Consolidated Financial Statements (Unaudited)

Net (Loss) Income per Share

The following table presents the computation of the numerator and denominator used in the calculation of net (loss) income per share attributable to holders of the Company’s common stock.

For the three months ended March 31, 2026, all potentially dilutive securities were excluded from diluted earnings per share as the Company reported a net loss for the period.

Three Months Ended March 31,

Net Loss per Share

The following table presents the computation of the numerator and denominator used in the calculation of net loss per share attributable to holders of the Company’s common stock.

For the three and six months ended June 30, 2026 and 2025, all potentially dilutive securities were excluded from diluted earnings per share as the Company reported a net loss for the period.

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

(In thousands, except for per share amounts)

Net (loss) income attributable to USA Rare Earth, Inc.

Net loss attributable to USA Rare Earth, Inc.

$ ( 10,333 ) $ ( 142,506 ) $ ( 77,322 ) $ ( 90,674 )

Declared and deemed dividends, and interest accretion ( 733 ) — ( 1,442 ) —

Undistributed net (loss) income attributable to USA Rare Earth, Inc.

$ ( 67,698 ) $ 48,270

Weighted-average shares outstanding - basic 196,479 64,463

Preferred shares — 13,774

Incentive units outstanding prior to conversion

Warrants outstanding prior to conversion

Weighted-average shares outstanding - diluted 196,479 83,079

Net (loss) income per share attributable to USA Rare Earth, Inc.

Undistributed net loss attributable to USA Rare Earth, Inc.

$ ( 11,066 ) $ ( 142,506 ) $ ( 78,764 ) $ ( 90,674 )

Weighted-average shares outstanding - basic and diluted 230,081 92,769 213,347 91,598

Net loss per share attributable to USA Rare Earth, Inc.

Basic and diluted

$ ( 0.05 ) $ ( 1.54 ) $ ( 0.37 ) $ ( 0.99 )

The following table presents categories of potential shares that are excluded from the diluted per share computation as their effect would be anti-dilutive.

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2026 2025 2026 2025

(Shares in thousands)

12 % Series A Cumulative Convertible Preferred Stock (1)

2,443 6,595 2,443 6,595

Series A Warrants

2,437 6,130 2,437 6,130

Earnout Shares (2)

1 unchanged sentence

Investor Warrants (3)

— 18,369 — 18,369

Incentive Units

— 10,714 — 10,714

Government Grant Warrants

17,601 — 17,601 —

Total 22,481 51,908 22,481 51,908

1 unchanged sentence

(2) Represents contingently issuable shares outstanding at each reported date.

(3) Investor warrants outstanding as of March 31, 2025 were fully exercised during 2025 and are therefore excluded from the March 31, 2026 table.

(3) Investor warrants outstanding as of June 30, 2025 were fully exercised during 2025 and are therefore excluded from the June 30, 2026 table.

Segment Reporting

1 unchanged sentence

The Company’s chief operating decision maker (“CODM”) is the Company’s chief executive officer.

The CODM assesses performance and allocates resources primarily on the basis of consolidated net loss and total assets, which are reported on the Company’s Condensed Consolidated Statements of Operations and Comprehensive Loss and Condensed Consolidated Balance Sheets, respectively.

The CODM does not regularly review discrete segment revenue or expense categories beyond the consolidated financial statements for purposes of evaluating performance or allocating resources.

Accordingly, the Company has not presented additional quantitative disclosures of significant segment expenses, as such information is not regularly provided to the CODM.

USA Rare Earth, Inc.

2 unchanged sentences

Notes to Condensed Consolidated Financial Statements (Unaudited)

The CODM assesses performance and allocates resources primarily on the basis of consolidated net (loss) income and total assets, which are reported on the Company’s Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income and Condensed Consolidated Balance Sheets, respectively.

The CODM does not regularly review discrete segment revenue or expense categories beyond the consolidated financial statements for purposes of evaluating performance or allocating resources.

Accordingly, the Company has not presented additional quantitative disclosures of significant segment expenses, as such information is not regularly provided to the CODM.

Because the Company operates in a single reportable segment and the measures used by the CODM are consistent with the consolidated financial statements, no reconciliation is required between segment measures and the consolidated amounts.

1 unchanged sentence

Disaggregation of Revenue

All of the Company’s revenue is derived from sales of casting and strip casting material based on the customers’ “shipped to” address.

The following table presents domestic and international revenue.

No revenue was reported in the three months ended March 31, 2025.

Three Months Ended March 31, 2026

All of the Company’s revenue is derived from sales of casting and strip casting.

The following table presents United States (“domestic”) and international (“foreign”) revenue, based on the customers’ “shipped to” address.

No revenue was reported in the three and six months ended June 30, 2025.

Three Months Ended June 30, 2026

Six Months Ended June 30, 2026

(In thousands)

6 unchanged sentences

The percentages by customer reflect specific relationships or contracts that would concentrate revenue for the period presented and do not indicate a trend specific to any one customer.

No revenue was reported in the three months ended March 31, 2025.

Three Months Ended March 31, 2026

No revenue was reported in the three and six months ended June 30, 2025.

Three Months Ended June 30, 2026

Six Months Ended June 30, 2026

Customer 1 26 % 37 %

2 unchanged sentences

Customer 4 18 % 17 %

Government Grants

Expected U.S.

Government Transaction

On January 26, 2026, the Company announced two non-binding letters of intent with U.S.

government agencies representing a total of approximately $ 1.58 billion in potential funding and strategic support.

The first non-binding letter of intent with the U.S.

Department of Commerce (the “DOC Letter of Intent”) covers $ 277.0 million in direct funding awards under the CHIPS Act, and $ 1.30 billion in senior secured debt with each advance having a 15-year term and bearing a fixed or floating interest rate.

The second non-binding letter of intent with the U.S.

Department of Energy's National Energy Technology Laboratory (the “DOE Letter of Intent”), establishes a collaboration to advance HREE separation technologies at our Colorado Facility and Round Top Deposit, leveraging digital twin technology.

Collectively, these two letters of intent and their contemplated transactions are referred to as the “Expected U.S.

Government Transaction.”

All other customers (1)

(1) Includes individual customers that each accounted for less than 10% of total revenue.

USA Rare Earth, Inc.

2 unchanged sentences

Notes to Condensed Consolidated Financial Statements (Unaudited)

As conditions to the negotiation and execution of definitive documentation for the Expected U.S.

Government Transaction, the Company must, among other things:

(i) raise at least $ 500.0 million from non-federal sources, which was satisfied upon the closing of the $1.50B PIPE in January 2026;

(ii) obtain two memoranda of understanding from semiconductor end or midstream users;

(iii) obtain neodymium praseodymium oxide and MREC feedstock supply agreements with a term at least through 2027;

(iv) exercise a surface purchase option with the Texas General Land Office;

(v) implement certain third-party recommendations and third-party validation of nuclear material licensing requirements at the Company's research and development facility in Wheat Ridge, Colorado;

and (vi) define a power infrastructure plan for the Company's magnet manufacturing facility in Stillwater, Oklahoma.

In addition, the U.S.

Government's $ 277.0 million in direct funding awards includes a condition requiring the Company to issue to the U.S.

government $ 277.0 million of common stock (approximately 16.1 million shares at $ 17.17 per share), and the $ 1.30 billion senior secured loan would require the issuance of warrants to the U.S.

government representing an additional 10 % of the Company's fully diluted shares outstanding (approximately 17.5 million shares with an exercise price of $ 17.17 per share and a 10-year exercise period).

In addition, to meet certain milestones to obtain funding awards and debt financing to reimburse the Company for its capital expenditures under the Expected U.S.

Government Transaction, the Company would be required to raise a significant amount of capital during 2026 and 2027 and establish a $ 250.0 million revolving credit facility by December 31, 2026.

Subsequent Events

Merger Transaction and Acquisition

Earnout Share Conversion

In connection with the business combination between the Company and USA Rare Earth, LLC, the Company agreed to issue common stock of the Company (the “earnout shares”) to certain shareholders of USA Rare Earth, LLC in two tranches upon the occurrence of certain triggering events.

On April 15, 2026, the Company achieved the market-price condition for the first tranche of earnout shares, as the Company's common stock exceeded $ 15.00 per share for at least 20 out of 30 consecutive trading days.

• On April 15, 2026, the Company achieved the market-price condition for the first tranche of earnout shares, as the Company's common stock was equal to or exceeded $ 15.00 per share for at least 20 out of 30 consecutive trading days.

As a result, 5.05 million earnout shares were converted into shares of the Company’s common stock.

The earnout shares were classified as liabilities and remeasured at fair value on a recurring basis prior to conversion.

• On May 15, 2026, the Company achieved the market-price condition for the second tranche of earnout shares, as the Company's common stock was equal to or exceeded $ 20.00 per share for at least 20 out of 30 consecutive trading days.

As a result, 5.05 million earnout shares were converted into shares of the Company’s common stock.

The earnout shares were classified as liabilities and remeasured at fair value on a recurring basis prior to conversion which resulted in a fair value gain on conversion of $ 70.7 million and $ 107.2 million in the three and six months ended June 30, 2026, respectively, presented in (Loss) gain on fair market value of financial instruments, net in the Condensed Consolidated Statements of Operations and Comprehensive Loss.

Upon conversion, the related earnout liability was reclassified to common stock and additional paid‑in capital.

The remaining earnout shares associated with the second tranche continue to be classified as a liability and will remain subject to remeasurement until the applicable market‑price condition is achieved or the earnout period expires.

The second tranche of 5.0 million earnout shares will become payable when the Company’s common stock price exceeds $ 20.00 per share for at least 20 out of 30 trading days.

Carester SAS Investment

On April 9, 2026, the Company entered into a binding letter of intent (the “Carester LOI”) to acquire a 12.5 % equity interest in Carester SAS (“Carester”), the parent company of Caremag SAS, for cash and equity consideration amounting to € 40.0 million, or approximately $ 46.4 million.

See Note 2, “Fair Value Measurements – Earnout Liability” for a reconciliation of the conversion of the Earnout liability.

Definitive Carester SAS Investment

On April 9, 2026, the Company entered into a binding letter of intent, and subsequently on July 23, 2026, the Company entered into a definitive agreement to acquire a 13.6 % equity interest in Carester SAS (“Carester”), the parent company of Caremag SAS, for cash and equity consideration amounting to € 40.0 million, or approximately $ 45.7 million.

The proposed consideration consists of € 28.3 million in cash, or approximately $ 32.4 million, and € 11.7 million in equity consideration, or approximately $ 13.3 million, payable in shares of the Company’s common stock, in each case subject to customary adjustments, including the potential substitution of cash in lieu of the Company’s common stock.

3 unchanged sentences

dollars, may differ from the estimated amounts described above.

SVRE Holdings Ltd.

On April 19, 2026, the Company entered into a definitive agreement to acquire 100 % of SVRE Holdings Ltd., the parent company of Serra Verde Group (“Serra Verde”), for $ 300.0 million in cash and 126.8 million shares of the Company’s common stock (approximately $ 2.53 billion) for total consideration of approximately $ 2.83 billion.

Proposed SVRE Holdings Ltd.

This acquisition is subject to customary conditions.

4 unchanged sentences

Notes to Condensed Consolidated Financial Statements (Unaudited)

Texas Semiconductor Innovation Fund Grant

On May 11, 2026, the Company entered into a Grant Agreement with the Office of the Governor of the State of Texas (the “OOG”) pursuant to the Texas Semiconductor Innovation Fund (“TSIF”), Grant No.

TSIF 26-016P.

Under the Grant Agreement, the OOG has agreed to reimburse the Company for certain allowable costs directly allocable to the Round Top Project, up to a maximum amount of $ 14.2 million.

The grant is disbursed on a cost reimbursement basis and is subject to the Company's strict compliance with the terms and conditions of the Grant Agreement, including applicable reporting, audit, and performance requirements.

The Grant Agreement terminates upon the completion of the grant project, on December 31, 2028, or upon the depletion of grant funds, whichever occurs first.

Government Grants

Department of Commerce CHIPS Act Awards

On June 3, 2026 (the “Award Date”), the Company entered into a Direct Funding Agreement (the DFA”) and a Loan Guarantee Agreement (the “LGA”) with the U.S.

Department of Commerce (the “Dept.

of Commerce”) pursuant to the CHIPS and Science Act of 2022 (the “CHIPS Act”).

In connection with the execution of these agreements, the Company also entered into a Securities Issuance Agreement with the Dept.

of Commerce pursuant to which the Company issued shares of its common stock and warrants to purchase shares of its common stock as conditions precedent to the DFA and LGA, respectively.

As a condition precedent to the DFA, the Company issued to the Dept.

of Commerce 16,132,790 shares of its common stock on the Award Date.

The shares were measured at fair value based on the Company’s closing stock price of $ 27.98 per share on the Award Date, resulting in an aggregate fair value of approximately $ 451.4 million.

As a condition precedent to the LGA, the Company issued to the Dept.

of Commerce a warrant to purchase up to 17,600,584 shares of its common stock (the “Warrant”) at an exercise price of $ 17.17 per share.

The Warrant issued under the LGA was initially measured at fair value of $ 430.9 million ($ 24.48 per Warrant share) on the Award Date based on an independent third-party valuation.

Together, the combined fair values for the common stock issued under the DFA and the Warrants issued under the LGA of $ 882.3 million are treated as the total cost incurred to obtain access to the funding arrangement under the CHIPS Act, and along with other financing costs, are recognized as Deferred arrangement costs in the Condensed Consolidated Balance Sheets.

Direct Funding Agreement

The DFA provides for up to $ 277.0 million in direct funding from the Dept.

of Commerce to support the construction and development of domestic rare earth and critical minerals projects (the “Projects”).

Receipt of funding under the DFA is contingent upon the Company satisfying various contractual milestones, conditions, and approval requirements.

Management evaluates these conditions on an ongoing basis and assesses the probability of achieving the required milestones and ultimately receiving the related funding.

Based on this assessment, the Company concluded that recognition of the deferred equity cost (included in the Deferred arrangement costs on the Condensed Consolidated Balance Sheets) at Award Date remains appropriate as of June 30, 2026.

In addition, the DFA contains customary representations, covenants, and conditions, including restrictions on stock buybacks and dividends for a five-year period following the Award Date, minimum liquidity requirements, and clawback provisions applicable upon milestone failure or breach of authorized purpose.

The deferred equity cost asset will remain on the balance sheet until direct funding award disbursements are received.

Upon receipt of approved cash disbursements, the Company will record a credit to additional paid in capital and reduce a proportionate share of the deferred equity cost with an offset to additional paid in capital.

As of June 30, 2026, the Company had not received any direct funding award disbursements, nor had it received formal approval for any disbursement requests..

The common stock issued to the Dept.

of Commerce is subject to a one-year lock-up period from the Award Date.

of Commerce’s voting rights with respect to the shares are restricted to the greatest extent permissible under applicable law.

Loan Guarantee Agreement

The LGA provides for a loan guarantee by the Dept.

of Commerce of up to $ 1.30 billion in borrowings by the Company from the Federal Financing Bank (“FFB”) to fund a portion of the capital costs of the Projects.

Advances (“loan disbursements”) under the LGA are subject to milestone-based conditions precedent and are non-revolving.

Each loan disbursement has a 15-year maturity from the award date.

The interest rate applicable to each loan disbursement is based upon the U.S.

Treasury securities at each draw down date plus 150 basis points.

The LGA contains customary affirmative and negative covenants, including restrictions on the incurrence of additional indebtedness, maintenance of certain financial ratios, and requirements applicable to the use of proceeds.

The Company will account for each loan disbursement as debt under ASC 470, Debt .

As of June 30, 2026, no advances had been drawn under the LGA.

USA Rare Earth, Inc.

| Q2'2026 Quarterly Report (Form 10-Q) | 25

USA Rare Earth, Inc.

Notes to Condensed Consolidated Financial Statements (Unaudited)

The initial fair value of the Warrant was recorded under Warrant liability with an offset to deferred financing costs (included in Deferred arrangement costs in the Condensed Consolidated Balance Sheet).

Subsequent changes in the fair value of the warrant liability are recognized in earnings as a component of other income (expense) and do not adjust the deferred financing costs.

See Note 2, “Fair Value Measurements – Government Grant Warrant Liability,” for the valuation methodology, significant unobservable inputs, and the roll forward of the warrant liability for the three and six months ended June 30, 2026.

The Warrant has a ten-year term commencing on the Award Date and is exercisable, in whole or in part, beginning on the first anniversary of the Award Date.

At expiration, to the extent not previously exercised, the Warrant is deemed automatically exercised on a net-share (cashless) basis.

The Warrant includes a holder-elected redemption right upon the occurrence of a Business Combination (as defined in the Warrant), the Dept.

of Commerce may require the acquirer to purchase all or a portion of the Warrant at a price equal to the amount the Dept.

of Commerce would receive in respect of the underlying Warrant shares in a hypothetical liquidation of the Company at fair market value, payable by wire transfer of immediately available funds.

Because this holder-elected cash settlement alternative is available even in a Business Combination in which common shareholders receive non-cash consideration, the cash settlement is not assured to be in the same form as the consideration received by common shareholders, and any such Business Combination would be outside the sole control of the Company, the Warrant does not meet the criteria for equity classification.

The Warrant was immediately issued as a condition precedent to the LGA commitment and is fully exercisable after 1 year, the Warrant is not linked to a specific loan disbursement.

Therefore, the Warrant was issued to obtain access to the credit facility provided under the LGA rather than in connection with the issuance of a specific loan disbursement.

Debt issuance costs associated with the LGA, comprising 1) the initial fair value of the Warrant, 2) the 2.0 % upfront loan commitment fee of $ 26.0 million, 3) a 2.0 % annual ticking fee, paid quarterly, based on the unutilized LGA commitment amount, and 4) directly attributable legal and advisory costs, are deferred as a loan commitment asset and will be reclassified as a debt discount against each FFB note as advances are drawn, and subsequently amortized to interest expense over the term of the applicable note using the effective interest method.

Upon exercise or redemption, in whole or in part, or expiration, the Warrant liability is remeasured to fair value immediately prior to settlement, with the change in fair value recognized in earnings.

The portion of the liability settled is then derecognized with a corresponding entry to equity (for net-share settlement) or against cash or other assets (for cash settlement under the holder-elected redemption right).

Subsequent Events

Hooton Park Acquisition

On July 2, 2026, the Company purchased its currently leased Less Common Metals.

manufacturing site, including land and building (also referred to as “Hooton Park”), for approximately £ 7.0 million, or approximately $ 9.3 million.

The Company is currently completing the accounting for the acquisition, including a preliminary assessment of environmental remediation obligations associated with the property.

Based on information currently available, management expects certain environmental liabilities to be recognized in connection with the acquisition;

however, the amount and timing of any such obligations remain subject to further analysis and may change materially as the valuation and environmental review are finalized.

USA Rare Earth, Inc.

| Q2'2026 Quarterly Report (Form 10-Q) | 26

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements