GrafTech International Ltd (NYSE:EAF) Reports Q3 2025 Results, Matching Profitability Estimates and Showing Strategic Progress

GrafTech International Ltd (NYSE:EAF) reported third quarter 2025 financial results that largely met analyst expectations on profitability while demonstrating continued progress in its strategic initiatives. The manufacturer of graphite electrodes posted results that reflected a challenging pricing environment but showed improvement in sales volume and cost control measures.

Earnings and Revenue Performance

The company's financial performance for the quarter showed mixed results relative to expectations. GrafTech reported net sales of $144 million, slightly above analyst estimates of $141 million. This represents a 10% increase compared to the same quarter last year, though the results included an $11 million benefit from the resolution of a long-standing commercial matter.

On the profitability front, the company reported:

• Adjusted loss per share of $1.03, matching analyst estimates exactly
• Net loss of $28 million, compared to a net loss of $36 million in Q3 2024
• Adjusted EBITDA of $13 million, a significant improvement from negative $6 million in the prior year period

The market reaction has been notably positive, with shares rising approximately 2.7% in pre-market trading following the earnings release. This positive momentum builds on recent strength, with the stock gaining over 28% during the past month.

Operational Highlights and Strategic Progress

GrafTech demonstrated meaningful operational improvements during the quarter. Sales volume increased 9% year-over-year to 28.8 thousand metric tons, with particularly strong growth in the United States where sales volume surged 53%. This geographic shift aligns with the company's strategy to focus on regions with stronger pricing dynamics.

Cost management remained a bright spot for the company. GrafTech achieved a 10% year-over-year reduction in cash cost of goods sold per metric ton, reflecting the company's ability to control production costs despite ongoing market challenges. The company also generated positive adjusted free cash flow of $18 million during the quarter.

Financial Position and Outlook

The company maintained a solid liquidity position with $384 million in total liquidity as of September 30, 2025. This includes $178 million in cash and cash equivalents, providing flexibility to navigate near-term industry challenges.

Looking ahead, management provided updated full-year 2025 guidance:

• Sales volume growth of 8-10% year-over-year (moderated from previous 10% guidance)
• Approximately 10% decline in cash cost of goods sold per metric ton (improved from previous 7-9% decline guidance)
• Capital expenditures of approximately $40 million

This outlook compares to analyst estimates for full-year 2025 sales of $530 million. The company's revised sales volume guidance reflects a disciplined approach to foregoing volume opportunities where margins are unacceptably low, while the improved cost guidance demonstrates accelerating efficiency efforts.

Market Context and Future Prospects

CEO Timothy Flanagan expressed optimism about improving steel industry trends in key regions, particularly in the United States where the landscape remains supportive. In Europe, where the steel industry has faced greater challenges, the company anticipates recently announced trade policy measures will support a recovery path.

Longer term, GrafTech remains confident that the steel industry's transition toward electric arc furnace technology and broader decarbonization trends will drive sustained demand for graphite electrodes. The company's vertical integration into petroleum needle coke production provides a competitive advantage in both product quality and cost structure.

For investors seeking more detailed earnings information and future estimates, additional data is available on the earnings estimates page for EAF.

Disclaimer: This article is for informational purposes only and does not constitute investment advice. The information presented should not be interpreted as a recommendation to buy or sell any security. Investors should conduct their own research and consult with financial advisors before making investment decisions.