Origin Materials 2025 Q1 Earnings Misses Targets as Net Loss Widens by 90%

Origin Materials (ORGN) reported its fiscal 2025 Q1 earnings on May 15th, 2025. The company's total revenue decreased significantly by 20.4% to $5.43 million compared to $6.83 million in the same quarter of the previous year, missing market expectations. Origin's guidance adjustment also disappointed, with projections for revenue in 2026 and 2027 lower than anticipated. The company now expects to generate between $50 million and $70 million in 2026, and $150 million to $210 million in 2027.

Revenue
Origin Materials' revenue for the first quarter of 2025 was reported at $5.43 million, which represents a decline of 20.4% from $6.83 million in the first quarter of 2024. This decrease was attributed entirely to the Products segment, which also recorded revenue of $5.43 million, emphasizing the company's reliance on this single segment for its income stream.

Earnings/Net Income
The company's losses deepened in the first quarter of 2025, with a loss of $0.18 per share, compared to a loss of $0.10 per share in the first quarter of 2024. This marks an 80% increase in losses per share. Additionally, the net loss widened significantly by 90% to $26.44 million from $13.91 million the previous year. Overall, the EPS reflects a worsening financial position for Origin Materials.

Post-Earnings Price Action Review
The strategy of purchasing ORGN shares when revenue falls short and holding for 30 days has shown positive historical results, aligning with a "buy the dip" approach. This method capitalizes on the market's volatility and the potential for recovery, as evidenced by a 22.610% drop in stock price over the past three months and a 29.330% decline over the last year. These fluctuations present opportunities for investors to benefit from price rebounds, provided that market conditions are favorable. Despite the recent downturn, Origin Materials is focused on improving its process efficiency and iteration time, which could hint at a potential turnaround. However, investors should be aware of the inherent risks, including further price declines and market uncertainties. In summary, while the strategy carries risks, it could be suitable for those who can withstand short-term volatility and are prepared to leverage potential recoveries.

CEO Commentary
John Bissell, Co-Chief Executive Officer, highlighted ongoing progress in commercializing Origin's PET cap solution. Despite facing challenges in customer product qualification, he emphasized strong demand and expressed confidence in overcoming these hurdles. Bissell assured stakeholders of the company's commitment to ensuring their caps appear on products from iconic brands, while also investing in supply chain and manufacturing diversification.

Guidance
Origin Materials has revised its revenue expectations, projecting $50 million to $70 million for 2026 and $150 million to $210 million for 2027. The company aims to achieve run-rate Adjusted EBITDA positivity by the end of 2026, contingent on operating 8 to 10 CapFormer lines at scale.

Additional News
Origin Materials recently transitioned to a single CEO leadership structure, with John Bissell assuming the role of sole Chief Executive Officer, effective December 31, 2024. This move aims to streamline operations and support the company's manufacturing expansion. Additionally, Origin announced the commencement of commercial production of PET caps at their Reed City, Michigan facility. The company is also progressing with the installation of new CapFormer lines, expecting to have eight operational by the end of 2025. These developments underscore Origin's commitment to scaling its business and meeting growing market demand.