Why Did Origin Materials Plunge 36.71%? Revenue Guidance Cut Amid Tariff Woes

On August 15, 2025, Origin Materials experienced a significant drop of 36.71% in pre-market trading, reflecting a dramatic shift in investor sentiment.

Origin Materials has revised its revenue guidance for 2026, reducing it to a range of $20 million to $30 million, and for 2027, setting it at $100 million to $200 million. This adjustment is due to delays in manufacturing capacity build-out, which are attributed to supply chain disruptions and tariff headwinds.

The company has achieved a significant milestone with the commercial launch of its first PET bottle caps, partnering with Power Hydration in California. This launch marks a major step forward in the company's efforts to enter the $65 billion global closures market.

Despite these advancements, Origin Materials faces challenges due to increased tariffs on EU and Switzerland imports, which have raised cash outlays for capacity expansion. These tariffs have led to delays in factory acceptance testing for CapFormer lines, pushing some installations into 2026 and resulting in a reduction in previously guided manufacturing output for 2026 and 2027.

To address these challenges, Origin Materials has initiated a strategic review with RBC Capital Markets to evaluate accretive strategic alternatives. This review aims to augment manufacturing capacity and access to capital, driven by significant customer interest and inbound collaboration inquiries. The company's adaptive supply chain strategy and new European production partnership with Royal Hoerdijk are also helping to offset tariff exposure and diversify global operations.