Why MP Materials Stock Crashed on Monday

Core Viewpoint - MP Materials' stock has significantly declined due to President Trump's tariff policies, which have adversely affected its revenue from Chinese customers [1][2][4]. Group 1: Tariff Impact - President Trump has raised tariffs on Chinese imports to approximately 145%, while China has retaliated with 125% tariffs on U.S. imports [2]. - MP Materials has halted shipments of rare-earth concentrates to China, stating that selling under such high tariffs is not commercially rational [3]. - A single customer in China, Shenghe Resources Holding, accounted for about 80% of MP Materials' consolidated revenue, indicating a substantial loss of export business due to the tariffs [4]. Group 2: Company Strategy and Future Outlook - MP Materials has been preparing for the impact of tariffs by building factories to refine its own concentrate and manufacture rare-earth batteries [5]. - In the short term, MP Materials is expected to experience a significant drop in revenue and potentially larger losses than previously anticipated [6]. - Long-term projections suggest that MP Materials may turn profitable, but not before 2026, indicating a challenging year ahead for investors [6].