Core Insights - MP Materials has seen a nearly 10% decline in stock price over the last five trading days and is down approximately 30% from its peak on October 14 due to China's additional restrictions on rare-earth exports [1] - Despite the recent pullback, MP Materials remains a key player in the U.S. critical minerals initiative, operating the only active rare-earth mine in the country [2] - The company reported record output of Neodymium-Praseodymium (NdPr) oxide in Q2 2025, with a 119% year-over-year increase in production and an 84% rise in revenue to $57.4 million [3] Company Overview - MP Materials operates the Mountain Pass Mine in California, focusing on NdPr production essential for high-strength magnets used in electric vehicles and defense systems [2] - The U.S. Department of Defense has become MP's largest shareholder after investing $400 million to boost magnet production [2] - MP secured a $500 million supply agreement with Apple to finance the construction of its new facility in Texas for manufacturing rare-earth magnets [2] Industry Context - China controls 70% to 90% of the global rare earth market, making it challenging for U.S.-based firms to compete due to lack of capital and government backing [4] - The rare-earth industry is transforming as Western governments and private investors have invested billions since China's export restrictions began in April [5] - A $1.8 billion consortium has been announced to ensure supplies for the U.S. and its allies, with JPMorgan Chase planning to invest $10 billion in strategic industries, including rare-earth companies [6] Future Outlook - The U.S. is expected to continue reducing reliance on Chinese rare earth supplies, with reports suggesting a price floor for MP Materials to protect against price collapses [7] - MP's position as a leading player in America's rare-earth strategy is reinforced by government support, which may stabilize earnings even if global prices decline [7] - Despite solid fundamentals, MP's valuation poses challenges, trading at approximately 40 times its forward revenue, and the company reported a $53.5 million net loss year-to-date [8]