Lithium Argentina Grows Revenue 6% to $184 Million on Volume Strength

Revenue at Lithium Americas (Argentina) (NYSE:LAAC) rose 6% to $184 million in the third quarter, a figure achieved despite realized lithium prices falling roughly 10% from the second quarter. The arithmetic is straightforward: sales volumes climbed 18%, and that was enough. Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) increased to $113 million from $110 million in the prior quarter, CEO Sam Pigott said.

Cauchari-Olaroz, the company's brine operation in Jujuy Province run as a joint venture with Ganfeng Lithium, generated $95 million in operating cash flow and approximately $92 million in free cash flow during the quarter. The operation distributed $100 million to its partners, bringing year-to-date distributions to roughly $230 million. Generosity, in this case, comes with a cost: asset-level net debt rose to $171 million from $142 million.

How Are Costs Behaving?

The operation ran at approximately 95% of design capacity, with cash operating costs of about $5,800 per ton and a cash operating margin of 67%. Year-to-date production reached 28,490 tons, keeping the operation on track for full-year guidance of 35,000 to 40,000 tons.

Pigott said fourth-quarter production should exceed 9,000 tons, likely putting full-year output above the midpoint of that range. C1 operating costs (direct cash costs of production) have stayed below $6,000 per ton in every quarter of 2026, averaging roughly $5,700 per ton year to date. Asked whether costs could return to the $5,400 per ton achieved in the first quarter, Pigott cited higher energy and logistics costs, plus Argentine inflation outpacing currency devaluation. Relief in those areas, he said, would flow through to the operation.

What Is Happening With Debt?

The joint venture secured a $170 million, three-year syndicated facility in July and a $50 million, two-year facility in June, primarily to replace existing debt and extend maturities at lower interest rates. On the corporate balance sheet, the company closed a $180 million investment from Ganfeng in September through a six-year unsecured convertible debenture carrying a 4% coupon and a $12.50-per-share conversion price. It then repurchased $200 million of its January 2027 convertible notes in October. Approximately $59 million remains outstanding, which the company intends to repay at maturity from more than $100 million in cash on hand.

How Big Could the Expansion Get?

A scoping study published during the quarter outlined a 45,000-ton-per-year Stage 2 expansion, lifting total capacity to approximately 85,000 tons annually. At an assumed lithium carbonate price of $18,000 per ton, the study estimated:

• After-tax net present value (the discounted value of future cash flows) of $3.1 billion, on a 100% project basis
• An internal rate of return of 28.5%
• Initial capital of roughly $1 billion

The company plans to accelerate an initial 10,000-ton module using direct lithium extraction, or DLE (a technology that extracts lithium from brine without evaporation ponds), targeting production in 2028 subject to permits. Pigott said there is no minimum spending commitment and that material spending or a final investment decision requires joint approval. He expects the module to be financed with project cash, with details early next year. He attributed the study's estimated operating cost of about $5,000 per ton primarily to DLE's potential to cut reagent consumption and improve recoveries. Argentine approval for the modular approach could come before year-end; a Chinese technology export permit could follow early next year.

What About PPG and the Market?

Lithium Argentina and Ganfeng finalized the consolidation of the PPG project in October, with Ganfeng holding 67% and Lithium Argentina 33%. A scoping study published last year estimated planned capacity of 150,000 tons per year and an after-tax net present value of $8.1 billion on a 100% basis, using the same $18,000-per-ton price.

Financing discussions, including a possible offtake arrangement or a strategic minority investor, were advanced in some cases, Pigott said. The company expects approval under Argentina's RIGI investment incentive program by year-end, which he described as an important milestone for reducing project risk.

On the broader market, Pigott said the company was taking a wait-and-see approach to 2027 demand, citing installation bottlenecks and policy changes affecting energy storage projects, while noting that Ganfeng continued to report strong demand. The physical market appeared tight from an inventory perspective, he said, but falling prices were making buyers hesitant. The company sells its technical-grade product at a mid-single-digit discount to a blended China battery-grade lithium carbonate price, excluding value-added tax. Fourth-quarter pricing is declining with the market. Ganfeng, for its part, remains eager to take available product.