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TORONTO - Largo Inc. (TSX:LGO) (NASDAQ:LGO), currently trading at $1.37 and showing signs of being undervalued according to InvestingPro analysis, produced 2,256 tonnes of vanadium pentoxide (V₂O₅) in the second quarter of 2025, marking a 74% increase from the first quarter, though still below the 2,689 tonnes produced in the same period last year. The company’s operational improvements come amid challenging financial conditions, with a weak Financial Health Score of 1.31 out of 5.
The company reported a global recovery rate of 84.9% for the quarter, representing a 14% improvement over Q2 2024 and a 9% increase from Q1 2025. Monthly production showed steady growth within the quarter, rising from 481 tonnes in April to 940 tonnes in June. InvestingPro data reveals concerning fundamentals behind these operational metrics, including negative gross profit margins and rapid cash burn. Subscribers can access 8 additional key ProTips about Largo’s financial position.
V₂O₅ equivalent sales reached 1,807 tonnes in Q2, including 123 tonnes of purchased material, slightly below the 1,841 tonnes sold in the same period last year. Ilmenite concentrate production totaled 8,149 tonnes, with sales of 6,024 tonnes, down from 12,261 tonnes sold in Q2 2024.
The company cited improved mine access and mining rates as key factors in its operational turnaround. Total material mined increased 32% year-over-year to 4.3 million tonnes, while total ore mined decreased 15% to 485,687 tonnes compared to Q2 2024, but increased 9% from Q1 2025.
"Our second quarter results reflect steady progress under the Company’s operational turnaround plan," said Daniel Tellechea, Interim CEO of Largo, in a press release statement.
In a separate development, Storion Energy, Largo’s 50:50 joint venture with Stryten Energy affiliates, signed a supply agreement with TerraFlow Energy for vanadium electrolyte and battery stacks. The agreement includes an electrolyte lease for a 48 MWh flow battery project in Texas, expected to commence in early 2027.
Largo maintains it remains on track to achieve its 2025 V₂O₅ production guidance.
In other recent news, Largo Resources reported a significant improvement in its production metrics, with vanadium pentoxide output increasing by 75% to 835 tonnes in May. Ilmenite concentrate production also rose by 65% to 3,025 tonnes. These production gains were attributed to improved access to ore at the Maracás Menchen Mine. However, Largo’s first-quarter financial results for 2025 showed a decline in revenue to $28.2 million from $42.2 million the previous year, resulting in a net loss of $9.2 million. H.C. Wainwright adjusted its price target for Largo Resources to $3.70, down from $3.90, but maintained a Buy rating due to the company’s cost-cutting strategies. The firm noted that operating costs decreased significantly, enhancing future cash flow prospects. Despite a 25% year-over-year decline in vanadium equivalent production, Largo saw a 21% increase in total material mined. H.C. Wainwright highlighted operational improvements, including better recovery rates, and expects ongoing optimization to boost production in future quarters.
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