Stardust Power reports solid progress in Q3 2025, highlights strategic partnerships and positive outlook for lithium supply amid evolving market dynamics

OPERATOR - (00:02:42)

Good afternoon and welcome to Stardust power Inc. Stardust Power's third quarter 2025 earnings call. My name is Tawanda and I'll be your operator today. Before this call, Stardust Power issued its financial Results for the third quarter ended 2025 in a press release. Joining us on today's call are Stardust Powers Founder and CEO Roshan Pajari and CFO Uday Devaspore. Following their remarks, we will open the call for questions. Before we begin, Joanna Gonzalez, Stardust Powers Director of Investor Relations and Communications, will make a brief introductory statement. Ms. Gonzalez, please proceed.

Joanna Gonzalez - Director of Investor Relations and Communications - (00:03:32)

Thank you operator and good afternoon everyone. Before management begins their formal remarks today, we would like to remind everyone that some statements we're making today may be considered forward looking statements under securities laws and involve a number of risks and uncertainties. As a result, we caution you that there are a number of factors that many of which are beyond our control which could cause actual results and events to differ materially from those described in the forward looking statements. For more detailed risks, uncertainties and assumptions relating to our forward looking statements, please see the disclosures in our earnings release and public filings made with the sec. We disclaim any obligation or undertaking to update forward looking statements to reflect circumstances or events such as that occur after the date the forward looking statements are made. Except as required by law, we refer you to our filings with the SEC for detailed disclosures and descriptions of our business as well as uncertainties and other variable circumstances including but not limited to risks and uncertainties identified under the caption risk factors in our recent filings. You may get Stardust Power's SEC filings by visiting the SEC website at www.sec.gov. I would like to remind everyone this call is being recorded and will be made available for replay via a link available in the Investor Relations section of Stardust Power's website. Now I will turn the call over to Stardust Power CEO Roshan Pajari.

Roshan Pajari - (00:05:07)

Thank you Joanna and thank you all for joining us today. Welcome to the Stardust Power's Q3 2025 earnings call. It's been an active quarter all around. Markets are aligning, policy momentum is thriving and government engagement in lithium and across the critical mineral sector is reaching new levels. All of this underscores the important role Stardust Power plays in securing America's energy future. It's also been an exceptionally busy time for our team as we continue advancing on all fronts of the business. At the core, Stardust Power's business model is fully aligned with U.S. policy objectives. We aggregate and unlock the lithium supply that might not otherwise reach the market. We will refine it. Here in the heartland of America. Our goal is to build a secure American domestic supply chain for battery grade lithium. We continue to be strategically aligned with national energy priorities for focused on onshoring critical minerals and reducing reliance on foreign supply. As federal and state incentives accelerate investment in domestic midstream and upstream processing, we believe our speed to market and disciplined approach provide a meaningful competitive advantage. Stepping back, let's look at what's happening in the lithium market. Overall, the global lithium market is fundamentally strong. Demand continues to grow driven by EVs, energy storage, handheld electronics and other critical technologies. Globally, some regions are catching up. But in the US the bottleneck isn't lithium or raw materials. It's processing capacity that's the choke point in the supply chain and building it domestically is non negotiable. And if we want to secure our future over the upcoming years, new North American production will deliver meaningful supply, strengthening U.S. availability and advancing a secure homegrown lithium supply chain. Stardust Power is critical to our energy security. The geopolitical landscape further supports our strategy. Recent U.S. policy actions, from executive orders to expanded federal and state incentives reinforced the need for a secure domestic critical mineral supply chain. At the same time, ongoing trade tensions and export restrictions from China are underscoring the strategic importance of onshoring refining. In this environment, Stardust Power stands out as one of a handful of companies positioned to deliver battery grade lithium carbonate refined in America for America, advancing both energy independence and industrial resilience. In the near term, global lithium demand remains strong. Other key materials such as copper, nickel, rare earths and other critical minerals are following similar trends, supporting steady investment and underscoring the strategic value of domestic production for Stardust Power. This reinforces our focus on moving quickly to market and capturing value in a growing supply constrained landscape. Momentum is also building on the policy front. The US Government approach to critical minerals is evolving to strengthen domestic supply chains through strategic partnerships and equity participation. Notably, the DOE renegotiated its existing loan to Lithium Americas, securing a 5% equity stake in the company and a further 5% economic interest in its Thacker Pass project in Nevada. Similarly, the US government has arranged to take a roughly 10% stake in Trilogy Metals, advancing the Ambler Metals project in Alaska and reinforcing national security objectives. Meanwhile, the rare earth sector has attracted increased government participation and support, all of which create a stronger, more stable investment environment for the broader domestic critical minerals industry. While these policy and regulatory tailwinds benefit the sector and support companies directly. It is important to note that our business model is fully self sustaining. We are not reliant on government funding to advance our project or achieve profitability. Our planned refinery, disciplined timing and low risk technology platform position us to capitalize on favorable market and policy conditions while delivering battery grade lithium independently and profitably. While any outside funding from the government or other state sources would be welcomed and it is additive to our project, our business model still works if such funds are not received. The lithium market has begun to stabilize following the correction earlier this year, with prices improving modestly as inventories normalize and near term oversupply concerns ease. While global production continues to expand. New capacity in South America and China has faced commissioning delays in in grade variability, keeping the market tighter than expected. Demand fundamentals remain strong supported by sustained growth in electric vehicles and stationary storage, both of which continue to exceed long term forecast. We are also seeing the early formation of a North American lithium pricing environment that is beginning to separate from the traditional China, Japan, Korea benchmark Regional demand from battery and cathode producers seeking low carbon domestically sourced material is growing rapidly and this localized demand is helping establish a market premium for North American lithium. This decoupling represents an important structural shift, one that reinforces the strategic value of domestic refining capacity. Looking ahead, the supply demand balance is expected to tighten again toward the latter half of the decade as slower project development and higher financing costs constrain new supply. Against this backdrop, the outlook for lithium remains strong with steady pricing recovery anticipated through 2026. These dynamics favor US refineries like Stardust Power, which can convert regional lithium chloride feedstock into high purity battery grade carbonate for the domestic market, capturing value from both the policy tailwinds and evolving regional price differentials, turning to upstream sourcing and supply updates and how we're securing feedstock for our refinery. The upstream lithium market is evolving towards lithium chloride production. Lithium chloride production offers several advantages over lithium carbonate for upstream producers and including lower capital intensity, faster time to market and insulation from changes in battery chemistries. These factors allow producers to operate more efficiently and respond quickly to market demand. Stardust Power is uniquely positioned to capitalize on this evolution. Our Muscogee refinery is designed to aggregate supply from multiple sources and scale the production of battery grade lithium carbonate efficiently. Critically, we are building one of the only independent lithium refineries outside of China, giving us a strategic advantage in serving North American and global battery markets. Against this backdrop of strong policy support, we are translating opportunity into supply agreements that secure a reliable quality feedstock pipeline to support our refinery and long term growth. Many of these agreements start out as letters of intent, but we can then work with our project finance partners on the execution of definitive documents. We make commercial decisions with financing in mind to construct an efficient capital stack. During the quarter, we announced a letter of intent with Prairie lithium to supply 6,000 metric tons per year of lithium carbonate equivalent in the form of lithium chloride. This feedstock will come from prairie's project in Saskatchewan, Canada and be processed at our Muscogee refinery. Its location and scale directly support our centralized refining model, aggregating regional lithium chloride sources and refining into battery grade lithium carbonate. Prairie is developing three PAD sites for production which can provide the feedstock. Currently, Prairie is building what they refer to as the largest commercial DLE project in North America. Partnering with Prairie strengthens our commercial position de risk Phase one and demonstrates tangible traction behind our strategy to anchor a North American lithium supply chain in the heartland of America. Building on that momentum, we also signed a letter of intent with Mandrake resources to secure 7,500 metric tons per year of lithium carbonate equivalent in the form of lithium fluoride from their Utah Lithium project. This high quality US Brine asset located in Paradox Basin within the Colorado Plateau benefits from strong infrastructure, a stable regulatory environment and proximity to our Muskogee refinery, reducing transport costs and and providing reliable domestic feedstock source. These agreements reflect our broader strategy as an aggregator of North American lithium supply, consolidating feedstock, strengthening the midstream and efficiently delivering battery grade lithium to the market. By prioritizing midstream conversion and aggregating supply, we de risk supply and build a resilient US Anchored supply chain. Our approach of aggregating sourcing of lithium chloride for conversion to carbonate is an innovative model in the industry, providing tangible benefits to both producers and the broader supply chain. This innovation continues to attract upstream partners, validating the model and reinforcing Stardust Power's leadership in creating a reliable domestic lithium ecosystem. Turning to engineering and operations during the quarter, we completed our FEL3 study for the Muskogee refinery, a major milestone that brings Stardust Power within reach of a final investment decision. The FEL3 is a comprehensive front end loaded engineering study of the refinery's design, cost and execution plan led by Primera usa, a globally recognized EPC firm specializing in mining and lithium processing. The study confirms phase one capacity of 25,000 metric tons per year of battery grade lithium carbonate expandable to 50,000 tons in phase two, making it one of the largest planned refineries in the U.S. phase 1 capital expenditures are estimated at approximately 500 million, nearly 200 million below prior estimates with a 90% probability factor inclusive of owner's cost, contingency and escalation. Construction is expected to take roughly 24 months to reach mechanical completion. The study incorporates 3D modeling and AACE Class 3 refined cost estimate, providing a clear technical definition, budgetary analysis and reduce project risk. Our air permit is administratively complete following an internal review by ODEQ and we are awaiting approval once a technical review is complete. Meanwhile, our engineering team is coordinating with OGE on site infrastructure under the updated will serve agreement for Power. As previously communicated, a third party independent engineering firm is finalizing the validation of the FEL3 report findings with completion expected in the coming weeks. We look forward to sharing the final results with investors as soon as the review is complete. Turning from our operations and engineering to our commercial update, Stardust Power continues to explore further sales agreements from our future lithium production as previously disclosed in our Form 8K filing, the company signed a letter of intent with a major global trading house to supply up to 20,000 metric tons per year of battery grade lithium carbonate to their US customers with an option to increase volumes to 25,000 metric tons per year over an 18 year term. This represents approximately 80% of phase one capacity and 40% of total refinery output once fully operational, with the possibility to extend to 25,000 metric tons per year, which is 100% of phase one capacity and 50% of total phase one and phase two capacity. Discussions remain active and once feedstock testing is complete, we can move toward a definitive offtake agreement. In parallel, the Company is engaged in commercial discussions with additional potential buyers including global OEMs, automakers and battery manufacturers. While pricing remains preliminary, we anticipate a balanced structure combining fixed price offtake and spot market exposure to manage both revenue stability and upside potential. The recently announced pricing structure proposed by the Department of War for MP Materials deal provides a good platform to consider other such critical commodities like lithium. Market dynamics continue to evolve in our favor with early signs of decoupling between North American and Asian lithium pricing. This emerging North American premium for battery grade lithium underscores the strategic value of domestic supply and positions Stardust Power to benefit as regional demand accelerates. Beyond our commercial progress, Stardust Power remains committed to engaging with our local communities and shaping state and federal energy conversations. We continue to take an active role in the communities where we operate and in Oklahoma's broader energy dialogue. We're not just building a refinery, we're building relationships that matter, partnering with civic business and policy leaders to to strengthen the state's clean energy and industrial base. This quarter, we proudly sponsored and participated in the Tulsa Renewable Business Alliance's Electric Connection Summit, where our team joined more than 150 energy professionals to discuss Oklahoma's renewable future, grid modernization and workforce readiness. We also sponsored the 34th annual Environmental Federation of Oklahoma Meeting and Trade show supporting dialogue among regulators, industry and tribal leaders including the Oklahoma Department of Environmental Quality, EPA Region 6 and the Cherokee Nation as they prepare for evolving environmental frameworks from Washington, D.C. beyond sponsorships, our team engaged directly with regional and federal stakeholders. We participated in the Tulsa Regional Chambers and Congressional Forum and TRBA Partner Showcase, connecting with Oklahoma's energy and business leaders to share how lithium refining can strengthen domestic supply chains and attract new investment into the state. We also contributed to the Tulsa Regional Chamber's One Voice Task Force on Energy, Economic Development and Transportation, helping shape state and federal legislative priorities ahead of the One Voice Policy Summit in November. In addition, we took part in the Oklahoma State Chamber Fall Policy Committee focused on the state's 2026 legislative agenda. At the community level, our participation in Leadership Muskogee Class 32, a nine month leadership program uniting business and civic leaders, reflects our commitment to listening and learning and contributing directly to Muskogee's growth as our project advances. On the federal front, we Contributed to the U.S. department of Energy's 2026 Critical Materials Assessment Update and joined the Domestic Critical Minerals and Material Supply Workshop where the Administration reaffirmed domestic mineral independence as a national security priority. We intend to remain an active voice in that national discussion. Together, these efforts demonstrate Stardust Power's commitment to responsible growth grounded in partnership, participation and a clear understanding of where our work aligns with the needs of our communities, state and country. Turning to personnel and organizational updates, we're pleased to welcome Mr. Kenneth Pitts as Director of Construction and Subcontracts. As we advance our refinery and project development. Ken brings expertise in large scale project execution, having successfully done multiple chemical and mining projects from feasibility through production, he will report to Randy Harris, Project Director. His addition further strengthens our leadership team, accelerates operational readiness, and ensures we have the experience in place to execute our production and growth objectives. Earlier this quarter, we completed a 1 for 10 reverse stock split, a necessary step to maintain our NASDAQ listing and strengthen our position in the public markets. As of October 27, we are fully compliant with the NASDAQ and trading on the NASDAQ Capital Market well positioned to move forward with confidence. This move was not about our fundamentals but about ensuring continued access to capital and aligning our share structure with the long term growth of the company. We have moved through key milestones including completing engineering and advancing permitting. Turning now to project finance, significant progress has been made. The independent engineer's third party validation of the FEL3 is nearing completion, marking a key milestone to support due diligence from investors and lenders. Financial modeling is completed and we have engaged key advisors across the market in insurance and legal work streams. The prerequisite activities to reach final investment decisions are well advanced following several key catalysts with ongoing completion of pre detailed design and testing work, supply strategy execution and securing full permitting ahead of debt and equity funding to support our phase one construction. Before I hand it over to our CFO Uday devasper, I would like to close with a clear message. We're moving fast and we're moving with purpose. Everything we've done this quarter, advancing commercial discussions, de risking engineering, securing feedstock and maintaining capital discipline is aimed squarely at one thing reaching final investment decision and commissioning Phase one of our Muscogee project. Speed to market is imperative. Companies that can execute early with qualified product and substantive partnerships will define the US Lithium landscape and Stardust Power intends to be one of them. We're building the right foundation, long term supply optionality, strategic offtake and growing alignment with federal and state partners who see the importance of domestic refining. We're focused on value creation and every action we take is designed to deliver returns to our shareholder as the market evolves. With that now, I'll turn it over to Uday to review our financial performance for the quarter.

Uday Devasper - Chief Financial Officer - (00:26:42)

Thank you Roshan and good afternoon everyone and thank you for joining our earnings call for the Q3 2025 earnings period. Before we begin, I want to clarify that we will not be providing forward looking guidance or estimates. During this call. Our focus will be on discussing our past performance and the current state of our business. We encourage you to refer to our filings with the SEC for more detailed information. First, a few developments. During the quarter and subsequent to quarter end, we took several important steps to strengthen our capital market position. As Roshan noted, we successfully regained compliance with NASDAQ listing requirements and our common stock and warrants continue to trade on the NASDAQ Capital Market following the completion of NASDAQ's review. As part of this process, we completed a 1 for 10 reverse stock split on September 8th, a necessary step to maintain our listing and ensure ongoing access to public markets. All share and per share figures have been adjusted and historical numbers have been restated to reflect the split. We also effectively utilized our B. Riley Financial at the market facility, raising approximately $1.6 million in gross proceeds during the quarter and post quarter end to support ongoing project development supported by strong liquidity volumes. Taken together, these actions leave us fully compliant with NASDAQ with a stronger balance sheet and continued access to growth capital, putting Stardust Power in a solid position to advance our project and deliver long term shareholder value. Subsequent to the quarter end, we entered into a warrant exchange agreement with an institutional investor. Under the agreement, the investor exchanged warrants for roughly 731,000 newly issued common shares. This transaction strengthens our capital structure and simplifies our equity base. By retiring these warrants now, we've removed uncertainty regarding a sizable future dilution overhang and improved transparency around our share count. It also signals our confidence in the business and and our upcoming milestones. In short, this exchange reduces complexity, aligns our investors for the long term and positions us well as we move toward final investment decision and full scale lithium carbonate production. Turning to the financials for Q3 2025, the company is pre revenue currently as reported in our filings previously, our ability to meet working capital and capital expenditure requirements for the next 12 months is dependent upon our plan to raise additional capital from issuance of equity or receive borrowings to fund the Company's operating and investing activities over the next year. As of Q3.25, we had cash and cash equivalents of $1.6 million on hand compared to $0.9 million as of December 31, 2024. As of current quarter end, we had no long term debt. We have devoted substantial efforts and financial resources to invest into our project, raise capital and organize and staff the company. As a result, the Company has incurred significant operating losses. As of Q3.25 and Q3.24, we had an accumulated deficit of $64.6 million and $43.1 million respectively. The company incurred a net loss of $4.5 million in Q3.25, which was lower by 5.6 million year over year. The decrease in net loss is primarily driven by certain expenses related to the close of the business combination incurred in prior year as we have not yet commenced commercial production of battery grade lithium carbonate. Excluding the impact of costs related to the business combination, our net loss reflects the anticipated ramp in operating expenses. These include higher consulting and professional service costs, personnel related costs and general operational expenditures associated with advancing the build out of our facility and laying the groundwork for execution under our supply agreements. Our loss per share improved to $0.53 for Q3 2025 compared to $2.23 in the prior year quarter primarily driven by decrease in general and administrative expenses costs due to lower personnel related costs and increase in weighted average common shares from the recent public offerings. Net cash used in operating activities decreased to $6.5 million for the nine months ended 30th September 2025 compared to 8.5 million in the prior year. The decrease is primarily driven by certain expenses related to the close of the business combination incurred in prior year, offset partially by our continued investment in operations and hiring of key talent. Net cash used in investing activities was $3 million for the nine months ended September 30, 2025 compared to $1.3 million in the prior year, primarily driven by initial capital investments made in the anticipated building of the refinery. Net cash provided by financing activities was 10.2 million for the nine months ended September 30, 2025, representing a modest increase over the $10.1 million reported by for the prior year period. During the current period, cash provided by financing activities was driven primarily by $12 million in net proceeds from public offerings and warrant inducements and $1.6 million proceeds from common stock issuances offset partially by the repayment of $3.8 million of short term loans. The prior period financing cash flow resulted from cash received from closing of the business combination in including proceeds from the pipe, subscription agreements and convertible notes net of transaction costs paid. And with that I conclude my remarks and we'll turn it back over to you. Roshan.

Roshan Pajari - (00:32:42)

Thanks Uday. We are now happy to take questions in line. Operator.

OPERATOR - (00:32:48)

Thank you. As a reminder ladies and gentlemen, to ask the question, please press Star one one on your telephone then wait for your name to be announced. To withdraw your question, please press Start one one again. Please stand by while we compile the Q and A roster. Our first question comes from the line of Joseph Rieger with Watts Capital Partners. Your line is open.

Joseph Rieger - Equity Analyst - (00:33:18)

Hey Roshan Uday and the rest of the team. Thanks for taking my questions. I guess. First thing you mentioned government financing. Is there any additional color you can give us as far as the type of conversations you're having with the government given the investments they've been making?

Roshan Pajari - (00:33:38)

Hi Joe. Thanks so much for joining us this evening. So we are in deep conversations with the government at multiple levels as we've all witnessed and referenced in the earnings report that there's strong federal interest in the area marked by equity investments and other forms of investment. So we have been in deep discussion about our project which we believe is at the core of the government interest in promoting on shoring processing capacity. You know, as the conversations progress we're happy to keep you informed that some of these conversations are ongoing.

Joseph Rieger - Equity Analyst - (00:34:17)

Okay, thanks for the insight there. And then as you guys think about, you know, keeping the balance sheet afloat in the meantime, you know, while you're working towards an FID and project level financing, what are the liquidity options you guys have to maintain the balance sheet and what do you think, you know, we should expect for corporate expense over the next call it four quarters.

Roshan Pajari - (00:34:43)

Let me answer the first part of that question. I'm going to turn it over to Uday but you know there's a lot of optionality. We have increased volume since the summer gives us flexibility in how we can raise capital at the public company including other types of options. So given that the non project finance capital costs have already been incurred and largely paid for including buying the land at 1.6, buying the 66 acres in Oklahoma and paying for the substantial FEL3 expense we have limited non project capital costs moving forward and how we can pay for those. Regarding outlook, maybe I'll turn it over to ube.

Uday Devasper - Chief Financial Officer - (00:35:32)

Hi Joe, nice to talk to you again and thanks for joining us. Yeah. As far as forecast for the next four quarters, we don't provide forecasts but I think it's safe to say that from an operational standpoint the cost will be similar to what you're seeing right now. Like Roshan mentioned, excluding project costs and capex that comes that will probably be, you know, incurred as we move along in these next four quarters. From an operational perspective we're trying to run a lean efficient ship. So I would expect cost to be in the similar range. And again from an operational and funding standpoint, like Roshan mentioned, there are multiple options available to us including access to public markets.

Joseph Rieger - Equity Analyst - (00:36:17)

Okay, thanks guys. I'll turn it over.

Roshan Pajari - (00:36:20)

Thanks Joe.

OPERATOR - (00:36:22)

Thank you. As a reminder ladies and gentlemen, that's Star one one to ask the question. I am showing no further questions in the queue. That concludes today's conference call. Thank you for your participation. You may now disconnect.