USA Rare Earth Inc. (USAR) experienced a significant pre-market plunge of 5.25% on Friday, following the release of its disappointing third-quarter financial results. The drop comes after the stock had already tumbled in after-hours trading on Thursday, reflecting investor concerns about the company's performance and the ongoing volatility in the rare earth sector.

The company reported a staggering net loss of $156.7 million for the third quarter of 2025, a dramatic increase from the $1.9 million loss in the same period last year. USA Rare Earth's adjusted earnings per share (EPS) came in at $(0.25), significantly missing the analyst consensus estimate of $(0.10). This represents a 155.1% negative surprise and a 733.33% decrease compared to the $(0.03) per share loss reported in the previous year. The wider-than-expected loss has heightened investor concerns about the company's short-term performance and financial stability.

Despite the recent setback, industry experts note that the long-term outlook for domestic rare earth producers remains positive, supported by U.S. government efforts to reduce dependence on Chinese supplies. USA Rare Earth continues to make progress on key projects, including the Round Top development and preparations for commercial-scale production at its Stillwater, Oklahoma magnet facility. However, the stock's performance may continue to be affected by broader market uncertainties, including threats of Chinese export controls, ongoing trade negotiations, and geopolitical tensions that have contributed to substantial price swings in the rare earth sector.