Shares of USA Rare Earth Inc. (USAR) tumbled 7.14% in after-hours trading on Thursday, following the release of the company's disappointing third-quarter financial results. The significant drop comes amid ongoing volatility in the rare earth sector, which has seen substantial price swings in recent weeks.

USA Rare Earth reported a net loss of $156.7 million for the third quarter of 2025, a stark increase from the $1.9 million loss in the same period last year. The company'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. However, 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. Despite the recent setback, the stock has gained 47.0% year-to-date, reflecting the sector's overall growth potential amidst geopolitical tensions and efforts to secure critical mineral supply chains.