SQM (SQM) 2Q26 Beat

Equity Research 19 August 2026 | 10:52AM BRT

SQM (SQM): 2Q26 Beat; Focus on Growth Projects and Capex Disbursement

SQM’s reported EBITDA of $1,318M (+57% q/q; +328% y/y) beat GS/VA Consensus Marcio Farid | by 10%/18%, driven by strong lithium volumes and pricing as well as better costs and Goldman Sachs do Brasil CTVM S.A. volumes for Iodine. We expect a positive market reaction, but capex update came in Emerson Vieira higher than expected and could partially offset positive earnings. | Goldman Sachs do Brasil CTVM S.A. During the quarter, SQM announced major milestones for its continuing expansion Henrique Marques initiatives, announcing the Mt. Holland expansion, which is expected to double | spodumene concentrate capacity, with first production from the expansion expected Goldman Sachs do Brasil CTVM S.A. during 2030 (GS view here), as well as submitting the Environmental and Technical documentation for the Salar Futuro Project (GS view here). The Salar Futuro Project is expected to have a $3B capex to be deployed during the first 7 years, mostly concentrated in year 3 and 4.

The company also announced its capex estimates for the period of 2026-28, which should reach $3.0B, driven mostly by Novandino (60% of the capex), followed by the Iodine and SPN divisions (20%) and the International Lithium division (20%). This estimate contemplates $300M of sustaining capex per year across all divisions.

n Lithium: EBITDA beat on higher volumes and prices. SQM’s lithium division reported EBITDA of $1,068M (+64% q/q; +722% y/y), beat GSe by 8%. Sales volumes were 7% above our expectations, driven by higher volumes coming from the Chilean operations. Realized price was also a positive, increasing 23% q/q (+4% vs. GSe). The strong numbers from volumes and prices were partially offset by higher-than-anticipated costs, which increased by 16% q/q (+16% vs. GSe). Demand was robust during the quarter, with BESS market offsetting a weaker-than-expected EV market, and management expects global lithium demand to surpass 2.1mt in 2026 (vs. previous expectations of reaching 1.9mt). Sales volumes are expected to reach 280-290kt in FY26.

n Iodine: EBITDA beat on better costs; sales volume to moderate during 2H26. SQM’s Iodine division reported EBITDA of $194M (+19% q/q; +22% y/y) was above GSe by 22%. The beat was driven by lower-than-expected costs (-11% q/q) and stronger volumes, while prices remained in line with GS estimates. In the meantime, the seawater pipeline is currently under commissioning phase, which should allow SQM to produce iodine and its derivatives across four different

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operations, optimizing production and cost efficiencies. Additionally, management has increased its forecast for iodine production for FY26 by 500t to 15.5kt (vs. 15.0kt prior). n SPN: EBITDA beat on lower costs. SQM’s SPN EBITDA of $89M (+61% q/q; +74% y/y) beat GSe by 9% mostly led by better costs (-7% vs. GSe), although partially offset by lower prices (-3% vs. GSe). Looking ahead, management reiterated its view of sales volumes increasing by 10% y/y on a full-year basis, while also pointing to a better-than-expected outlook for potassium nitrate, which is now expected to remain flattish during 2026 (vs. 2025), rather than decreasing by 5% as previously expected. n Stronger-than-expected other divisions. Potassium and Industrial chemicals business reported EBITDA of $8M (vs $3M at GS) and $11M (vs GS at $9M), respectively. The beat was mostly driven by higher volumes (especially in the Potassium business), as well as lower than anticipated costs (across divisions).

n What to watch for during earnings call: SQM is hosting its earnings call on…