Largo Inc. (TSX: LGO) (NASDAQ: LGO) has reported a robust second quarter for 2026, with revenue surging 68.5% year-over-year to $44 million, driven by higher vanadium production and sales. The company produced 2,900 tonnes of vanadium pentoxide, a 28.5% increase, and sold 2,773 tonnes, up 53.5%. This operational strength translated into an adjusted EBITDA of $2.7 million, a significant improvement from $34,000 in the prior-year quarter, while Mining Operations Adjusted EBITDA rose 64.8% to $4.4 million.
The financial results reflect a period of strategic expansion for Largo. The company reiterated its 2026 guidance for V2O5 equivalent production of 10,500 to 12,000 tonnes and sales of 7,500 to 9,500 tonnes, indicating confidence in sustained output. Despite a net loss of $22.7 million, largely due to noncash items and higher costs, Largo ended the quarter with $5.1 million in cash and $114.2 million in debt. The loss underscores the impact of investments and market conditions, but the company's strategic initiatives signal a forward-looking approach.
Subsequent to the quarter, Largo secured a $60.1 million delivery order from the U.S. Defense Logistics Agency Strategic Materials, a testament to the critical nature of vanadium in defense applications. This order not only provides a significant revenue stream but also highlights Largo's role as a key supplier in the U.S. supply chain. Additionally, the company achieved full-scale copper-platinum group metals (PGM) concentrate production at its Maracás Menchen Mine following Brazilian regulatory approval. This new production capability is expected to yield approximately 300 to 380 tonnes per month, with an average grade of about 15% copper and 41 grams per tonne of PGMs. This diversification leverages existing infrastructure to create an additional revenue source, reducing reliance on vanadium alone.
The vanadium market also provided tailwinds during the quarter, with the average U.S. ferrovanadium benchmark price increasing 45.8% year-over-year. This price appreciation, coupled with higher production volumes, contributed to the revenue growth. Largo's position as the world's largest primary vanadium producer, with operations at the Maracás Menchen Mine in Brazil, positions it to capitalize on these favorable market dynamics.
Beyond its core vanadium business, Largo is strategically investing in clean energy storage through its 37.4% ownership of Storion Energy, a joint venture with Stryten Energy. This venture focuses on domestic electrolyte production for utility-scale vanadium flow battery long-duration energy storage solutions in the U.S., tapping into the growing demand for renewable energy storage. The company also holds interests in tungsten properties in Canada and Brazil, with preliminary economic assessments completed in 2011.
These developments underscore Largo's commitment to operational excellence and sustainability, as it leverages vertical integration to ensure reliable supply and quality. The company's expansion into copper-PGM production and its involvement in energy storage reflect a strategic pivot toward diversification and value-added products. With strong quarterly results and strategic milestones, Largo is positioning itself for sustained growth in the critical materials sector.
