EAF

GRAFTECH INTERNATIONAL LTD

NYSE · TECHNOLOGY · ELECTRICAL INDUSTRIAL APPARATUS

11.05

+0.40 +3.76%

USD · close Oct 27

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MKT CAP $288.3MP/E —DIV YIELD —FCF YIELD -42.82%REV TTM $512.9M +0.9%NET INCOME −$177.3MNET DEBT $1.1B52W 5.23 – 18.01SEC XBRL · TTM TO Invalid Date

How EAF rewrote its risk factors

10-K ITEM 1A · FY2024 → FY2025

Text kept

55%

of sentences unchanged

Added

new sentences

Dropped

sentences removed

Length

−789

words, now 7,967

New in FY2025

Please carefully read all of the information included in this Report and carefully consider, among other matters, the following risk factors, as well as any discussed under Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Although the risks are organized by headings, and each risk is discussed separately, many are interrelated.
We sell our products primarily to the EAF steel production industry, which is highly cyclical and is affected significantly by general economic conditions.
Significant customers for the steel industry include companies in the automotive, construction, appliance, machinery, equipment and transportation industries, which are industries that were negatively affected by general economic downturns and the deterioration in financial markets, including severely restricted liquidity and credit availability, in the past.
Our customers, including major steel producers, have in the past experienced and may again experience downturns or financial distress that could adversely impact our overall demand and result in less sales.
Pricing for graphite electrodes has historically been cyclical and future declines in price may continue to adversely affect our results.
Between 2006 and 2025, our weighted-average realized price of graphite electrodes was approximately $6,200 per MT (on an inflation‑adjusted basis using constant 2025 dollars).
During the last demand trough in 2016, our weighted-average realized price of graphite electrodes fell to approximately $3,000 per MT, on an inflation‑adjusted basis using constant 2025 dollars.
Prices as of December 31, 2025 have receded from the highs of 2018, and the price of graphite electrodes may continue to decline in the future.
Beginning in 2023 and continuing through 2025, spot prices began decreasing given the softer commercial environment.
Spot prices for the year ended December 31, 2025 were approximately 4,100 per MT on a weighted-average basis.
Our business, financial condition and operating results have been, and are being, materially and adversely affected by the depressed spot price of graphite electrodes throughout 2024 and 2025 and could be materially and adversely affected further to the extent prices for graphite electrodes remain at depressed levels or continue to decline or remain at current levels in the future.
If we are unable to implement price increases in certain regions, or if these increases lead to loss of market share, our results of operations, cash flow, liquidity, and financial condition could be materially adversely affected.
General economic, competitive or market-specific conditions may limit our ability to raise prices, maintain existing prices or otherwise impact our plans with respect to implementing price increases.
In addition, we may lose customers who choose to source their graphite electrodes from a competitor who has not increased prices or who lowers their prices.
If we are unable to successfully execute future price increases, there may be material adverse effects on our market share, results of operations, cash flow, liquidity and financial condition.
Global graphite electrode overcapacity has adversely affected graphite electrode prices in the past, and continues to do so, which is negatively impacting our sales, margins and profitability, and may continue to do so in the future.
Overcapacity in the graphite electrode industry has adversely affected pricing in the past, and continues to do so.
Excess production capacity, particularly in China, is resulting in manufacturers currently pricing a significant portion of their electrode sales at or below market prices.
Excessive imports into the Americas and EMEA, which markets collectively made up 94% of our net sales for the year ended December 31, 2025, can also exert downward pressure on graphite electrode prices, which negatively affects our sales, margins and profitability.
The graphite electrode industry is highly competitive.
Competition in the graphite electrode industry is based primarily on price, quality/performance, local presence, product portfolio, delivery reliability and customer service.
In such a competitive market, changes in market conditions, including customer demand and technological development, as well as increased exports by Chinese EAF steel and graphite electrode suppliers, could adversely affect our competitiveness, sales and/or profitability.
We are dependent on the supply of petroleum needle coke and extended disruptions in supply could negatively impact our operations.
At full operating levels, Seadrift provides a substantial portion of our petroleum needle coke requirements, with third-party purchases making up a small portion of the balance.
An extended interruption of suitable petroleum needle coke for our operations could have a material adverse effect on our business, financial condition or operating results.
While we have added pin stock capability at our Pamplona, Spain facility, we primarily rely on one production location for this critical component.
If our Monterrey, Mexico facility were to become unable to provide us with connecting pins in required volumes, at suitable quality levels, or in a cost-effective manner, we would be required to shift production to our Pamplona, Spain facility or identify and obtain additional replacement manufacturing sources.
We are dependent on the cost and availability of manufacturing inputs, including raw materials (in addition to petroleum needle coke, energy and freight).
Our results of operations could deteriorate if such inputs increase in cost or are substantially disrupted for an extended period of time.
Petroleum and coal products, including decant oil and coal tar pitch, which are our principal raw materials other than petroleum needle coke, energy and freight, have been subject to significant price fluctuations.
A substantial increase in raw material, energy and freight prices that cannot be mitigated or passed on to customers or a continued interruption in supply, particularly in the supply of decant oil, could have a material adverse effect on our business, financial condition, results of operations and cash flows.
While we believe our insurance policies are in accordance with customary industry practices, such insurance does not cover all risks associated with the hazards of our business and is subject to limitations, including deductibles and maximum liabilities covered.
A majority of our net sales are derived from sales outside the United States, and a substantial majority of our operations and our property, plant and equipment and other long‑lived assets are located outside the United States.
As a result, we are subject to risks associated with operating in multiple countries, including: • currency fluctuations and devaluations in currency exchange rates, including impacts of transactions in various currencies, translation of various currencies into dollars for U.S. reporting and financial covenant compliance purposes, and impacts on results of operations due to the fact that the costs of our non‑U.S. operations are primarily incurred in local currencies while their products are primarily sold in dollars and euros; • imposition of or increase in customs duties and other tariffs or the loss of the protection thereof; • imposition of or increases in currency exchange controls, including imposition of or increases in limitations on conversion of various currencies into dollars, euros, or other currencies, making of intercompany loans by subsidiaries or remittance of dividends, interest or principal payments or other payments by subsidiaries; • imposition of or increases in revenue, income or earnings taxes and withholdings and other taxes on remittances and other payments by subsidiaries; • inflation, deflation and stagflation in any country in which we have a manufacturing facility; • imposition of or increases in investment or trade restrictions by the United States or other jurisdictions or trade sanctions adopted by the United States; • compliance with laws on anti-corruption, export controls, customs, sanctions, environmental and other laws governing our operations, including in challenging jurisdictions; • inability to determine or satisfy legal requirements, effectively enforce contract or legal rights, including our intellectual property rights, and obtain complete financial or other information under local legal, judicial, regulatory, disclosure and other systems; and • nationalization or expropriation of assets, and other risks that could result from a change in government or government policy, or from other political, social or economic instability.
Our results of operations could deteriorate if our manufacturing operations were substantially disrupted for an extended period for any reason.
In the event manufacturing operations are substantially disrupted at one of our primary operating facilities, we may not have the ability to increase production at our remaining operating facilities in order to compensate without considerable time and expense.
It is possible that technological developments could adversely affect the functionality of our computer systems and require further action and substantial funds to prevent or repair computer malfunctions.
Cybersecurity incidents can also include employee or personnel failures, fraud, phishing or other social engineering attempts or other methods to cause confidential information, payments, account access or access credentials, or other data to be transmitted to an unintended or unauthorized recipient.
As of December 31, 2025, 658 employees, or approximately 61% of our worldwide employees, were covered by collective bargaining or similar agreements.
Our intellectual property portfolio is extensive, with approximately 113 U.S. and foreign patents and pending patent applications, which we believe is more than any of our major competitors in the businesses in which we operate.

and 15 more.

Gone since FY2024

You should carefully read all of the information included in this Report and carefully consider, among other matters, the following risk factors, as well as any discussed under Part II, Item 7, “Management’s Discussion and Analysis of Financial Condition and Results of Operations.” Although the risks are organized by headings, and each risk is discussed separately, many are interrelated.
You should not interpret the disclosure of any risk factor to imply that the risk has not already materialized.
We sell our products primarily to the EAF steel production industry.
The EAF steel production industry historically has been highly cyclical and is affected significantly by general economic conditions.
Significant customers for the steel industry include companies in the automotive, construction, appliance, machinery, equipment and transportation industries, which are industries that were negatively affected by the general economic downturn and the deterioration in financial markets, including severely restricted liquidity and credit availability, in the past.
Our customers, including major steel producers, have in the past experienced and may again experience downturns or financial distress that could adversely impact our ability to collect our accounts receivable on a timely basis or at all.
Pricing for graphite electrodes has historically been cyclical and the price of graphite electrodes may continue to decline in the future.
Between 2005 and 2024, our weighted-average realized price of graphite electrodes for non-LTAs was approximately $6,000 per MT (on an inflation‑adjusted basis using constant 2024 dollars).
During the last demand trough in 2016, our weighted-average realized price of graphite electrodes for non-LTAs fell to approximately $3,000 per MT, on an inflation‑adjusted basis using constant 2024 dollars.
Prices as of December 31, 2024 have receded from the highs of 2018, and the price of graphite electrodes may continue to decline in the future.
Beginning in 2023 and continuing throughout 2024, spot prices began decreasing given the softer commercial environment.
Spot prices for the year ended December 31, 2024 were approximately $4,200 per MT on a weighted-average basis.
Our business, financial condition and operating results are being materially and adversely affected by the spot price of graphite electrodes as of December 31, 2024 and could be materially and adversely affected further to the extent prices for graphite electrodes continue to decline in the future, particularly as we implement our price increase initiative as described below.
We may be unable to realize the benefits of our initiative to increase prices on our products in certain of our regions and furthermore may lose market share in these regions as a result of this initiative, which could have a material adverse effect on our results of operations, cash flow, liquidity and financial condition.
In February 2025, we informed our customers of our intention to increase prices on volume that is not yet committed.
This is just one initiative we expect to accelerate our path to profitability and support our ability to invest in our business for the long term.
General economic, competitive or market-specific conditions may limit our ability to raise prices or otherwise impact our plans with respect to implementing price increases.
In addition, we may lose customers who choose to source their graphite electrodes from a competitor who has not increased prices.
If we are unable to successfully execute this initiative to increase prices, there may be material adverse effects on our market share, results of operations, cash flow, liquidity and financial condition.
Global graphite electrode overcapacity has adversely affected graphite electrode prices in the past, and is currently doing so now, which is negatively impacting our sales, margins and profitability.
Overcapacity in the graphite electrode industry has adversely affected pricing in the past, and is currently doing so now.
Excess production capacity is resulting in manufacturers producing and exporting electrodes at prices that are lower than prevailing domestic prices, and sometimes at or below their cost of production.
Excessive imports into the Americas and EMEA, which markets collectively made up 89% of our net sales for the year ended December 31, 2024, can also exert downward pressure on graphite electrode prices, which negatively affects our sales, margins and profitability.
The graphite industry is highly competitive.
Competition in the graphite industry (other than, generally, with respect to new products) is based primarily on price, quality/performance, local presence, product portfolio, delivery reliability and customer service.
Competition with respect to new products is, and is expected to continue to be, based primarily on price, performance and cost effectiveness, customer service and product innovation.
In such a competitive market, changes in market conditions, including customer demand and technological development, as well as increased exports by Chinese EAF steel suppliers could adversely affect our competitiveness, sales and/or profitability.
We are dependent on the supply of petroleum needle coke.
Our results of operations could deteriorate if disruptions in the supply of petroleum needle coke occur for an extended period.
At full operating levels, Seadrift provides a substantial portion of our petroleum needle coke requirements, with third party purchases making up the balance.
An extended interruption of suitable needle coke for our operations could have a material adverse effect on our business, financial condition or operating results.
While we have added capability at our Pamplona, Spain facility, we primarily rely on one production location for this critical component.
If our Monterrey, Mexico facility were to become unable to continue to provide us with connecting pins in required volumes, at suitable quality levels, or in a cost-effective manner, we would be required to shift production to our Pamplona, Spain facility or identify and obtain additional replacement manufacturing sources.
We are dependent on supplies of raw materials (in addition to petroleum needle coke).
Our results of operations could deteriorate if those supplies increase in cost or are substantially disrupted for an extended period.
Petroleum and coal products, including decant oil and coal tar pitch, which are our principal raw materials other than petroleum needle coke, and energy, have been subject to significant price fluctuations.
A substantial increase in raw material prices that cannot be mitigated or passed on to customers or a continued interruption in supply, particularly in the supply of decant oil, would have a material adverse effect on our business, financial condition, results of operations or cash flows.
While we believe our insurance policies are in accordance with customary industry practices, such insurance may not cover all risks associated with the hazards of our business and is subject to limitations, including deductibles and maximum liabilities covered.
A substantial majority of our net sales are derived from sales outside the United States, and a majority of our operations and our property, plant and equipment and other long‑lived assets are located outside the United States.
As a result, we are subject to risks associated with operating in multiple countries, including: • currency fluctuations and devaluations in currency exchange rates, including impacts of transactions in various currencies, translation of various currencies into dollars for U.S. reporting and financial covenant compliance purposes, and impacts on results of operations due to the fact that the costs of our non‑U.S. operations are primarily incurred in local currencies while their products are primarily sold in dollars and euros; • imposition of or increase in customs duties and other tariffs or the loss of the protection thereof; • imposition of or increases in currency exchange controls, including imposition of or increases in limitations on conversion of various currencies into dollars, euros, or other currencies, making of intercompany loans by subsidiaries or remittance of dividends, interest or principal payments or other payments by subsidiaries; • imposition of or increases in revenue, income or earnings taxes and withholdings and other taxes on remittances and other payments by subsidiaries; • inflation, deflation and stagflation in any country in which we have a manufacturing facility; • imposition of or increases in investment or trade restrictions by the United States or other jurisdictions or trade sanctions adopted by the United States; • compliance with laws on anti-corruption, export controls, customs, sanctions, environmental and other laws governing our operations, including in challenging jurisdictions; • inability to determine or satisfy legal requirements, effectively enforce contract or legal rights, including our rights under our LTAs and intellectual property rights, and obtain complete financial or other information under local legal, judicial, regulatory, disclosure and other systems; and • nationalization or expropriation of assets, and other risks that could result from a change in government or government policy, or from other political, social or economic instability.

and 36 more.

Sentence-level comparison of Item 1A in the two most recent 10-Ks (FY2024 ↗, FY2025 ↗). A reworded sentence counts as one dropped and one added, so heavy edits read as low “kept”. Headings and page furniture are stripped; nothing is summarised by a model.

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