MP Materials shares pop 18% after $500M deal with Apple

MP Materials shares gained 18% on Tuesday morning after the company signed a $500 million deal with Apple Inc.

The deal will secure a domestic supply of neodymium magnets, which are critical for the iPhone maker's products.

The agreement, announced Tuesday, includes plans to construct a new manufacturing facility in Texas.

The factory will house specialized magnet production lines tailored for Apple’s devices, furthering the tech giant’s push to localize more of its supply chain.

Apple said the deal supports its previous pledge to invest over $500 billion in the US over the next four years.

As part of the broader collaboration, the two companies will also work together on a rare-earth recycling line at MP Materials’ Mountain Pass facility in California.

This initiative aims to reuse critical minerals in future Apple products and develop new magnet technologies.

“Rare earth materials are essential for making advanced technology, and this partnership will help strengthen the supply of these vital materials here in the United States,” Apple CEO Tim Cook stated in the release.

MP Materials gains as US focuses on critical minerals

While shares of MP Materials jumped following the announcement, Apple’s stock remained relatively unchanged.

The deal follows closely on the heels of another major development: the US Department of Defense recently signed a $900 million deal with MP to secure access to magnets vital for military use.

The Pentagon’s investment is part of a broader funding package that includes $1 billion in financing from JPMorgan Chase & Co. and Goldman Sachs Group Inc. to support a new production facility.

MP Materials operates the only rare-earth mine in the US, located at Mountain Pass in California.

The mine plays a strategic role in Washington’s efforts to reduce dependency on China for rare-earth elements, a concern heightened in recent years amid trade tensions and supply disruptions.

Global trade tensions shift supply chain strategies

The deal comes at a time when rare earths have become a focal point in the US-China trade war.

China, which dominates the global supply of rare-earth magnets, previously restricted exports in response to US tariffs imposed during the Trump administration.

These curbs sent ripples through global supply chains, temporarily halting production at automakers such as Ford and Suzuki, and drawing concerns from tech leaders like Elon Musk, who cited shortages affecting his robotics operations.

Recent developments indicate a potential easing in tensions.

China resumed shipments of rare earths in June, and the US rolled back some export restrictions on semiconductors, including components from Nvidia Corp. and Advanced Micro Devices Inc.

Still, the long-term viability of non-Chinese rare-earth producers remains uncertain.

Despite the recent price spikes driven by export restrictions, companies like MP Materials and Australia’s Lynas Rare Earths Ltd. have faced challenges turning a consistent profit due to oversupply and price volatility.

With this new partnership, Apple not only secures a more reliable domestic supply of critical minerals but also signals a broader industry shift toward supply chain diversification and resilience amid geopolitical uncertainty.