Westwater Resources, Inc.: Form 10-Q for the period ended Sep 30, 2025

The following management’s discussion and analysis of the consolidated financial results and financial condition of Westwater for the three and nine months ended September 30, 2025, has been prepared based on information available to us as of November 12, 2025. This discussion should be read in conjunction with the unaudited Interim Financial Statements and Notes thereto included herewith and the audited consolidated financial statements of Westwater for the period ended December 31, 2024, and the related notes thereto included in our Annual Report, which were prepared in accordance with U.S. GAAP. This management’s discussion and analysis contains forward-looking statements that are subject to risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including, but not limited to, those set forth elsewhere in this report. See “Cautionary Note Regarding Forward-Looking Statements” herein.

INTRODUCTION

Westwater Resources, Inc., originally incorporated in 1977, is an energy technology and critical minerals company focused on developing battery-grade natural graphite materials through its two primary projects, the Kellyton Graphite Plant and the Coosa Graphite Deposit, both located in Coosa County, Alabama. Once operational, Westwater expects the Kellyton Graphite Plant to process natural flake graphite and, based on current studies and estimates, produce 12,500 metric tons (“mt”) per year of CSPG in Phase I of the Kellyton Graphite Plant, primarily for use in lithium-ion batteries. Westwater also holds mineral rights to explore and potentially mine the Coosa Graphite Deposit, which Westwater anticipates will eventually provide natural graphite flake concentrate to the Kellyton Graphite Plant.

RECENT DEVELOPMENTS

Customer Engagement Update

The global landscape for the U.S. supply of critical materials, including natural graphite, continues to evolve. On November 3, 2025, FCA, which is part of the Stellantis group of companies, unexpectedly terminated its Offtake Agreement with the Company. FCA was one of three companies, including SK On and Hiller Carbon, with existing offtake agreements with Westwater.

Both of the offtake agreements with SK On and Hiller Carbon remain in effect. While FCA has indicated they are open to considering a new arrangement with the Company, any future agreement would be based on current market conditions. The Company continues to explore additional offtake opportunities with other prospective customers and are providing them with samples as part of its ongoing engagement.

Westwater continues to respond to outreaches from prospective customers as they weigh the impact of announced changes and potential changes to global tariffs, export restrictions, domestic content requirements, countervailing and anti-dumping duties, and the potential impacts on the future demand for battery grade natural graphite. Most of these potential customers are the largest lithium-ion battery suppliers or vehicle manufacturers in the world.

Issuance of Patent for Graphite Purification

On September 17, 2025, the Company announced it had received its U.S. Patent related to its graphite purification method. Westwater’s purification process offers a more sustainable alternative to traditional purification techniques often used in China and other countries. Unlike conventional methods that frequently rely on hydrofluoric acid, Kellyton’s Phase I process completely avoids the use of this hazardous substance. Instead, Westwater’s patented process relies on a more environmentally-friendly approach to produce high-purity graphite, which the Company believes positions Westwater as a leader in sustainable production of battery-grade natural graphite. Westwater has another patent application pending in the U.S. Patent & Trademark Office.

Kellyton Graphite Plant – Construction and Estimated Cost Update

During the nine months ended September 30, 2025, construction activities at the Kellyton Graphite Plant consisted of installing equipment and electrical work to set up the power distribution center, moving off power generators, and tapping into the Alabama power grid. We have installed micronization (sizing) and spheroidization (shaping) mills in the SG building and commissioned and started up one micronization and spheroidization mill. In addition, we continue to install peripheral support equipment surrounding the micronization and spheroidization mills in the SG building. Westwater has constructed and continues to operate its R&D Lab. The R&D Lab allows Westwater to continue product development and optimization with potential customers, and to perform additional quality control tests. It also affords greater flexibility to optimize future samples in accordance with customer specifications.

Since inception of the project, and inclusive of liabilities as of September 30, 2025, the Company has incurred costs of approximately $125.1 million. The Company has continued construction activities related to Phase I of the Kellyton Graphite Plant at a measured pace during the third quarter of 2025. With the additional liquidity raised subsequent to the end of the quarter, the Company expects to order long-lead equipment items and further advance the Kellyton Graphite Plant, but maintain a measured approach. Given the updates provided on customer engagement above, efforts are now underway to optimize capital investment in Phase I at the Kellyton Graphite Plant. The intention is to adjust processing capacity to align our existing offtake agreements throughout this initial phase. This strategy is expected to lower the plant’s initial capacity and, in turn, decrease the total capital and reduce the time needed to reach commercial production. The Company expects to provide an update once this optimization evaluation is complete.

Qualification Line Development at Kellyton Graphite Plant

Since the beginning of the year, Westwater operated its qualification line at the Kellyton Graphite Plant and produced and completed multiple samples of over 1 mt of CSPG for customers for pre-production cell trials and testing. In the third quarter, the Company continued to make improvements to the qualification line to improve cycle times, yield, and graphite flow rates to optimize the capability of the qualification line.

Samples produced on the qualification line are representative of CSPG mass production. The Company expects that the operation of the qualification line will allow Westwater to supply its customers bulk samples of CSPG in 1 to 10 mt batches for cell qualification activities. The line will also be used to train Westwater’s operations team which the Company expects will expedite the commissioning and startup of the Kellyton Graphite Plant. During 2025, Westwater commissioned of one of the micronizer mills and one of the shaping mills, which are being used in conjunction with the qualification line to produce additional samples for customers until the mills are eventually used in the mass production line when the Kellyton Graphite Plant is complete and operational.

Coosa Graphite Deposit

On October 27, 2025, Westwater announced its plan to progress the permitting process for future mine development at its Coosa Deposit. The Company has retained a third-party engineering firm to lead the permitting process for mine development at the Coosa Deposit and expects to engage with the U.S. Army Corps of Engineers, the Alabama Department of Environmental Management, and other state and local authorities in the coming months. The permitting process is expected to include preparation of key environmental studies and applications under applicable federal and state frameworks, including, but not limited to, water discharge, wetlands and air permits, and other operational and construction-related approvals.

In parallel with permitting activities, the Company plans to conduct additional drilling to further delineate and expand the resource base at Coosa. These results will inform ongoing mine planning and design efforts, as Westwater continues to evaluate and optimize the project for efficient, responsible production of natural graphite.

Debt Financing Update

During the third quarter, the Company, along with its investment banker, continued to work on completing the syndication of a secured debt facility for approximately $150 million. Due to the unexpected termination of the FCA contract, which supported the syndication process, the syndication process is now on hold.

Closing a syndicated debt facility for Phase I of the Kellyton Plant is subject to continuing the syndication process, customary agreement on completing the syndication, obtaining additional offtake agreements to support the syndication, due diligence and investment committee approval by potential lenders, and final loan conditions and terms. No assurance can be given that the Company will ultimately enter into the secured debt facility, or that financing will be available in amounts sufficient to meet its needs, or on terms acceptable to the Company.

In April 2025, Westwater received a letter of interest from Export-Import Bank of the United States (“EXIM”) related to the Kellyton Graphite Plant, under the “Make More in America Initiative” and the “China and Transformational Exports Program.” The letter of interest is separate from the Phase I debt syndication process. The application is still pending with EXIM, but because of the government shutdown, EXIM’s review of the Company’s application and diligence process has been delayed.

The progression from a letter of interest to a loan commitment from EXIM requires a formal application, and for EXIM to complete due diligence, underwriting, and finalization of terms and conditions. No assurance can be given that the Company will ultimately enter into a loan transaction with EXIM.

In addition to the EXIM loan application, Westwater has engaged advisors to support ongoing efforts to evaluate and attempt to secure other sources of government funding that may be available to the Company.

Graphite and Vanadium as Critical Materials

Presently, the United States is almost 100% dependent on imports for battery-grade graphite, which is currently the primary anode material in the lithium-ion batteries that power electric vehicles, smartphones, and laptops, and store power generated from intermittent renewable energy sources. Westwater intends to process natural flake graphite into battery-grade graphite, primarily for lithium-ion batteries.

The U.S. currently relies on imports of at least 15 critical minerals, including graphite which is currently supplied almost entirely by companies located in China. An executive order effective March 20, 2025, names the Defense Production Act and the U.S. International Development Finance Corporation as mechanisms for supporting an effort to provide financing, loans and other investment support to domestically process critical minerals.

Approximately 77% of the global natural flake graphite and approximately 97% of global anode active material is supplied by China (Mining Technology, 2024), which causes China to pose a geopolitical risk, particularly to the EU and U.S. regions. China and the United States have imposed tariffs and export controls on critical minerals, including graphite, indicating the potential for further trade barriers between China and the United States. Evident by the executive orders signed during 2025, while subject to continuing uncertainty, import tariffs on battery natural graphite produced anywhere outside the U.S. are likely to persist. In addition, tariffs are also now in place on CSPG shipped from other countries including Indonesia, South Korea and Japan.

Further, the U.S. Department of Commerce (“DOC”) issued a preliminary determination in the anti-dumping investigation of graphite-based anode materials imported from the People’s Republic of China. The July 2025 preliminary determination concluded that Chinese producers have been selling graphite-based anode materials into the U.S. market at unfairly low prices, and as a result, proposed an anti-dumping duty of 93.5% on Chinese graphite-based anode materials. This ruling followed a May 2025 ruling addressing countervailing duties which has been subsequently amended to add a countervailing duty rate of 11.55%. Westwater believes these tariffs, duties and export restrictions continue to highlight the supply-chain risk for the U.S. and other countries related to natural graphite products and could provide an opportunity for Westwater.

Westwater has developed patented graphite-purification technologies and advanced product-development processes designed to meet the demands of potential customers for battery-grade graphite materials. Westwater is developing methodologies and constructing facilities intended to produce high purity, battery-grade graphite products at its Kellyton Graphite Plant. These products are being designed to serve all major battery sectors. In addition, we believe the processes we intend to use are environmentally sustainable and permittable in the United States, where a robust regulatory environment complements our core values to reliably deliver safe, well-made products to our customers.

Westwater has and will continue to support the efforts by the relevant United States governmental agencies, the State of Alabama and local municipalities to ensure that they remain aware of the importance of natural battery-grade graphite, its importance to the nation’s security, and how the Kellyton Graphite Plant and the Coosa Graphite Deposit fit into the critical minerals-equation.

Equity Financings

Capital Raises during the three and nine months ended September 30, 2025

During the three and nine months ended September 30, 2025, the Company sold 6.7 million and 13.8 million shares of Common Stock for net proceeds of $5.7 million and $10.1 million, respectively, pursuant to the ATM Sales Agreement. During the nine months ended September 30, 2025, the Company sold 5.1 million shares of Common Stock for net proceeds of $3.2 million pursuant to the 2024 Lincoln Park PA. There were no sales of Common Stock for the three months ended September 30, 2025 pursuant to the 2024 Lincoln Park PA.

See Note 9 Common Stock to the Interim Financial Statements for additional information.

RESULTS OF OPERATIONS

Summary

Our net loss for the three months ended September 30, 2025, was $9.8 million, or $0.12 per share, as compared with a net loss of $3.1 million, or $0.05 per share for the same period in 2024. The $6.7 million increase in our net loss was primarily due to other expenses for conversions and fair value adjustments of the Convertible Notes, an increase in stock compensation expense, more depreciation expense, and more product development expenses in the current period. These increases were offset by other expenses related to a loss on sales and a write-down of raw material inventory in the prior comparable period.

Our net loss for the nine months ended September 30, 2025, was $16.4 million, or $0.21 per share, as compared with a net loss of $9.8 million, or $0.17 per share for the same period in 2024. The $6.6 million increase in our net loss was primarily due to other expenses for issuance costs, conversions, and fair value adjustments of the Convertible Notes, an increase in stock compensation expense, and more depreciation expense. These increases were offset by other expenses related to a loss on sales and a write-down of raw material inventory in the prior comparable period. See below for further details related to these changes.

Product Development Expenses

Product development expenses for the three months ended September 30, 2025, were $0.4 million, an increase of $0.1 million compared to the same period in 2024. Product development expenses for the nine months ended September 30, 2025, were $0.8 million and remained essentially flat compared to the same period in 2024. Product development expenses for the three and nine months ended September 30, 2025 and 2024, related primarily to sample production of battery-grade natural graphite products for evaluation by current and potential customers.

General and Administrative Expenses

General and administrative expenses for the three and nine months ended September 30, 2025, increased by $1.0 million and $1.4 million, respectively, compared to the same periods in 2024, primarily due to an increase in stock compensation expense as a result of larger and broader restricted stock unit awards granted throughout the organization in May 2025 compared to awards granted in prior years. See Note 10 Stock-Based Compensation for further details.

Depreciation and Amortization

Depreciation and amortization for the three and nine months ended September 30, 2025, increased by $0.2 million and $0.4 million, respectively, compared to the same periods in 2024, due to an increase in depreciation expense resulting from the qualification line, which was placed in service in January of 2025.

Other Expense, net

Other expense, net for the three months ended September 30, 2025, was $5.8 million, compared to other expense, net of $0.4 million for the same period in 2024. Other expense, net for the nine months ended September 30, 2025, was $6.1 million, compared to other expense, net of $1.2 million for the same period in 2024. The change in other expense, net for both periods was primarily due to other expenses for issuance costs, conversions, and fair value adjustments of the Convertible Notes. Other expense related to the conversions and adjustments to the Convertible Notes was impacted by the Company’s higher stock price during the quarter ended September 30, 2025. The increase in other expense in the current periods were partially offset by a loss on sales and a write-down of raw material inventory recognized in the same periods of the prior year.

FINANCIAL POSITION

Operating Activities

Net cash used in operating activities of $7.9 million for the nine months ended September 30, 2025, represents an increase of $4.2 million compared to the same period in 2024. The increase in cash used in operating activities was primarily due to $3.4 million of cash received on sales of raw material inventory in 2024, and changes in other working capital.

Investing Activities

Net cash used in investing activities increased by $2.4 million for the nine months ended September 30, 2025, as compared to the same period in 2024. For both periods, the investing activity represents construction capital expenditures as the Company continues a managed approach to construction activity while seeking debt financing to fund the remaining construction of Phase I of the Kellyton Graphite Plant, slightly offset by cash received from sales of assets. See Note 5 Property, Plant and Equipment for further details.

Financing Activities

Net cash provided by financing activities increased by $21.6 million for the nine months ended September 30, 2025, as compared to the same period in 2024. The increase was primarily due to net cash proceeds received for the Convertible Notes issued in the current year and an increase in shares of Common Stock sold under the ATM Sales Agreement and 2024 Lincoln Park PA during the nine months ended September 30, 2025, compared to the same period in 2024.

LIQUIDITY AND CAPITAL RESOURCES

Since 2009, the Company has not recorded revenue from operations and, as of September 30, 2025, current liabilities exceeded current assets. As such, Westwater is subject to the risks associated with development stage companies. Management expects to continue to incur cash losses as a result of construction activity at the Kellyton Graphite Plant and general and administrative expenses until operations commence at the Kellyton Graphite Plant. If financing is not available to fund the construction of Phase I of the Kellyton Graphite Plant through the equity and debt capital markets or alternative financing sources, the Company may be required to reduce or severely curtail operations, change its planned business development strategies related to the Coosa Graphite Deposit and Phase I of the Kellyton Graphite Plant, alter the construction and commissioning timeline of Phase I of the Kellyton Graphite Plant, put the construction of Phase I of the Kellyton Graphite Plant on hold until additional funding is obtained, or seek strategic alternatives. If the Company is required to abandon construction and development or alter its intended long-term plans related to the Kellyton Graphite Plant, the Company could be required to evaluate the recoverability of its long-lived assets.

The Company has relied on equity financings, debt financings and asset sales to fund its operations. During the quarter ended September 30, 2025, and through the date that these Interim Financial Statements were issued, the Company continued construction activities related to the Kellyton Graphite Plant. However, construction activities have been significantly reduced from anticipated levels until additional funding is secured to advance Phase I of the Kellyton Graphite Plant. The Company’s construction-related contracts include termination provisions at the Company’s election that do not obligate the Company to make payments beyond what is incurred by the third-party service provider through the date of such termination. See Note 2 Liquidity to the Interim Financial Statements for additional information.

On September 30, 2025, the Company’s cash balance was approximately $12.9 million. During the nine months ended September 30, 2025, the Company sold 13.8 million shares of Common Stock for net proceeds of $10.1 million pursuant to the ATM Sales Agreement, and sold 5.1 million shares of Common Stock for net proceeds of $3.2 million pursuant to the 2024 Lincoln Park PA.

Subsequent to September 30, 2025, the Company sold 22.2 million shares of Common Stock for net proceeds of $43.3 million pursuant to the ATM Sales Agreement. As of November 5, 2025, the Company’s cash balance was approximately $53 million.

On October 17, 2025, the Company filed an additional prospectus supplement for the purpose of registering under the Company’s Registration Statement the offer and sale of shares of Common Stock in the aggregate amount of up to $75 million pursuant to the ATM Sales Agreement, which does not include the approximately $55 million of shares of Common Stock that were previously sold pursuant to the ATM Sales Agreement as of the date of the filing of the prospectus supplement.

As of September 30, 2025, the Company has approximately $26.2 million remaining available for future sales under the 2024 Lincoln Park PA, subject to certain limitations contained within the Convertible Notes. See Note 9 Common Stock for further details regarding the Company’s equity financing agreements.

While the Company has advanced its business plan and has been successful in the past raising funds through equity financings as well as through the sale of non-core assets, no assurance can be given that additional financing will be available in amounts sufficient to meet its needs, or on terms acceptable to the Company. Recent volatility in the equity and debt capital markets, higher interest rates, inflation, electric vehicle production and adoption rates, generally uncertain economic conditions and regulatory policy and enforcement, and unstable geopolitical conditions, including tariffs, could significantly impact the Company’s ability to access the necessary funding to advance its business plan. The Company’s ability to raise additional funds under the ATM Sales Agreement may be limited by the Company’s market capitalization, share price and trading volume.

OFF-BALANCE SHEET ARRANGEMENTS

We have no off-balance sheet arrangements.

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

With the exception of historical matters, the matters discussed in this report are forward-looking statements that involve risks and uncertainties that could cause actual results to differ materially from projections or estimates contained herein. We intend such forward-looking statements to be covered by the safe harbor provisions for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. Such forward-looking statements include, without limitation, statements regarding the adequacy of funding, liquidity, access to capital, financing activities, the timing or occurrence of any future drilling or production from the Company’s properties, economic conditions, the strategic goals of the business, costs of any phase of development or operational line at the Kellyton Graphite Plant and estimated construction and commissioning timelines and completion dates, the start date for the mining of the Coosa Graphite Deposit, and the Company’s anticipated cash burn rate and capital requirements. Words such as “may,” “could,” “should,” “would,” “believe,” “estimate,” “expect,” “anticipate,” “plan,” “forecast,” “potential,” “intend,” “continue,” “project,” “target” and variations of these words, comparable words and similar expressions generally indicate forward-looking statements. You are cautioned not to place undue reliance on forward-looking statements. Actual results may differ materially from those expressed or implied by these forward-looking statements. Factors that could cause actual results to differ materially from these forward-looking statements include, among others:

• the spot price and long-term contract price of graphite (both flake graphite feedstock and purified graphite products) and vanadium, and the world-wide supply and demand of graphite and vanadium;
• the effects, extent and timing of the entry of additional competition in the markets in which we operate;
• our ability to obtain or maintain contracts or other agreements with customers;
• available sources and transportation of graphite feedstock;
• the ability to control costs and avoid cost and schedule overruns during the development, construction and operation of the Kellyton Graphite Plant;
• the ability to construct and operate the Kellyton Graphite Plant in accordance with the requirements of permits and licenses and the requirements of tax credits and other incentives;
• the effects of inflation, including labor shortages and supply chain disruptions;
• rising interest rates and the associated impact on the availability and cost of financing sources;
• uncertainty in debt and equity capital markets and the associated impact on the availability and cost of financing sources;
• the availability and supply of equipment and materials needed to construct the Kellyton Graphite Plant;
• stock price volatility;
• changes in the U.S. administration or government regulation of the mining and manufacturing industries in the U.S.;
• unanticipated geopolitical, geological, processing, regulatory and legal or other problems we may encounter, including government shutdowns;
• the results of our exploration activities, and the possibility that future exploration results may be materially less promising than initial exploration results;
• any graphite or vanadium discoveries not being in high enough concentration to make it economic to extract the minerals;
• our ability to finance growth plans;
• our ability to obtain and maintain rights of ownership or access to our mining properties;
• currently pending or new litigation or arbitration;
• recent changes in legislation, regulations and economic conditions regarding tariffs, the implementation of the U.S. Department of Governmental Efficiency (“DOGE”) and related DOGE budget and spending cuts and the potential that this affects the demand for our products or our cost or ability to produce or sell them;
• the potential impact that foreign country tariffs may have on our construction costs or ability to (i) source and procure necessary raw materials for the manufacture and provision of our products and services; and (ii) sell and deliver our products to such foreign countries; and
• our ability to maintain and timely receive mining, manufacturing, and other permits from regulatory agencies.

In addition, other factors are described in our Annual Report, and the other reports we file with the SEC. Most of these factors are beyond our ability to predict or control. Future events and actual results could differ materially from those set forth herein, contemplated by or underlying the forward-looking statements. Forward-looking statements speak only as of the date on which they are made. We disclaim any obligation to update any forward-looking statements made herein, except as required by law.

Evaluation of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in its filings with the SEC is recorded, processed, summarized and reported within the time period specified in the SEC’s rules and forms, and that such information is accumulated and communicated to management, including the Company’s Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure. In designing and evaluating the disclosure controls and procedures, management has recognized that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply judgment in evaluating the Company’s controls and procedures.

During the fiscal period covered by this report, the Company’s management, with the participation of the Chief Executive Officer and Chief Financial Officer of the Company, carried out an evaluation of the effectiveness of the design and operation of the Company’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended). Based on that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures were effective at a reasonable assurance level as of September 30, 2025.

Changes in Internal Controls

There were no changes in our internal control over financial reporting during the three month September 30, 2025, that materially affected, or are reasonably likely to materially affect our internal control over financial reporting.

An investment in our Common Stock involves various risks. When considering an investment in us, careful consideration should be given to the risk factors discussed in Risk Factors in Item 1A in our Annual Report.