Origin Materials (ORGN -8.54%) reported second quarter 2025 results on August 14, 2025, highlighting the commercial launch of its first PET bottle caps, revised manufacturing and financial guidance, and the initiation of a strategic review to pursue capacity expansion and partnerships. Revenue guidance for calendar year 2026 was sharply reduced to a range of $20 million to $30 million, and 2027 revenue guidance is set at $100 million to $200 million (non-GAAP), driven by delays in manufacturing capacity build-out related to supply chain and tariff headwinds.
Origin Materials launches world’s first PET caps to market
Origin Materials achieved a commercial milestone with its 1881 PET bottle cap for noncarbonated water, now on shelves through a partnership with Power Hydration in California. This follows the company’s first publicly named customer, Berlin Packaging, and affirms successful qualification for commercial bottling systems.
"In a separate press release issued today, we announced the first Origin PET bottle caps are now on store shelves. A world's first and a significant inflection point for the company and the packaging industry. We are now officially in the market with our 1881 cap for noncarbonated water, a $7 billion segment of the cap's market. Coupled with our recent customer announcements, including our first publicly named customer, Berlin Packaging, and recent progress reports on our manufacturing capacity build-out, we are closer than ever to bringing our transformative PET bottle cap technology to the entire $65 billion closures packaging market."
-- John Bissell, CEO
The commercial launch validates Origin Materials’ differentiated thermoforming PET technology, de-risking technical execution and enabling entry into a large and highly commoditized segment historically underserved by innovation.
Tariffs and OEM delays force Origin Materials to revise capacity and financial outlook
In July and August 2025, U.S. tariffs on EU and Switzerland imports used for CapFormer production equipment rose to 15% and 39%, respectively, materially raising cash outlays for capacity expansion. As a result, factory acceptance testing (FAT) for CapFormer lines two through eight faces delays of 30 to 90 days, as discussed on the earnings call. This is pushing some installations into 2026 and resulting in a 50%-15% aggregate reduction in previously guided manufacturing output for calendar years 2026 and 2027.
"Despite our progress, we experienced a number of OEM manufacturers' delays, including slower subcomponent deliveries and procurement delays, often due to tariff considerations. As a result, we expect FAT completion for each of our lines to be 30 to 90 days beyond our prior expectations. These delays accentuate the gap between the indicated demand for Origin's PET caps and our production capacity, leaving money on the table."
-- John Bissell, CEO
These postponements directly restrict near-term revenue and delay positive adjusted EBITDA generation, intensifying capital constraints during a period of strong indicated demand for Origin’s patented PET caps.
Strategic review seeks to accelerate capacity and derisk growth
Origin Materials has retained RBC Capital Markets to evaluate accretive strategic alternatives that could augment manufacturing capacity and access to capital, driven in part by significant customer interest and inbound collaboration inquiries. The company’s adaptive supply chain strategy and new European production partnership with Royal Hoerdijk help to offset tariff exposure and diversify global operations beyond the U.S. market.
"To pursue these emerging opportunities and help address the gap between the indicated demand and production capacity for Origin's PET caps, we have launched a strategic review with our financial adviser, RBC Capital Markets, to identify accretive strategies that can enhance the company's manufacturing capacity, marketing and distribution capabilities, and strategic capital. We believe this will enable value capture beyond what we can achieve organically, potentially enabling Origin to more effectively fulfill pent-up demand and accelerate our efforts to unlock shareholder value in the near term."
-- John Bissell, CEO
This process positions Origin Materials to address shortfalls in internal funding and operating scale, with potential benefits from joint ventures, manufacturing partners, or inorganic approaches that could preserve long-term shareholder value and accelerate penetration in the $65 billion global closures market.
Looking Ahead
Origin Materials now expects 2026 revenue of $20 million to $30 million and 2027 revenue of $100 million to $200 million, down from prior guidance of $50 million to $70 million and $150 million to $210 million, respectively, due to delayed capacity ramp and supply chain disruptions. These figures are presented on a non-GAAP basis. Adjusted EBITDA (non-GAAP) run rate breakeven has shifted from 2026 to 2027. Management reiterated ongoing CapFormer installations through 2025 and the continuation of the strategic review with RBC as avenues for accelerating capacity, mitigating tariff impact, and unlocking further customer growth.
