EAF 10-K & 10-Q changes, risk factors and insider trading

Our business, financial condition, results of operations, and cash flow can be affected by a number of factors, whether currently known or unknown, including but not limited to those described below. You shouldPlease 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. Moreover, the risks below are not the only risks we face and additional risks not currently known to us or that we presently deem immaterial may emerge or become material at any time. The occurrence of any of the following risks could materially and adversely affect our business, financial condition, results of operations, and cash flow, in which case, the market price of our securities could decline. 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.industry, Thewhich EAF steel production industry historically has beenis highly cyclical and is affected significantly by general economic conditions. As a result, we have experienced periods of significant net losses.

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 downturndownturns 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 abilityoverall todemand collectand ourresult accountsin receivableless on a timely basis or at all.sales.

Pricing for graphite electrodes has historically been cyclical and thefuture declines in price of graphite electrodes may continue to declineadversely inaffect theour future.results.

Pricing for graphite electrodes has historically been cyclical, reflecting the demand trends of the global EAF steelmaking industry and the supply of graphite electrodes. In addition, as petroleum needle coke reflects a significant percentage of the raw material cost of graphite electrodes, graphite electrodes have historically been priced at a spread to petroleum needle coke, which in the past has increased in tight demand markets. Between 20052006 and 2024,2025, our weighted-average realized price of graphite electrodes for non-LTAs was approximately $6,000$6,200 per MT (on an inflation‑adjusted basis using constant 20242025 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 20242025 dollars. Following the significant rationalization of graphite electrode production globally, the resumption of growth in EAF steel production, falling scrap prices, reductions in Chinese steel exports and constrained supply of needle coke, graphite electrode prices reached record highs in 2018.

Prices as of December 31, 20242025 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 throughoutthrough 2024,2025, spot prices began decreasing given the softer commercial environment. Spot prices for the year ended December 31, 20242025 were approximately $4,2004,100 per MT on a weighted-average basis. Our business, financial condition and operating results have been, and are beingbeing, materially and adversely affected by the depressed spot price of graphite electrodes as of December 31,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, particularly as we implement our price increase initiative as described below.future.

WeIf maywe beare unable to realizeimplement theprice benefits of our initiative to increase prices on our productsincreases in certain regions, or if these increases lead to loss 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 onshare, our results of operations, cash flow, liquidityliquidity, and financial condition.condition could be materially adversely affected.

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. We operate in a highly competitive industry and, as a result, we may not be successful in raising or maintaining our existing prices. 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 thisfuture initiativeprice to increase prices,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 iscontinues currentlyto doingdo so now,so, which is negatively impacting our sales, margins and profitability.profitability, and may continue to do so in the future.

Overcapacity in the graphite electrode industry has adversely affected pricing in the past, and iscontinues currentlyto doingdo so now.so. Global graphite electrode production capacity that outpaces demand for graphite electrodes adversely affects the price of graphite electrodes. Excess production capacitycapacity, particularly in China, is resulting in manufacturers producingcurrently andpricing exportinga electrodessignificant atportion pricesof thattheir areelectrode lower than prevailing domestic prices, and sometimessales at or below theirmarket cost of production.prices. Excessive imports into the Americas and EMEA, which markets collectively made up 89%94% of our net sales for the year ended December 31, 2024,2025, can also exert downward pressure on graphite electrode prices, which negatively affects our sales, margins and profitability.

The graphite electrode industry is highly competitive. Our market share, net sales or net income could decline due to vigorous price and other competition.

Competition in the graphite electrode 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. Graphite electrodes, in particular, are subject to rigorous price competition. 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. Competition could prevent implementation of price increases, including those described above, require price reductions or require increased spending on R&D, marketing and sales that could adversely affect us. In such a competitive market, changes in market conditions, including customer demand and technological development, as well as increased exports by Chinese EAF steel suppliersand graphite electrode suppliers, could adversely affect our competitiveness, sales and/or profitability.

We are dependent on the supply of petroleum needle coke.coke Ourand results of operations could deteriorate ifextended disruptions in the supply ofcould petroleumnegatively needleimpact cokeour occur for an extended period.operations.

Petroleum needle coke is our key raw material used in the production of graphite electrodes. At full operating levels, Seadrift provides a substantial portion of our petroleum needle coke requirements, with third partythird-party purchases making up a small portion of the balance. A disruption in Seadrift’s production of petroleum needle coke could require us to obtain additional petroleum needle coke from third-party sources. There is no assurance that we would be able to obtain acceptable alternative sources on a cost-effective or timely basis, or at all. 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.

We manufacture graphite connecting pins, which are used by customers to connect and fasten graphite electrodes together in a column for use in an EAF. For the past several years, all of our connecting pin production was performed at our Monterrey, Mexico facility. 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 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. There is no assurance that we would be able to obtain acceptable alternative sources on a cost-effective or timely basis, or at all. An extended interruption in the supply of connecting pins would result in the loss of sales, which could have a material adverse effect on our business, financial condition or operating results.

We are dependent on suppliesthe cost and availability of manufacturing inputs, including raw materials (in addition to petroleum needle cokecoke, energy and freight). Our results of operations could deteriorate if thosesuch suppliesinputs increase in cost or are substantially disrupted for an extended period.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 energy,freight, have been subject to significant price fluctuations. For example, Seadrift may not always be able to obtain an adequate quantity of suitable low‑sulfur decant oil for the manufacture of petroleum needle coke, and capital may not be available to install equipment to allow use of higher sulfur decant oil (which is more readily available in the United States) if supplies of low‑sulfur decant oil become more limited in the future. Further, low-sulfur emissions regulations adopted in 2020 by the International Maritime Organization have at times negatively affected pricing for low-sulfur decant oil and they may again in the future cause similar adverse impacts.

We have in the past entered into, and may continue in the future to enter into, derivative contracts and short‑durationduration, fixed-rate purchase contracts to effectively fix a portion of our exposure to certain products. These hedging strategies may not be available or successful in eliminating our exposure. A substantial increase in raw materialmaterial, 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, wouldcould have a material adverse effect on our business, financial condition, results of operations orand cash flows. These hedges may be insufficient or ineffective in protecting against the impact of these fluctuations.

We are in an energy intensive industry that requires both natural gas and electricity in our manufacturing process. We primarily rely on third parties for the supply of our energy resources consumed in the manufacture of our products. The prices for third-party electricity and natural gas are subject to volatile market conditions, particularly in Europe. These market conditions often are affected by factors beyond our controlcontrol, and we may be unable to raise the price of our products to mitigate the effects of increased energy costs in our manufacturing processes. In addition, our customers are subject to these same market conditions.

Our operations are subject to hazards associated with manufacturing and the related use, storage, transportation and disposal of raw materials, products and wastes. These hazards include explosions, fires, severe weather (including but not limited to hurricanes or other adverse weather that may be increasing as a result of climate change) and natural disasters, industrial accidents, mechanical failures, discharges or releases of toxic or hazardous substances or gases, transportation interruptions, human error and terrorist activities. These hazards can cause personal injury and loss of life, severe damage to or destruction of property and equipment as well as environmental damage, and may result in suspension of operations and the imposition of civil and criminal liabilities, including penalties and damage awards. While we believe our insurance policies are in accordance with customary industry practices, such insurance maydoes not cover all risks associated with the hazards of our business and is subject to limitations, including deductibles and maximum liabilities covered. We may incur losses beyond the limits, or outside the coverage, of our insurance policies. In the future, we may not be able to obtain coverage at current levels, and our premiums may increase significantly on coverage that we maintain. Costs associated with unanticipated events in excess of our insurance coverage could have a material adverse effect on our business, competitive or financial position or our ongoing results of operations.

A substantial 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:

•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

Our results of operations could deteriorate if our manufacturing operations were substantially disrupted for an extended period for any reason, including equipment failure, legal proceedings, climate change, natural disasters, public health crises, political crises or other catastrophic events.reason.

Our manufacturing operations are subject to disruption due to equipment failure, extreme weather conditions, floods, hurricanes and tropical storms and similar events, major industrial accidents, including fires or explosions, cybersecurity incidents, strikes and lockouts, adoption of new laws or regulations, changes in interpretations of existing laws or regulations or changes in governmental enforcement policies, civil disruption, riots, terrorist attacks, war, public health crises and other events. These events may also impact the operations of one or more of our suppliers. For example, the potential physical impacts of climate change on our operations are uncertain and will likely be particular to the geographic circumstances. These physical impacts may include changes in rainfall and storm patterns, shortages of water or other natural resources, changing sea levels, changes in the frequency of natural or human induced disasters, including earthquakes, tsunamis, storms, hurricanes, floods, fires, droughts, tornadoes and other extreme weather events or conditions, and changing global average temperatures. For instance, our Seadrift facility in Texas and our Calais facility in France are located in geographic areas less than 50 feet above sea level. As a result, any future rising sea levels could have an adverse impact on their operations and on their suppliers. In the event manufacturing operations are substantially disrupted at one of our primary operating facilities, such as the September 2022 temporary suspension of our operations located in Monterrey, Mexico, we may not have the ability to increase production at our remaining operating facilities in order to compensate without considerable time and expense. To the extent any of these events occur, our business, financial condition and operating results could be materially and adversely affected.

Our information technology systems are an important element for effectively operating our business. Information technology systems or processes, and the information technology systems or processes of our customers, our third-party business partners, our vendors or other parties that have been entrusted with our information, including risks associated with any failure to maintain or upgrade our systems, network disruptions and breaches of data security could disrupt our operations by impeding our processing of transactions, our ability to protect customer or company information or our financial reporting, leading to increased costs. It is possible that future technological developments could adversely affect the functionality of our computer systems and require further action and substantial funds to prevent or repair computer malfunctions. Our computer systems, including our back‑up systems, could be damaged or interrupted by power outages, computer and telecommunications failures, computer viruses, cybercrimes, internal or external security breaches, events such as fires, earthquakes, floods, tornadoes and hurricanes, errors by our employees, or other cybersecurity incidents. Cybersecurity incidents and similar attacks vary in their form and can include the deployment of harmful malware or ransomware, denial-of-service attacks, and other attacks, which may affect business continuity and threaten the availability, confidentiality and integrity of our systems and information. 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. Cybersecurity threat actors also may attempt to exploit vulnerabilities in software that is commonly used by companies in cloud-based services and bundled software. Although we have taken steps to address these concerns by implementing network security, back‑up systems and internal control measures, these steps may be insufficient or ineffective. Security and/or privacy breaches, cybersecurity incidents, acts of vandalism or terror, misplaced, corrupted, altered or lost data, programming, and/or human error or other similar events with respect to our information technology systems or processes, or the information technology systems or processes of third-parties that have been entrusted with our information, could have a material adverse effect on our business strategy, financial condition, results of operations or cash flows, including major disruptions to business operations, loss of intellectual property, release of confidential information, alteration or corruption of data or systems, costs related to remediation or the payment of ransom, litigation, administrative, and civil or criminal investigations or actions, regulatory intervention and sanctions or fines, investigation and remediation costs and possible prolonged negative publicity.

Patents are subject to complex factual and legal considerations. Accordingly, the validity, scope and enforceability of any particular patent can be uncertain. Therefore, we cannot assure you that:

We cannot assure you that agreements designed to protect our proprietary know‑how and information will not be breached, that we will have adequate remedies for any such breach, or that our strategic alliance suppliers and customers, consultants, employees or others will not assert rights against us with respect to intellectual property arising out of our relationships with them.

From time to time, we may become subject to legal proceedings, including allegations and claims of alleged infringement or misappropriation by us of the patents and other intellectual property rights of third parties. We cannot assure you that the use of our patented technology or proprietary know‑how or information does not infringe the intellectual property rights of others. In addition, attempts to enforce our own intellectual property claims may subject us to counterclaims that our intellectual property rights are invalid, unenforceable or are licensed to the party against whom we are asserting the claim or that we are infringing that party’s alleged intellectual property rights. We may also be obligated to indemnify affiliates or other partners who are accused of violating third parties’third-parties’ intellectual property rights by virtue of those affiliates or partners’ agreements with us, and this could increase our costs in defending such claims and our damages.

We currently benefit from U.S. and EU anti-dumping duties and tariffs against certain Chinese and Indian imports that if reduced or not extended could have a material adverse effect on our business, financial condition and results of operations, cash flow, liquidity and financial condition.operations.

These anti-dumping duties and tariffs are generally subject to periodic reviews and challenges, which can result in their revocation or reduction. There can be no assurance that these anti-dumping duties and tariffs will be continued in the future or that such anti-dumping duties and tariffs will adequately combat unfairly traded imports. If these anti-dumping duties and tariffs were to be revoked or reduced in the future, our business, financial condition and results of operations would be adversely impacted.

The U.S. government has imposed tariffs on certain foreign goods from a variety of countries and regions, mostincluding notablyChina China,and India, that it perceives as engaging in unfair trade practices, and previously raised the possibility of imposing significant, additional tariff increases or expanding the tariffs to capture other types of goods from other countries. In response, many of these foreign governments have imposed retaliatory tariffs on goods that their countries import from the U.S. Uncertainties with respect to tariffs, trade agreements or any potential trade wars could negatively affect the global economy and could affect demand for our products and could have a material adverse effect on our financial condition, results of operations and cash flows. In addition, we may lose customers who choose our competitor’s products over our own as a result of such trade barriers. Changes in tariffs and trade barriers could also result in adverse changes in the cost and availability of our raw materials, and our ability to manufacture globally to support global sales which could lead to increased costs that we may not be able to effectively pass on to customers, each of which could materially adversely affect our operating margins, results of operations and cash flows.

Our credit agreement (as amended, the “2018 Credit Agreement”) currently provides for a $225 million senior secured revolving credit facility after giving effect to the December 2024 amendment (the “Fourth Amendment”) that decreased the revolving commitments under the 2018 Credit Agreement by $105 million from $330 million (the “2018 Revolving Credit Facility”). As any borrowings under the 2018 Revolving Credit Facility remain subject to compliance with the financial covenant in our 2018 Revolving Credit Facility, our operating performance resulted in a reduction of the availability under our 2018 Revolving Credit Facility.

•requirecause us to reduce or delay capital expenditures or sell assets or operations to meet our scheduled debt service obligations;

•pay dividends or repurchase stock; and

•engage in certain affiliate transactions;transactions.

We are subject to stringent environmental, health and safety laws and regulations relating to our current and former properties (including former onsite landfills over which we have retained ownership), other properties that neighbor ours or to which we sent wastes for treatment or disposal, as well as our current raw materials, products, and operations. Some of our products (including our raw materials) are subject to extensive environmental and industrial hygiene regulations governing the registration and safety analysis of their component substances. Coal tar pitch, which is classified as a substance of very high concern under the EU’s Registration, Evaluation, Authorization and Restriction of Chemical Regulation (“REACH”) regulations, is used in certain of our processes but in a manner that we believe does not currently require us to obtain a specific authorization under the REACH guidelines. Violations of these laws and regulations, or of the terms and conditions of permits required for our operations, can result in damage claims, reputational harm, the imposition of substantial fines and sanctions and require the installation of costly pollution control or safety equipment or costly changes in operations to limit pollution or decrease the likelihood of injuries. In addition, we are currently conducting remediation and/or monitoring at certain current and former properties, including at our Monterrey, Mexico facility,properties and may become subject to material liabilities in the future for the investigation and cleanup of contaminated properties, including with respect to emerging contaminants or for properties on which we have ceased operations. We have been in the past, and could be in the future, subject to claims alleging personal injury, death or property damage resulting from exposure to hazardous substances, accidents or otherwise for conditions creating an unsafe workplace. Further, noncompliance or alleged noncompliance with or stricter enforcement of, or changes in interpretations of, existing laws and regulations, adoption of more stringent new laws and regulations, discovery of previously unknown contamination or imposition of new or increased requirements could require us to incur costs or become the basis of new or increased liabilities or reputational harm that have a material adverse impact on our operations, costs or results of operations. It is also possible that the impact of safety and environmental regulations on our suppliers could affect the availability and cost of our raw materials.

For example, legislators, regulators and others, as well as many companies, are considering ways to reduce emissions of greenhouse gases (“GHGs”) due to scientific, political and public concern that GHG emissions are altering the atmosphere in ways that are affecting, and are expected to continue to affect, the global climate. The EU has established GHG regulations and is revising its emission trading system for the period after 2020 in a manner that may require us to incur additional costs. The United States has required annual reporting of GHG emissions from certain large sources beginning in 2011 and various and regional state efforts to reduce GHG emissions have also been implemented. Further measures,measures in the United States, EU and many other countries, may be enacted in the future. In particular, in December 2015, more than 190 countries participating in the United Nations Framework Convention on Climate Change reached an international agreement related to curbing GHG emissions (the “Paris Agreement”). FurtherFurther, GHG regulations under the Paris Agreement or otherwise may take the form of a national or international cap‑and‑trade emissions permit system, a carbon tax, emissions controls, reporting requirements, or other regulatory initiatives. For more information, see the section entitled “Business.”

•provisions in our Amended Certificate of Incorporation provide for a classified Board of Directors such that only one of three classes of directors is elected each year, which prevents our stockholders from replacing the majority of our directors at once;

•under our Amended Certificate of Incorporation, our Board of Directors havehas authority to cause the issuance of preferred stock from time to time in one or more series and to establish the terms, preferences and rights of any such series of preferred stock, all without approval of our stockholders; and

Although our Board of Directors has authorized a stock repurchase program that does not have an expiration date, the program does not obligate us to acquire any particular amount of shares of common stock, and the stock repurchase program may be suspended or discontinued at any time at our discretion. We did not repurchase any shares of common stock under this program in 2024.2025. We cannot guarantee that the program will be fully consummated or that it will enhance long-term stockholder value. The 2018 Revolving Credit Facility, the Initial First Lien Term Loan Facility and the indentures governing the New Notes limit our ability to make repurchases under the stock repurchase program. The program could affect the trading price of our stock, and increase volatility, and any announcement of a termination of this program may result in a decrease in the trading price of our common stock. In addition, our use of this program will diminish our cash.

As of December 31, 2024,2025, we had liquidity of $464.2$340.0 million, consisting of $108.0$101.6 million of availability under our 2018 Revolving Credit Facility, $100.0 million of availability under our Initial First Lien Term Loan Facility (with respect to the Delayed Draw Commitments thereunderthereunder, which we intend to draw in full prior to its expiration in July 2026) and cash and cash equivalents of $256.2$138.4 million. As of December 31, 2024,2025, we had total debt of approximately $1.1 billion.

For GrafTech, despite the industry-wide headwinds, we anticipateexpect to achieve a low double-digit percentage point5-10% year-over-year increase in our sales volume for 20252026 on a full-year basisbasis, as we continue to regaingain market share.share This reflectsreflecting our compelling customer value proposition and our ongoing focus on delivering on the needs of our customers. Of our anticipated 20252026 sales volume, to date, we have overapproximately 60%65% committed in our order book following the successful completion of the customer negotiations that occur in the fourth quarter of each year. Specific to the first quarter of 2026, we expect a year-over-year increase in our sales volume of approximately 10%.

AsWhile itwe relatesare toencouraged price,by challengingour ongoing strong volume performance, industry-wide pricing dynamicslevels have persisted in most regions and the pricing environment remainsremain unsustainably low. Challenging pricing dynamics, most notably aggressive competitor pricing behavior, increased further during the fourth quarter of 2025 and we expect that pressure to continue into 2026. As a result, we arewill takingcontinue furtherto execute actions to accelerate our path to normalized levels of profitability and support our ability to invest in our business. TheseThis includeincludes initiativesfurther to optimizeoptimizing our order book andby activelycontinuing to shift the geographic mix of our businesssales volume to regions where there is an opportunity to capture higher average selling prices.prices, Inparticularly addition,in wethe haveUnited informedStates, while also maintaining our customersdisciplined approach of ourforegoing intentionvolume opportunities where margins are unacceptably low. We estimate that the higher mix of United States volume in 2025 compared to increasethe pricesprior byyear 15%boosted our weighted-average selling price approximately $135 per MT on volumea thatfull-year is not yet committed for 2025.basis.

As it relates to costs, we will continue to executeexpand on our initiatives to improve our cost structure. ReflectingWith theseour actions2025 andcost theperformance, benefitwe ofhave theachieved anticipateda increasecumulative decline in our salescash cost of goods sold per metric ton of 31% since the end of 2023. As we look to implement additional measures to enhance the efficiency of our production schedules and further optimize production volume levels,costs, we expect to build on this achievement with a mid-singlelow digitsingle-digit percentage pointpercentage-point decline in our cash cost of goods sold per MT for 20252026 compared to 2024 and is expected to continue to trend toward our long-term expectation of approximately $3,700 per MT.2025.

In addition,Further, we will continue to closelyprudently manage our working capital levels and capital expenditures. For 2025,2026, reflecting our anticipated volume growth, we expect thea modest increase in our net impact of working capital willlevels befor favorable to ourthe full yearyear, cashmost flow performance, although to a lesser extent thannotably in eachthe first half of the previousyear tworeflecting yearsthe whichtiming reflectedof ourplanned effortsplant tomaintenance alignand inventoryother levelstiming with our view on demand.factors. We anticipate our fullfull-year year 20252026 capital expenditures will be approximately $40$35 million.million, which we believe is an adequate level to maintain our assets at current utilization levels.

Longer term, we remain confident that the steel industry’s efforts to decarbonize will lead to increased adoption of the electric arc furnace method of steelmaking, driving long-term demand growth for graphite electrodes. We also anticipate the demand for petroleum needle coke, the key raw material we use to produce graphite electrodes, to accelerate driven by its utilization in producing synthetic graphite for useused in anodes for lithium-ion batteries forthat the growingpower electric vehiclevehicles market.and energy storage systems. We believe that the near-term actions we are taking, supported by an industry-leading position and our sustainable competitive advantages, including our substantial vertical integration into petroleum needle coke via our Seadrift facility, will optimally position GrafTech to benefit from that long-term growth.

In addition to measures of financial performance presented in our Consolidated Financial Statements in accordance with generally accepted accounting principles in the United States ("“GAAP"”), we use certain other financial measures and operating metrics to analyze the performance of our Company. The “non‑GAAP” financial measures consist of EBITDA, adjusted EBITDA, adjusted net (loss) income andloss, adjusted (loss) earnings per share, free cash flow, adjusted free cash flow and cash cost of goods sold per MT, which help us evaluate growth trends, establish budgets, assess operational efficiencies and evaluate our overall financial performance. The key operating metrics consist of sales volume, production volume, production capacity and capacity utilization.

(21) Production capacity reflects expected maximum production volume during the period depending on product mix and expected maintenance outage. Actual production may vary.vary (2) Includes graphite electrode facilities in Calais, France; Monterrey, Mexico; and Pamplona, Spain.

We define EBITDA, a non‑GAAP financial measure, as net loss plus interest expense, minus interest income, plus income taxes and depreciation and amortization. We define adjusted EBITDA, a non-GAAP financial measure, as EBITDA adjusted by any pension and other post-employment benefit (“OPEB”) expenses, rationalization and rationalization-related expenses, non‑cash gains or losses from foreign currency remeasurement of non‑operating assets and liabilities in our foreign subsidiaries where the functional currency is the U.S. dollar, stock-based compensation expense, proxy contest expenses,expenses and Tax Receivable Agreement adjustments and goodwill impairment charges.adjustments. Adjusted EBITDA is the primary metric used by our management and our Board of Directors to establish budgets and operational goals for managing our business and evaluating our performance.

• adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs;

• adjusted EBITDA does not reflect our cash expenditures for capital equipment or other contractual commitments, including any capital expenditure requirements to augment or replace our capital assets;

• adjusted EBITDA does not reflect the interest expense or the cash requirements necessary to service interest or principal payments on our indebtedness;

• adjusted EBITDA does not reflect tax payments or the income tax benefit that may represent a reduction in cash available to us;

• adjusted EBITDA does not reflect expenses relating to our pension and OPEB plans;

• adjusted EBITDA does not reflect rationalization or rationalization-related expenses;

• adjusted EBITDA does not reflect stock-based compensation expense;

• adjusted EBITDA does not reflect proxy contest expenses;

• adjusted EBITDA does not reflect Tax Receivable Agreement adjustments; and

• other companies, including companies in our industry, may calculate EBITDA and adjusted EBITDA differently, which reduces its usefulness as a comparative measure.

We define adjusted net loss, a non‑GAAP financial measure, as net loss, excluding the items used to calculate adjusted EBITDA and further excluding debt modification costs, less the tax effect of those adjustments.adjustments and non-cash income tax expense related to the establishment of a deferred tax valuation allowance. We define adjusted loss per share, a non‑GAAP financial measure, as adjusted net loss divided by the weighted average diluted common shares outstanding during the period. We believe adjusted net loss and adjusted loss per share are useful to present to investors because we believe that they assist investors’ understanding of the underlying operational profitability of the Company.

We define free cash flow, a non-GAAP financial measure, as net cash provided by or used in operating activities less capital expenditures. We define adjusted free cash flow, a non-GAAP financial measure, as free cash flow adjusted by payments made or received from the settlement of interest rate swap contracts and payments made for debt modification costs. We use free cash flow and adjusted free cash flow as critical measures in the evaluation of liquidity in conjunction with related GAAP amounts. We also use these measures when considering available cash, including for decision-making purposes related to dividends, debt servicingdividends and discretionary investments. Further, these measures help management, the Board of Directors, and investors evaluate the Company's ability to generate liquidity from operating activities.

There have been no material changes to the Risk Factors disclosed in Part 1, Item 1A., “Risk Factors,” in our Annual Report on Form 10-K filed on February 13, 2026. You should not interpret the disclosure of any risk factor to imply that the risk has not already materialized.

Sales volume for the firstsecond quarter of 2026 was 28.130.8 thousand metric tons (“MT”) and increased 14%8% compared to the firstsecond quarter of 2025.

For the firstsecond quarter of 2026, our weighted-average realized price was approximately $3,900 per MT. This represented a decrease of 5%7% compared to the firstsecond quarter of 2025. The year-over-year pricing decline reflected persistent competitive pressures across most of our principal commercial regions, partially mitigated by favorable mix as we achieved 37%29% sales volume growth in the United States, which remains the strongest region for graphite electrode pricing.

Production volume was 29.433.4 thousand MT for the firstsecond quarter of 2026, resulting in a capacity utilization rate of 74%, up from 65% for the quarter.second quarter of 2025. While production volume has exceeded sales volume for the first six months of 2026, our expectation remains to balance our production and sales volume levels on a full-year basis.

While volumedemand trends are stable,improving, current industry-wide pricing levels do not reflect the indispensable nature of graphite electrodes for electric arc furnace steelmaking. As a result, we are taking deliberate actions to restore more sustainable pricing and improve our profitability. These include implementingthe previously announced price increases of $600 to $1,200 per metric ton on uncommitted volume, actively supporting graphite electrode trade cases in key jurisdictions, including the United States and Brazil, and continuing to optimize our order book by prioritizing higher-value regions andwhile foregoing volume opportunities where margins are unacceptably low. Since announcing our price increases near the end of the first quarter of 2026, we have secured new customer commitments at weighted-average prices that are more than 15% above those for comparable commitments entered into during the first quarter of 2026.

On costs, geopolitical developments continue to impact key input costs, including oil-based raw materials, energy and logistics. InHowever, response,reflecting our ongoing cost improvement initiatives, we are expanding initiativesexpect to improveoffset ourthese costheadwinds. structure, including enhancing production efficiency and optimizing production schedules. Factoring all of this in,Accordingly, we continue to expect a low single-digit percentage-point decline in our cash cost of goods sold per MT for 2026 compared to 2025.

We are also maintaining disciplined capital and working capital management. For 2026, we continue to expect a modest increase in working capital for the full year to support higher volume. We continue to anticipate our full-year capital expenditures will be approximately $35 million, consistent with maintaining our assets at current utilization levels.

Longer term, we remain confident in the structural drivers of demand growth for graphite electrodes. The ongoing shift toward electric arc furnace steelmaking and growing demand for petroleum needle coke in battery applications are expected to support sustained industry growth. We believe the actions we are taking, combined with our vertical integration and aindustry-leading leadingcapabilities, competitive position, will enableposition GrafTech to benefitgenerate stronger financial performance as market conditions normalize.

As of MarchJune 31,30, 2026, we had liquidity of $328.7$253.0 million, consisting of cash and cash equivalents of $120.2$145.4 million,million $108.5and $107.6 million of availability under our 2018 Revolving Credit Facility and $100.0 million of availability under our Initial First Lien Term Loan Facility (with respect to the Delayed Draw Commitments thereunder, which we intend to draw in full prior to its expiration in July 2026).Facility. As of MarchJune 31,30, 2026, we had total debt of approximately $1.1$1.2 billion.

The Three Months Ended MarchJune 31,30, 2026 Compared to the Three Months Ended MarchJune 31,30, 2025

Net sales increaseddecreased $13.3$4.5 million, or 12%,3%, compared to the firstsecond quarter of 2025, reflecting higher sales volume partially offset by a year-over-year decrease in our weighted-average realized price.price, partially offset by higher sales volume.

Cost of goods sold increaseddecreased $24.1$4.6 million, or 22%,4%, compared to the firstsecond quarter of 2025,2025. reflecting increased sales volume. In addition, inventoryInventory written down in prior periods due to LCM inventory valuation adjustments had aan $7.5$8.0 million favorable impact on cost of goods sold in the firstsecond quarter of 2026 compared to a $12.3$4.3 million favorable impact in the firstsecond quarter of 2025, resulting in a $4.8$3.7 million unfavorablefavorable impact year over year. These favorable impacts were partially offset by increased volume. Our cash cost of goods sold on a per MT basis decreased 6% compared to the second quarter of 2025.

Selling and administrative expenses decreased $0.4$0.7 million, or 3%,5%, compared to the firstsecond quarter of 2025. The decrease is primarily due to reduced legalstock-based spend,compensation partiallyexpense offset by an increasedue to ourforfeitures allowanceduring forthe doubtfulsecond accounts.quarter of 2026.

Other expense (income) expense,, net represented incomeexpense of $12.0$0.5 million in the firstsecond quarter of 2026, compared to expenseincome of $0.4$2.4 million in firstthe second quarter of 2025. InThe the firstsecond quarter of 2026,2025 we recognizedincluded a $12.3 million gainbenefit related to the salewrite off of assetsthe remaining $3.8 million liability associated with previouslyour divestedTax operations,Receivable consisting of $9.3 million of cash proceeds in excess of the carrying value of the assets, net of fees and the derecognition of $3.1 million of liabilities associated with the sites.Agreement.

Interest expense decreased $5.6$1.0 million, or 19%,4%, compared to the firstsecond quarter of 2025. Interest expense for the firstsecond quarter of 2025 included $5.4$0.9 million of debt modification costs due to post-closure costs related to our debt transaction consummated in the fourth quarter of 2024 and were primarily legal, advisory and other administrative costs. See Note 7, “Interest Expense” in the Notes to the Condensed Consolidated Financial Statements for further discussion.

The following table summarizes the income tax expense (benefit):

The effective tax rate for the firstsecond quarter of 2026 was different than the U.S. statutory tax rate of 21% primarily due to no tax benefit being recorded on U.S. and Switzerland losses with a valuation allowance. AtIn Junethe 30,second quarter of 2025, the Company recognized a valuation allowance on the net tax assets carried in the United States and Switzerland. Prior to that date, the effective rate reflected the benefits associated with the losses realized in those jurisdictions, which drove the effective benefitSwitzerland of 15.5%$34.2 inmillion theand prior$8.4 period.million, respectively. Tax benefits associated with losses realized after June 30, 2025 in the United States and Switzerland are not reflected in the effective tax rate, resulting in a tax expense recognized in the current period, despite the loss incurred on a consolidated basis. Therefore, the effective tax rate for the firstsecond quarter of 2026 was different than the U.S. statutory rate of 21% primarily due to our valuation allowance position and, to a lesser extent, the mix of U.S. and foreign earnings, tax incentives and provisions of the Tax Cuts and Jobs Act. See Note 9, “Income Taxes” in the Notes to the Condensed Consolidated Financial Statements for further discussion.

The impact of these changes in the average exchange rates of other currencies against the U.S. dollar on our net sales was an increase of $2.5$0.5 million and $3.3 million for the second quarter and first quartersix months of 2026, respectively, compared to the firstsame quarterperiods of 2025. The impact of these changes on our cost of goods sold was ana increasedecrease of $6.7$1.4 million and $8.1 million for the second quarter and first quartersix months of 2026, respectively, compared to the firstsame quarterperiods of 2025.

Our sources of funds have consisted principally of cash flow from operations and debt, including our credit facilities (subject to continued compliance with the financial covenants and representations). Our uses of those funds (other than for operations) have consisted principally of capital expenditures, debt repayment, dividends, share repurchasesrepayment and other general purposes. On an ongoing basis, we expect to evaluate and consider strategic transactions, including acquisitions, divestitures, joint ventures, equity investments, equity and debt issuances, refinancing our existing debt or repurchases of our outstanding debt obligations in open market or privately negotiated transactions, as well as other strategic transactions. These transactions may require cash expenditures, which may be funded through a combination of cash on hand, proceeds from the issuance of debt or from equity offerings. Disruptions in the U.S. and international financial markets could adversely affect our liquidity and the cost and availability of financing to us in the future.

We believe that we have adequate liquidity to meet our needs for at least the next twelve months. As of MarchJune 31,30, 2026, we had liquidity of $328.7$253.0 million, consisting of cash and cash equivalents of $120.2$145.4 million,million $108.5and $107.6 million of availability under our 2018 Revolving Credit Facility (after giving effect to $7.0$7.9 million of letters of credit) and $100.0 million of availability under our Initial First Lien Term Loan Facility (with respect to the Delayed Draw Commitments thereunder). As any borrowings under the 2018 Revolving Credit Facility remain subject to compliance with the financial covenants thereunder (see below and Note 5, “Debt and Liquidity”), our operating performance as of MarchJune 31,30, 2026 and December 31, 2025 resulted in a restriction of the availability under the 2018 Revolving Credit Facility. We had long-term debt of $1.2 billion and $1.1 billion as of MarchJune 31,30, 2026 and December 31, 2025.2025, respectively. As of December 31, 2025, we had liquidity of $340.0 million, consisting of cash and cash equivalents of $138.4 million, $101.6 million of availability under our 2018 Revolving Credit Facility (after giving effect to $13.8 million of letters of credit) and $100.0 million of availability under our Initial First Lien Term Loan Facility (with respect to the Delayed Draw Commitments thereunder).

As of MarchJune 31,30, 2026 and December 31, 2025, $49.9$48.8 million and $45.6 million, respectively, of our cash and cash equivalents were located outside of the U.S. We repatriate funds from our foreign subsidiaries through dividends or repayment of intercompany obligations. All of our subsidiaries face the customary statutory limitation that distributed dividends cannot exceed the amount of retained and current earnings. Upon repatriation to the U.S., the foreign source portion of dividends we receive from our foreign subsidiaries are not subject to U.S. federal income tax because the amounts were either previously taxed or are exempted from tax by Section 245A of the Internal Revenue Service Code (the “Code”).Code.

Cash flow. Our cash flow typically fluctuates significantly between quarters due to various factors. These factors include customer order patterns, production cadence, seasonal fluctuations in working capital requirements, timing of tax and interest payments and other factors.

The New Notes Indentures contain certain covenants that, among other things, limit the Company’s ability, and the ability of certain of its subsidiaries, to incur or guarantee additional indebtedness or issue preferred stock, pay distributions on, redeem or repurchase capital stock or redeem or repurchase subordinated debt, incur or suffer to exist liens securing indebtedness, make certain investments, engage in certain transactions with affiliates, consummate certain asset sales and effect a consolidation or merger, or sell, transfer, lease or otherwise dispose of all or substantially all assets. Pursuant to the New Notes Indentures, if our pro forma consolidated total net leverage ratio is no greater than 2.50 to 1.00, we can make restricted payments so long as no default or event of default has occurred and is continuing. If our pro forma consolidated total net leverage ratio is greater than 2.50 to 1.00, we can make restricted payments pursuant to certain baskets. We were in compliance with all of our debt covenants in the New Notes Indentures as of MarchJune 31,30, 2026 and December 31, 2025.

The Existing 4.625% Notes Indenture contains certain events of default customary for agreements of its type (with customary grace periods, as applicable) and provides that, upon the occurrence of an event of default arising from certain events of bankruptcy or insolvency with respect to the Company or GrafTech Finance, all outstanding Existing 4.625% Notes will become due and payable immediately without further action or notice. If any other type of event of default occurs and is continuing, then the trustee or the holders of at least 30% in principal amount of the then outstanding Existing 4.625% Notes may declare all of the Existing 4.625% Senior Notes to be due and payable immediately. We were in compliance with all of our debt covenants as of MarchJune 31,30, 2026 and December 31, 2025.

The Existing 9.875% Notes Indenture contains certain events of default customary for agreements of its type (with customary grace periods, as applicable) and provides that, upon the occurrence of an event of default arising from certain events of bankruptcy or insolvency with respect to the Company or GrafTech Global, all outstanding Existing 9.875% Notes will become due and payable immediately without further action or notice. If any other type of event of default occurs and is continuing, then the trustee or the holders of at least 30% in principal amount of the then outstanding Existing 9.875% Notes may declare all of the Existing 9.875% Notes to be due and payable immediately. We were in compliance with all of our debt covenants as of MarchJune 31,30, 2026 and December 31, 2025.

On the Settlement Date, Barclays Bank plc (the “Fronting Lender”), agreed to provide GrafTech Global $175 million of new senior secured first lien term loans (the “Initial First Lien Term Loans”) and provided commitments (the “Delayed Draw Commitments”) with respect to $100 million of new senior secured first lien delayed draw term loans (together with the Initial First Lien Term Loans, the “First Lien Term Loans”). The First Lien Term Loans are governed by a new credit agreement, dated as of the Settlement Date, by and among GrafTech, as holdings, GrafTech Global, as borrower, GLAS USA LLC, as administrative agent, GLAS Americas LLC, as collateral agent, and the lenders from time to time party thereto (the “First Lien Term Loan Credit Agreement”). The Initial First Lien Term Loans were drawn in a single drawing on the Settlement Date. TheIn DelayedJune Draw Commitments are available to2026, the Company until July 23, 2026, subject to the satisfaction of customary conditions precedent thereto. The Company expects to drawdrew the $100 million of available Delayed Draw Commitments prior to the expiration.Commitments.

The Company payspaid a ticking fee with respect to undrawn Delayed Draw Commitments in an amount equal to 3.75% per annum of the amount of such undrawn and outstanding commitments. The First Lien Term Loans are prepayable in whole or in part at the option of the Company (i) prior to the 24-month anniversary of the Settlement Date, subject to payment of a customary “make-whole” premium (which includes a 2.00% prepayment premium), (ii) on or after the 24-month anniversary of the Settlement Date through, but excluding, the 36-month anniversary of the Settlement Date, subject to a 2.00% prepayment premium, and (iii) on or after the 36-month anniversary of the Settlement Date, without a prepayment premium. If the Company sells certain of its assets, then GrafTech Global may be required to offer to prepay the First Lien Term Loans and/or other indebtedness of GrafTech Global and/or its subsidiaries.

In February 2018, the Company entered into a credit agreement (as amended, the “2018 Credit Agreement”), which provided for (i) a $2,250 million senior secured term facility (the “2018 Term Loan Facility”) after giving effect to the June 2018 amendment (the “First Amendment”) that increased the aggregate principal amount of the 2018 Term Loan Facility from $1,500 million to $2,250 million and (ii) a $330 million senior secured revolving credit facility after giving effect to the May 2022 amendment that increased the revolving commitments under the 2018 Credit Agreement by $80 million from $250 million (the “2018 Revolving Credit Facility”). GrafTech Finance Inc. (“GrafTech Finance”) was the sole borrower under the 2018 Term Loan Facility while GrafTech Finance, GrafTech Switzerland SA (“Swissco”) and GrafTech Luxembourg II S.à.r.l. (“Luxembourg Holdco” and, together with GrafTech Finance and Swissco, the “Co-Borrowers”) were co-borrowers under the 2018 Revolving Credit Facility. In December 2024, the 2018 Credit Agreement was further amended to provide for a $225 million senior secured first lien revolving credit facility, reducing the revolving commitments under the 2018 Credit Agreement by $105 million. On June 26, 2023, GrafTech repaid the term loans under the 2018 Term Loan Facility with proceeds from the Existing 9.875% Notes issuance. As of MarchJune 31,30, 2026 and December 31, 2025, there were no outstanding term loans under the 2018 Term Loan Facility.

The 2018 Revolving Credit Facility matures on November 30, 2028, subject to a springing maturity date 91 days prior to the maturity date of certain other reference indebtedness. As of MarchJune 31,30, 2026 and December 31, 2025, the availability under our 2018 Revolving Credit Facility was $108.5$107.6 million and $101.6 million, respectively. As of MarchJune 31,30, 2026 and December 31, 2025, there were no borrowings outstanding on the 2018 Revolving Credit Facility and there was $7.0$7.9 million and $13.8 million, respectively, of letters of credit drawn against the 2018 Revolving Credit Facility as of each date. As any borrowings under the 2018 Revolving Credit Facility remain subject to compliance with the financial covenants thereunder, our operating performance as of MarchJune 31,30, 2026 and December 31, 2025 resulted in our inability to access the full amount of commitments under the facility.

The 2018 Revolving Credit Facility has customary negative covenants and events of default and is required to be prepaid in the case of certain mandatory prepayments of the First Lien Term Loans. The 2018 Revolving Credit Facility also includes a financial covenant requiring that the Company have a Senior Secured First Lien Net Leverage Ratio of no more than 4.00 to 1.00, tested quarterly, to the extent outstanding revolving loans and letters of credit (subject to certain exclusions) exceed 51.3% of the amount of commitments then-existing under the 2018 Revolving Credit Facility. We were in compliance with all of our debt covenants as of MarchJune 31,30, 2026 and December 31, 2025.

In July 2019, our Board of Directors authorized a program to repurchase up to $100.0 million of our outstanding common stock. In November 2021, our Board of Directors authorized the repurchase of an additional $150.0 million of stock repurchases under this program. We may purchase shares from time to time on the open market, including under Rule 10b5-1 and/or Rule 10b-18 plans. The amount and timing of repurchases are subject to a variety of factors including liquidity, stock price, applicable legal requirements, other business objectives and market conditions. In the first quartersix months of 2026, we did not repurchase any shares of our common stock. As of MarchJune 31,30, 2026, we had $99.0 million remaining under our stock repurchase authorization.

Potential uses of our liquidity (other than operations) include capital expenditures, debt repayments, dividends, share repurchases, and other general purposes. Any such potential uses of our liquidity may, subject to certain restrictions, be funded by existing available liquidity, the incurrence of new secured or unsecured loans, capital market issuances, including under our ATM Program, divestitures, joint ventures or equity investments. An improving economy, while resulting in improved results of operations, could increase our cash requirements to purchase inventories, make capital expenditures and fund payables and other obligations until increased accounts receivable are converted into cash. A downturn, including any recession, could significantly and negatively impact our results of operations and cash flows, which, coupled with increased borrowings, could negatively impact our credit ratings, our ability to comply with debt covenants, our ability to secure additional financing and the cost and availability of such financing.

We manage our capital expenditures by taking into account quality, plant reliability, safety, environmental and regulatory requirements, prudent or essential maintenance requirements, global economic conditions, available capital resources, liquidity, long-term business strategy and return on invested capital for the relevant expenditures, cost of capital and return on invested capital of the Company as a whole and other factors. Capital expenditures totaled $12.1$19.0 million in the threesix months ended MarchJune 31,30, 2026. We continue to expect full-year capital expenditures to be approximately $35.0 million for 2026.

In the event that operating cash flows fail to provide sufficient liquidity to meet our business needs, including capital expenditures, any such shortfall would need to be made up by borrowings under the First Lien Term Loans and 2018 Revolving Credit Facility, to the extent available, or other liquidity options described above. The Company also maintains access to credit and capital markets and may incur additional debt or issue equity securities from time to time, including under our ATM Program, which may provide an additional source of liquidity. However, there can be no guarantee that we would be able to access the credit or capital markets on commercially satisfactory terms or at all.

Net cash used in operating activities decreased $17.3$1.9 million in the first quartersix months of 2026 compared to the first quartersix months of 2025. The decrease was primarily due to a $22.3$18.5 million decrease in cash used for working capital. Accounts payable and other accruals increased by $5.4 million in the first six months of 2026 compared to a decrease of $21.8 million in the first six months of 2025 primarily due to the timing of purchases and payments. Cash flow used for inventories decreased $20.1$5.5 million in the first quartersix months of 2026 compared to the first quartersix months of 2025, which included a planned inventory build. Cash flow provided by prepaidaccounts andreceivable otherdecreased current assets increased $8.5$9.7 million in the first quartersix months of 2026 compared to the first quartersix months of 2025 primarily due to collections of value-added tax and the timing of payments. Cash provided by accounts payable and accruals increased $5.4sales million in the first quarter of 2026 compared to the first quarter of 2025 primarily due to the timing of payments.volume.

Net cash used in investing activities was $2.8$9.8 million in the threesix months ended MarchJune 31,30, 2026 compared to $10.3$14.2 million in the threesix months ended MarchJune 31,30, 2025. In the first quartersix months of 2026, we received $9.3 million of cash from the sale of assets associated with previously divested locations.

Net cash provided by (used in) financing activities was $0.4$99.9 million in the first quartersix months of 2026 compared to $0.2a $0.3 million cash use in the first quartersix months of 2025, primarily indue connectionto with vesting of RSUs and tax withholding on behalf ofdrawing the participants.remaining $100.0 million available under our Delayed Draw First Lien Term Loan.

(3)Non-cash gainslosses from foreign currency remeasurement of non-operating assets and liabilities of our non-U.S. subsidiaries where the functional currency is the U.S. dollar.

(54)GainLoss (gain) recognized related to the sale of assets associated with previously divested operations.

(3)Non-cash gainslosses from foreign currency remeasurement of non-operating assets and liabilities of our non-U.S. subsidiaries where the functional currency is the U.S. dollar.