The Donaldsonville CCS project was completed in July 2025, costing approximately $200 million and expected to produce 1.9 million tons of low-carbon ammonia annually. Additionally, the Blue Point joint venture was formed in Q2 2025 to construct a $3.7 billion low-carbon ammonia production facility, with CF holding a 40% ownership.

Capital expenditures for the first six months of 2025 more than doubled to $377 million (from $182 million in 6M 2024), including $90 million related to the Blue Point joint venture. Full-year 2025 consolidated capital expenditures are projected to be $800-$900 million, with $300-$400 million for the Blue Point JV.

The company reported approximately $2.3 billion in remaining performance obligations as of June 30, 2025, with significant portions expected to be recognized as revenue in 2026-2028 (38%) and 2029-2031 (17%), providing a stable future revenue stream and indicating strong customer commitments.

The company sold its Ince facility in Q1 2025, recognizing a $23 million loss as part of its U.K. operations restructuring plan initiated in 2022. This demonstrates management's willingness to divest non-core or underperforming assets to streamline operations.

The Ammonia segment's gross margin for the six months ended June 30, 2025, increased by $110 million, or 52%, to $322 million, driven by an 18% increase in sales volume and a 6% increase in average selling prices, alongside a net decrease in manufacturing and maintenance costs.

Selling, general and administrative expenses increased $25 million (33%) to $101 million in Q2 2025, primarily due to higher incentive compensation and costs related to corporate initiatives. Additionally, 'Other operating-net' swung from $39 million income in Q2 2024 to $8 million expense in Q2 2025, largely due to FEED studies for clean energy initiatives.

The Trump administration reimposed and increased various tariffs on imports from Canada, EU, Asian countries, Algeria, Trinidad, Brazil, and China, with ongoing negotiations and potential for unpredictable changes, which could impact supply/demand, capital project costs, and global trade relations.

The income tax provision for Q2 2025 included $21 million of expense related to an increase in unrecognized tax benefits resulting from ongoing tax audits, raising the effective tax rate by 3.4 percentage points to 22.4% for the quarter.

The cost of natural gas used for production increased 77% YoY to $3.36 per MMBtu in Q2 2025, and 39% to $3.52 per MMBtu for the six months, leading to a $136 million and $176 million decrease in gross margin, respectively, highlighting the continued exposure to this volatile raw material.

Average selling prices for products increased 17% YoY to $376 per ton in Q2 2025 and 9% YoY to $354 per ton for 6M 2025. This was driven by higher global energy costs and supply disruptions in key regions (Egypt, Iran, Russia) that raised the global market clearing price.

The company's strategy to decarbonize its ammonia production network and build new low-carbon ammonia capacity, including the Blue Point JV, positions it to capture emerging opportunities in clean energy and maintain a competitive edge in a transitioning market.

North America continues to be the primary revenue driver, contributing $1.686 billion (89%) of total revenue in Q2 2025 and $3.059 billion (86%) for 6M 2025, indicating a strong regional competitive advantage and market presence.

The cost of natural gas used for production increased 77% YoY to $3.36 per MMBtu in Q2 2025 and 39% YoY to $3.52 per MMBtu for the six months, directly contributing to a $136 million and $176 million reduction in gross margin, respectively, highlighting a key challenge to operational efficiency.

Higher costs associated with maintenance activity in Q2 2025, coupled with increased selling, general and administrative expenses ($25 million YoY) due to incentive compensation and corporate initiatives, impacted overall operational efficiency and contributed to higher cost of sales.

Sales volume increased 3% to 5.0 million tons in Q2 2025 and 7% to 10.0 million tons for 6M 2025, primarily due to higher supply availability resulting from increased beginning inventory and higher production in 2025 compared to 2024 (which was impacted by a winter storm).

The company completed its Donaldsonville CCS project (approx. $200M cost) and formed the Blue Point joint venture to construct a $3.7 billion low-carbon ATR ammonia production facility with CCS, demonstrating a strong commitment to advanced environmental technologies.

The Blue Point joint venture executed an agreement with Linde plc for an air separation unit (ASU), reducing the total projected cost of the low-carbon ATR ammonia production facility from $4.0 billion to $3.7 billion, showcasing effective technology sourcing and cost optimization.

The shift in 'Other operating-net' from $39 million income in Q2 2024 to $8 million expense in Q2 2025 is primarily attributed to costs related to FEED studies for the company's clean energy initiatives, indicating ongoing investment in future technological developments.

The Board authorized a new $2 billion share repurchase program in May 2025, following the existing $3 billion program. In the first six months of 2025, the company repurchased 8.2 million shares for $636 million, contributing to an 11% reduction in diluted weighted-average common shares outstanding.

Capital expenditures surged 107% YoY to $377 million for the first six months of 2025, including $90 million for the Blue Point joint venture. This reflects a clear strategic priority to invest in the low-carbon ammonia production network and related infrastructure, aligning with long-term growth objectives.

Dividends declared per common share remained consistent at $0.50 in Q2 2025 and $1.00 for the six months ended June 30, 2025, demonstrating a commitment to returning capital to shareholders while simultaneously funding substantial growth initiatives.

The Donaldsonville carbon capture and sequestration (CCS) project, costing approximately $200 million, was completed in July 2025. This facility is expected to capture and sequester up to 2 million metric tons of CO2 annually and produce approximately 1.9 million tons of low-carbon ammonia, significantly advancing environmental commitments.

The formation of the Blue Point joint venture (CF 40% ownership) to build a $3.7 billion low-carbon ATR ammonia production facility, designed to capture over 95% of CO2 (approx. 2.3 million metric tons annually), underscores a strong commitment to sustainable product offerings and reduced emissions.

Both the Donaldsonville and Blue Point CCS projects are expected to qualify for tax credits under Section 45Q of the Internal Revenue Code, which provides incentives for carbon sequestration, demonstrating a strategic approach to funding sustainability initiatives and improving project economics.

Average selling prices increased 17% YoY in Q2 2025 and 9% YoY for 6M 2025 across all segments, primarily due to higher global energy costs and supply disruptions in key regions (Egypt, Iran, Russia), which raised the global market clearing price.

The Trump administration's reimposition and increase of various tariffs on imports from multiple countries, coupled with ongoing negotiations and the potential for unpredictable changes, introduce significant uncertainty regarding global trade relations and their impact on business operations and project costs.

Average daily market prices for natural gas at Henry Hub increased 55% YoY to $3.16 per MMBtu in Q2 2025 and 66% YoY to $3.71 per MMBtu for 6M 2025, reflecting a tighter supply/demand balance and elevated global price spreads, which directly impacts the company's primary raw material cost.