July 24, 2025 [Reuters]- Finnish biofuel maker and oil refiner Neste reported stronger than expected core earnings for the second quarter driven by soaring sales of sustainable aviation fuel (SAF), sending its shares rising 13% in early trading.

Neste’s comparable quarterly earnings before interest, taxes, depreciation and amortization (EBITDA) rose 42% from a year earlier to 341 million euros ($401 million).

Analysts in a company-provided consensus had expected 302.5 million euros on average.

“Our sustainable aviation fuel sales increased close to 80% quarter on quarter, benefiting from additional SAF production capacity at our renewables refinery in Rotterdam,” CEO Heikki Malinen said in a statement.

The rise in SAF sales drove the sales volume in Neste’s renewable products unit to a new quarterly record of 1,096 thousand tonnes. The unit’s sales volume margin fell 5% to $361 per tonne, but exceeded analysts’ forecast of $329 per tonne.

“We saw positive developments in the biofuel regulation both in the US and EU, largely supporting long-term renewables demand,” Malinen, who joined the company last year, said.

RBC analysts said in a research note that the second quarter was a “key litmus test” for Neste’s new management, adding the results boded well for the investor sentiment.

However, Malinen warned that the market environment was volatile and headwinds from global trade tensions were expected to continue.

Neste has been battling an excess supply in the renewable fuels market, pressuring its sales volumes and leading to a reduction of around 510 jobs globally earlier in 2025.

Alhough the group said it still expected its annual sales volumes to improve from 2024, it also forecast persisting oversupply in the renewable fuels market for the year.

Oversupply, weak demand and high input costs had made Neste cut its forecast for the renewables sales margin three times in 2024.