Albemarle, the world's largest producer of lithium for rechargeable batteries, posted a surprise second-quarter profit on Wednesday, helped by sustained demand for the metal, sending its shares up over 6% after the bell.

Lithium's use in electric vehicles, large-scale battery storage and other electronic applications has grown rapidly, with demand up 24% last year and likely to grow 12% annually for the next decade, according to data from consultancy Fastmarkets.

Albemarle said its net sales came in at $1.33-billion during the quarter, 7% lower than last year but still above analysts' expectations of $1.22-billion, according to data compiled by LSEG.

Its revenue fell year-over-year as a result of lower pricing, which was offset by volume growth in its energy storage and specialties business segments.

Lithium prices have fallen more than 90% in the past two years due in part to oversupply in China, fueling layoffs, corporate buyouts and project delays across the globe.

To weather the pricing glut, Albemarle has taken measures such as job cuts and cancelling expansion projects - including a key US lithium refinery.

Earlier this year, Albemarle launched a "comprehensive review of its cost and operating structure," which is expected to be completed by October.

The company on Wednesday lowered its annual capital expenditure plan to be in the range of $650-million to $750 million, compared with its prior view of $700-million to $800-million.

Albemarle's cash from operations rose to $538-million during the first half of the year and it now expects to generate positive free cash flow (FCF) in 2025.

Scotiabank analyst Ben Isaacson said that while the market would respond favorably to the FCF outlook, there could be downward revisions to the 2026 forecast as Albemarle's long-term agreements begin to expire.

The Charlotte, North Carolina-based company reported quarterly adjusted profit of 11 cents per share, compared with expectations of a loss of 82 cents per share.