Cleveland-Cliffs posts weaker-than-expected Q2 earnings, upbeat Q3 outlook lifts shares
US-based steel producer Cleveland-Cliffs reported an adjusted loss of $0.20 per share in the second quarter, slightly worse than analysts' expectation of a $0.19 per share loss.
During the same period, the company's revenue increased 9% year on year to $5.2 billion, in line with market expectations.
Cleveland-Cliffs' adjusted EBITDA more than tripled, rising from $95 million in the first quarter to $286 million.
Q3 EBITDA guidance beats expectations
The company expects to generate approximately $575 million in adjusted EBITDA in the third quarter of 2026. The guidance points to more than double the second-quarter EBITDA and exceeds market expectations.
Cleveland-Cliffs also maintained its 2026 steel shipment guidance at 16.5-17 million net tons.
Chairman, President and CEO Lourenco Goncalves said the second quarter marked an important step toward restoring the company's historical profitability levels. He noted that operating performance improved significantly despite planned maintenance outages carried out in April and May.
Steel prices and demand continue to recover
The company's steel products shipment volume totaled 4 million net tons in the second quarter, with the automotive sector accounting for 29% of direct sales.
The average net selling price increased from $1,048/ton in the first quarter to $1,124/ton.
Goncalves said customer demand in the US steel market continues to strengthen, while lower imports and longer lead times are providing additional support for steel prices.
Focus remains on reducing debt
As of June 30, 2026, Cleveland-Cliffs reported $3.1 billion in liquidity.
The company reaffirmed its target of reducing its net debt-to-EBITDA ratio to below 2.5x over the next 12 months, highlighting management's confidence in its balance sheet and the ongoing recovery in profitability.
Investors responded positively to the company's stronger-than-expected third-quarter guidance. Cleveland-Cliffs shares rose approximately 7% in US pre-market trading following the release of the financial results.
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