Key Highlights
- Alcoa’s Q2 adjusted earnings per share came in at $2.12 with EBITDA of $901M, below analyst expectations of $2.55 EPS and $943M EBITDA.
- The company reduced its alumina production forecast for the full year to 9.5M–9.6M metric tons from the previous range of 9.7M–9.9M, citing operational challenges at the Pinjarra refinery in Western Australia.
- Total revenue increased to $3.97B compared to $3.02B in the same period last year, while net income rose to $407M from $164M.
- The aluminum division’s EBITDA jumped significantly to $1.07B from $97M year-over-year, driven by elevated metal prices and the resumption of previously idled production facilities.
- Shares of AA declined approximately 2.4% in pre-market trading Friday and have dropped roughly 12% since the beginning of the year.
Shares of Alcoa (AA) fell 2.4% during pre-market hours Friday, trading near $45.84, following the company’s second-quarter earnings report that underperformed analyst projections and a downward revision to its alumina production guidance for the year.
The aluminum manufacturer posted adjusted earnings of $2.12 per share and EBITDA of $901M on total revenue of $3.97B for the quarter. Wall Street analysts had anticipated earnings of $2.55 per share and EBITDA of $943M, based on FactSet consensus estimates.
Despite missing adjusted targets, the reported figures showed considerable improvement. Net income climbed to $407M, or $1.53 per diluted share, versus $164M, or $0.62 per share, in the prior-year period. Revenue grew from $3.02B in Q2 2025.
Benchmark aluminum prices have experienced a substantial increase over the past year, rising from approximately $2,600 per metric ton to around $3,200 currently — a favorable trend that positively impacted Alcoa’s aluminum operations.
Adjusted EBITDA for the aluminum segment soared to $1.07B during Q2, a remarkable increase from merely $97M in the corresponding quarter of 2025. This impressive turnaround reflects both the strength in metal pricing and the company’s decision to bring previously curtailed smelting capacity back online.
Shipments of aluminum products increased 18% compared to the first quarter. Alcoa noted this growth resulted from inventory that had been repositioned across North America in Q1 and expanded production capabilities.
Operational Challenges at Pinjarra Weigh on Alumina Performance
The company’s alumina operations presented a contrasting picture. The alumina division recorded a $96M loss, an improvement from the $139M loss posted in Q2 2025, though still unprofitable.
Alumina shipment volumes remained unchanged from the previous quarter. Shipping delays in Australia were partially balanced by decreased trading volumes and lower production at the Pinjarra refinery located in Western Australia.
Operational difficulties at the Pinjarra facility have persisted since March, when existing instability was exacerbated by natural gas supply interruptions linked to Cyclone Narelle. While the refinery has since stabilized and returned to normal operations, the lost production during this period cannot be fully recovered.
“While the refinery has since returned to stable operations and is performing well, we do not expect to fully recover the production and shipment volumes that were lost during the second quarter,” CFO Molly Beerman said on the earnings call.
Revised Production Forecast Weighs on Sentiment
Due to these operational setbacks, Alcoa lowered its full-year 2026 alumina production outlook to 9.5M–9.6M metric tons, down from the previously projected range of 9.7M–9.9M tons.
This reduction in guidance overshadowed the robust performance from the aluminum segment and contributed to the stock’s negative market response.
The stock had already been facing downward pressure prior to this earnings release. AA shares declined 3.6% on Thursday and have lost approximately 12% of their value year to date, despite the rally in underlying aluminum prices.
Additional pressure stems from the company’s late June announcement of its plan to purchase South32’s bauxite, alumina, and aluminum operations for $4.1B in a combination of cash and equity. Shares have declined 13% since the acquisition was unveiled, as investors weigh concerns about increased leverage, shareholder dilution, and potential integration challenges.
Through Thursday’s market close, AA stock had fallen 12% since the start of the year.
Get 3 Free Stock Ebooks
Discover top-performing stocks in AI, Crypto, and Technology with expert analysis.
- Top 10 AI Stocks - Leading AI companies
- Top 10 Crypto Stocks - Blockchain leaders
- Top 10 Tech Stocks - Tech giants
