Key Highlights
- Second quarter EPS of -$0.20 fell short of analyst estimates by a penny; revenue of $5.2B aligned with projections
- Shares climbed approximately 7% in pre-market hours following the earnings announcement
- Quarterly adjusted EBITDA surged threefold from the previous quarter, reaching $286 million
- Third quarter adjusted EBITDA projection of roughly $575 million represents over 100% growth from Q2 and exceeds Street expectations
- Management reaffirmed full-year steel shipment outlook of 16.5–17.0 million net tons
Shares of Cleveland-Cliffs settled at $9.45 ahead of the earnings announcement, marking a 3.18% decline over the prior three-month period and a 13.38% drop year-over-year. However, the quarterly results triggered a 6.88% surge in pre-market activity.
The steelmaker reported an adjusted quarterly loss of $0.20 per share, falling a single cent short of the Wall Street consensus of -$0.19. Quarterly revenue reached $5.2 billion, in line with analyst projections and representing a 9% increase from the $4.8 billion recorded in the same quarter of 2025.
While technically an earnings miss, the gap was negligible. The more significant narrative lies in the operational progress achieved and the forward-looking projections.
The company’s adjusted EBITDA reached $286 million during the quarter, representing a threefold increase from the $95 million posted in the first quarter. Chief Executive Lourenco Goncalves highlighted that this performance came despite prolonged maintenance shutdowns during April and May.
“The second quarter marked another step in returning to the earnings power this company is capable of,” Goncalves said.
The company shipped 4.0 million net tons of steel products during the quarter. Automotive customers accounted for 29% of direct shipments. Average net selling prices improved to $1,124 per ton, climbing from $1,048 in the preceding quarter.
Bullish Q3 Forecast Fuels Stock Rally
The primary catalyst for the stock’s advance was the third quarter projection. Cleveland-Cliffs forecasted adjusted EBITDA of approximately $575 million for Q3 — representing more than a doubling from Q2’s figure and substantially exceeding consensus estimates.
Goncalves pointed to strengthening domestic demand, reduced import pressure, and lengthening order lead times as tailwinds.
The steelmaker maintained its full-year shipment guidance unchanged at a range of 16.5 to 17.0 million net tons.
As of June 30, 2026, Cleveland-Cliffs reported total liquidity of $3.1 billion. Management anticipates achieving its leverage target of below 2.5x net debt to EBITDA within the next twelve months.
Analyst Estimates Trended Lower
During the 90-day window preceding the earnings release, Cleveland-Cliffs experienced five downward EPS revisions and zero upward adjustments. InvestingPro assigns a “fair performance” rating to the company’s overall financial health.
The pre-market rally pushed shares to $10.26, representing an $0.81 gain or 8.60% increase, underscoring the market’s focus on the optimistic Q3 outlook rather than the marginal Q2 miss.
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