Cleveland-Cliffs earnings exceeded analyst expectations in the third quarter of 2026, while revenue fell short despite rising from a year earlier. The steelmaker reported adjusted earnings of $0.28 per diluted share on October 19, beating estimates by $0.04, and forecast further improvement in adjusted EBITDA in the fourth quarter.
Key Takeaways
- Adjusted earnings beat expectations, but revenue missed forecasts by $110 million.
- Quarterly GAAP earnings returned to profit after a second-quarter loss.
- Management expects higher pricing to lift fourth-quarter adjusted EBITDA despite seasonal and cost pressures.
Table of Contents
- Cleveland-Cliffs earnings improve despite revenue miss
- Higher steel prices support the profit recovery
- Outlook depends on pricing and contract changes
- Conclusion
Cleveland-Cliffs earnings improve despite revenue miss
For the quarter ended September 30, consolidated revenue reached $5.612 billion, compared with $4.734 billion a year earlier and $5.226 billion in the second quarter. The year-over-year increase was not enough to meet analyst expectations.
Cleveland-Cliffs’ third-quarter 2026 results announcement showed GAAP diluted earnings of $0.26 per share, compared with a loss of $0.25 in the preceding quarter. Adjusted earnings of $0.28 per share also reversed a second-quarter adjusted loss of $0.20.
The results therefore showed an operating recovery alongside a mixed performance against market forecasts: earnings exceeded expectations, while sales did not. The adjusted earnings measure supplements rather than replaces the company’s GAAP results.
| Item | Details |
|---|---|
| Q3 consolidated GAAP net income | $165 million |
| Q3 net income attributable to Cliffs shareholders | $152 million, after income attributable to noncontrolling interests |
| Liquidity at September 30, 2026 | $3.2 billion |
Higher steel prices support the profit recovery
Average net selling prices for steel products rose to $1,177 per net ton from $1,124 in the second quarter. Steel product sales volumes increased to 4.150 million net tons from 4.025 million.
Adjusted EBITDA reached $612 million, up from $286 million in the second quarter and above management’s earlier $575 million guidance. Chairman and Chief Executive Officer Lourenco Goncalves said selling prices, sales volumes and unit costs all improved sequentially.
Outlook depends on pricing and contract changes
Cleveland-Cliffs expects fourth-quarter adjusted EBITDA of approximately $715 million. Management attributes the anticipated increase to higher pricing, partly offset by seasonality, additional maintenance outages, input costs and incentive compensation accruals.
For 2027, the company expects adjusted EBITDA to exceed $4 billion, based on contract changes and prevailing price forecasts. That figure is a forward-looking management expectation, not a reported result or a guaranteed outcome.
Goncalves also said the company expects significant fourth-quarter debt reduction, supported by anticipated free cash flow and property sale proceeds. Management continues to target net debt below 2.5 times EBITDA by the middle of 2027.
Conclusion
The next performance benchmark is management’s approximately $715 million fourth-quarter adjusted EBITDA forecast. Delivery will show whether higher pricing can outweigh the seasonal and cost pressures identified in the outlook.
Read More News
Disclaimer
This FinanceVelix article provides general information, not personalized financial, investment, legal, or tax advice. Market prices, interest rates and economic conditions can change; investments carry a risk of loss. Facts reflect the material available when published and may change. Check important information independently and consult a qualified professional when needed. Mentioning an asset, company, or service is not an endorsement.
