Cleveland-Cliffs shares rose more than 16% to close at $14.10 on October 19, 2026, after the steelmaker returned to quarterly profitability and outlined stronger earnings expectations. Third-quarter adjusted EBITDA reached $612 million, more than double the preceding quarter, while management forecast approximately $715 million for the fourth quarter.
Key Takeaways
- Third-quarter adjusted EBITDA exceeded the company’s previous $575 million guidance.
- GAAP net income recovered to $165 million from a $134 million second-quarter loss.
- Management expects 2027 adjusted EBITDA above $4 billion, based on contract changes and prevailing price forecasts.
Table of Contents
- Cleveland-Cliffs shares rally as quarterly results improve
- Higher pricing supports the fourth-quarter outlook
- Stelco shifts emphasis toward hot-rolled steel
- Conclusion
Cleveland-Cliffs shares rally as quarterly results improve
Cleveland-Cliffs’ third-quarter 2026 results announcement showed adjusted EBITDA increasing by $326 million from the second quarter’s $286 million for the period ended September 30. The result was $37 million above management’s earlier guidance, rather than a comparison with a supplied analyst consensus estimate.
Chairman and Chief Executive Officer Lourenco Goncalves said average selling prices, sales volumes and unit costs all improved relative to the second quarter. Average steel selling prices rose to $1,177 per net ton from $1,124, while steel product sales volumes increased to 4.150 million net tons from 4.025 million.
The return to GAAP profitability means the quarter’s improvement was not limited to adjusted EBITDA, a non-GAAP earnings measure. However, Cleveland-Cliffs still recorded a consolidated net loss of $198 million for the first nine months of 2026.
| Item | Details |
|---|---|
| Consolidated revenue | $5.612 billion in Q3 2026 versus $5.226 billion in Q2. |
| GAAP diluted earnings per share | $0.26 in Q3 versus a $0.25 loss in Q2. |
| Adjusted diluted earnings per share | $0.28 in Q3 versus a $0.20 loss in Q2. |
| Total liquidity | $3.2 billion as of September 30, 2026. |
Higher pricing supports the fourth-quarter outlook
Management expects increased pricing to lift fourth-quarter adjusted EBITDA, partly offset by seasonal effects, increased maintenance outages, input costs and incentive compensation accruals. The approximately $715 million forecast would represent another sequential improvement, but remains guidance rather than a completed result.
For 2027, the company expects adjusted EBITDA to exceed $4 billion, citing changes to customer contracts and prevailing price forecasts. That outlook depends on future operating and market conditions; it is not contracted profit.
Goncalves also said the company expects substantial fourth-quarter debt reduction through stronger free cash flow and property-sale proceeds. Management retained its target of net debt below 2.5 times EBITDA by mid-2027.
Stelco shifts emphasis toward hot-rolled steel
Stelco contributed positively to third-quarter EBITDA as the Canadian hot-rolled steel market improved, Goncalves said. He described the quarter as Stelco’s strongest since Cleveland-Cliffs acquired the business two years earlier.
The company nevertheless decided to indefinitely idle Stelco’s galvanizing lines, citing oversupply in Canada’s galvanized steel market. Management said total Stelco production tonnage would be maintained as the business concentrates on hot-rolled products, with affected employees to return when conditions improve.
Conclusion
The next operating benchmark is Cleveland-Cliffs’ approximately $715 million fourth-quarter adjusted EBITDA forecast, alongside management’s planned debt reduction. Those results will test whether the third-quarter recovery continues through year-end.
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