Cleveland-Cliffs Inc. (CLF)

Cleveland-Cliffs reported third-quarter 2026 results on 19 October, with revenue of $5.6 billion and net income of $165 million 1.

That compares with a net loss of $134 million in the second quarter 1. Adjusted EBITDA, operating earnings with one-off items taken out, was $612 million, above the $575 million the company had guided to three months earlier 1. SteelOrbis noted a net loss of $234 million in the third quarter of 2025 5.

Chief executive Lourenco Goncalves said average selling price, sales volumes and unit costs all moved in the right direction compared with the second quarter 1. Steelmaking sold 4.2 million net tons at an average of $1,177 a ton, up from $1,124 in the second quarter 1.

The company expects fourth-quarter adjusted EBITDA of about $715 million 1. It also said it would expect 2027 adjusted EBITDA to exceed $4 billion, based on contracts already signed and prevailing index price forecasts 1.

The open question is Stelco, its Canadian steelmaker, where the company said it would idle the galvanizing lines indefinitely 1. Canada's industry minister, Melanie Joly, gave the company a 15 day deadline to answer alleged breaches of its purchase commitments 8.

Goncalves said on 28 October that only 175 workers have been laid off and that he hopes to call them back before Christmas, the Canadian Press reported 9.

Cleveland-Cliffs began as a miner, and its legacy business is producing iron ore pellets, the lumps of ore that blast furnaces melt into iron, and the company says it became a steel company in 2020 3.

The step that made it a steelmaker was the AM USA transaction, the purchase of substantially all of the former ArcelorMittal USA, which closed on 9 December 2020 3.

The first years after those 2020 purchases went to repairs, with spending elevated in 2022 for overdue maintenance at the acquired plants, and normal maintenance levels resumed in 2023 3.

Revenue then slipped from $22.0 billion in 2023 to $19.2 billion in 2024 and $18.6 billion in 2025 3. In 2025 the fall was mainly a lower average steel selling price, down $76 a ton on product mix 3.

On 1 November 2024 the company completed the Stelco acquisition 3. It described Stelco as one of the lowest cost flat-rolled steelmaking assets in North America, and the cash paid, net of cash acquired, was $2.5 billion 3.

The deal doubled the company's exposure to the North American spot market, where steel sells at the going price rather than under a contract 3.

Losses followed, with net income attributable to shareholders was a loss of $760 million in 2024 and $1,478 million in 2025, while net interest expense rose from $370 million to $594 million 3.

During 2025 the company decided to idle or close six operations 3. They included the Dearborn blast furnace, the Steelton, Conshohocken and Riverdale facilities, and the Minorca and Hibbing iron ore mines 3.

Configured raw steel capacity fell from 23.0 million net tons at the end of 2024 to 20.0 million at the end of 2025 3.

A five-year contract to supply semi-finished slabs, begun with the AM USA purchase, expired on 9 December 2025 3. It had been about 10 percent of sales volume and was unprofitable in 2024 and 2025 3.

In 2025 the company also issued common shares, raising $951 million, and signed a memorandum of understanding with POSCO, South Korea's largest steelmaker 3.

In the second quarter of 2026 it idled the Gary plate finishing line and one of the two plate mills at Burns Harbor, moving plate output to the other mill 2. Reuters reported through GMK Center that Stelco would suspend its cold-rolling and coating workshops from 9 October for an indefinite period 7.

Flat-rolled steel

Flat-rolled steel, steel in sheets and coils for car bodies and appliances, is the core product, and the company says it offers the most comprehensive flat-rolled selection in the industry 3.

Third-quarter steel volumes of 4.2 million net tons were 46 percent hot-rolled, 31 percent coated, 15 percent cold-rolled, 4 percent plate, and 4 percent stainless and electrical 1.

Steelmaking revenue of $5.4 billion in the quarter came 34 percent from distributors and converters, 28 percent from direct automotive sales, 28 percent from infrastructure and manufacturing, and 10 percent from steel producers 1.

About 35 to 40 percent of flat-rolled shipments are sold under fixed price contracts, and the rest at spot prices or index-linked prices 3.

Automotive steel

Automotive is the largest end use, so North American light vehicle production drives demand 3. In 2025 direct automotive sales were 30 percent of revenue, against 32 percent in 2024 3.

In the fourth quarter of 2025 the company completed a trial in which its steel was stamped into exposed car parts with no defects on a customer's existing aluminum-forming equipment 3.

Electrical steel and the power grid

The company calls itself a leading U.S. producer of electrical steels, the thin steel inside transformers, and expects strong profitability in that business 3.

Industrial Info Resources reported that Butler Steel Works in Pennsylvania is adding four electrified slab-reheat furnaces, and that the company plans a 25 percent output increase there to meet demand from the grid 6.

Iron ore, pellets and metallics

The company mines iron ore and makes pellets, and its Toledo, Ohio plant makes hot briquetted iron, a scrap substitute, with capacity of 1.9 million metric tons a year 3.

It calls itself the first and only producer of that iron in the Great Lakes region 3. Its scrap arm, FPT, has 21 locations and processed about 3 million net tons in each of 2024 and 2025 3.

Tubing, tooling and stamping

The Other Businesses group holds the tubular, tooling and stamping operations, which make steel tubing, tool and die work and stamped steel parts and assemblies for customers 3.

Plants and people

The company runs seven blast furnaces and four electric arc furnaces, with configured capacity of about 20.0 million net tons of raw steel a year 3.

Its steel sites sit across Indiana, Michigan, Ohio, Pennsylvania and Ontario, and it employs about 25,000 people, more than 18,000 of them under collective bargaining agreements 3.

Lourenco Goncalves has been chairman, president and chief executive since August 2014 3. Celso Goncalves is chief financial officer and Clifford Smith is chief operating officer 3.

Rivals and current problems

The Steelmaking segment competes with domestic and foreign producers of flat-rolled carbon, plate, stainless and electrical steels, and with aluminum and other materials 3. In Canada, Goncalves named ArcelorMittal Dofasco as the other galvanized steel maker 6.

The Canadian dispute is the main problem, as Ottawa says the company broke commitments made when it bought Stelco, including a floor on Canadian employment of 1,766 a year, and the company says it complies 8.

Mesabi Metallics has also sued the company since September 7, 2017, alleging tortious interference and antitrust violations, in a bankruptcy court proceeding in Delaware 3.

The umbrella, in words

The annual report's Exhibit 21 lists the subsidiaries, among them Cleveland-Cliffs Steel Corporation, Northshore Mining Company, Tilden Mining Company, United Taconite, Ferrous Processing and Trading Company, Cleveland-Cliffs Tooling and Stamping Company, and Stelco Inc. 4.

The company owns 85.3 percent of the Hibbing iron ore mine, which is partly idled, and it acquired Stelco on 1 November 2024 3. It also has equity-method investments in several businesses 3.

The memorandum of understanding with POSCO, an agreement in principle, remains subject to negotiation of definitive terms 2.

Beyond the plants above, the company leases its Cleveland headquarters, owns office space in Burns Harbor, Indiana, and owns its Research and Innovation Center in Middletown, Ohio 3.

Large holders reporting on Schedule 13G include BlackRock, State Street and Vanguard 101112. The chairman and chief executive is Lourenco Goncalves, who has led the company since August 2014 3.

The company expects fourth-quarter 2026 adjusted EBITDA of about $715 million, higher than the third quarter on better pricing, partly offset by seasonality and maintenance outages 1.

For 2027 it said it would expect adjusted EBITDA above $4 billion, and Goncalves said several earnings drivers are developing better than first expected 1.

Goncalves said the company expects a major debt reduction in the fourth quarter and remains on track for a leverage target of under 2.5 times net debt to EBITDA by the middle of next year 1.

Capital spending is guided to about $700 million in 2026 and more than $1 billion in 2027, mainly for U.S. plants, Industrial Info Resources reported 6. At Butler, it said construction of a hot mill expansion is to start next year 6.

The POSCO memorandum of understanding is subject to definitive agreements, and the company says there is no assurance the parties will sign them 2. The company is also running sales processes for certain non-core assets and says proceeds would go to debt 3.

The company said it has begun exploring rare earths at its ore bodies and tailings basins and identified two sites with geological indicators 3. It cautions that further studies are needed before it can tell whether extraction would be economical 3.

In Canada, Ottawa set a 15 day deadline announced on 22 October 8. Goncalves said he intends to call back all 175 laid-off workers before Christmas if a plan to raise Canadian sales works 9.

Goncalves also said the company will not talk to any buyers for Stelco before the end of next calendar year 9.

The company said it expects domestic steel demand to grow as tariffs support domestic production and imports stay unattractive 2. It also said it expects Stelco to add more to earnings as production concentrates on hot rolled products 21.