DENVER, Colo. (247marketnews.com) -- Cleveland-Cliffs (NYSE:CLF) delivered a significantly stronger second quarter, signaling that the steelmaker's turnaround may be gaining traction as pricing, volumes, and operational performance continue improving. While the company remained unprofitable on a GAAP basis, key operating metrics moved sharply higher, with revenue rising to $5.2 billion, adjusted EBITDA climbing to $286 million, more than triple the prior quarter, and operating cash flow reaching $230 million. Management also reported a return to positive free cash flow and said debt reduction has already begun.
The improved results come as Cleveland-Cliffs benefits from stronger domestic steel market conditions. The company cited subdued imports, improving demand, longer lead times, and continued strength in automotive production as supportive industry trends. Average realized steel selling prices increased to $1,124 per net ton, while revenue grew approximately $300 million sequentially despite maintenance outages during April and May. The combination of stronger pricing and improving production efficiency appears to be restoring earnings leverage after a difficult start to the year.
Perhaps the most closely watched takeaway was management's forward guidance. Cleveland-Cliffs expects third-quarter adjusted EBITDA of approximately $575 million, more than double second-quarter levels, while indicating that fourth-quarter EBITDA is currently expected to exceed third-quarter performance. If achieved, the second half of 2026 would represent the company's strongest earnings period since 2021, supported by higher automotive volumes, stronger utilization rates across finishing operations, improving profitability at Stelco in Canada, and favorable contract repricing heading into 2027.
Although the company posted a GAAP net loss of $134 million, the loss narrowed considerably from the first quarter's $229 million, reflecting continued operational improvement. Liquidity remained solid at $3.1 billion, and Cleveland-Cliffs reaffirmed its full-year shipment guidance of approximately 16.5 to 17.0 million net tons, while maintaining capital expenditure and operating expense guidance. Management also expressed confidence that leverage could fall below its target of 2.5x debt-to-EBITDA by this time next year if current trends continue.
The report reflects a broader recovery across portions of the North American steel industry as infrastructure spending, automotive demand, and domestic manufacturing continue supporting steel consumption. Investors will likely focus on whether Cleveland-Cliffs can convert improving market fundamentals into sustained profitability and stronger free cash flow during the second half of the year.
Sources
Cleveland-Cliffs Q2 2026 Earnings Release: https://www.clevelandcliffs.com/investors
Cleveland-Cliffs Investor Relations: https://www.clevelandcliffs.com/
U.S. Securities and Exchange Commission (SEC): https://www.sec.gov/
NYSE Company Profile – Cleveland-Cliffs (NYSE: CLF): https://www.nyse.com/quote/XNYS:CLF
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