CLF's Revenue Climbs and Margins Improve Despite First-Quarter Losses
Revenue Grows and Adjusted EBITDA Turns Positive
Cleveland-Cliffs (NYSE:CLF) posted a first-quarter 2026 revenue of $4.92 billion, up from $4.63 billion a year ago and $4.31 billion in the previous quarter. While the company recorded a GAAP net loss of $229 million ($0.42 per diluted share), the adjusted EBITDA rebounded to $95 million from a loss of $179 million in Q1 last year and $21 million in Q4 2025. This positive turn came despite an $80 million one-time energy cost hit due to extreme weather.
| Key Financials (in millions except per share) | Q1 2026 | Q1 2025 | Q4 2025 |
|---|---|---|---|
| Revenue | $4,922 | $4,629 | $4,313 |
| Net Loss (GAAP) | $(229) | $(486) | $(235) |
| Adjusted Net Loss/Share | $(0.40) | $(0.93) | $(0.43) |
| Adjusted EBITDA | $95 | $(179) | $(21) |
| Liquidity | $3,100 | n/a | n/a |
Margins Improve and Steel Shipments Remain Robust
Steel shipments totaled 4.1 million net tons, an increase of 338,000 tons over the previous quarter. The average selling price per ton in Q1 2026 stood at $1,048, well above both Q1 ($980) and Q4 2025 ($993). Margins improved notably—cash margin swung to $136 million from a $149 million loss the year before—while gross margin losses narrowed to $95 million versus $405 million in Q1 2025 and $220 million in Q4 2025.
| Steel Segment Metrics | Q1 2026 | Q1 2025 | Q4 2025 |
|---|---|---|---|
| Shipments (in 000s tons) | 4,108 | 4,140 | 3,770 |
| Avg. Selling Price/Ton | $1,048 | $980 | $993 |
| Revenues | $4,757 | $4,467 | $4,154 |
| Cash Margin | $136 | $(149) | $25 |
| Gross Margin | $(95) | $(405) | $(220) |
Management Signals Optimism for Sequential Improvement
CEO Lourenco Goncalves emphasized the short-term impact of higher energy prices while expressing confidence that both earnings and cash flows will improve each quarter throughout 2026. He noted that strong orders and positive momentum should drive healthy free cash flow in the upcoming quarter, reinvigorating Cliffs' earnings and cash-generation profile.
Further, he pointed to the benefit of ongoing trade enforcement—a key factor with U.S. steel imports at their lowest since the global financial crisis. These actions, along with clarity around derivative product regulations, are credited with supporting domestic steel manufacturing and job creation.
North American Market Strength and Strategic Outlook
Cliffs remains focused on bolstering its North America-centric supply chain, particularly as import barriers remain robust. The company continues to engage with Canadian officials to reinforce a 'Fortress North America' stance and advocates for stronger trade defenses that support jobs in both countries.
Additionally, while negotiations with POSCO continue amid geopolitical disruptions, Cliffs is seeking a deal that reflects the strategic value of their assets and leadership in U.S. steel demand.
Liquidity and Full-Year Guidance Maintained
Total liquidity stood at $3.1 billion as of March 31, 2026. The company sustained its 2026 guidance across shipment volumes (16.5–17.0 million tons), capital expenditures ($700 million), SG&A ($575 million), D&A ($1.1 billion), and pension/OPEB ($125 million). This stability, despite early headwinds in 2026, points to management’s confidence in ongoing operational execution.
What’s Next for Cleveland-Cliffs?
Although CLF’s early 2026 loss underscores the challenges facing U.S. steelmakers, the uptick in EBITDA and improved cash metrics point to a recovery path—particularly as pricing power, operational momentum, and pro-trade policy set a favorable backdrop. As free cash flow is expected to turn positive in the next quarter, investors and analysts will be watching to see if Cliffs can deliver on its outlook and seize further gains from its North American leadership and ongoing strategic initiatives.
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