Pomegra
Cleveland-Cliffs (CLF) rose about 12% premarket after Q3 2026 adjusted EPS of $0.28 topped estimates and management guided 2027 EBITDA above $4 billion.
- CLF rose 12% premarket to about $13.58 from a $12.12 close after adjusted EPS of $0.28 beat estimates.
- Adjusted EBITDA hit $612 million, above the $575 million guidance, and more than double the second quarter's $286 million.
- Management forecasts Q4 adjusted EBITDA near $715 million and 2027 adjusted EBITDA above $4 billion.
Lead
Cleveland-Cliffs shares jumped about 12% in premarket trading on Monday, October 19, 2026, after the steelmaker reported adjusted earnings of $0.28 per diluted share for the third quarter, ahead of Wall Street estimates. Revenue of $5.6 billion came in slightly below the roughly $5.7 billion consensus but rose from $5.2 billion in the second quarter. The stock was trading near $13.58 before the open, up from a $12.12 close. It held a gain of about 10% at $13.29 in morning trading.What Did Cleveland-Cliffs Report for the Third Quarter?
Cleveland-Cliffs reported net income of $165 million, or $0.26 per diluted share, and adjusted EBITDA of $612 million. That is its strongest quarter in three years, according to Chairman and CEO Lourenco Goncalves. Adjusted EBITDA exceeded the company's own $575 million guidance from three months earlier and compared with $286 million in the second quarter.
Steel shipments totaled 4.2 million net tons. The average selling price reached $1,177 per net ton, up $53 from the prior quarter, while unit costs fell $17 per ton. Cash margin was $685 million. Capital spending was $152 million in the quarter and $461 million for the first nine months of 2026. Liquidity ended September at $3.2 billion.
Why Did Cleveland-Cliffs Shares Jump?
Shares jumped because the quarter showed margin expansion, a guidance beat and a sharply higher forward outlook, which outweighed the small revenue shortfall. Pricing, volumes and costs all improved together, which is rare in a cyclical business such as steel.
Management attributed the improvement to a favorable trade backdrop. Imports remain well below historical levels, lead times are extended, and customers are placing a premium on the reliability of domestic supply. That setup supports pricing power for integrated producers operating in the United States.
The move outpaced the sector. Nucor (NUE) rose about 2% and Steel Dynamics (STLD) about 1% in morning trading, which points to a company-specific rerating tied to Cliffs' leverage to steel prices and its balance-sheet repair plan.
What Is the Outlook for Cleveland-Cliffs Into 2027?
Cleveland-Cliffs expects fourth-quarter adjusted EBITDA of about $715 million, a further sequential gain despite typical seasonal softness and planned maintenance outages. For 2027, management expects adjusted EBITDA to exceed $4 billion.
Debt reduction is the central financial priority. Long-term debt stood at $7.645 billion at September 30. The company expects free cash flow to increase in the fourth quarter and anticipates proceeds from a property sale, which together are expected to produce a major debt paydown. Its target is net debt to EBITDA below 2.5 times by mid-2027.
Strategic Context
The quarter was not uniformly strong. Cliffs has decided to idle its galvanizing lines at Stelco in Canada indefinitely, citing oversupply in that market. The decision narrows exposure to a weak product segment and shifts attention to higher-return U.S. operations.
The earnings gain is also large relative to the year-earlier period. Third-quarter adjusted EBITDA of $612 million compares with $143 million a year ago, which shows how much operating leverage the company carries when pricing improves.
Outlook
Cleveland-Cliffs delivered an EPS and EBITDA beat, a slight revenue shortfall, and a 2027 EBITDA target above $4 billion. The fourth quarter should show whether pricing holds and whether the planned property sale and free cash flow deliver the debt reduction management has outlined. Import volumes and domestic lead times remain the key variables for steel pricing through year-end.
Mentioned tickers: CLF, NUE, STLD
