Cleveland-Cliffs Surges 13% After Q3 Earnings Beat and Bullish 2027 Outlook Powered by Tariffs

Cleveland-Cliffs reported third-quarter 2026 results that beat earnings and EBITDA expectations, sending shares up roughly 13-14% in premarket trading on October 19. The steel producer posted GAAP net income of $165 million, or $0.26 per diluted share, swinging sharply from a loss of $234 million, or $0.51 per share, in the year-ago period. Adjusted EPS of $0.28 beat the consensus estimate of $0.24, while adjusted EBITDA of $612 million topped both the analyst estimate of around $594-601 million and the company's own $575 million guidance issued three months earlier. Revenue of $5.61 billion came in below the $5.72 billion estimate but was up 19% year over year from $4.73 billion.

The earnings improvement was driven by higher steel volumes and prices. Steel shipments reached 4.15 million net tons, up 3% from 4.03 million tons a year earlier, though below the 4.28 million ton estimate. The average selling price rose to $1,177 per ton from $1,032 per ton in the prior-year quarter, lifting steelmaking revenues to $5.45 billion from $4.56 billion. Steelmaking gross margin swung to $454 million from a $56 million loss a year earlier, and cash margin in steelmaking reached $685 million, or about $165 per ton. The company ended the quarter with liquidity of $3.2 billion and generated $224 million in operating cash flow.

Management guided fourth-quarter adjusted EBITDA of approximately $715 million, well above the analyst estimate of around $632-665 million and representing a 17% sequential increase. Looking further out, the company projected full-year 2027 adjusted EBITDA exceeding $4 billion, citing new client contracts already signed and prevailing index price forecasts, with tariffs cited as a meaningful tailwind. The company also disclosed that Stelco galvanizing lines have been indefinitely idled while approximately 2,000 Canadian jobs are being preserved.