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StocksMediumUpdated×2•Originally published 19 October 2026•Updated 19 October 2026•
4 min read

Cleveland-Cliffs Shares Jump 15% After Profit Beat, Higher 2027 Outlook

Key Facts

1Cleveland-Cliffs expects adjusted EBITDA to exceed $4 billion in 2027.
2Consolidated net income under U.S. generally accepted accounting principles totaled $165 million in the third quarter of 2026.
3The company's shares rose 15% in early trading on October 19, 2026, according to Reuters.
4Management expects contract renewal improvements to add more than $1 billion to adjusted EBITDA in 2027 compared with the current year.

Cleveland-Cliffs reported consolidated net income of $165 million for the third quarter on October 19, 2026, with adjusted earnings per share beating analysts' expectations. Shares of the steelmaker rose 15% in early trading on the day of the earnings release, according to Reuters, as it raised its earnings outlook for next year. Consolidated revenue totaled $5.6 billion, according to the company's earnings statement. Diluted earnings per share under U.S. generally accepted accounting principles were $0.26. Adjusted earnings per share came to $0.28, compared with expectations of 19 cents, according to London Stock Exchange Group data cited by Reuters. The company had posted an adjusted loss of 45 cents per share in the third quarter of 2025, the news agency reported.

Adjusted earnings before interest, taxes, depreciation and amortization totaled $612 million in the third quarter, according to the company's statement. Steel shipments reached about 4.2 million net tons, with an average net selling price for steel products of $1,177 per net ton. Management said during the earnings call that higher production volumes helped reduce unit costs from the previous quarter. The reduction amounted to $17 per net ton, according to its remarks published by The Motley Fool. In Canada, management attributed Stelco's shift to a "positive EBITDA contributor" during the quarter to an improvement in the hot-rolled steel market.

On contracts, management said during the call that renewal improvements were expected to add more than $1 billion to adjusted EBITDA in 2027 compared with the current year. That expected improvement excludes changes in the underlying pricing index, according to management. It said the annual contracts discussed, which serve sectors outside the automotive industry, reset on January 1, 2027. The company is also introducing a "take-or-pay" provision for minimum contracted volumes. Under this provision, customers must pay for the minimum volume even if they do not take delivery, according to management's explanation of the contractual arrangements.

On cash, total liquidity stood at $3.2 billion at the end of the quarter on September 30, 2026, according to the company's statement. Management said during the earnings call that working capital increased by $160 million during the quarter, consuming cash. It estimated capital expenditure for the current year at about $700 million. On the maintenance schedule, the company postponed the relining of blast furnace "C" at Burns Harbor until April 2028 to take advantage of favorable business conditions, according to management. Deferring the work allows for about 500,000 additional net tons of shipments in 2027, according to its estimates during the call.

The company's investments include a $1 billion modernization project at Middletown Works, announced in August 2026. Cleveland-Cliffs said the project includes upgrades to the blast furnace and process control technologies, with financing that includes $500 million in support from the U.S. Department of Energy. The company aims to complete the rebuilding of the Middletown furnace in the first quarter of 2030. In a separate project at Butler Works, it aims to increase production of grain-oriented electrical steel, used in transformers, by up to 25%. It expects the Butler Works expansion to be completed in early 2028, according to its statement on the project.

For the fourth quarter of 2026, Cleveland-Cliffs expects adjusted EBITDA of about $715 million, according to guidance published with the results. For 2027, management expects earnings on the same measure to exceed $4 billion. That outlook is based on new contracts and prevailing price expectations, according to the company. Alongside its second-quarter results, it had presented an illustrative estimate of potential adjusted EBITDA in 2027 of $3.3 billion, according to Investing.com. Alongside the new earnings outlook, management aims to reduce the ratio of net debt to EBITDA to below 2.5 times by mid-2027.