Steel Dynamics Reports Q3 2026 Net Income of $756 Million

Steel Dynamics (NASDAQ: STLD ) reported third-quarter financial results on Tuesday. The transcript from the company's third-quarter earnings call has been provided below. This transcript is brought to you APIs. For real-time access to our entire catalog, please visit for a consultation.

Access the full call at Summary Steel Dynamics reported a strong Q3 2026, with net income of $756 million, $5.26 per diluted share and adjusted EBITDA of $1.2 billion, despite a slight miss on earlier guidance due to foreign currency and aluminum hedging adjustments. The company achieved record steel shipments of 3.8 million tons and maintained high utilization rates, with steel mills operating at 92%, outperforming the domestic industry rate of 80%. Strategic growth initiatives included successful milestones in aluminum mill commissioning, with expectations for improved performance in Q4 2026 and 2027.

Management highlighted continued strong demand in flat-rolled and long product steel markets, with significant increases in order backlogs and pricing power expected to benefit future results. Steel Dynamics generated robust cash flow from operations of $846 million, maintained liquidity of $2.4 billion and executed $591 million in share repurchases during the year. The company forecasts continued growth and competitive positioning through strategic investments in aluminum and diversified product lines, supported by a strong capital allocation strategy.

Management announced a transition in which Teresa Wagler will take over as CEO, emphasizing continuity in strategic vision and leadership. Management addressed operational challenges in the aluminum division, with improvements expected, and said the division is set to capitalize on the structural supply deficit in the U.S. aluminum market. Full Transcript OPERATOR Good day and welcome to the Steel Dynamics third quarter 2026 earnings conference call.

At this time all participants are in a listen-only mode. After management's remarks, we will conduct a question and answer session and instructions will follow at that time. Please be advised that this call is being recorded today, October 20, 2026, and your participation implies consent to our recording this call. If you do not agree to these terms, please disconnect at this time.

I would like to turn the conference over to David Lipschen, Director, Investor Relations. Please go ahead, sir. David Lipschen (Director, Investor Relations) Thank you, Sylvie. Good morning and welcome to Steel Dynamics third quarter 2026 earnings conference call.

As a reminder, today's call is being recorded and will be available on our website for replay later today. Leading today's call are Mark Millett, Chairman and Chief Executive Officer of Steel Dynamics, and Teresa Wagler, Executive Vice President and Chief Financial Officer. The other members of our senior leadership team are joining us on the call individually. Some of today's statements, which speak only as of this date, may be forward-looking and predictive, typically preceded by believe, expect, anticipate, or words of similar meaning.

They are intended to be protected by the Private Securities Litigation Reform Act of 1995 should actual results turn out differently. Such statements involve risks and uncertainties related to integrating or starting up new assets, the aluminum industry, the use of estimates and assumptions in connection with anticipated project returns, and our steel, metals recycling, fabrication, and aluminum businesses, as well as to general business and economic conditions.

Examples of these are described in the related press release as well as in our annually filed SEC Form 10-K under the headings Forward-Looking Statements and Risk Factors found on the internet at and, if applicable, in any later SEC Form 10-Q. You will also find any referenced non-GAAP financial measures reconciled to the most directly comparable GAAP measures in the press release issued yesterday entitled Steel Dynamics Reports Third Quarter 2026 Results. And now I'm pleased to turn the call over to Mark. Mark Millett (Chairman and Chief Executive Officer) Well, good morning everyone.

Thank you for joining us this morning for the third quarter 2026 earnings call. Before I begin our report, I would like to take a moment to congratulate Teresa on her appointment to CEO at the end of this year. As most of you know, she's been with the company for 28 plus years, starting when we had just our first mill in Butler, Indiana. Back then it was just a handful of people and now we've got 14,000 strong in our team.

In that time she has built an incredible understanding of our markets, our customers, and our company. Most importantly, she understands our culture and is passionate about our people. She has been acutely involved with the strategic decisions and direction we have taken these past 15 years. Decisions that have driven tremendous growth and about 3,000% in shareholder value appreciation, a value very few can claim.

That success has also been supported by an incredible team of 14,000 people, as I said, and the best senior leadership on the planet, all of whom have been very, very key contributors of our growth. I just want to, very unusually maybe, but I just like to single them out: Miguel Alvarez, Jim Anderson, Matt Bell, Chad Bickford, Chris Graham, Barry Schneider, Tommy Scruggs, Rick Poinsatte. These folks have been incredible. And with this team and with Teresa at the helm, we will undoubtedly drive SDI to even greater heights.

So that said, and congratulations, Teresa. Teresa Wagler (Executive Vice President and Chief Financial Officer) Thank you very much, Mark. Mark Millett (Chairman and Chief Executive Officer) Our teams, I think, in the third quarter achieved a very strong quarter-over-quarter financial and operational performance. That said, we did come in just shy of our earlier guidance range due to late September anticipated moves in foreign currency and aluminum hedging, unrealized mark-to-market adjustments of just under 30 million.

Some quarter highlights included record quarterly steel shipments of 3.8 million tonnes, adjusted EBITDA of 1.2 billion, and extremely strong cash flow from operations of $846 million. Further milestones relating to the aluminum mill commissioning and ramp were also achieved. Seriously, my sincere thanks to an amazing team that consistently brings our vision and strategies to life. As I've said always, safety will be our most important cultural pillar and value.

With great dedication to each other, our team continues to focus on our Take Control of Safety philosophy. We have hundreds of volunteers that travel across our company not simply auditing our safety practices at our facilities, but cultivating our culture to ensure each facility has the right attitude and mindset to drive our performance ever upwards. It is an incredible time commitment and so inspiring as they operate as a family, supporting each other while challenging the status quo and striving for continuous improvement every day. Before I continue though, Teresa, will you update us on some specifics relative to Q3?

Teresa Wagler (Executive Vice President and Chief Financial Officer) Absolutely. Thank you, Mark, and thank you for your kind words. Good morning, everyone. Appreciate you being with us this morning.

For the third quarter 2026, our net income was $756 million, or $5.26 per diluted share, with adjusted EBITDA of $1.2 billion. Third quarter 2026 revenues were $6.5 billion, and operating income was just under $1 billion. Was just over $1 billion, higher than sequential second quarter results, driven by higher realized steel pricing and record steel shipments. As Mark mentioned, the steel team delivered an outstanding quarter with record shipments of 3.8 million tons.

Our steel operations generated operating income of $1 billion in the third quarter, a 43% sequential increase as average selling prices per ton increased $102. During the third quarter 2026, the domestic steel industry operated at an estimated utilization rate of 80%, while our steel mills operated at 92%. We consistently achieve higher utilization due to our value-added product diversification, differentiated customer supply chain solutions, and the support of our internal manufacturing businesses. And this is consistent throughout all market cycles.

Regarding flat-rolled steel, market conditions remain favorable. Customer demand is strong, inventory levels throughout the supply chain remain very lean, and order lead times are elevated. Value-added spreads to hot-rolled coil prices have recovered, increasing to over $230 per ton. As the largest flat-rolled steel coater in North America, we are well positioned to capitalize on these margin opportunities.

As a reminder, approximately 80% of our flat-rolled steel portfolio, sometimes more, is linked to contractual pricing that generally lags market changes by two months. Given the significant improvement in flat-rolled steel pricing and the continued expansion of value-added spreads, we expect these favorable market dynamics to positively impact our fourth quarter results and into 2027. Long product steel markets also remain incredibly strong, supported by healthy activity in nonresidential construction. Customer demand continues to be exceptionally robust, with order backlogs extending well into 2027.

We remain optimistic about demand for our diversified product portfolio of steel products and believe our end market exposure positions us incredibly well. For modeling purposes, for those on the call, our hot-rolled coil shipments in the third quarter were 992,000 tons. Our cold-rolled shipments were 146,000 tons. And finally, our coated flat-rolled shipments were 1 million—excuse me, were 1,630,000 tons.

Third quarter 2026 operating income for metals recycling was $33 million lower than sequential. Sorry. With $33 million lower than second quarter earnings due to lower realized pricing. Our metals recycling team is partnering even more closely with our steel and aluminum teams to expand scrap separation capabilities.

This will provide a meaningful advantage in increasing recycled content in our aluminum flat-rolled products while expanding our earnings opportunities. Our steel fabrication team achieved third quarter operating income of $91 million, an increase from second quarter results of $85 million, as increased volume and higher average pricing offset significantly higher steel raw material input costs. I want to give a shout-out to the team. They did an incredible job.

Our steel joists and deck business is experiencing strong demand, with our order backlog 50% higher today than a year ago. The Dodge Momentum Index, which generally leads construction spending by 12 to 18 months, remains elevated and is improving. We are also seeing improved pricing within our steel joists and deck business, with strong expectations for 2027, supported by positive customer sentiment and quoting activity, continued manufacturing onshoring, and public funding for infrastructure and other fixed asset investment programs. We're starting to see the uplift from this macro environment, and we believe it could be considerable.

Third quarter 2026 operating losses from our aluminum operations were $26 million, a 21% improvement over sequential results. Shipments and financial performance were below our original expectations due to a matter within the hot strip mill, which Mark will describe in a moment. The issue has been resolved, and we expect improved performance going forward. We expect volumes, cost structure, and profitability from the aluminum rolling mill to improve in the fourth quarter and throughout 2027.

In the third quarter, we generated strong cash flow from operations of $846 million. Our cash generation is supported by our differentiated circular business model and highly variable, low-cost structure. At the end of the quarter, we had liquidity of $2.4 billion. During the third quarter 2026, we invested $150 million in capital investments, with fourth quarter estimates also in that same range.

During 2026, we have repurchased $591 million of our common stock and continued a positive dividend profile. As of September 30, $216 million remained available under our current repurchase program. These actions reflect the strength of our capital foundation and cash flow generation capability and the continued confidence in our future. Our capital allocation strategy prioritizes high-return growth opportunities while maintaining a disciplined and balanced approach to shareholder value creation.

Shareholder returns are anchored by a sustainable and growing base dividend, complemented by a flexible share repurchase program that allows us to return additional capital to shareholders when appropriate. At the same time, we remain committed to preserving our investment-grade credit profile, ensuring the financial strength and flexibility needed to support strategic growth initiatives, navigate market cycles, and create long-term value for our shareholders. Our free cash flow profile has fundamentally changed, increasing to an average annual $2.4 billion during the most recent five years.

And if you exclude our recent transformational growth, it averages $3.2 billion per year, an incredible achievement. And there's more to come. Over the past number of years, we've invested more than $5 billion—arguably six—in three primary transformative organic growth initiatives. These investments reflect our disciplined approach to capital allocation and our commitment to growing in markets where we believe we can create sustainable competitive advantages.

As these assets continue to mature, we expect them to generate meaningful earnings and related free cash flow. We've established a strong and sustainable capital foundation that enables us to invest in meaningful strategic growth opportunities, consistently return capital to shareholders, and maintain the investment-grade financial metrics that underpin our long-term success. I would be remiss if I also didn't congratulate Mark on his upcoming retirement—although my belief is he'll be busier then than he is now. And just to point out, under Mark's leadership we went from a market cap of $3 billion to today $35 billion.

And continuing to move forward, we had around 3,000 people when he originally started—we had three—to now almost 15,000. And that was all under Mark's leadership. So thank you, Mark, for that. Mark Millett (Chairman and Chief Executive Officer) Well, thank you, Teresa.

But it takes a team, takes a village. So thank you, though. You know, consistently achieving those incredible results year over year just doesn't happen. It is the product of an effective business model that mitigates volatility, a commitment to state-of-the-art technology, both leveraged by a unique and passionate culture driven to excel.

The resulting performance reflects the dedication of our teams and the effective strategies we have developed and executed over time. We've invested strategically to gain significant scale, high-margin product and market diversification, efficient and unique customer supply chains, and synergistic operating platforms to optimize market opportunities throughout economic cycles. These strategies enable us to consistently achieve at the highest levels, allow us to control our own destiny, and outperform competitors across all market cycles.

A foundational focus on market and product diversification, particularly in higher-margin, value-added products, supports stronger through-cycle facility utilization and drives superior financial performance. We optimize cash generation, which enables a balanced and consistent capital allocation strategy that supports growth, maintains financial strength, and delivers compelling long-term returns to our shareholders. Our disciplined approach to capital investment continues to generate strong through-cycle cash flow and supports one of the highest return on invested capital profiles not only of steel companies but in the industrial sector.

Our most recent and most significant current investment is in aluminum flat-rolled products. The mill is transitioning from commissioning to full production ramp, and the excitement continues to be palpable as you tour the facility. The team has outperformed all industry expectations, constructing and commissioning an incredible facility in industry-leading time. Competitors and customers alike that have toured the mill are amazed at the quality and the capability of the plant and the speed of product qualification.

But even more important to me, they are broadly complimentary of the quality and the esprit de corps of the team. Again, they and our culture will differentiate us from the rest of the industry. The team is navigating a volatile aluminum market driven by the impacts of geopolitical conflict and domestic supply chain challenges. But despite these near-term challenges, they've remained focused on execution, customer service, and operational excellence.

Beyond these temporary constraints, we are operating in a unique and highly favorable long-term market environment. The United States faces a significant structural supply deficit of more than 1.4 million tons of aluminum sheet, and that shortfall is forecast to widen as demand continues to grow across key end markets. We believe our aluminum platform is exceptionally well positioned to capitalize on that growing domestic demand, creating substantial long-term value for our shareholders. The investment is in clear alignment with our core competencies.

Our construction capabilities have once again been proven. Both Columbus and the Mexican slab cast mill are state-of-the-art facilities built cost effectively and in record time. We expect the same result for our second recycled slab center currently being built in Mississippi.