STLD · Steel Dynamics, Inc.

Steel Dynamics delivered a strong first quarter 2026 performance, with net income rising 86% year-over-year to $403 million, or $2.78 per diluted share. The earnings improvement was primarily driven by the steel operations segment, which generated operating income of $557 million, a 73% increase sequentially. This segment benefited from record steel shipments of 3.6 million tons and metal spread expansion, as the average external selling price increased $86 per ton to $1,193, while ferrous scrap costs rose only $22 per ton to $396. The metals recycling segment also contributed meaningfully, with operating income surging 155% sequentially to $47 million due to higher selling values. Conversely, the steel fabrication segment remained steady at $90 million in operating income, as higher shipments were offset by metal spread compression from increased raw material costs. The aluminum operations, currently in a startup phase, incurred an operating loss of $65 million as the company continues to commission its Columbus, Mississippi mill and San Luis Potosi, Mexico slab center. Management noted that despite initial startup costs and inventory write-offs, shipments and earnings for aluminum are expected to increase sharply in the second quarter. The company generated $148 million in operating cash flow, impacted by a $120 million annual profit-sharing distribution and a $413 million increase in working capital tied to higher pricing and demand. Steel Dynamics maintained a robust liquidity position of $2.0 billion while returning capital to shareholders through $72 million in dividends and $115 million in share repurchases. Looking ahead, management remains constructive on market conditions, citing strong demand backlogs in steel fabrication extending into late 2026 and ongoing progress in aluminum commissioning, with additional cold mills and CASH lines scheduled to come online in the third quarter.