Nucor Corporation (NUE) | The Buildout — AI Infrastructure
The Verdict
Nucor makes steel and fabricated steel products, from sheet, plate, structural, and bar steel to joists, deck, steel racking, and utility towers. It is an indirect supplier to AI infrastructure: data-center construction and the power grid serving it consume physical steel products Nucor is positioned to provide. The company is vertically integrated, melting scrap into steel and then fabricating downstream products.
| Market Cap | — |
| Revenue (TTM) | $36.1B |
| Revenue Growth | +17.2% |
| EBITDA Margin (TTM) | 15.5% |
| Net Debt | $4.4B |
| Earnings Beats | 5 of 7 |
| P/E (TTM) | — |
| EV/EBITDA (TTM) | — |
What We Like
- Steel mill shipments reached 7.1 million tons in Q2 2026, a second consecutive all-time quarterly record.
- Finished steel imports were down 25% year-over-year in Q2; import share of U.S. finished steel fell from over 22% in Q1 2025 to about 15% in Q1 2026.
- Steel Mills backlog was 4.7 million tons at the end of Q1 2026, up 20% from year-end and the highest since Q2 2021.
- Lexington, Kingman, and the Crawfordsville galv line were EBITDA positive in March 2026; Brandenburg shipped over 230,000 tons in Q2, with nearly one-third in grades and sizes previously unavailable.
- Q2 free cash flow was $829 million, the strongest quarter since 2023, with full-year 2026 capex held at about $2.5 billion.
What We’re Watching
- Q3 2026 is the cleanest test: Steel Mills is guided higher QoQ even without the $130 million Q2 refund, while Raw Materials is guided lower QoQ.
- West Virginia commercial shipments are expected to begin ramping in early 2027, with ~50% utilization targeted by the end of year one and qualifications building into 2028.
- USMCA annual review was triggered in July 2026 and Section 301 investigations are ongoing; policy outcomes could change the import environment.
- Consumer-oriented end markets — residential, HVAC, traditional office, heavy equipment, agriculture — remain soft, while U.S. steel demand growth is only ~2% for 2026.
The thesis looks intact and strengthening on volume, backlog, and free cash flow. Q2 earnings quality and Q3 raw-materials guidance caution against treating the quarter as a clean baseline, because of the $130 million refund and the Helion mark-up. The open question is whether West Virginia can execute its ramp and trade policy holds while data-center revenue and profit remain undisclosed.
Earnings Beat
Nucor reported Q2 FY2026 revenue of $10,397 million, gross margin of 19.6%, and EBITDA of $2,012 million. Net income was $1,156 million. Steel mill shipments reached 7.1 million tons, a second consecutive all-time quarterly record.
| Metric | Q2 FY2026 | Q1 FY2026 | Q2 FY2025 | YoY |
|---|---|---|---|---|
| Revenue | $10.4B | $9.5B | $8.5B | +23.0% |
| Gross margin | 19.6% | 15.8% | 14.5% | +510bps |
| EBITDA | $2.0B | $1.4B | $1.3B | +56.6% |
| EPS | $5.06 | $3.24 | $2.61 | +93.6% |
| Steel mill shipments | 7.1 million tons | 7.0 million tons | n/a | — |
| Free cash flow | $829 million | $225 million | -$222 million | vs -$222M |
I think ’27 could be a very special year, not just for Nucor, but this industry.— Leon Topalian, CEO, July 28, 2026
Management tone: Management shifted from the prior call's "relatively stable demand with pockets of strength" to a broad-based, bullish read. CEO Leon Topalian said demand was unlike anything he has seen in his 30-year career. Management was careful to separate reported EPS from the adjusted figure and flagged the non-repeat $130 million Q2 refund, while still guiding higher.
Management Guidance
For Q3 2026, management guided consolidated earnings higher than Q2, Steel Mills higher QoQ even without the $130 million refund, Steel Products higher QoQ from higher volumes and pricing, and Raw Materials lower QoQ. For full-year 2026, management guided shipments closer to the high end of 5%–10%, U.S. steel demand about 2%, and capex about $2.5 billion. West Virginia utilization was reaffirmed at ~50% by end of year one, with pre-operating/start-up costs elevated through 2026 and 2027.
Trajectory
Reported revenue accelerated from $8,521 million in Q3 FY2025 to $10,397 million in Q2 FY2026, with the last two quarters up 23.5% and 9.5% sequentially. Gross margin expanded from 13.9% in Q3 FY2025 to 19.6% in Q2 FY2026, driven by higher steel-mill metal margins and higher utilization; Q2 also included a $130 million non-repeat procurement refund. Trailing free-cash-flow conversion is 55% of net income, and the earnings bar is hard.
The Model
The model projects FY+1 revenue of $39,000 million and EBITDA of $5,928 million (15.2% margin), and FY+2 revenue of $41,800 million and EBITDA of $6,688 million (16.0% margin). The FY+1 projection is anchored by record shipments, building backlog, and import displacement; FY+2 assumes continued ramp contribution from West Virginia and downstream capacity.
| Metric | FY2025 | Next FY (E) | Following FY (E) |
|---|---|---|---|
| Revenue | $32.5B | $40.4B | $43.6B |
| YoY Growth | — | +24.2% | +8.0% |
| EBITDA | $4.1B | $7.1B | $8.2B |
| EBITDA Margin | 12.7% | 17.6% | 18.7% |
Projections are the median of 5 independent model runs. The model’s revenue sits 9.9% above analyst consensus.
For Q3 2026, management guided consolidated earnings higher than Q2, Steel Mills higher QoQ even without the $130 million refund, Steel Products higher QoQ from higher volumes and pricing, and Raw Materials lower QoQ. For full-year 2026, management guided shipments closer to the high end of 5%–10%, U.S. steel demand about 2%, and capex about $2.5 billion. West Virginia utilization was reaffirmed at ~50% by end of year one, with pre-operating/start-up costs elevated through 2026 and 2027.
What Could Go Right — and Wrong
- Trade enforcement yields a melted-and-poured North American steel requirement, structurally lifting domestic addressable market.
- West Virginia reaches ~50% utilization by the end of year one, then ramps toward higher-end automotive and consumer-durables qualifications into 2028.
- Data-center, border/defense, and energy demand persist multiyear; border-wall shipments continue well into 2028.
- Import share stays near ~15% or lower, and sheet import displacement adds about 6.5 million tons of addressable market for domestic suppliers.
- Towers & Structures projects ramp on schedule; management points to downstream M&A as a future cash-use priority.
- Trade policy weakens and imports rebound; beam imports already spiked more than 50 percentage points QoQ in Q2.
- West Virginia commissioning slips, extending pre-operating/start-up cost drag through 2027.
- Consumer-oriented end markets weaken further, offsetting strong project pockets; overall U.S. steel demand is only about 2% in 2026.
- Raw Materials volatility persists; Q3 is guided lower on lower scrap pricing and elevated Middle East pellet costs.
- Data-center demand slows, exposing that data-center backlog is only about 10% of total by management estimate.
Looking Ahead
The next twelve months center on West Virginia's commissioning and first commercial shipments in early 2027, plus the ramp of downstream projects. Nearer in, management expects Towers & Structures backlog detail in the coming weeks and Q3 2026 results to test margin expansion without the one-time Q2 refund. Trade policy, including the USMCA annual review triggered in July 2026, is the external variable.
- In the coming weeksTowers & Structures backlog detail — Management promised more detailed order-book and backlog disclosure.
- Fall 2026Berkeley second galvanizing line — Production expected; cash-positive around end 2026 or early 2027.
- Later 2026West Virginia cold/hot mill commissioning — Cold mill and hot mill commissioning milestones due.
- End 2026West Virginia commissioning complete — All commissioning, inspection, and testing expected complete.
- Early 2027West Virginia first commercial shipments — Commercial sheet shipments begin to ramp.
- Q1 2027Utah Towers & Structures startup — Full production targeted by mid-2027.
Financials
Annual Summary
| Metric | FY2024 | FY2025 | TTM | YoY |
|---|---|---|---|---|
| Revenue | $30.7B | $32.5B | $36.1B | +5.7% |
| Gross Margin | 13.2% | 11.8% | 15.5% | 133bps |
| EBITDA | $4.3B | $4.1B | $54.2B | -4.5% |
| EBITDA Margin | 14.1% | 12.7% | 15.5% | 136bps |
| Net Income | $2.0B | $1.7B | $2.9B | -14.0% |
| Free Cash Flow | $806M | −$188M | $24.3B | — |
| Net Cash | — | — | — | — |
Key Ratios (Trailing)
- P/E TTM—
- EV/EBITDA TTM—
- EV/Revenue TTM—
- Price/FCF TTM—
- Gross Margin (TTM)15.5%
- EBITDA Margin (TTM)15.5%
- Net Margin (TTM)8.0%
- ROIC12.3%
- FCF Conversion28.3%
- SBC / Revenue0.2%
The Company
Nucor is a North America–focused steel and steel-products manufacturer and North America’s largest recycler. It makes sheet, plate, structural, and bar steel, and downstream products such as joists, deck, steel racking for warehouses and data centers, and utility towers. Steel Mills accounted for 62% of 2025 external sales. Scrap steel is its primary raw material.
The company is vertically integrated: it produces and procures raw materials, melts and rolls steel, and fabricates downstream steel products. Selected 10-K plant capacities include Fontana at 4,020,000 tons, Hickman at 2,740,000 tons, and Berkeley County at 2,430,000 tons. The West Virginia sheet mill was not in the 10-K plant table, consistent with it being under construction at the February 25, 2026 filing date. Most operating facilities and customers are in North America.
Business Segments
Competitive Landscape
The competitive dynamic is that steel is largely a commodity product, so Nucor’s stated edge is breadth, logistics, and downstream reach rather than proprietary steel technology. Management says Nucor is the only company with the raw materials, sheet, tube capacity, and logistics team to keep up with border-wall demand, and says Nucor can supply 95% of the steel needed to build a data center. Global steel overcapacity remains a disclosed structural risk.
Supply Chain
Nucor sits midstream to downstream in the steel supply chain, buying scrap, DRI, and other inputs and selling to construction, automotive, energy, and utility customers. No neighbor call in the provided material mentions Nucor directly.
More on NUE: Earnings recap