Earnings Recap — Q2 FY2026
CY Q3 2026 · Reported July 30, 2026 · Beat 5 of last 7 quarters
The Buildout is a website built on agentic AI tools, currently in beta, and could have factual errors.
ArcelorMittal's positive outlook, driven by trade policy and regionalization, supports the broader steel demand environment for infrastructure and electrification, which are key components of the AI infrastructure buildout. The company's emphasis on electrical steels and heavy plate for wind and transmission aligns with the growing need for steel in data center and renewable energy infrastructure. However, AI is not a material part of ArcelorMittal's investment case, and the company does not disclose AI-related end-market demand.
ArcelorMittal reported Q2 EBITDA of $2.1B, with European EBITDA per ton reaching a three-year high of $98. The company announced production restarts in Spain, Poland, and France, bringing all European blast furnaces back online. Underlying free cash flow annualized at $2.5B in the first half, excluding seasonal working capital and strategic growth CapEx. Management noted that results do not yet reflect the full benefits of the new TRQ trade tool, with customer engagement higher and order books strengthening. They also highlighted progress on strategic growth projects, including the Calvert EAF ramp-up and Liberia growth optionality.
Management expressed strong confidence in continued momentum across all segments into Q3 and the second half. They guided Q3 shipments stable to higher sequentially, a counterseasonal outcome, supported by a strengthening order book and reduced imports from the new TRQ trade tool. They expect higher shipments and average selling prices, partially offset by higher carbon costs as European production increases. The company highlighted strong underlying free cash flow in the first half. They also highlighted a differentiated growth pipeline, including potential second EAF at Calvert, downstream expansion in Brazil, and India capacity growth to 40 million tons per annum, with $1.8B incremental EBITDA expected from 2026 onwards.
“Our European segment delivered an EBITDA per ton of $98, which is a three-years high, and demonstrates the early signs of the improved policy backdrop.”
on European performance
“As we head into August, we have our full suite of blast furnaces in operation. As a result, we are guiding to third quarter shipments to be stable to higher than the second quarter, which would represent a powerful counterseasonal outcome.”
on Q3 guidance
“We are moving forward with the detailed engineering for the second EAF. We're incorporating the lessons learned from the first EAF project to optimize this.”
on Calvert second EAF
On Europe, can you talk a bit more about your outlook for that division? You've announced the restart of Fos-sur-Mer. Your order books appear to inflect. How should we expect your pricing dynamic to evolve into Q3 and Q4 after taking into account the lags, and should we expect any incremental ramp-up costs that can hold your margins back for Europe?
Genuino Christino responded that the outlook is very positive, with Q3 shipments guided stable to higher, which is not the usual trend. Order books are strong, booking into Q4. All furnaces will be running from Q3. Prices are moving in the right direction, and imports should be lower due to TRQ. He noted that bringing back capacity benefits from fixed cost absorption, with minimal additional fixed costs, though carbon costs will rise. Overall, these tons should be even more profitable.
Can you talk about the level of inventories you're seeing in Europe? The messaging from the steel industry was that if TRQ came on, the slightly higher level of inventories carried over from last year will mean volumes will not pick up immediately. Your guidance for 3Q suggests otherwise... Is the inventory levels now significantly lower to enable that shipment increase?
Genuino Christino said imports were still elevated in Q2 but stable on a half-year basis. He noted that inventories are not excessive, especially in the south (France/Spain), which will replace most imports. Order books and customer engagement are developing nicely, and prices are not showing typical high-inventory weakness, giving confidence in the guidance.
To what extent do you have spare capacity in Brazil, and especially now with the Calvert EAF ramping up, how much capacity you think you have to be able to divert into Europe if the market maybe needs some extra tons?
Genuino Christino said Brazilian facilities are running at full capacity, but there is optionality to divert volumes where opportunities arise. The group has high-quality slabs from multiple sources, including Tubarão, and unique flexibility to capitalize on its footprint. He noted that ArcelorMittal is well-positioned to bring slabs if necessary, with more downstream capacity available.