Earnings call transcript: Nucor’s Q2 2025 earnings beat EPS forecasts, stock drops

Nucor Corporation reported its Q2 2025 earnings, showcasing a robust $2.60 earnings per share (EPS), surpassing analysts’ forecast of $2.52. Despite this earnings beat, revenue fell short of expectations, coming in at $8.46 billion compared to the anticipated $8.54 billion. Following the earnings announcement, Nucor’s stock fell by 5.66% in regular trading and further declined by 6.24% in premarket trading, reflecting investor concerns over the revenue miss and future guidance. According to InvestingPro data, this volatility aligns with the stock’s historical pattern, as NUE shows a beta of 1.72, indicating higher price movements compared to the broader market.

Key Takeaways

• Nucor’s Q2 2025 EPS of $2.60 exceeded forecasts, but revenue missed expectations.
• Stock price dropped significantly post-earnings, down 5.66% in regular trading.
• Strong domestic steel demand anticipated for 2025, driven by infrastructure and technology sectors.
• Nucor continues to expand its production capabilities with new facilities.
• Guidance indicates a slight decline in Q3 earnings compared to Q2.

Company Performance

Nucor Corporation demonstrated solid financial performance in Q2 2025, achieving net earnings of $603 million and an EBITDA of approximately $1.3 billion. The company returned $329 million to shareholders through dividends and buybacks during the quarter, maintaining its 53-year streak of consecutive dividend payments. InvestingPro analysis reveals the company’s strong financial health, with a current ratio of 2.52 indicating robust liquidity. Despite the revenue shortfall, Nucor’s operational efficiency and strategic investments in new production facilities have positioned it favorably within the steel industry. For deeper insights into Nucor’s financial health and extensive metrics, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro.

Financial Highlights

• Revenue: $8.46 billion, slightly below the forecast of $8.54 billion.
• Earnings per share: $2.60, beating the forecast of $2.52.
• EBITDA: Approximately $1.3 billion.
• Capital expenditures: $954 million in Q2.

Earnings vs. Forecast

Nucor’s EPS of $2.60 surpassed the forecasted $2.52 by 3.17%, marking a positive earnings surprise. However, revenue fell short of expectations by 0.94%, contributing to the negative market reaction. This mixed performance contrasts with previous quarters where Nucor typically met or exceeded both EPS and revenue forecasts.

Market Reaction

Following the earnings release, Nucor’s stock experienced a notable decline, dropping 5.66% during regular trading hours and an additional 6.24% in premarket trading. The stock’s movement reflects investor apprehension about the revenue miss and future earnings guidance, despite the EPS beat. The stock is currently trading at $135.50, significantly below its 52-week high of $170.52. Based on InvestingPro’s Fair Value analysis, Nucor appears slightly undervalued at current levels. The stock has demonstrated strong momentum over the past six months, with a total return of 14.91%, despite recent volatility.

Outlook & Guidance

Nucor anticipates a slight decrease in consolidated earnings for Q3 2025 compared to Q2, with expectations of modest margin compression in the steel mill segment. The company remains optimistic about domestic steel demand, projecting higher demand in 2025 due to infrastructure and technology investments. Capital expenditure guidance for 2025 remains at $3 billion, underscoring Nucor’s commitment to expanding its production capabilities. InvestingPro data shows that four analysts have recently revised their earnings estimates upward for the upcoming period, suggesting potential upside despite near-term headwinds. The company maintains strong profitability metrics with a return on equity of 7% and an Altman Z-Score of 4.73, indicating solid financial stability.

Executive Commentary

CEO Leon Topalian emphasized Nucor’s strategic positioning, stating, "We are the best, most diverse, well-positioned steel company to provide everything that’s going in the ground and above." CFO Steve Laxton highlighted the value creation from Nucor’s diverse portfolio, noting, "We fundamentally create incremental value with these businesses when we add them and fold them into our portfolio."

Risks and Challenges

• Revenue Miss: The shortfall in revenue could signal challenges in meeting future growth targets.
• Market Volatility: The significant stock price decline indicates potential investor uncertainty.
• Tariff Concerns: Potential 50% tariffs on Brazilian imports could impact raw material costs.
• Margin Compression: Anticipated margin compression in the steel mill segment may affect profitability.
• Economic Conditions: Broader macroeconomic pressures could influence demand for steel products.

Q&A

During the earnings call, analysts questioned the impact of potential Brazilian slab tariffs and explored margin dynamics across different product segments. Nucor executives also addressed the working capital build in the first half of 2025, highlighting flexibility in raw material sourcing as a mitigating factor.

Full transcript - Nucor Corp (NUE) Q2 2025:

Conference Operator: Good morning, and welcome to Nucor’s Second Quarter twenty twenty five Earnings Call. All lines have been placed on mute to prevent any background noise, and today’s call is being recorded. After the speakers’ prepared remarks, I will provide instructions to callers wishing to ask any questions. I’d now like to introduce Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations to begin your call.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor: Thank you, and good morning, everyone. Welcome to Nucor’s second quarter earnings review and business update. Leading our call today is Leon Topalian, Chair, President and CEO along with Steve Laxton, Executive Vice President and CFO. Other members of Nucor’s executive team are also here with us today and may participate during the Q and A portion of the call. Yesterday, we posted our second quarter earnings release and investor presentation to Nucor’s IR website.

We encourage you to access these materials as we will cover portions of them during the call. Today’s discussion will include the use of non GAAP financial measures and forward looking information within the meaning of securities laws. Actual results may be different than forward looking statements and involve risks outlined in our Safe Harbor statement and disclosed in Nucor’s SEC filings. The appendix of today’s presentation includes supplemental information and disclosures along with a reconciliation of non GAAP financial measures. So with that, let’s turn the call over to Leon.

Leon Topalian, Chair, President and CEO, Nucor: Thanks Jack. Now I want to begin by thanking our 33,000 Nucor teammates for delivering a solid quarter both in terms of financial results and our safety performance. Amid all the uncertainty and distractions, you have remained focused on executing our growth strategy and creating value for our shareholders, customers and communities. And you did it all while setting another all time safety record for the first half of any year. Thank you for your vigilance and focus and never losing sight of our most important value.

Let’s continue to carry that momentum into the back half of the year. To recap some of the second quarter financials, Nucor generated EBITDA of approximately 1,300,000,000 and earned $2.6 per diluted share. This represents a significant improvement over our first quarter results driven by higher average selling prices in our steel mill segment and stable realized pricing and higher volumes in our steel products segment. During the quarter, we returned $329,000,000 to Nucor shareholders through dividends and buybacks, bringing our total capital return to shareholders for the first half of the year to $758,000,000 Capital expenditures for the quarter totaled $954,000,000 and we remain on track to deploy approximately $3,000,000,000 in CapEx for the year. Our team continues to execute well and I’d like to highlight just a few of our accomplishments for the quarter.

Production levels and shipments at our Brandenburg Plate Mill trended higher for a sixth consecutive quarter. Shipments in June reached another record helping Brandenburg achieve positive EBITDA for the quarter. Meanwhile, Brandenburg’s product development team continues to strengthen its market position with key customers for complex grades of steel plate that we have not been able to produce prior. I’d also like to recognize our entire sheet making group for shipping nearly 3,100,000 tons during the second quarter, marking the second consecutive quarter where the sheet group has set a new shipment record. In particular, I’d like to congratulate our team at Gallatin Sheet Mill in Kentucky for setting a new monthly shipping record during the quarter.

On our first quarter earnings call, I mentioned our structural steel backlog reaching historically high levels and that set us up nicely for strong shipments in the second quarter. Nucor’s BEAM team delivered shipping over 630,000 tons and generating the highest quarterly earnings for this business since 2022 and the fourth highest of all time. On the growth front, our construction teams continue to make great progress as we near completion of several important capital projects. A rebar micro mill in Lexington, North Carolina recently rolled its first heat and is now in the early stages of ramping up production. And the team in Kingman, Arizona has successfully melted, cast and rolled several heats out of its new melt shop and it will be ramping up production throughout the third quarter.

For Nucor Towers and Structures, pole production and galvanizing operations in Alabama are set to begin by September with customer shipments beginning in the fourth quarter. Our Indiana Greenfield project is set to commence full operations by the 2026 with customer shipments beginning in the second quarter. Within sheet, we remain on schedule to complete our coating complex in Crawfordsville, Indiana by the 2025 and our galvanizing line in Berkeley, South Carolina by the 2026 and the construction of our new West Virginia Sheet Mill is nearly 60% complete and remains on track for completion by the 2026. A key driver of our quarterly results came from the strong performance of our steel products group. We have grown this business to become the broadest and most diverse portfolio of downstream steel products in North America, allowing Nucor to offer a wide variety of solutions for our customers.

For the entire segment, second quarter pre tax earnings were $392,000,000 a 28% increase over the adjusted results of the previous quarter. In fact, pre tax earnings for each of the main product groups comprising this segment were in line with or above Q1 levels. On an LTM basis, the steel products segment accounted for 45% of Nucor’s total pretax segment earnings with EBITDA margins of approximately 16%. Both of these metrics remain significantly higher than their respective pre pandemic averages. Tariff policy continues to evolve, but has been positive for the steel industry overall.

We support the administration’s recent actions to strengthen the Section two thirty two program by increasing the tariffs to 50%. We also applaud the Commerce Department’s decision earlier this year to expand the review of steel derivative products covered by the Section two thirty two tariffs and for implementing a transparent inclusions process. These steps will help to curb the volume of unfairly traded imports and protect our national security. However, dumped and subsidized imports continue to persist and the vigorous enforcement of our trade laws is needed now more than ever. Nucor and other domestic producers have been injured by elevated levels of unfairly traded corrosion resistant imports in recent years and filed trade positions on core imports from 10 countries last September.

Nucor is pleased with the preliminary determinations from the U. S. Commerce Department and U. S. International Trade Commission in these investigations and we anticipate affirmative final determinations from both agencies later this summer and fall.

The Commerce Department and ITC have also initiated investigations into rebar imports from four countries with the ITC issuing an affirmative preliminary injury determination earlier this month. Affirmative determinations in these cases and other trade proceedings are critical to ensuring a level playing field for the steel industry in America. We are optimistic that the administration’s vigorous enforcement of our trade laws and the strengthened Section two thirty two program will result in a sustained reduction of imports into our market. We’re also monitoring the evolving country specific tariff negotiations and their impact on raw material cost. Nucor’s raw material supply chain is advantaged by having a broader set of capabilities than any other steel producer in North America.

That diversity, along with our world class sourcing and logistics teams, give us flexibility to source raw materials in a way that optimizes our cost structure and adapt to this highly dynamic situation. Beyond trade policy, we were pleased to see the tax provisions and manufacturing incentives contained in the new legislation signed into law earlier this month. We expect the bill will lead to further economic growth and boost our competitiveness as a nation. It will unleash new investments in steel intensive projects and promote the reshoring of vital manufacturing while enhancing our national security. And as North America’s largest and most capable steel products company, Nucor is incredibly well positioned to support this growth.

With that, let me turn it over to Steve who will share additional details about our second quarter performance, the current demand environment for steel and our outlook for the third quarter. Steve? Thank you, Leon, and thank you all for joining us on

Steve Laxton, Executive Vice President and CFO, Nucor: the call this morning. During the second quarter, Nucor generated net earnings of $6.00 $3,000,000 or $2.6 a share, right at the midpoint of our earnings guidance range. This represents a substantial improvement over the prior quarter adjusted earnings per share of $0.77 and is similar to the reported $2.68 earnings per share during the second quarter of last year. Year to date Nucor’s adjusted earnings were $782,000,000 or $3.37 a share. Our second quarter results included pre operating and startup cost of approximately $136,000,000 or $0.45 per share.

This is down $34,000,000 compared to the prior quarter and in line with the prior year second quarter. Turning to the segment level results for the quarter, the steel mills segment generated eight forty three million dollars of pre tax earnings more than triple that of the prior quarter. Higher average selling prices particularly in our sheet and plate operations were the largest drivers of the change in profitability. Total volume for the steel mills segment was in line with prior quarter as increases in sheet, plate and beam shipments were offset by lower bar shipments. We continue to see solid and steady booking rates and our steel mills backlog at the end of the second quarter was up nearly 30% over this time last year.

To comment briefly on the pricing environment, we would describe it as broadly stable. Our published consumer spot price for HRC has been within 5% band of either side of $900 a ton for the past sixteen weeks. During this period, we shipped record sheet volumes and our sheet backlog at the end of the second quarter was 15% higher than the same time last year. As for rebar and MBQ products, we’ve recently announced price increases that take our average selling price for both products above the respective thirteen and fifty two week averages. We continue to see healthy overall demand for long products and we expect lower rebar imports during the second half of the year.

Turning to Steel Products, as Leon mentioned earlier, we saw another strong performance in this segment. During the second quarter, Products generated pre tax earnings of $392,000,000 up 28 over the prior quarter’s adjusted basis. Results were driven by stable realized pricing and higher volumes leading to our best earnings quarter for this segment since the 2024. Similar to steel mills, our backlog levels for the steel product segment remain healthy, up approximately 20% from a year ago and extending into 2026 for some products. We continue to see strong demand as evidenced by robust quoting activity and believe this reflects improved business confidence among our customers servicing the construction and infrastructure markets.

In joist and deck, we’re now seeing pricing for new orders at levels that are approaching our average backlog pricing. As a result, prices and margins in this business are expected to stabilize above pre pandemic levels by end of the year. Turning to raw materials segment, we realized pretax earnings of approximately $57,000,000 for the quarter, an increase of approximately 95% over the first quarter. Results were in line with expectations with stable volumes and pricing and lower operating expenses. Moving to the balance sheet, Nucor remains committed to maintaining a strong investment grade credit profile.

Nucor’s credit ratings are the highest of any North American steel producer and we have long believed that our financial strength is a competitive advantage, allowing us to execute our strategy through various phases of the economic cycle. During the quarter, we retired $1,000,000,000 in long term debt with proceeds from our senior notes issued in March. We ended the second quarter with a total debt to capital ratio of approximately 24% in cash of approximately $2,500,000,000 Our next substantial maturity is not until 2027 and more than 80% of our long term debt maturities are after 02/1930. In addition to maintaining a strong balance sheet, a cornerstone of Nucor’s capital allocation framework is to provide a meaningful direct return to shareholders. During the second quarter, we returned $329,000,000 to shareholders in the form of dividends and share repurchases.

When combined with the first quarter, we’ve returned $758,000,000 of cash to shareholders representing nearly 100% of Nucor’s year to date net earnings. During the same period, we’ve repurchased approximately 4,000,000 shares at a weighted average value of approximately $124 a share. Leon covered some of the factors impacting our markets, but now I’d like to touch on four of the larger macro themes that are driving demand. First, technology and advanced manufacturing. Since the passage of the CHIPS Act in 2022, we’ve seen announcements of over 90 technology and advanced manufacturing projects totaling over $450,000,000,000 in private investments.

And that momentum is accelerated in 2025. These projects take time to move from announcement to construction, but we’re seeing increased bidding and new order activity. We’re currently supplying steel to eight large semiconductor facilities now under construction, which all require beam, rebar, joist and deck and other downstream products. Second, infrastructure demand remains strong, driven by funds allocated and now flowing to projects under the IIJA. We’ve seen notable increases in public transit, highway bridge and tunnel contract awards and our bar and plate teams are responding to this demand.

Nucor’s bar shipments were 13% higher in the first half of the year, while New Kors plate shipments to the bridge market hit a record in the second quarter and rose 35% for the 2025. We also anticipate higher steel tube demand later this year as contracts progress for unfinished sections of the border wall. Third, energy. In the energy sector, Nucor has seen exceptional growth in power transmission with the first half shipments to this market up 88% year over year. We’ve also seen significant increases in steel shipments related to solar and onshore wind projects and the recently enacted tax policy will likely lead to some incremental pull ahead tons over the coming year.

Additionally, our Brandenburg facility has been certified to supply line pipe for both LNG and oil pipeline projects, opening up new opportunities in this expanding market. Last but not least, data centers. Construction in this market remains particularly strong. According to the Dodge Construction Network, spending from construction starts is projected to grow 18% this year and an additional 26% in 2026. Our beam orders for this segment have increased significantly and serve as a precursor to incremental demand for a variety of downstream products that Nucor supplies.

We expect these growing market segments will continue to drive demand for steel and steel products for the foreseeable future. Turning to the third quarter outlook, we expect Nucor’s consolidated earnings to be nominally lower than in the second quarter. In the steel mill segment, despite resilient backlogs and stable demand, we expect modest margin compression compared to the second quarter. In both the steel products and raw material segments, earnings are expected to be similar to the second quarter. For steel products, we expect slightly lower profitability in tubular and joist and deck offset by improved performance in other business lines.

As we look ahead to the 2025, our expectation is that domestic steel demand will be higher than it was in the 2024 and with the broadest range of capabilities in the North American steel market. We are confident in our ability to create value for our customers and shareholders as we capture a healthy share of that demand. And with that, we’d like to hear from you and answer any questions you may have. Operator, please open the line for questions.

Conference Operator: Thank you very much. We now have to open the lines for Q Our first question comes from Bill Peterson from JPMorgan. Bill, your line is now open.

Bill Peterson, Analyst, JPMorgan: Good morning and thanks for taking my question. On the steel products, you mentioned the margin compression. Can you break that down

Leon Topalian, Chair, President and CEO, Nucor: for us?

Bill Peterson, Analyst, JPMorgan: Is that a statement of higher input cost?

Analyst: I guess how should

Bill Peterson, Analyst, JPMorgan: we think about pricing directionally, kind of flattish on a blended basis from the second to the third quarter? Trying to get a sense before the margin expands in the fourth quarter on how we should think about the puts and takes.

Leon Topalian, Chair, President and CEO, Nucor: Yes, Bill, let me kick it off and then maybe I’ll ask John Hollis, our EVP of that group to touch on a few things. But I want to begin with thanking the men and women of the Nucor family. This is the safest start to the first half of any year in the history of our company and I couldn’t be more proud of how our team continues to generate and take care of one another in our most important value. Every metric, every result that we will talk about today and moving on are generated through those team members. And again, to see that value exemplified as the safest first half of any year is an incredible achievement.

So thank you for that. The second, to your question specifically, Bill, look, it’s a great question. You And know, we’re talking earlier this morning before we got on the call. If we think about the resiliency of non res construction and the construction market in general, that took off really post COVID and it has remained robust for a long period of time, and we anticipate that remaining robust. ’24 was not particularly great year.

And but as we look at the strength of their backlog, you’re pushing six to nine months out. So really what the nominal adjustment that we see in pricing isn’t because the demand drivers are weak, it’s the lag effect that many of those orders were taken in late Q4, early Q1 of this year are now being realized and sold under that under those pricing. And so in fact, we’ve just recently announced a price increase last week. So again, the demand drivers for this segment are really robust and we expect them to remain that way again throughout the rest of this year and quite frankly beyond. And so again, it’s a incredibly important strong contributor to our business segment.

We’re proud of all the groups that make up that family. But, again, as we move forward, we see strength in that market.

John Hollis, EVP, Nucor: Yes, Bill. This is John Hollis. Again, it’s very normal for us to have margin expansion and contraction as we have movements in steel prices. Steve pointed to the joist and deck market and what we expect out of that in the second half of the year. Some of our you got to remember, we have a dozen different businesses in our downstream portfolio.

Some of those backlogs are nine months out, so we have good visibility as to what those margins would look like. Some of those backlogs are six weeks out. So there’s a lot of variation in that. But I think it’s important to note that many of these downstream businesses are custom engineered products that have value added solutions, and our teams have done an excellent job of separating pricing from movements in raw materials and really redefine the earnings profile of these businesses. And Leon as Leon mentioned, demand remains solid and we’re optimistic about the future of downstream products.

Bill Peterson, Analyst, JPMorgan: Thanks for that. And also thanks for highlighting the safety performance, strong results on that. My second question is on the steel mills. And nice to see utilization trends in the first half of the year. But among the steel products, which are running a relatively lower utilization?

Or said another way, what is your biggest or best opportunities to displace imports as we look ahead to the second half of the year?

Leon Topalian, Chair, President and CEO, Nucor: Yes. Look, I’d tell you that that really sits across the board. Our capability set is the most diverse within all North American steel producers. So whether we’re talking tubular, joist deck, rebar, but there are some opportunities, right? We’re running roughly 85% utilization rates across the steel mill segment.

So again, there’s more opportunities in sheet. There’s more opportunities in our plate group. We have more opportunities in rebar and some of our long products. But again, we’re well positioned to supply those. And again, we don’t just simply produce to stack backlogs up.

We’re producing the orders in most every case. And so we’re meeting the demand where it’s at and, again, have the flexibility to adapt and adjust very quickly. While we’re, pleased to see what import levels are doing and and coming down in that 21%, they’re still too high. We need to be in the low teens. And quite frankly, the North American steel industry can supply the needs of what’s being required without having those imports come into The United States.

So we’re gonna continue to advocate for strong fair trade and balanced trade for, again, illegal imports being dumped and subsidized on the shores of The US.

Bill Peterson, Analyst, JPMorgan: Yeah. Thanks, Leon, and congrats on the strong execution.

Leon Topalian, Chair, President and CEO, Nucor: Appreciate it, Bill.

Conference Operator: You very much. Next question comes from Lawson Winder from Bank of America Securities. Lawson, your line is now open.

Lawson Winder, Analyst, Bank of America Securities: Thank you, operator, and good morning, Leon. Good morning, Steve. Thank you for today’s update. If I could ask about Lexington and Kingman and those ramp ups, congratulations on getting those to the cost of being fully operational. Could you speak to the pre operating start up costs and the period by period outlook for those assets as they start contributing to EBITDA positively?

Leon Topalian, Chair, President and CEO, Nucor: Yes, Lawson, look, I’m going to touch on a couple of things and then let Steve kick off into the pre operating start up cost as they move through that start up. But I want to begin with thanking our Lexington, North Carolina team and then that MicroBell and their start up and congratulating them on their safety and how hard they’ve continued to focus on our customers and bring that mill up. We’re excited about what this mill is gonna do. It’s our third micro mill in the fleet, alongside Frostproof and Sedalia. And again, it’s a market segment we know really well.

We’re excited about where that’s geographically located as well in the Atlanta corridor. And so again, we look for great things to come from them as they continue their startup into Q3 and Q4. And as well at Kingman, Arizona, we’re proud of the team that they’ve started their melt shop up now and will continue to ramp up in that asset. Again, it’s geographically positioned incredibly well also in a market that’s growing and continues to grow. The other point I’ll mention maybe before Steve or Randy may want to share a few additional comments is you’re starting to see the move into Nucor’s bottom lines throughout the segment of contributors like our team in Nucor Brandenburg and the plate mill and the things that they’ve done there and ramping up, Nucor Gallatin and our sheet mill and their delivery.

But we’ve got yet to fully realize the impacts of all of that to the bottom line. So Brandenburg is going to continue to ramp Gallatin Lexington, North Carolina, Kingman, Arizona, our towers and structures plants in Alabama, Indiana that will start up later this year in the spring next as well as the Utah towers plant that will begin late next year. The Galve lines at Crawfordsville and Nucor, Berkeley and finally West Virginia. So you’re seeing the start of the bottom line being impacted today, which again will decrease the overhang of the pre operating and startup cost. But the momentum and the pent up earnings power of Nucor is just now coming online.

And so over the next months and years, I love our strategy, our positioning, the customers and capability sets we’re going to be able to serve and how that’s going to position Nucor to achieve the highest highs we’ve ever achieved and the highest lows. So with that, Steve, maybe make a few comments on our pre operating costs.

Dave Smusky, Nucor: Lawson, how are you doing? The pre op start up cost came down quite a bit quarter over quarter. And the real driver on that is the Brandenburg team getting to breakeven more so than some of the bar mills, although they’re doing an excellent job as well. Just the sheer size of it, that’s the one that’s impacted the most. And I think if you’re thinking about what to model out for the second of the year, you’re probably going to be in that 140,000,000 to $150,000,000 a quarter range for the back half of the year.

And Leon highlighted where we are. We’re marching through we’re about three fourths of the way through this major capital investment plan that we’ve had to reposition our company. He alluded to it, but you’ll see those figures start to come down a little bit later. It will lag our capital spending plans.

Lawson Winder, Analyst, Bank of America Securities: Thanks for that. That’s fantastic, guys. If I could follow-up on Brandenburg. What utilization rate is the asset now currently operating? And then just how do you see that trending for Q3 and Q4?

Brad Ford, Nucor: Lawson, this is Brad Ford. I’m happy to take that one. First of I’d just congratulate the Brandenburg team and really the entire playgroup for the major step forward in Q2. We had record production, record shipments. The team achieved some pretty significant reductions in operating expenses and efficiencies.

And then we also had some key achievements in product development all contributing to that EBITDA positive Q2. Those are all records we expect to continue to break every quarter going forward, right, simply in Q3 and again in Q4. So we’re very proud of that team. One of the things we talk about at Brandenburg versus you talk about capacity utilization. It’s really the story is around the capabilities of that mill, and what that brings to the playgroup.

And we saw that play out in some some key end use markets in q two, specifically in the bridge side. You know, bridge demand has been very, very strong, and and over 20% of our playgroup shipments in q two were only Brandenburg sizes. So prior to Brandenburg, tons that we couldn’t participate in, customers we couldn’t participate with. On the energy side, we saw onshore wind, power transmission and line pipe, all very robust. As we mentioned in the opening comments, Brandenburg was approved by some large line pipe manufacturers.

We expect this to be a larger part of our order book in the quarters ahead. So really it’s a story of capability over capacity and the addition of Brandenburg’s capabilities has us extremely well positioned to really be the supplier of choice. And we’re pretty excited about the balance of this year and as we roll into ’26.

Lawson Winder, Analyst, Bank of America Securities: Thank you very much for that. Appreciate it. Best of luck to you

Leon Topalian, Chair, President and CEO, Nucor: Thanks a lot.

Conference Operator: Thank you very much. Our next question comes from Katya Chanky from BMO Capital Markets. Katya, your line is now open.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor0: Hi. Thank you for taking my questions. Maybe going back to the 3Q outlook, specifically to the mill segment. So you expect volumes and pricing to be relatively stable, but also are calling for margin compression. Can you talk a bit more about what’s driving that margin compression expectation?

Leon Topalian, Chair, President and CEO, Nucor: Yes, Katya. I’ll touch on that. Look, it’s a few things. One, if we step back and look at the entire tariff picture, we certainly looked at that and put baked some of that into our forecast. So as we think about the impact to slabs, impact to raw materials, if, the impact of the tariffs to Brazil come into effect on Friday, That still remains to be seen that could have some impact.

However, I’ll I’ll touch on that in in in a moment, but, you know, that that’s a part of it. And the second, you know, part of that forecast is really around, again, the lag effect. We touched on that a few minutes ago with the impact to our product segment where they’re realizing that pricing delta that’s now flowing through the system that is at lower pricing levels. But again, the drivers and the demand drivers beyond that remain incredibly robust. So as we move into q three and beyond, we’re gonna start realizing those higher selling prices and again that will adjust.

But those are the two drivers that are impacting why we potentially see nominal adjustment. But again, there’s some upside as well if certain things happen. But I don’t want to just leave that overhang there with a comment around the tariffs. As we think about the raw material flexibility that we have, it’s as broad and vast as any steelmaker in North America. And so, Al, maybe just touch on a few of the things that we’re doing, the flexibility of our raw materials thing and why if, again, Katya, the tariffs go into effect on Friday, why we will not feel the full impact of those to our bottom line?

Sure, Leon. I’d be happy to. Katya, it’s Al

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor1: Baer. So to unpack a bit what Leon is mentioning there, I’d start with those comments about our raw materials team having the broadest capability of any steel producer in North America. In simple terms, we’re built for this. This is why we stay in game day shape and we’re ready to play right now. And that team is getting it done.

This is their time to shine and they are really performing. When we think about Brazil, there’s really two key inputs that we buy from Brazil. One is DRI pellets and the other is pig iron. And so as we think about DRI pellets, we’ve already taken the steps needed to mitigate that 50% tariff from Brazil. So we’ve done that through changes to our supply, our global sourcing for those pellets and through the mix that we feed those DRI plants.

So the DRI issue is largely taken care of. When we shift to pig iron then I think it’s helpful to first put our usage into perspective. So today, Katya, pig iron represents 7% to 8% of our melt across the enterprise. If you look back five years or so that would be double that. And so one example of this flexibility was the the invasion of Ukraine.

You know, at that time, Russia and Ukraine were 50% of our pig supply. And we we pivoted very quickly in a very agile fashion and never missed a quality spec, never missed a customer commitment, and shifted our supply, pulling the levers we have to pull to react and and respond. So as we sit here today then with with pig iron, we would expect to do largely the same thing and and pivot our supply and and pull the levers that that we have to pull. Some of those are shifting to alternate supply like DRI, like low copper shred. You think about our DRI supply, it’s internal.

It’s stable. Both of our DRI plants are world class amongst their peers, absolutely world class, and have become a top performer for the supply chain for our steel mills. The other is low copper shred. That’s that’s not directly an HQ high quality metallic substitute, but it’s part of that picture. And we’ve grown significantly in low copper shred production, and we expect to grow more into the future.

So I I I just summarize our positioning in in this way that this environment, it’s very challenging and it’s very fluid, but it’s exactly the type of environment that we’ve built this team to handle. And and they’re executing that strategy with skill and precision. And it it just gives us up other options that that other producers don’t have.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor0: That’s super helpful. Just to to confirm, basically, what I’m hearing is that you’re preparing for the 50% tariffs from Brazil to go into effect on August 1. So if they don’t if they actually do not go into effect, there’s upside to your current expectations. Is is that fair?

Leon Topalian, Chair, President and CEO, Nucor: Yeah. Look, I think there’s a lot of variables that could create some upside. But again, what our jobs are to make sure we provide a realistic forecast for you to estimate what we think the earnings are going to be. And so again, let’s talk in a week and we’ll let you know whether or not those things come to pass. So until that time, yeah, don’t want to speculate on what could be, but we’ve built our models to accordingly and again to put the risk mitigators there in place so that again we can pivot very quickly should they come to pass.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor0: Perfect. Thank you. I’ll hop back into the queue.

Leon Topalian, Chair, President and CEO, Nucor: Thank you, Tatu.

Conference Operator: Thank you so much. Our next question comes from Tristan Greta from BNP Paribas. Tristan, your line is now open.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor2: Yes, hi. Thank you for taking my questions. Just a quick follow-up on the raw material costs. Have you seen any tariff led cost already in Q2 on the BRI buying or life cover or anything? Was there anything in the average cost in Q2?

Leon Topalian, Chair, President and CEO, Nucor: No, I no, not we did not Tristan. No.

Lawson Winder, Analyst, Bank of America Securities: All right. That’s

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor2: clear. And then my second question, I think in your presentation, you talked about the beautiful bill potential impact. Could you maybe go a bit more in details? And if you’ve been able to quantify and time those impacts, that would be appreciated. And maybe just a last question on the working capital.

Look, had a big build in H1. I’m not sure if that’s also some raw material inventory strategy ahead of the tariffs. If you can share any type of outlook into H2 for your working capital, that’d be great as well. Thank you.

Leon Topalian, Chair, President and CEO, Nucor: Okay. I I I certainly got the front end of the question. I’m I’m not sure I’ve I’ve got the the back end, but I’ll let Steve answer that. If look. If I I begin from the macro, the one big beautiful bill, I I think certainty certainly comes into play, certainly of what the corporate tax rate is gonna be.

And and again, now we can begin building, you know, certain things out. I think the other incentives for, reshoring are are certainly there. And again, when you think about reshoring, Nucor sits at the tip of the spear of all of that. We’re the best, most diverse, well positioned steel company to provide everything that’s going in the ground and above. And so again, our diversity of range of capabilities offers incredible opportunities.

You know, I I don’t know if Brad mentioned it a few minutes ago, but when you think about Brandenburg and its offering today, it is the widest, heaviest, broadest range of plate capable products in The United States. And so now as we think about long term partnerships with defense, military applications and beyond, it offers great exposure and, again, pull through for other products. So within that bill, you see $47,000,000,000 for funding for the border wall that we, again, sit at the ready poised, not only because we have it, but because we did it prior in the first administration. We’ve got 29,000,000,000 slated for shipbuilding, again, back to Brandenburg and the capability set in in our plate ranges. 150,000,000,000 in defense spending that, again, we see sit in a very enviable position to be poised to supply all of that.

And then again, if I pull back one one layer one level higher from the the bill itself, over the last six months, you’ve seen commitments from companies, that are in the top fortune 50 of this nation that amount announced $2,000,000,000,000 of investment into The United States Of America. Again, Nucor sits incredibly well positioned, to to do everything from the data centers, the energy, the markets, the clean, and and clean manufacturing, the advanced manufacturing, all of those areas, again, from shipbuilding to bridges to defense and military, again, I I think are wonderful pull throughs. And, again, I think this bill is gonna be very advantageous for the steel industry, but quite frankly, as a whole.

Dave Smusky, Nucor: Tristan, this is Steve. And just to address the last part of your question about working capital changes, and it ties in with Leon’s response about some positive demand trends. But it was a large factor working capital build is a large factor of why we had negative free cash flows for the first half

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor3: of the

Dave Smusky, Nucor: year. We had roughly six a little north of $620,000,000 of capital usage in our operating working capital build just in the second quarter alone. That’s not abnormal given the price trends and the volume trends we’ve seen. That’s not all that surprising. But I think what that sets up really well is a very constructive pivot toward the second half of the year where we expect a dramatic change in free cash flow profile in the back half of the year compared with the first half of the year.

And that’s driven in part by the working capital usage in the first half, but also capital spending was very, very high in the first half of the year. So it really sets up a very nice the market conditions along with our position in the market set up a very nice free cash flow outlook for the second half.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor2: All right. That’s clear. Thank you.

Conference Operator: Thank you so much. Our next question comes from Phil Gibbs from KeyBanc. Phil, your line is now open.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor4: Hey, good morning.

Leon Topalian, Chair, President and CEO, Nucor: Good morning, Phil.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor4: Sticking with the big beautiful bill question, Steve, are there any direct tax benefits to you all in the back half of the year for 2026?

Dave Smusky, Nucor: Yes. Hey, Phil. Actually, it’s relatively limited. The construct of that bill is a little bit forward facing, if you will, in that many of our projects are already underway. Some of the largest spend we’ve got, it does probably have the most pronounced effect for us in R and D spending and the ability to accelerate that into expensing that right upfront rather than amortizing it over seven years.

So we’ll have some very positive net present value benefits with that regard, maybe not as large as you might expect given the capital spending that we’re undertaking.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor4: Okay. And then I have one follow-up just on the cost side. So the slab piece you buy, I think you buy foreign slab for CSI in that business on the West Coast. So my baseline assumption is that business starts to see some higher cost in the third quarter. I think that’s what you may have been alluding to on the earlier comments.

And then secondly, just maybe give us a view of what you’re seeing on just your own energy and electricity cost side and how those things are trending overall? Thank you.

Leon Topalian, Chair, President and CEO, Nucor: Look, Phil, a few things. And yes, it’s the short answer. The tariffs on slabs have already been taken already are in effect. And so that change is already upon us. But again, Noah Handers and the sheet group continue to do a great job.

We have not unlike our raw materials, the incredible flexibility to pivot and again self supply if we chose. But Noah you want to just touch base on a few of the things that you and your teams are doing there to again mitigate some of this impact.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor1: Yes. Just a couple of small things to add here. One, we as Leon mentioned and as you see in our raw material strategy, we have the ability to go source anywhere in the world and domestically. And our team exercises that ability and they’re really adept at finding us the lowest cost solution. So while we do have some exposure to the Brazilian tariff and you see a little bit of that compression in the in our outlook on third quarter is due to that tariff impact to Brazil.

We also have the ability to self supply. We’re shipping their internal finished hot rolled tons that CSI is then able to transform at very competitive cost. And then we are able to source from other international other sources internationally at very competitive cost. So our team is doing an awesome job managing the impact of the tariffs and we’re able to continue to serve the West Coast market profitably.

Dave Smusky, Nucor: Phil, just to round out your question on energy. Energy costs are up a little bit year over year. They’re down quarter over quarter, but they’re for us, they’re a little over $40 a ton in our steelmaking. And in terms of outlook, we put that relatively flat in the next couple of quarters going ahead.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor4: Thanks very much. Thanks,

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor5: Phil.

Conference Operator: Thank you very much. Our next question comes from Mike Harris from Goldman Sachs. Mike, your line is now open.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor5: Good morning and thanks for taking my question. As we look at the steel products segment, what would you guys call out as potential gaps in that portfolio? And maybe speak to some examples of what type verticals could bring material synergies to the table.

Leon Topalian, Chair, President and CEO, Nucor: Yes. Mike, look, again, as John had mentioned earlier, that group is comprised of about 12 different businesses from overhead doors or insulated metal panels or joist and deck or building systems. And I would tell you almost across the board, we’re seeing either flat or improving conditions. So again, I would tell you there’s really not a lot or there’s no low spots to call out. Again, there’s some lag in terms of realized margins in net earnings that we’re going to see flow through into Q3 and beyond.

But again, if we go back six, seven, eight years, that group, as a whole represented about 15% of Nucor’s overall net earnings. Today, that’s pushing closer to 45%, 46% of overall net earnings. And again, as you think about the core build out of our steelmaking capacity, those dollars are going to continue to shift into our adjacencies, expand beyond and all those sit under this products bucket as well. So that growth for Nucor is going to continue to grow in that area. So I would tell you we’re excited about that.

Our internal as well as the external forecast in almost every one of those segments are showing improving conditions.

Dave Smusky, Nucor: Yes, Mike. Maybe I’ll add just a little bit to what Leon said there. If you go back to pre COVID levels of EBITDA margins for the downstream segment, we’re doing nine or 10% EBITDA at that time and now we’re doing 1617% depending on whether you want to talk first half or fourth quarter. And I think that speaks to what Leon’s really hitting at with where we will allocate capital going forward, which is kind of the heart of your question about what gaps are in the product suite, we continue to find ways to add to our portfolio that improve our margins, improve free cash flows and offer a wider range of solutions in the marketplace and fit our business model. That’s probably the most important aspect.

We fundamentally create incremental value with these businesses when we add them and fold them into our portfolio. So we’re not going to ever tell you the specific targets, but we will keep marching in the same direction that we have you’ve seen us do in the past.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor6: No. That, that’s very helpful.

Analyst: And I guess the in the

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor5: spirit of full disclosure, I was looking at slide number six where you talked about the evolution of the, the business. And I was just trying to make sure I understood that future. Was that because, you know, you were just making the, you know, the best better, or did you not feel you had, enough to fight with already in it? Sounds like it was the, the former? That’s that’s really all I had, guys.

I mean, you’ve you’ve answered a lot of my questions already, I’ll, I’ll get back in the queue. Thank

Leon Topalian, Chair, President and CEO, Nucor: you, Mike. Appreciate that. And, yes, your your comment about the the former is accurate. It is continuing to put more arrows in our quiver to deliver more capabilities for our customer sets.

Conference Operator: Thank you very much. Our next question comes from Carlos De Alba from Morgan Stanley. Carlos, your line is now open.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor3: Yes. Thank you. Good morning, everyone. Just wanted to explore a little bit more the margin compression expected in the steel mills in the third quarter. Can you provide maybe some color by different products, sheet, plate, bars, beams?

Are there any of those products where you that you would highlight where you expect the biggest margin compression maybe you see some margin expansion in some of them that would be great?

Leon Topalian, Chair, President and CEO, Nucor: Yes, Carlos, look, we touched on that a little bit a few moments ago. I think the potential for some pressure in flat sheet in particular could impact those the earnings segment in Q3. And that’s why, again, we’ve highlighted that, we’ve touched on that. Part of that is what Noah just mentioned a few moments ago regarding the slabs coming in from Brazil. So, again, we have some mitigation strategies already being worked and and put in place, which could mean we supply sell supply there through our own sheet mills.

And, we have a very adaptive capability set. But, again, that’s that’s one area. But as we talk about that, yeah, I think there’s a a ton of upside as we think about the potential continued growth in what Brandenburg is doing in the playgroup, what John and the team are doing in in products, what Randy and his group are doing in in our long products in in rebar and MBQ. You know, we didn’t talk about it on this call, but our our bean mills in both Arkansas and Berkeley are performing at near historic highs. Their backlogs are at near historic highs.

And all of that backlog, like hundreds of thousands of tons is actual orders. They don’t they don’t produce anything for stock. Every one of those are direct, quotable and billable order. And so that that’s gonna continue to fuel Nucor’s earnings power. And, again, so there’s ’s a lot of segments that we’re very excited about.

Again, the megatrends across The U. S, the start up next month of our towers and structures plant gives us incredible excitement again to be able to move into that market. And then by early spring, the second plant and late next year, third. So again, there’s a number of different elements here that our investment strategy that we deliberately and focused on five years ago, we’re beginning to pay those dividends today. And the investments that are just beginning to start up now are going to continue to pay for the next twenty, thirty, forty years.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor3: Great. Thank you, Leon. Maybe just to if we assume in on bars and maybe beams, but on bars you mentioned the price increases MBQ and rebar, would you expect margin expansion in the bar business and maybe in the beams as well?

Leon Topalian, Chair, President and CEO, Nucor: I’ll touch on beams and then let Randy touch Randy Spicer, our EVP over our products touch on. But look, as we think about the opportunity for longs, man, it’s significant. Again, it’s an area we’ve played in for a long time. We have a great customer base there. We have an incredible market share as well in beans.

But that mill is run you know, at seventy year ish percent of capacity for a long time, Carlos. So we have a lot of opportunity and upside there. At the same time, it is one of the strongest, profit generators in the entire company and has been consistently for a long period of time. And so we couldn’t be more excited about the work that they’re doing, how they look to continue to expand those margins. And, again, yes, I do think there’s opportunity in the beam side.

Randy, why don’t you touch on the longs and bar and MBQ?

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor6: Yes. Thank you, Leon Carlos. Thank you for the question. Definitely the same, I would say, on the bar side. The momentum is very strong.

We have continued to see robust order entry across all of our regions. As we start looking in the key end markets as we’ve talked about several on the call, the infrastructure work, again continued big projects with the chip plant, warehouses and data centers. The support that we get from our downstream businesses has been just tremendous. When you look at the macro signals, the momentum index is showing up 20 on a year, which again is letting us know there are even more projects that are coming into the planning phases. So when we look at our long products, our backlogs are at multi year highs and our lead times continue to extend.

So we are very confident in a very strong second half.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor3: Great. Thank you very much. All the best.

Leon Topalian, Chair, President and CEO, Nucor: Thanks, Carlos.

Conference Operator: Thank you very much. Our next question comes from Alex Hacking from Citi. Alex, your line is now open.

Analyst: Yes. Good morning, Leon and team. I apologize I missed the first couple of minutes of the call, but just wanted to check the CapEx guidance is unchanged at $3,000,000,000 and therefore we should expect a pretty significant decline in 2H. And then just as a follow-up, if I look at Slide five, all the projects nearing completion, beyond that you’ve got the sheet mill, you’ve got the Utah towers, the Pacific Northwest rebar mill. Is there anything else that I’m missing that’s kind of coming beyond what’s on Slide five?

Thanks.

Leon Topalian, Chair, President and CEO, Nucor: Yes, Alex. It was a riveting couple of minutes, and so we’ll catch you up, very quickly. But, yeah, you you touched on most of them. The couple that I would add to that list are our two galvanizing lines at Crawfordsville, Indiana as well as Nucor Berkeley that will come online next year. The third tower is planned in Utah as well next year.

And so again, we’re starting to see the contributions from the investments that were made several years ago like Brandenburg, Gallatin and now Kingman and Lexington are in startup mode now. Commission ing is done. And now their quest is to ramp those facilities up, serving our customer base to continue to generate stronger, sustainable, less volatile earnings for our shareholders and for the future. So yes, as we see that pent up earnings power is starting to flow through and will continue over the next couple of years. But those are the couple I would add that you didn’t call out.

Dave Smusky, Nucor: Hey, this is Dave Smusky. I also had CSI Galpin in late twenty twenty seven startup. Yes. And Alex, math exercise is correct. We do expect lower capital spending in the second half of the year.

That and combined with a little bit less working capital use, we should see a pronounced change in free cash flow in the back half compared with the first half of the year.

Jack Sullivan, Vice President, Treasurer and General Manager of Investor Relations, Nucor5: Thank you.

Conference Operator: Thank you very much. We currently have no further questions in the queue. So I’d like to hand back to Leon Topalian for any further remarks.

Leon Topalian, Chair, President and CEO, Nucor: Thank you for joining us again today. And I’d like to thank our Nucor team for delivering an incredible first half of the year regarding safety as well as our solid financial performance. I’d like to thank our customers for the trust that you place in us with each and every order. And finally, thank you to our investors for the trust that you place in us with your valuable shareholder capital. Thank you for your interest in Nucor, and have a great day.

Conference Operator: As we conclude today’s call, we’d like to thank everyone for joining. You may disconnect your lines.

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