01—Abstract
Summary
Summary of the 10-Q filed April 27, 2026. Cited figures are marked; the original filing is the authoritative source.
Steel Dynamics, Inc. (STLD) reported a sharp improvement in first-quarter 2026 results.
Net sales rose to $5.20 billiona from $4.37 billion in the first quarter of 2025, and operating income increased to $538.0 million from $275.1 million. Net income attributable to Steel Dynamics, Inc. was $403.4 million, or $2.78 per diluted share, versus $217.2 million, or $1.44 per diluted share, a year earlier. Management attributes the gains mainly to expanded metal spreads in the steel and metals recycling operations, and states that steel shipments reached a record 3.6 million tons with underlying domestic demand strengthening and backlogs increasing.
The steel operations segment drove most of the improvement, with operating income of $555.5 millionb compared with $228.9 million in the prior-year quarter. Steel fabrication operating income declined to $89.5 million from $116.7 million as metal spreads contracted. The aluminum operations segment, which is still ramping up its recycled aluminum flat rolled mill, posted an operating loss of $64.6 million, and management says operations were temporarily paused to resolve startup issues.
The balance sheet and liquidity remain solid. Cash and equivalents were $556.5 millionc, total liquidity was $2.0 billion including $1.19 billion of Revolver availability, and total outstanding debt was $4.2 billion, unchanged from year-end 2025.
Operating cash flow was $148.3 milliond, reflecting a $373.8 million increase in accounts receivable and a $169.6 million increase in inventories. The company repurchased $115.1 million of stock and paid $72.5 million in dividends, and it raised its quarterly dividend to $0.53 per share.
02—Key points
Key Highlights
- Net sales of $5.20 billion, up from $4.37 billion in Q1 2025, with steel operations net sales up 16% on average selling prices up 19%.
- Operating income of $538.0 million, up 96% from $275.1 million, led by steel operations operating income of $555.5 million (up 143%).
- Net income attributable to Steel Dynamics, Inc. of $403.4 million, or $2.78 diluted EPS, compared with $217.2 million, or $1.44, a year earlier.
- Record quarterly steel shipments of 3.6 million tons, with customer orders and backlogs rebounding.
- Aluminum operations posted an operating loss of $64.6 million on startup issues at the recycled aluminum flat rolled mill, which the company expects to improve in the second quarter of 2026.
- Total liquidity of $2.0 billion, total debt of $4.2 billion, and a covenant interest coverage ratio of 13.72:1.00 against a 2.50:1.00 minimum.
- Quarterly dividend increased to $0.53 per share, and $115.1 million was spent on share repurchases in the quarter.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2026, Steel Dynamics kept $0.08.
- Revenue$5.20B100.0%
- Cost of revenue−$4.44B85.3%
- Gross profit$763.2M14.7%
- Operating costs−$225.2M4.3%
- Operating income$538.0M10.3%
- Interest, other & tax−$137.9M2.6%
- Net income$400.1M7.7%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2026filed April 27, 2026Financial Statements
Q1 FY2026 against Q1 FY2025
| Line item | Q1 FY2026Q1 FY2025 | Change |
|---|---|---|
| Revenue | $5.20B$4.37B | +19.1% |
| Cost of Revenue | $4.44B$3.88B | +14.4% |
| Gross Profit | $763.22M$486.54M | +56.9% |
| SG&A Expenses | $175.22M$181.81M | −3.6% |
| Operating Income | $538.00M$275.14M | +95.5% |
| Net Income | $400.11M$217.68M | +83.8% |
| EPS (Basic) | $2.79$1.45 | +92.4% |
| EPS (Diluted) | $2.78$1.44 | +93.1% |
| Shares Outstanding (Basic) | 144.80M150.26M | −3.6% |
| Shares Outstanding (Diluted) | 145.32M150.81M | −3.6% |
05—Questions
Frequently Asked Questions
What drove the large increase in operating income?
Management attributes the increase to expanded metal spreads. Steel selling prices rose faster than scrap costs, with steel metal spread up 30%, and nonferrous metal spreads in metals recycling rose 81%, particularly on higher copper prices.
How is the aluminum operations segment performing?
The segment reported an operating loss of $64.6 million, compared with a loss of $28.7 million a year earlier. Net sales rose 141% to $242.1 million, and the flat rolled mill shipped 22,500 metric tons of finished product in the quarter. The company says operations were temporarily paused to resolve startup issues and expects both shipments and earnings to increase in the second quarter of 2026.
Is the company's debt and liquidity position sound?
Total outstanding debt was $4.2 billion, unchanged from December 31, 2025. The $1.2 billion unsecured Revolver had full availability of $1.2 billion with no borrowings outstanding at March 31, 2026. Management states it was in compliance with its covenants and expects to remain so over the next twelve months.
Why did operating cash flow decline slightly despite higher earnings?
Operating cash flow was $148.3 million compared with $152.6 million a year earlier. The filing cites a $373.8 million increase in accounts receivable tied to higher sales prices and volumes, a $169.6 million inventory increase tied to the aluminum mill startup, and a $120.1 million annual profit sharing payment within accrued expenses.
What are the company's capital allocation priorities this quarter?
Capital expenditures were $138.0 million, mainly for aluminum and steel operations. The company paid $72.5 million in dividends after raising the quarterly rate to $0.53 per share and repurchased $115.1 million of stock, leaving $687.0 million available under the February 2025 repurchase program.
06—Continue