ArcelorMittal beats earnings forecasts as high steel prices offset demand hit
ArcelorMittal Q1 2026 Earnings Overview
By Javi West Larrañaga
April 30 (Reuters) - ArcelorMittal, the world's second-largest steelmaker, reported stronger-than-expected core earnings on Thursday, helped by higher steel prices and improved performance in its North America business.
Financial Results and Analyst Expectations
The Luxembourg-based company posted first-quarter core earnings of $1.68 billion, narrowly beating analysts' average estimate of $1.65 billion, according to data compiled by LSEG.
Regional Performance
However, results at ArcelorMittal's Europe business and mining unit fell below J.P. Morgan's estimates, the brokerage said in a note to investors.
Analyst Recommendations and Market Reaction
J.P. Morgan also said the company's market value did not "adequately discount potential negative impacts arising from higher global energy prices", such as higher costs of production, demand destruction and risks to global growth, and lowered its recommendation for the stock to "underweight".
ArcelorMittal's shares fell up to 3.7% at market open, but quickly reversed course to trade marginally higher by 0752 GMT.
Market Dynamics and Steel Demand
Price Trends and Demand Challenges
HIGHER PRICES, BUT DEMAND SUFFERS
Although the war in the Middle East may have unexpectedly improved EU steelmakers' competitiveness against their more exposed Asian peers, higher inflation and a spike in energy prices have also led to weaker steel demand.
Steel Demand Forecasts
The World Steel Association in April trimmed its 2026 forecast for steel demand in the European Union and Britain from 3.2% to 1.3%.
Company Outlook and Industry Environment
Still, the company's performance was resilient in the first quarter despite the "unsettled backdrop" in the Middle East, CEO Aditya Mittal said in the statement.
The business fundamentals have also improved over the past three months thanks to the structural reset in the EU policy environment, he added.
Steel Prices and Future Expectations
Though demand is still below 2022 levels, European hot rolled coil prices have increased about 22% in the past six months, reflecting higher energy costs and the first effects of the bloc's safeguard measures, after years of low prices.
The first-quarter performance did not yet reflect the materially improved pricing environment, ArcelorMittal said, adding those benefits were expected to start rolling in from the second quarter of 2026.
(Reporting by Javi West Larrañaga in Gdansk, editing by Milla Nissi-Prussak)
