Alcoa Corporation

Revenue increased 24% to $4 billion, the highest quarterly revenue in Alcoa Corporation’s almost 10-year history. Net income attributable to Alcoa was $407 million, or $1.53 per share, versus $425 million in the prior quarter; adjusted net income was $562 million, up $189 million sequentially. Adjusted EBITDA was $901 million. The aluminum segment delivered record adjusted EBITDA of $1.1 billion with a 32.3% margin, while alumina segment adjusted EBITDA declined $56 million sequentially. For the full year, Alcoa lowered alumina production guidance to 9.5 million to 9.6 million metric tons and alumina shipment guidance to 11.5 million to 11.6 million metric tons. It raised other corporate expenses to approximately $180 million and depreciation to approximately $660 million. For third quarter, alumina is expected to be net favorable by about $10 million and aluminum performance is expected to be flat. The company ended June with $1.4 billion of cash and generated $422 million of free cash flow, with cash from operations of $608 million.

Bill Oplinger framed the quarter as a strong execution story, pointing to stable operations, year-to-date production records at four smelters and one refinery, and improved labor stability through multiyear agreements. He also said the company is making progress on strategic growth initiatives, including a $65 million Mosjøjen expansion, a gallium facility, and the large South32 acquisition. His tone was confident and constructive, with repeated emphasis on Alcoa’s ability to create value through scale, disciplined operations, and assets that are difficult to replace.

Molly Beerman led with the hard numbers: revenue of $4 billion, adjusted EBITDA of $901 million, net income of $407 million, EPS of $1.53, and adjusted net income of $562 million. She said the aluminum segment drove the quarter, while alumina was hurt by higher production costs and unfavorable cost absorption at Pinjarra, plus higher fuel oil, diesel, and carbon costs. She also highlighted liquidity and capital allocation, noting $1.4 billion of cash, $422 million of free cash flow, $608 million of operating cash flow, the redemption of the remaining $209 million of 2028 notes, and $24 million contributed to the gallium JV. She guided full-year alumina volumes lower, raised corporate expenses and depreciation, and gave specific near-term cost assumptions including $90 per barrel fuel oil and about $15 million of unfavorable carbon costs in Q3.

Analysts focused on three issues: the Q3 cost outlook, the South32 transaction and approvals, and whether value-added aluminum demand and restarts could continue improving. Management said Q3 energy costs should improve, with diesel and fuel oil now expected to be $5 million favorable, and noted the fuel oil outlook is based on $90 per barrel. On the acquisition, Alcoa said it remains targeted on $500 million to $1 billion of asset monetization through 2030 and believes the South32 deal remains largely negotiated, with approvals in Australia progressing but potentially taking longer than originally expected. On demand and restarts, management said North American and European value-added demand remained solid, Alumar is about 95% restarted, and Portland still has room to ramp.