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NUCOR CORP (NUE)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 delivered sequential improvement: revenue $8.46B, EBITDA $1.30B, and diluted EPS $2.60; revenue and EBITDA exceeded consensus, while EPS was roughly in line-to-slightly above the mean, supported by higher sheet and plate pricing and record sheet shipments . Q2 revenue $8.46B vs S&P Global consensus $8.41B*, EBITDA $1.30B vs $1.23B*, EPS $2.60 vs $2.64* (rounded) — net effect a modest beat on revenue/EBITDA and essentially in line on EPS .*
  • All three segments improved vs Q1: steel mills pre‑tax earnings rose to $843M (from $231M), steel products to $392M (from $288M), and raw materials to $57M (from $29M) .
  • Management guides Q3 earnings “nominally lower” on expected steel mill margin compression despite resilient demand and healthy backlogs; this is the main near‑term risk/catalyst for the stock narrative .
  • Operating rates climbed to 85% (vs 80% in Q1 and 75% in Q2’24), shipments to outside customers held at ~6.82M tons, and mills backlog ended Q2 at ~3.7M tons (+30% YoY), reflecting robust end‑market demand across infrastructure, energy and data centers .

What Went Well and What Went Wrong

What Went Well

  • Record operational execution: “our sheet‑making group shipped nearly 3.1 million tons during the second quarter, marking the second consecutive quarter where the sheet group has set a new shipment record” (CEO) .
  • Brandenburg plate mill achieved positive EBITDA, with record production and shipments; approvals for line pipe supply broaden the opportunity set (EVP Plate) .
  • Steel products segment delivered strong results and healthy backlog; pre‑tax earnings rose 28% q/q to $392M, with LTM segment margins around 16% and contribution ~45% of total pre‑tax segment earnings (CEO/CFO) .

What Went Wrong

  • Guidance for Q3 calls for margin compression in steel mills, leading to “nominally lower” consolidated earnings vs Q2 despite stable volumes/pricing — a near‑term headwind .
  • Working capital build drove negative free cash flow in 1H; management expects a “dramatic change” to FCF in 2H as capex moderates and WC normalizes (CFO) .
  • Energy costs remain elevated (~$40/ton YoY up; sequentially down), contributing to conversion cost pressure in steel mills (CFO) .

Financial Results

Consolidated P&L and EBITDA (actuals)

MetricQ2 2024Q1 2025Q2 2025
Revenue ($USD Billions)$8.08 $7.83 $8.46
Diluted EPS ($)$2.68 $0.67 $2.60
EBITDA ($USD Billions)$1.24 $0.70 $1.30

Margins (S&P Global)

MetricQ2 2024Q1 2025Q2 2025
EBITDA Margin %15.25%*8.84%*15.20%*
EBIT Margin %11.14%*4.14%*10.87%*
Net Income Margin %7.99%*1.99%*7.13%*

Values retrieved from S&P Global.*

Actual vs Wall Street Consensus (S&P Global)

MetricQ2 2024Q1 2025Q2 2025
Revenue Actual ($USD Billions)$8.08 $7.83 $8.46
Revenue Consensus Mean ($USD Billions)$7.52*$7.26*$8.41*
EPS Actual ($)$2.68 $0.67 $2.60
Primary EPS Consensus Mean ($)$2.41*$0.66*$2.64*
EBITDA Actual ($USD Billions)$1.24 $0.69 $1.30
EBITDA Consensus Mean ($USD Billions)$1.18*$0.65*$1.23*
# of Estimates (Revenue / EPS)6 / 7*7 / 10*8 / 6*

Values retrieved from S&P Global.*

Segment Breakdown (pre‑tax earnings, $USD Millions)

SegmentQ2 2024Q1 2025Q2 2025
Steel Mills$645 $231 $843
Steel Products$442 $288 $392
Raw Materials$39 $29 $57
Corporate/Elims$(228) $(263) $(393)
Total EBT$898 $285 $899

KPIs

KPIQ2 2024Q1 2025Q2 2025
Shipments to outside customers (k tons)6,289 6,830 6,820
Steel mills total shipments (k tons)5,867 6,463 6,474
Operating rate at steel mills (%)75% 80% 85%
Avg scrap & scrap substitute cost per gross ton used ($)$396 $394 $403

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Diluted EPSQ2 2025$2.55–$2.65 (issued 6/18/25) Actual: $2.60 Met midpoint
Consolidated EarningsQ3 2025N/A“Nominally lower vs Q2” on steel mills margin compression; volumes/pricing broadly stable Lowered (qualitative)
Steel Mills marginsQ3 2025N/AMargin compression expected (sheet/plate; Brazil slab tariffs impact) Lowered (qualitative)
Steel Products earningsQ3 2025N/ASimilar to Q2; mixed within tubular/joist & deck vs others Maintained (balanced)
Raw Materials earningsQ3 2025N/ASimilar to Q2 Maintained
FY CapexFY 2025~$3.0B (reaffirmed) ~$3.0B (unchanged) Maintained
DividendQ2 2025$0.55/quarter $0.55 (payable Aug 11) Maintained
Buyback AuthorizationQ2 2025Remaining $806M as of Apr 5 Remaining ~$606M as of Jul 5 Decreased by ~$200M due to repurchases

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4’24, Q1’25)Current Period (Q2’25)Trend
Tariffs / Trade policyAdvocated stronger 232, extend to downstream; expect pro‑growth agenda (CEO) Supports 50% Section 232 tariffs; corrosion‑resistant & rebar cases advancing; expects import reductions; monitoring Brazil slab/DRI tariffs (CEO/CFO) Tightening; supportive for domestic pricing
Raw materials & supply chainBuilt for volatility; diversified sourcing; DRI/shred flexibility (Mgmt) Brazil tariffs impact mitigated; pig iron now ~7–8% of melt; DRI/shred flexibility emphasized (EVP) Well‑hedged; manageable cost risk
Data centersExpect strong growth; racking & beams opportunity (CFO) Structural steel shipments for data centers doubled YTD; downstream orders up 30%+ YTD (presentation) Strengthening secular driver
Energy & transmissionGrowing towers business; 3 plants by 2027 (CEO) Power transmission shipments up; towers Alabama operations by Sept; Indiana by Q1’26; towers EBITDA target ≥$150M (CEO/EVP) Accelerating; near‑term ramps
Brandenburg (plate)Target EBITDA positive mid‑2025 (Mgmt) Achieved positive EBITDA; approved for line pipe; ABS certification; record plate shipments (EVP Plate) Ahead/as planned
Working capital / FCF1H capex heavy; start‑up costs ~$160–170M/qtr (CFO) WC build drove negative 1H FCF; 2H FCF expected to improve materially; capex moderates (CFO) Inflecting positive in 2H

Management Commentary

  • “Nucor generated EBITDA of approximately $1.3 billion and earned $2.60 per diluted share... driven by higher average selling prices in our steel mill segment and stable realized pricing and higher volumes in our steel product segment” (CEO) .
  • “Steel mills backlog at the end of the second quarter was up nearly 30% over this time last year… our published consumer spot price for HRC has been within a 5% band around $900 a ton for the past 16 weeks” (CFO) .
  • “We expect Nucor’s consolidated earnings to be nominally lower than in the second quarter. In the steel mill segment… modest margin compression compared to the second quarter” (CFO) .
  • “Pre‑operating and startup cost came down quite a bit quarter over quarter… model $140–$150 million per quarter for the back half” (CFO) .
  • “Energy costs are up a little bit year over year… a little over $40 a ton in our steelmaking” (CFO) .

Q&A Highlights

  • Steel mills margin compression in Q3: driven by tariff effects (Brazil slabs, DRI/pig iron) and backlog price lag; mitigation includes self‑supply, diversified sourcing, and flexible substrate strategy (CEO/CFO) .
  • Start‑up costs trajectory: Brandenburg’s EBITDA positivity lowers pre‑op overhang; plan ~$140–$150M per quarter in 2H (CFO) .
  • Working capital/FCF: ~$620M operating WC use in Q2; set up for “dramatic” FCF improvement in 2H as WC/capex pivot (CFO) .
  • Segment cadence: steel products stable overall with tubular/joist & deck mixed; raw materials similar to Q2; beams at near historic highs with large backlogs (CEO/CFO) .
  • Energy and data center demand: structural/data center orders strong; towers business ramping with national footprint; transmission orders climbing (CEO/EVP) .

Estimates Context

  • Q2 beats/in‑line: Revenue $8.46B vs $8.41B* and EBITDA $1.30B vs $1.23B* were above consensus; EPS $2.60 was essentially in line with consensus $2.64* — a small delta likely driven by mix and noncontrolling interests .*
  • Prior periods: Q1 2025 delivered beats vs consensus on revenue ($7.83B vs $7.26B*) and GAAP EPS ($0.67 vs $0.66*); Q2 2024 was above consensus on both revenue and EPS .*
  • Revisions outlook: Near‑term (Q3) estimate revisions may edge down on steel mill margin compression commentary; medium‑term revisions could skew up as mills/core products benefit from tariff enforcement, growing backlogs, and 2H FCF inflection (management’s constructive demand view) .*

Values retrieved from S&P Global.*

Key Takeaways for Investors

  • Q2 was solid with a modest revenue/EBITDA beat and strong sequential improvement across segments; the quarter supports resilience in core demand and NUE’s diversified earnings base .
  • Near‑term caution: management signaled Q3 margin compression in steel mills despite stable volumes/pricing — expect consensus to drift lower for Q3 EPS; monitor tariff implementation timing and substrate cost impacts .
  • Medium‑term constructive: robust backlogs (~3.7M tons), infrastructure/data center/energy transmission demand, and tariff enforcement underpin pricing stability and volumes into 2026 .
  • Execution catalysts: Brandenburg’s positive EBITDA, towers ramp (Alabama Sept; Indiana by Q1’26), and coating lines (Crawfordsville end‑2025; Berkeley mid‑2026) extend value‑added mix and margin durability .
  • Capital allocation: FY25 capex ~$3B reaffirmed; 2H FCF expected to improve as WC/capex moderate; continued buybacks (1.8M shares in Q2; $606M authorization remaining) and dividend $0.55 support returns .
  • Trading implications: any downside guide for Q3 could pressure shares short‑term; strength in steel products/backlogs and policy tailwinds (232 tariffs, OBBB legislative incentives) are supportive medium‑term .
  • Watchlist items: HRC trajectory, Brazil tariff implementation (slabs/DRI), energy costs, WC release pace, and towers/data center order flow translating to margins and EBITDA in 2H’25–2026 .