Cleveland-Cliffs' Q1 Earnings Miss Estimates, Revenues Beat

Core Viewpoint - Cleveland-Cliffs Inc. reported a significant loss in Q1 2025, with a net loss of $495 million or $1.00 per share, which is a substantial increase from a loss of $67 million or $0.14 per share in the same quarter last year [1] Financial Performance - Revenues decreased by approximately 11% year-over-year to $4,629 million, although this figure exceeded the Zacks Consensus Estimate of $4,596.6 million [2] - Steelmaking revenues were reported at $4,467 million, down around 11% year-over-year, missing the estimate of $4,495 million [2] - The average net selling price per net ton of steel products was $980, reflecting a decline of about 17% year-over-year, which also fell short of the estimate of $986 [3] - External sales volumes for steel products increased by roughly 5% year-over-year to approximately 4.14 million net tons, surpassing the estimate of 4.06 million net tons [3] Financial Position - The company ended the quarter with cash and cash equivalents of $57 million, up around 6% from the previous quarter [4] - Long-term debt rose approximately 8% sequentially to $7,601 million [4] - Net cash used by operating activities was reported at $351 million for the quarter [4] Outlook - Cleveland-Cliffs anticipates a reduction of about $50 per net ton in steel unit costs for 2025 compared to 2024, an increase from the earlier expectation of a $40 reduction, primarily due to the idling of underperforming assets [5] - Projected capital expenditures are now around $625 million, down from the previous estimate of $700 million [6] - The forecast for selling, general, and administrative expenses has been revised to approximately $600 million from around $625 million [6] - Depreciation, depletion, and amortization expenses are projected at roughly $1.1 billion [6] Price Performance - Cleveland-Cliffs shares have declined by 51.3% over the past year, compared to a 36.8% decline in the Zacks Steel Producers industry [7] Zacks Rank & Comparisons - The company currently holds a Zacks Rank of 3 (Hold) [8] - Other better-ranked stocks in the Basic Materials sector include Hawkins, Inc. (HWKN), Avino Silver & Gold Mines Ltd. (ASM), and Contango Ore, Inc. (CTGO), each with a Zacks Rank of 1 (Strong Buy) [8]