Nucor Q1 2026 Earnings Results & Report

Nucor EPS Results

• Actual EPS: $3.23
• Consensus EPS: $2.82
• Beat/Miss: Beat by +$0.41
• One Year Ago EPS: $0.77
• EPS Beat Rate: 6 of last 8 quarters

Nucor Revenue Results

• Actual Revenue: $9.50 billion
• Expected Revenue: $8.88 billion
• Beat/Miss: Beat by +$614.85 million
• YoY Revenue Growth: +21.30%

Nucor (NYSE:NUE) is a Charlotte, North Carolina-based steel producer and one of the largest steel companies in North America. The company operates electric arc furnace (EAF) steel mills that use recycled scrap steel as a primary raw material, along with facilities that manufacture and process steel products for construction, manufacturing, transportation, energy and other industrial markets.

Nucor’s product portfolio includes carbon and alloy steel in sheet, plate, bar and structural forms, as well as reinforcing steel, wire and wire mesh. Through its downstream businesses, the company also produces steel joists, deck, cold-finished steel, fasteners, metal building systems and other fabricated steel products. Nucor operates a metals recycling network that supports its steelmaking operations and purchases and processes ferrous and nonferrous scrap.

The company’s history traces back to a predecessor established in 1905. It adopted the Nucor name in 1972 and became known for expanding the mini-mill model and EAF steelmaking in the United States. Nucor serves customers throughout the United States, Canada and Mexico through a network of mills, fabrication facilities, processing centers and recycling operations. Leon J. Topalian serves as Nucor’s chair, president and chief executive officer.

Nucor Q1 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: Q1 financials were strong: EBITDA of about $1.5 billion and EPS of $3.23, with a record 7 million tons of quarterly steel shipments and a 20% increase in steel mill backlog to 4.7 million tons.
• Positive Sentiment: Balance sheet and capital allocation remain robust — returned $254 million to shareholders, ended the quarter with ~ $2.5 billion cash ( $3.2 billion liquidity), and invested $661 million in CapEx (about 40% toward the West Virginia sheet mill) with $2.5 billion FY CapEx guidance.
• Positive Sentiment: The new Nucor Steel West Virginia sheet mill is entering phased commissioning in 2026 (pickle line in Q2), with full equipment commissioning by year-end and commercial ramp in early 2027 targeting roughly 50% utilization by end-2027 to expand Midwest/Northeast and automotive supply.
• Positive Sentiment: Trade policy developments have reduced imports (U.S. finished steel import share down from >22% to ~15%); the Administration reaffirmed the 50% Section 232 tariff and tightened treatment of derivative products, which management says levels the playing field for domestic producers.
• Positive Sentiment: Outlook is constructive — management expects shipments growth above 5% in 2026 (potentially higher), higher Q2 earnings across segments as pricing catches up and metal margins improve, while noting ongoing pre‑operating/startup costs (~$108 million) and some raw‑material/energy pressure.

Presentation

[Operator]

Good morning, and welcome to Nucor's first quarter 2026 earnings call. All lines have been placed on mute to prevent any background noise, and today's call is being recorded. After the speaker's prepared remarks, I will provide instructions for callers wishing to ask questions. I would now like to introduce Chris Jacobi, Director of Investor Relations. You may begin your call.

[Chris Jacobi, Director of Investor Relations at Nucor]

Thank you. Good morning, everyone. Welcome to Nucor's first quarter earnings review and business update. Leading our call today is Leon Topalian, Chair and CEO, along with Steve Laxton, President and COO, and Jack Sullivan, CFO. Other members of Nucor's executive team are also here with us today and may participate during the Q&A portion of the call. Yesterday, we posted our first quarter earnings release and investor presentation to nucor.com. We encourage you to access these materials as we will cover portions of them during the call. Today's discussion will include the use of non-GAAP financial measures and forward-looking information within the meaning of securities laws. Actual results may be different than forward-looking statements and involve risks outlined in our safe harbor statement and disclosed in Nucor's SEC filings.

[Chris Jacobi, Director of Investor Relations at Nucor]

The appendix of today's presentation includes supplemental information and disclosures along with a reconciliation of non-GAAP financial measures. With that, let's turn the call over to Leon.

[Leon Topalian, Chair and CEO at Nucor]

Thanks, Chris. As always, I want to begin by recognizing our 33,000 teammates across the company for their continued commitment to working safely. Safety is and will always remain our most important value. At Nucor, that means more than the physical safety of our team. It encompasses the mental health of all of our teammates as well. With May being Mental Health Awareness Month, it's a great time to reinforce that commitment. As we move through 2026, we are firmly focused on making this the safest year in Nucor's history. Before turning to our financial performance, I'd like to briefly highlight a few leadership updates. Effective March 1st, Jack Sullivan was promoted to Chief Financial Officer, Treasurer, and Executive Vice President.

[Leon Topalian, Chair and CEO at Nucor]

Since joining Nucor in 2022, Jack has demonstrated strong leadership, deep financial acumen, and a clear understanding of Nucor's culture and how to create long-term value for our shareholders. Congratulations, Jack. We also announced that Dan Needham, our Executive Vice President of Commercial, will retire in June after 26 years with Nucor. I want to thank Dan for all his sacrifice and leadership during this time and wish he and his family the very best in retirement. Turning to Nucor's first quarter financial results, we generated EBITDA of approximately $1.5 billion and earned $3.23 per share. This is an excellent start to the year and a significant increase compared to the fourth quarter, driven by strong performance across all three of our operating segments.

[Leon Topalian, Chair and CEO at Nucor]

Consistent with our capital allocation framework, we returned $254 million to Nucor shareholders through dividends and share buybacks during the quarter, while also reinvesting $661 million into the business. Roughly 40% of CapEx in the quarter went towards our new sheet mill in West Virginia. Operationally, our team has performed incredibly well during the quarter. One of the clearest indications is the record shipments our steel mills achieved for the quarter. At 7 million tons, this was the highest quarterly shipment volume in Nucor's history, reflecting strong execution across our 26 steel mills and growing contributions from recently completed projects. Equally encouraging is the momentum evident in our backlogs.

[Leon Topalian, Chair and CEO at Nucor]

At the end of the first quarter, our steel mills backlog was up to 4.7 million tons, a 20% increase from year-end and the highest level we've seen since the second quarter of 2021. In steel products, our backlog grew 9% from year-end with increases across all major product groups. I want to thank our operating and commercial teams for a strong start to 2026 and for putting Nucor in a position to deliver even better second quarter results for our customers and our shareholders. Turning to trade policy, the combination of Section 232 steel tariffs and trade remedy orders have been effective at reducing imports, with that trend accelerating in the second half of 2025 and continuing in the first quarter of 2026.

[Leon Topalian, Chair and CEO at Nucor]

Import share of the U.S. finished steel market declined from over 22% in the first quarter of 2025 to approximately 15% this quarter. More recently, we were pleased to see the Administration reaffirm the 50% Section 232 tariff on steel and implement important changes to how derivative steel products are treated, specifically applying tariffs to the full value of those products. This action simplifies administration and enforcement while closing a key loophole that had allowed for undervaluation and circumvention. Taken together with existing trade remedies, these measures are working to ensure a more level playing field for domestic producers. We appreciate the Administration's recognition of the importance of a healthy and competitive American steel industry. That said, we remain vigilant, and there is still work to be done.

[Leon Topalian, Chair and CEO at Nucor]

As USMCA discussions continue, there is an opportunity to address ongoing challenges, including steel subsidies provided by the Canadian government and the use of North American channels as backdoors toward domestic markets, putting U.S. manufacturers at a competitive disadvantage. We also continue to advocate for policies that prioritize the use of American-made steel in critical sectors such as energy, infrastructure, defense, and shipbuilding.

[Leon Topalian, Chair and CEO at Nucor]

With that, I'll turn it over to Steve for an update on the growth initiatives and market outlook. Steve?

[Steve Laxton, President and COO at Nucor]

Thank you, Leon, and thank you all for joining us this morning. Our team continues to make great progress on our new sheet mill project in West Virginia, and we'll see key milestones achieved in 2026. We're entering the final phases of construction and we'll be sequencing commissioning of operations throughout the year, beginning with the pickle line in the second quarter. By the end of the year, we expect commissioning, inspecting, and testing of all equipment across the mill to be complete. Following commissioning, our priority will be to operate safely and reliably as commercial shipments begin ramping up in early 2027. We will be increasing production and advancing product development throughout 2027 and 2028, with capacity utilization and product offerings building steadily over time.

[Steve Laxton, President and COO at Nucor]

Once fully ramped, Nucor Steel West Virginia will supply some of the cleanest and most advanced sheet steel in North America, with expanded capabilities to better service automotive and consumer durable markets. This positions Nucor to grow market share in the Midwest and Northeast, two large sheet consuming regions where Nucor is relatively underweighted today. In addition to West Virginia, we have several major capital projects under construction or ramping up, and we're making meaningful progress across all of them. Starting with projects under construction, in our towers and structures business, we're building two new utility towers facilities, one in Indiana and one in Utah. In Indiana, we expect to be fully operational in the third quarter of this year. In Utah, we expect to reach full production by mid-2027.

[Steve Laxton, President and COO at Nucor]

We are also advancing the construction of a second galvanizing line at our Berkeley County sheet steel mill in South Carolina. Once complete, this line will expand our ability to service automotive customers in the Southeast. Equipment commissioning is planned for the middle of the year, and we expect production to begin in the fall. In addition to projects under construction and commissioning, we have recently completed several growth projects that are advancing their strategic and commercial plans as expected. In the bar group, our new micro mill in Lexington, North Carolina, and our new melt shop in Kingman, Arizona, were both EBITDA positive in March. In the sheet group, our new galvanizing line at Crawfordsville, Indiana, was also EBITDA positive in March, and we expect to commission the paint line later this year.

[Steve Laxton, President and COO at Nucor]

Our Alabama towers and structures facility is expanding its customer base, improving production, and on track to reach EBITDA positive run rates by the end of the summer. Before I turn the call over to Jack, let me share how we're thinking about the current market environment and Nucor's place in these markets. Already the established industry leader, producing roughly 1 ton out of every 4 tons of steel in the U.S. and having unparalleled range of product offerings in our downstream businesses, Nucor continues to find ways to grow. After achieving approximately 6% growth of shipments in 2025, we expect shipments to grow by more than 5% in 2026. A confluence of factors are enabling this. Consistent with our comments on Nucor's fourth quarter earnings call in January, overall demand remains relatively stable.

[Steve Laxton, President and COO at Nucor]

There are pockets of strength such as data centers, energy, border fence, and infrastructure. There are some markets that have remained softer for now, including consumer cyclicals, traditional office, heavy equipment, and agriculture. Taken as a whole, we expect domestic steel consumption to be stable, with overall demand remaining flat to up 2% for 2026. Second, as Leon highlighted, enforcement of trade laws is stabilizing what might have happened in the past where patterns of flooding dumped imports shocked the supply picture. Third, execution by our team with the investments we've made. Nucor is well-positioned with the portfolio we've developed to service market segments exhibiting particular strength right now. A few examples include we can supply 95% of the steel needed to build a data center.

[Steve Laxton, President and COO at Nucor]

We're the leading manufacturer of HSS structural tubing that are the primary building materials for large sections of the border fence. Our industry-leading pre-engineered metal buildings and insulated metal panels offering help to accelerate our customers' speed to market, which is increasingly valued in today's landscape. As the leading domestic producer of beams, plate, and bar, we are an essential material supplier and enabler for the construction of pipelines, LNG terminals, bridges, manufacturing facilities, and power generation and transmission infrastructure. Nucor's national reach, coupled with our strength in raw materials, steelmaking, and downstream products, provides supply chain integration, improved reliability, and operating efficiencies that no other North American producer can match. We have the right capabilities and team for this moment, and we're always looking ahead to assure Nucor remains well-positioned as markets evolve.

[Steve Laxton, President and COO at Nucor]

With that, I'll turn it over to Jack for a closer look at our first quarter financial results and our outlook for the second quarter. Jack?

[Jack Sullivan, CFO at Nucor]

Thanks, Steve. Good morning, everyone. In the first quarter, Nucor generated net earnings of $743 million or $3.23 per share, exceeding the midpoint of our guidance range by nearly $0.50. The beat was largely due to higher volumes and higher margin product mix. After some weather-related shipping delays early in the quarter, the team delivered a very strong March with our sheet, plate, and rebar groups all setting quarterly shipment records, while structural steel shipments reached levels not seen since 2021. Turning to the segment level results for the first quarter, the steel mill segment generated $1.1 billion of pre-tax net earnings, more than double the prior quarter. Volumes and average selling prices increased across all four product groups, with sheet and structural being the largest drivers. Metal spreads also expanded across all formats.

[Jack Sullivan, CFO at Nucor]

In steel products, we generated pre-tax earnings of $285 million, up 24% from the fourth quarter. Volumes increased 13% on stable pricing with our Tubular Group setting a new quarterly shipment record. Strong demand related to the border fence was a significant contributor, and we expect that to continue for the next several years. We did see some margin compression due to higher steel input costs flowing through, but we expect this to ease as the year progresses and realized pricing catches up. In our raw material segment, we generated pre-tax earnings of approximately $45 million compared to $24 million in the prior quarter, reflecting higher DRI production following two planned outages in the fall. Pre-operating and startup costs totaled $108 million for the quarter.

[Jack Sullivan, CFO at Nucor]

As a reminder, we expect these costs to trend higher as we work our way further into 2026 and toward the completion of our West Virginia sheet mill. Moving to the balance sheet, our strong investment-grade credit profile is the foundation of our capital allocation framework. It allows us to execute our strategy of disciplined investment to grow our business while still providing meaningful cash returns to shareholders. We ended the quarter with approximately $2.5 billion in cash and liquidity of $3.2 billion. Total debt as a percentage of capital sits at 24%, and our credit ratings remain the strongest of any U.S.-based steel producer. Capital expenditures totaled $661 million for the quarter, and we remain on track with our $2.5 billion CapEx estimate for the full year.

[Jack Sullivan, CFO at Nucor]

While this level of investment remains elevated as we finish several remaining growth projects, it is moderating compared to recent years. As our CapEx is trending down, our cash from operations is moving up. That combination produced a meaningful increase in free cash flow for the quarter, and we expect this trend to continue. We also returned over $250 million to shareholders in the form of dividends and share repurchases, or roughly 34% of quarterly net earnings. Consistent with our long-term track record, we remain committed to returning at least 40% of net earnings to shareholders on an annual basis. Looking ahead, Nucor's financial strength, highly variable cost structure, and business diversification position the company to invest in growth, reward our shareholders, and navigate through economic cycles.

[Jack Sullivan, CFO at Nucor]

Turning to our second quarter outlook, we expect higher consolidated earnings with improvement across all three operating segments. In steel mills, we expect stable volumes and increasing metal margins. The margin improvement reflects higher realized pricing, partially offset by rising raw material costs. Within the segment, we expect our sheet and plate businesses to be the largest contributors in the sequential increase. In steel products, we expect higher volumes and stable pricing. In some of our longer lead time products, like fabricated rebar and joist and deck, margins have been impacted by rising substrate costs, but are poised to improve as we work through backlogs and start to realize higher average selling prices. In raw materials, we expect higher earnings driven primarily by improved realized pricing for DRI.

[Jack Sullivan, CFO at Nucor]

Taken as a whole, the earnings uplift across all of our operating segments will be partially offset by higher corporate and intercompany profit eliminations upon consolidation. As we look further into 2026, we continue to expect that Nucor's earnings and cash flow will trend significantly higher than 2025 as we benefit from strong non-residential construction and infrastructure demand and begin to see returns from the investments we've been making these past few years. With the hard work and dedication of the Nucor team, we are confident in our ability to create value for our customers and shareholders. With that, we'd like to hear from you and answer any questions you may have. Operator, please open the line for questions.

[Operator]

Thank you. Our first question comes from Bill Peterson from JPMorgan. Your line is now open. Please go ahead.

[Bill Peterson, Analyst at JPMorgan]

Yeah, hi, good morning. Congratulations on a strong quarter. Congrats to the new management appointees, and thanks for the details thus far. On the West Virginia sheet mill, which you provided some granularity, I was hoping to get a bit more color on the phasing of commissioning, the strategy through year-end, and maybe what to expect for the next few years. I guess specifically, how long do you expect the commission phases to be complete? When do you expect the construction of the galv line to be complete? I guess how should we think about when you're gonna start production as well as the customer qualifications? Then any sort of thoughts on utilization in the next few years as well. Appreciate that.

[Leon Topalian, Chair and CEO at Nucor]

All right, Bill. Well, good morning, and thank you for the question. I'll, I'm gonna kick it off and maybe just stay at a high level and then ask Steve Laxton or Noah to jump in with some more of the details around the commissioning of that mill. Look, I wanna begin with a backdrop of our most important value, which is the safety, health, and well-being of the entire Nucor 33,000 team member family. Today, we sit at 65 of our divisions are reportable free at this point. It is an amazing accomplishment, and I wanna thank each and every one of our teams who are delivering exceptional results. You will see and continue to see those amazing results continue as we push into the quarter.

[Leon Topalian, Chair and CEO at Nucor]

You know, more specifically, Bill, as we think about West Virginia, as we touched on it in the opening remarks, I and our team could not be more excited about the capability set that that mill will bring for Nucor, for our customers, our shareholders, the value that's going to be generated and created in the largest sheet-consuming region of the U.S. Johnny Jacobs, who is our Vice President, GM, and his team have done a incredible job. As you know, the work that sits behind the scenes during construction and startup is tireless, it's thankless, and it's a just a really, really challenging environment. Those individuals have done an amazing job. Thank you to our entire West Virginia team.

[Leon Topalian, Chair and CEO at Nucor]

Again, I'll let Steve and Noah maybe update some more on the details.

[Steve Laxton, President and COO at Nucor]

Happy to do that. Thanks for the question, Bill. I'll just echo what Leon said about the team in West Virginia. They've had a remarkable safety record. I'll lead off with that. They've only had one reportable in all the years of that project, so outstanding safety culture and leadership in that team. In terms of the specifics of your question, right now, Bill, we're about 85% of the way through construction, so we still have work to do on the construction side. Having said that, we're starting right now with some of the commissioning, and we'll be sequencing that throughout the year. We'll start with the pickle line, then we'll bring up the cold mill and proceed through one of the gal lines.

[Steve Laxton, President and COO at Nucor]

The automotive quality gal line will be the next thing we start up after that, in commissioning. Ultimately, we'll get to commissioning the melt shop and hot mill later in the year. By the end of this year, we'll be done with all the commissioning. We're on track to hit that milestone. Then we'll start moving up through production and ramp up in 2027. Bill, what you'll see there is a very intentional and deliberate plan from that team and our entire sheet group. Noah and our team in the sheet group have really designed an excellent plan to bring that mill up in a very constructive and coordinated and intentional way.

[Steve Laxton, President and COO at Nucor]

By the time we get to the end of 2027, you ask about utilization rates, and markets are gonna dictate some of that. I might hedge here just a little bit. It'll depend on market conditions somewhat, but we'll be operating somewhere near that 50% of capacity by the end of next year. That team is poised. We're gonna make great progress over the next year and a half, and into 2028 even with product development and continued penetration to the markets. Anything you wanna add?

[Noah Hanners, EVP at Nucor]

No. I think you were all over it. Thank you.

[Bill Peterson, Analyst at JPMorgan]

Great. Thanks for that. And Steve, obviously, we've been working with you as a CFO, and now we have Jack, congrats on for both of you. Maybe the next question for Jack is your, you know, new role in CFO, how should investors think about any potential shifts in strategy relative to recent years? You know, anything you would continue, anything you would change, or just any sort of insights on how you're considering your new role?

[Jack Sullivan, CFO at Nucor]

Yeah. Thanks, Bill. I appreciate that. You know, I step into this role with a lot of humility and gratitude to serve this great company and the 33,000 teammates who make it such a special place. Preceding me in the role are four highly accomplished Nucor CFOs. Really my goal is just to carry on their long-standing tradition of doing three things really well: maintaining a healthy balance sheet, investing for the future, and generating attractive returns for our shareholders. Steve Laxton, who's sitting right here to my right, did a terrific job during his four-year tenure. Funding $15 billion in growth investments, returning $9 billion to our shareholders, and improving our credit profile along the way. That's a pretty impressive trifecta right there.

[Jack Sullivan, CFO at Nucor]

As the old saying goes, "If it ain't broke, don't fix it." Bill, no major shifts from that winning strategy. What I would say is, I think I bring a fresh set of eyes, a strong understanding of this business and how we make money, and just a lot of excitement to accelerate what is already one of the most compelling stories in American manufacturing.

[Bill Peterson, Analyst at JPMorgan]

Thanks for that, everyone, and, congrats again on the quarter.

[Jack Sullivan, CFO at Nucor]

Thanks, Bill.

[Operator]

Thank you. Our next question is from Alex Hacking from Citi. Your line is now open. Please go ahead.

[Alex Hacking, Analyst at Citi]

Morning, guys. Thanks for the call. A couple of questions. I'll ask them together if that's okay. Firstly, on the sheet side, you know, the new slow and steady approach to price hikes in this cycle that we're seeing right now, could you maybe discuss the rationale a little bit there and how the customer feedback has been? I mean, I hear only good things from customers, but I'm curious. Secondly, on structurals, you know, demand are very, very strong. Imports are down, but don't seem to be down that much. Is there any particular sub-segments that's driving structurals to be so good? Thanks a lot.

[Leon Topalian, Chair and CEO at Nucor]

Yeah, I'll kick it off, Alex. Good morning, and thanks for the question. Again, keep it a little broader base. The question you ask around sheet's an important one, and there's some very deliberate strategies there that I'll ask Noah to kind of walk us through. Cause again, I think it's an important context is, you overlay the backdrop of the current sheet market and demand today versus 2021 and 2022. Again, Noah can touch on that. You mentioned the structural side. Again, having spent three years at Nucor-Yamato, our Nucor-Yamato team and our Berkeley beam mill continue to deliver excellent performance, both from a safety standpoint as well as from a just net earnings. They are absolutely on fire. Their backlogs are at historic levels.

[Leon Topalian, Chair and CEO at Nucor]

Their customers are busier than anything that I've seen in, again, my 30-year career. You know, where is that going? It's obviously the non-res data centers, energy, structural side and infrastructure around energy and ships, ship plants and facilities, warehousing. You know, in an area that, you know, we're gonna continue to see expanded into the military complex in the years to come for Nucor. I would tell you it's hitting on all cylinders. While data centers are white hot, everyone's looking to participate. If you pulled out all of the data center backlog from Nucor, it only takes that down about 10%.

[Leon Topalian, Chair and CEO at Nucor]

The historic backlogs we're seeing are really, really spread out incredibly well across the enterprise that give me great confidence that not only, as we indicated, Q2 will be better, but I think 2026 is going to be a very strong year from Nucor or for Nucor. With that, Noah, why don't you walk through a little bit of the sheet strategy and where we sit today?

[Noah Hanners, EVP at Nucor]

Thanks for the question, Alex. You know, we like slow and steady, and our customers are liking slow and steady, and let's take a little time to unpack that. The fundamental supporting pricing right now are really strong, and I would say the rally we're in is probably the strongest kind of fundamentals we've seen for some time. Maybe to give you some context for how we see the rest of 2026, let's step back to the last inflection point in the market, which was Q4 of last year. The low side of pricing in Q4 of last year.

[Noah Hanners, EVP at Nucor]

To think about how our strategies work differently this year, you recall that historically, what would have happened in that low point, that trough in the market, is we would have had opportunistic, speculative buyers, overloading their order books to try to time the market. The result, if you think about traditional behavior in Q4, would have been that we would have overbooked on the mill side, lead times would have jumped significantly, prices would have jumped significantly, and we would have really overshot basic market fundamentals. Due to the spreads and the lead times, we then inevitably create the surge of imports that arrive a few months later, similar to what we saw in the back half of 2024. That's what usually happens. We've seen this time and time again in the sheet world.

[Noah Hanners, EVP at Nucor]

This time, our trajectory and our behavior has been markedly, importantly different in this cycle. We didn't chase the market down in Q4. We managed our order book to match what we saw as true underlying demand, and you saw this reflected in our steady, I would call it, modest, consistent approach with pricing and CSP. Consistent, modest increases that were supported by underlying demand. Then this is one factor that we believe's helped keep imports low. If you think back to 2024, and you saw imports that were 9 million-ish tons. This year, we're tracking 4 million or under. There's a 5 million ton window of serviceable market for domestic suppliers. That's a huge impact to the positivity with which we see the market today.

[Noah Hanners, EVP at Nucor]

As importantly, the supply chain is really healthy right now. Inventory levels are modest, which just tells you we haven't seen the speculation that traditionally drives the volatility we would see in this market. Couple other notes just on the strength of the current market, while we have a pretty positive outlook. We have some key markets that are starting to show signs of positive outlook. Service center shipments are starting to move up. They're trending up. We've heard from HVAC customers recently that are really in a non-residential construction space about a really strong second half there. There's some tailwinds there in non-res construction that yield some strength as well.

[Noah Hanners, EVP at Nucor]

You already heard mention of the border fence, which is 1.5 million tons over this year and next. All that together, we believe supports a strong operating environment through 2026 and then into potentially next year.

[Alex Hacking, Analyst at Citi]

Thanks, Noah. Really appreciate the context. Thanks to the rest of the team as well.

[Leon Topalian, Chair and CEO at Nucor]

Thanks, Alex.

[Operator]

Thank you. Our next question comes from Timna Tanners from Wells Fargo.

[Timna Tanners, Analyst at Wells Fargo]

Yeah, hey, good morning, everyone. I wanted to follow up, if I could, on the guidance comments. The 5% year-over-year volume increase would seem to imply that this level that we saw in the first quarter year-over-year is not sustainable. I'm just curious about what's driving that expectation. I conclude, just looking at the values that perhaps the bigger driver into Q2 could be price catching up with the market rather than volumes. Is that a fair conclusion? If you could comment a little bit more about the moving parts, that'd be great.

[Leon Topalian, Chair and CEO at Nucor]

Timna, look, I think both are true. I think you're gonna see volumes, again, Nucor's operating rates about 87% right now, utilization across the board. Some groups being a little higher, some a little lower. We have room. Again, from a contract standpoint, you think about sheet market and the things Noah just walked through, you know, we remain and have tons available in a very, very strong market. We've maintained, some discipline in not booking all of those tons through contracts. We have spot tons to offer. Again, we still have availability. Again, I think you're gonna see that continue to move up. The demand drivers, you know, again, I'm not gonna underplay this. I've been in this business a long time.

[Leon Topalian, Chair and CEO at Nucor]

I've been in our longs product businesses or sheet group. From a longs perspective, our customers that I'm talking to today are busier than anything they've ever seen in their history. When I tell you the demand driver, drivers today are odd, it's, you know, like 21, 22 or even beyond in some cases, depending on the product group. It is an incredible market. I do think you're gonna see some improvements in volume. To your point on the 5%, yeah, I think you're right. I think it's much more likely that it pushes closer to double digits. Again, not ready to say it's gonna be at or above 10%, but I think, you know, it'll strongly be above that 5% mark. You're gonna see that move up as well.

[Leon Topalian, Chair and CEO at Nucor]

I think that answered the two questions you were following on. Did I miss anything there, Timna?

[Timna Tanners, Analyst at Wells Fargo]

I think that's fair. I think I'd just, you know, be always helpful to get a little bit more color on how to think about some of the lags in pricing. If, if you want, that'd be great. I guess the second question I was gonna ask has to do with cost. Obviously, we all track scrap really closely, and that's a key one. I just wondered if you could elaborate on some of the cost pressures that you alluded to earlier in the script. That would be great.

[Leon Topalian, Chair and CEO at Nucor]

Yeah. Steve, actually why don't we take both? I mean, you know, the cost as well as the lag effect on, you know.

[Steve Laxton, President and COO at Nucor]

Yeah

[Leon Topalian, Chair and CEO at Nucor]

Is playing through, but will play through very positively as we head into Q2.

[Steve Laxton, President and COO at Nucor]

Yeah. Yeah, sure, Timna. You know, the lag effect, just to elaborate on that just a little bit on the prior question. You know, you know this, for the other listeners on the call, you know, 20% of our volume goes to our downstream business, and that gets in our financial results backed out through intercompany elim. You see that impacting financial results for us. Also, with over 70%, 80% of our business in sheet being contract and some other businesses that have a lag effect to the pricing. As pricing trends move up, there is this catch-up effect that takes time. To the heart of the question you were asking just a minute ago about Q2, you'll see some volume pickup.

[Steve Laxton, President and COO at Nucor]

We had weather effect, particularly some of the downstream products. You'll probably see a little bit more volume pickup relative to pricing in our products group. On the sheet side, or excuse me, steel side, you're gonna see it the other way around, where the pricing is catching up with catching up with the trends that you're seeing today in the marketplace. That's sort of putting a little bit finer point on your comment about the lag effect. With regards to cost, Nucor's costs have been down year-over-year and quarter-over-quarter. I think that's important to note. A lot of that has to do with utilization. Our utilization is up and, but also supplies and services are down, a few other little details.

[Steve Laxton, President and COO at Nucor]

The one area that is up that might be on investors' mind is energy. I think it's important to note that energy is around 10% of the cost in steel making, and it probably has a far less pronounced impact than some investors might be thinking because of what some of our integrated competition has in terms of their costs. Our profile is simply different there. We hedge, we typically forward buy anywhere between 40%-50% of a year's worth of natural gas heading into it. Most of our cost, 80% of our energy cost is related to power anyway. We don't have quite the same degree of exposure to near term moves and costs on that front.

[Timna Tanners, Analyst at Wells Fargo]

Very helpful. Thanks to you both.

[Leon Topalian, Chair and CEO at Nucor]

Thank you.

[Operator]

Thank you. Our next question comes from Lawson Winder from BofA Securities. Your line is now open. Please go ahead.

[Lawson Winder, Analyst at BofA Securities]

Thank you very much, operator. Good morning, Leon and team. Could I ask about your capital return? In recent years, Nucor has exceeded the 40% net income return. I mean, last year, it was, like, just under 70%. Is there room to push that higher in 2026, and how are you thinking about that? The corollary to that would be looking at the investment opportunity set. Are you seeing any new opportunities in which to invest in the business that could compete for that free cash flow versus capital return? Thank you.

[Jack Sullivan, CFO at Nucor]

Hey, Lawson, it's Jack. Thanks for the question. In terms of share, you know, returns to shareholders, yeah, I think over the past five years, we've trended close to 60% of net earnings over that time. Starting out the first quarter, a touch under that 40% target, and that was really the result of our earnings beat. As we work our way further into the year, you know, you should expect us to continue to close that gap and potentially exceed it. When it comes to actual returns to shareholders, it's sort of that balancing act between staying true to our longstanding targets of roughly 40%, recently higher. Also, you know, being opportunistic about other areas to create value for shareholders.

[Jack Sullivan, CFO at Nucor]

A lot of that is through reinvestment. We'll continue to do just that, balance reinvestment opportunities as they come along, maintain a healthy balance sheet along the way, and make good on our commitment to shareholders.

[Lawson Winder, Analyst at BofA Securities]

Okay. That's quite clear. Jack, congratulations on the promotion. If I could ask a follow-up question just related to joist and deck. You noted that pricing is expected to recover to help offset some of the higher substrate costs going forward in 2026. Can you just speak to some of the strength and weakness that you're seeing in the underlying market for that business?

[John Hollatz, EVP at Nucor]

This is John. I'll take that question, Lawson. Really the biggest market for the joist and deck business is the warehouse market, and that's really in a steady state. It's certainly not what it was in 2021 or 2022, but leveled off to a good position. The, the data center market continues to be really strong for us. That's where we're seeing a lot of our price increasing, and our backlog pricing has benefited from that and will continue to over the course of the year. We feel good about where we are in that part of the business.

[Lawson Winder, Analyst at BofA Securities]

Okay. Thank you guys very much.

[Leon Topalian, Chair and CEO at Nucor]

Thanks, Lawson.

[Operator]

Thank you. The next question comes from Katja Jancic from BMO. Your line is now open. Please go ahead.

[Katja Jancic, Analyst at BMO Capital Markets]

Hi. Thank you for taking my questions. Earlier you mentioned the recent change to Section 232 tariffs impacting derivative products. Have you since then seen an increase in inquiries from manufacturers that could potentially try to reduce the impact, or do you expect that to happen?

[Leon Topalian, Chair and CEO at Nucor]

Katja. I wanna make sure I understand the question. With the Section 232, are we seeing our customers look to basically shore up their supply chains domestically? Is that?

[Katja Jancic, Analyst at BMO Capital Markets]

Right. Or even the near shoring, because there's an ability for them to reduce the tariff from 25% to 10% if they use 100% U.S. Steel. I'm just wondering-

[Leon Topalian, Chair and CEO at Nucor]

Oh, yes.

[Katja Jancic, Analyst at BMO Capital Markets]

if you're seeing any inquiries?

[Leon Topalian, Chair and CEO at Nucor]

Yeah, we absolutely are. Again, I think, you know, what you've seen with the, you know, Trump 2.0 and the trade, things that he's implemented, you know, both from a NEO and Section 232 is to create a long-term, level fair playing field. Again, we're seeing import levels trend down to, you know, 15%, which is certainly the lowest I've seen in my entire career at Nucor. It's at a healthy and what I believe is a very sustainable level for the U.S. industry. Yes, to answer your question, and it's something that we will certainly support and, you know, the melt and made in America provisions of any trade policy that gets enacted.

[Leon Topalian, Chair and CEO at Nucor]

Yeah, our customers are certainly aware of that and looking to see how they can control their cost and output. Yeah, the domestic industry is healthy, it's strong, and again, Nucor's best days are still in front of us.

[Katja Jancic, Analyst at BMO Capital Markets]

Maybe going back to the energy side. I understand that it's only 10%, but maybe looking more longer term, given that there is this expectation data centers are gonna consume more energy and power costs are gonna be moving higher, how are you thinking about your power cost longer term? Are you thinking in any way to potentially look at longer term contracts, or how should we think about it?

[Leon Topalian, Chair and CEO at Nucor]

Katja, look, this is something we've talked about for a long, long time. In fact, very early days from when I became CEO in 2020, we've taken small positions, but financial positions in things like NuScale Power, which is the small module reactor technology, because we need all the power that we can get, not just in solar and wind, which are good. We're suppliers to both of those industries, but it's simply not enough. Nucor believes we've got to re-embrace nuclear power in this country. It is the cleanest, most sustainable, always on, demand-driven power that we can bring to the grid. You saw us invest in NuScale. You saw us invest in Helion that we're incredibly excited about.

[Leon Topalian, Chair and CEO at Nucor]

Those investments also tied to being able to build those facilities, whether it's nuclear or fission and/or fusion behind the meter, so that we could generate our own supply. Any excess would go to the grid. To your point, the demand profile and what the U.S. economy is not doing to keep up with supply has been an issue and something we've thought about for a very long period of time at Nucor. We've made those positions. You know, Steve mentioned it earlier as well, part of the reason why we hedge our natural gas buys. It's part of the reason we got into drilling wells on our own to begin with.

[Leon Topalian, Chair and CEO at Nucor]

The reason why we have a great relationship in every state that we're in, that we have a steel mill in with the utilities so that we maintain long-term uninterruptible power contracts that are very, very efficient and cost effective. Do I expect in the years to come that we'll get a lot of pressure? Absolutely, 100%. As you know, the data centers are, aren't pushing 200 MW, 300 MW, 400 MW now. They're pushing gigawatts. These facilities are massive, and they are massive power consumers. We've been thoughtful about it, we continue to be thoughtful about it, and we will continue to invest in the things, not because we wanna make electrons, but we recognize that this nation has to re-embrace nuclear. Today, China's building 46 new nuclear facilities. The U.S. is building zero.

[Leon Topalian, Chair and CEO at Nucor]

We've got to change that. Again, I think it's one of the clearest ways that we remain a superpower in cloud computing, AI, and the things that are gonna transform and re-revolutionize the U.S. economy.

[Katja Jancic, Analyst at BMO Capital Markets]

Thank you.

[Leon Topalian, Chair and CEO at Nucor]

Thank you.

[Operator]

Thank you. Our next question comes from Carlos de Alba from Morgan Stanley. Your line is now open. Please go ahead.

[Carlos de Alba, Analyst at Morgan Stanley]

Yeah. Thank you. Good morning, everyone. A couple of questions that are basically follow-ups from prior inquiries. One is on returning money to shareholders. As your CapEx starts to peak and you get the benefit of the new projects, would you have any preference between incremental buybacks or special dividends? Or are you agnostic to those two choices?

[Jack Sullivan, CFO at Nucor]

I think thanks for the question, Carlos. With respect to the best way to return cash to shareholders, traditionally our preference has been through buybacks. There've been very few instances over decades in which we've contemplated a special dividend. Not taking that entirely off the table, it's just, our traditional practice has been through buybacks and sort of dollar cost averaging our way through the year.

[Carlos de Alba, Analyst at Morgan Stanley]

Thank you, Jack. The other question is related to imports. The administration recently put out procedures for submissions by steel or aluminum producers that would be committed to new capacity in the U.S. This is related to the Proclamation 10984 on imports of medium and heavy-duty vehicles and vehicle parts. How do you think this could impact potentially the announcement of new capacity in the U.S.? Steel capacity in the U.S.?

[Leon Topalian, Chair and CEO at Nucor]

Yeah. Look,

[Carlos de Alba, Analyst at Morgan Stanley]

I think what it does, it could cut the imports from 50%. Sorry, not imports, but the tariffs from 50% to 25%.

[Leon Topalian, Chair and CEO at Nucor]

Well, Carlos, I think it's a fair question. Look, we've seen it. We've seen the interest from overseas. We've seen Nippon Steel come in and buy the U.S. Steel assets, and, you know, that company no longer exists, right? It's now owned and operated by a Japanese company. You're seeing, you know, similar results in Louisiana with Hyundai, you know, building their sheet metal there. You know, I think there are drivers to that, not just trade policy, but when you're the strongest economic situation in the world, people wanna come here and build things. Certainly, there are some incentives for them to do that. Behr, maybe just touch on, you know, some more specifics to Carlos's question.

[Allen Behr, EVP of Raw Materials at Nucor]

Yeah, Carlos, appreciate the question. We're obviously aware of that, the EO. We've studied as well. I would not add much more actually than Leon did, right? We continue to study that. I think that a lot of people are always gonna tend to move towards the U.S. market as strong as it is. However, we're still in a wait and see approach on that EO, along with many other things that are coming out right now.

[Carlos de Alba, Analyst at Morgan Stanley]

All right. Great. Thank you very much.

[Leon Topalian, Chair and CEO at Nucor]

Thanks, Carlos.

[Operator]

Thank you. Our next question is from Nick Cash from Goldman Sachs. Your line is now open. Please go ahead.

[Nick Cash, Analyst at Goldman Sachs]

Hi. Thank you so much, team, for taking the question. I just wanted to double-click on Timna this question and response from earlier. Again, the guide, you know, from 4Q was about, you know, 5% volume growth, and now it sounds like Nucor's expecting more than 5% volume growth for the year. You sound pretty positive and constructive on that and the environment. I'm just trying to any more color on what specifically has changed over the past, I guess, you know, two-three months? Are you more positive on the end markets? Does that give you conviction in heading into the back half of the year?

[Nick Cash, Analyst at Goldman Sachs]

Are certain end markets seeing, you know, stronger than anticipated rate of change over the past two months, imports weaker than thought, or what you're seeing potentially even across the backlog? Any additional color would be helpful. Thank you.

[Leon Topalian, Chair and CEO at Nucor]

Yeah. Nick, look, I appreciate the question. I think you're seeing a trifecta come to fruition. I think it's all the above. I'll unpack it in three categories. One, I think in our core businesses, we're seeing an incredible demand, incredible growth. Our longs products groups are from rebar, MBQ. Our structural backlogs are beyond numbers that we've ever seen. Our customers in the non-res, the structural fabricators are incredibly busy. There is a demand picture today that is incredibly robust that I think is a part of that driver. The second piece of that is our expand beyond businesses that are continuing to ramp up.

[Leon Topalian, Chair and CEO at Nucor]

When we talk about insulated metal panels or doors and door technologies, the towers and structures, greenfield plants that we're building, that again, we are incredibly excited about what they're bringing to the table. You know, the enclosures and data center spaces all are gonna be contributing to a much healthier bottom line for Nucor and our shareholders, not just this quarter, not just in the coming quarters, but year-over-year, you're gonna see it. The third and last, and probably the most important point. You know, Nick, we spent nearly $20 billion since I took over the company as CEO, and our teams have done an incredible job of, A, you know, implementing that cash and projects safely. They've worked tirelessly to bring those projects through, you know, construction, commissioning, startup.

[Leon Topalian, Chair and CEO at Nucor]

You're beginning now to see some of those, and that planting and that, you know, that toiling and just nurturing come to harvest. For, again, years of working towards and building out, you're now beginning to see the harvest starting to hit the balance sheet, and that's only going to continue. The pent-up tsunami of earnings power that Nucor's invested is still yet to hit the balance sheet. It is why I am so incredibly optimistic and, you know, looking at where our share price closed last night, the opening this morning, man, we're just getting warmed up. Nucor's best days, weeks, months, and years are still in front of it, and I couldn't be more optimistic.

[Leon Topalian, Chair and CEO at Nucor]

Those three factors combined bring to me what's going to generate the healthiest returns Nucor shareholders have ever experienced and ever seen and higher lows than Nucor has ever experienced by balancing out the M&A portfolio with countercyclical companies and product ranges that are in different end markets that, again, just stabilize the earnings portfolio through the balance sheet. Again, I couldn't be more optimistic and, you know, those three pieces really are why we feel very confident about 2026 and beyond.

[Nick Cash, Analyst at Goldman Sachs]

Awesome. Thank you. I'll pass it on.

[Leon Topalian, Chair and CEO at Nucor]

Thank you, Nick.

[Operator]

Thank you. We currently have no further questions. I'd like to hand back to Leon Topalian, Chair and CEO, for any closing remarks.

[Leon Topalian, Chair and CEO at Nucor]

Well, thank you all for joining us on today's call. Before I conclude, I want to once again thank our team for delivering a strong start to our year and also for your unwavering commitment to becoming the world's safest steel company. I'd also like to thank our customers for the trust that you place in us each and every day. Finally, to our investors, for your continued confidence in our long-term strategy. Thank you, and have a great day.

[Operator]

Thank you. This now concludes today's call. Thank you all for joining. You may now disconnect your lines.

Participants

Executives

• Allen Behr, EVP of Raw Materials
• Chris Jacobi, Director of Investor Relations
• Jack Sullivan, CFO
• John Hollatz, EVP
• Leon Topalian, Chair and CEO
• Noah Hanners, EVP
• Steve Laxton, President and COO

Analysts

• Alex Hacking, Analyst at Citi
• Bill Peterson, Analyst at JPMorgan
• Carlos de Alba, Analyst at Morgan Stanley
• Katja Jancic, Analyst at BMO Capital Markets
• Lawson Winder, Analyst at BofA Securities
• Nick Cash, Analyst at Goldman Sachs
• Timna Tanners, Analyst at Wells Fargo