Acerinox was the first of the three big European companies to open the earnings season.
On the stainless steel side
-production at the same level as 1Q2025 (-1.5%)
-sales at the same level as 1Q2025 (-1.5%)
-EBITDA increased vs 1Q2025, 65 → 78 MEUR; +20%
USA stronger, Europe dismal.
Guidance: Company EBITDA for 3Q2025 same as 2Q2025 even though 3Q is a quieter season
-on the stainless steel side, USA compensates for Europe’s weakness
Thanks. From this and yesterday’s Kauppalehti article by ter Horst, one can certainly get a good picture of the market situation. End-demand is sluggish on both sides of the pond, but in the US, the situation (price, share of demand) is better for local producers (Outokumpu and NAS). In Europe, the price level is very low and import pressure is high. NAS will certainly fare better in the US than Outokumpu.
According to the KL article, mainly special products have been exported from EU to US, and with 25% tariffs, customers paid the duties, but now with 50% tariffs, exports are practically at a standstill and all parties are waiting. Ter Horst further pointed out that it would be desirable to have a common external border tariff between US-Mex-Can, which would be important for the industry in general, but also for Outokumpu. Ter Horst still seemed to have faith in that. The EU is required to take quick and strict measures to protect European production.
Regarding Outokumpu’s results to be published on Thursday, there is naturally nothing new, a quiet period is underway. Finnish engineering companies, for their part, have achieved quite convincing results, and there seems to be demand. EBITDA, according to guidance, will improve or remain at the same level. I personally believe in a small improvement. More essential, however, will certainly be the guidance for Q3, which, due to seasonality and the market’s waiting state, can be imagined to have EBITDA at most at the same level. It is also very possible that it will decrease. Let’s hope that the US and EU will announce that trade agreement next week, resulting in a maximum 15% general tariff and indeed a high 50% tariff for steel only exceeding a certain quota. This would certainly sufficiently enable the continuation of Outokumpu’s special product exports to America.
A short piece related to Acerinox’s earnings release, I omitted the part about black steel from the end of the article.
Acerinox ready for price increases if tariffs or similar issues become clearer, and once summer is over.
(Reuters) -Steelmaker Acerinox (BME:ACX), whose U.S. business is a big beneficiary of President Donald Trump’s tariffs, is looking into raising some prices in the market, though no notable changes are expected before late September, its management said on Thursday.
“In the United States, we are trying to increase our prices, which is not easy under the current circumstances,” CEO Bernardo Velazquez told analysts in a post-earnings call.
There will be no “relevant” hikes in the third quarter, as price adjustments are typically not made during the summer season, Chief Corporate Officer Miguel Ferrandis added.
“At the end of September, we shall see,” he said, noting the decisions also depended on factors such as market visibility, a potential EU-U.S. trade deal and clarity on Russia’s war in Ukraine.
As the largest producer of stainless steel in the U.S., Acerinox benefits from Trump’s protectionist policies and 50% tariffs on imported steel.
Demand for stainless steel is subdued in both Europe and the United States, but tariffs on competitors mean Acerinox can keep U.S. prices stable, Velazquez told analysts.
Meanwhile in Europe, the economic turmoil has dragged steel prices, driving a big miss in Acerinox’s second-quarter results.
“We have a lot of pressure in the market, low demand, high inventories, so prices are going down,” Velazquez said.
Acerinox has highlighted market visibility, the EU-US trade agreement, and the clarification of Russia’s war in Ukraine as essential factors for price level increases (in the US and likely referring to Europe as well). If these are briefly considered:
Furthermore, for EU prices, in my opinion, the Commission’s strict measures to curb import pressure are clearly essential. This is at least as important as the aforementioned three.
Here is a pre-earnings report from Petri as Outokumpu publishes its Q2 results tomorrow, i.e., Thursday. 
We have lowered our short-term forecasts, reflecting the weak news flow. Our Q2 adjusted EBITDA forecast, which is approximately at the level of the comparison period and the first quarter’s actual results, is below consensus. Against this backdrop, we downgrade our recommendation to Reduce (previously Add), but reiterate our target price of 3.8 euros, as the stock is not particularly demanding in terms of valuation compared to its through-cycle earnings level.
Thanks to Petri for the preliminary report. Good thoughts, although I myself emphasize the positive signs currently in motion more than the challenging market situation in Q1-Q3, such as the stabilization of the market environment (e.g., improved visibility due to trade agreements) and an upward trend in prices in the US, ongoing and future measures limiting import pressure in the EU, strengthening demand for Outokumpu’s greener FeCr, and the goal of increasing price premium + sales (which does not require investments!), the arrival of CBAM in less than 0.5 years, etc. Now, in my opinion, we are in the darkest hour before dawn, before the morning truly begins to break.
Reminder!
Petri will start the earnings live soon, around 8:50!
Highlights from the Q2 review, which I believe can be summarized as a positive performance in Q2 and, on the other hand, strong short-term (Q3) challenges in Europe.
Outlook:
The question is from what perspective one looks at the matter; I personally see these challenges as temporary, as I am reasonably confident that the European Commission will make determined decisions during Q3 and Q4 to level the playing field for the European steel industry’s competitive position. Furthermore, it is likely that a duty-free or low-duty quota model will indeed be agreed upon between the US and EU during Q3, with a 50% tariff only on amounts exceeding the quota, allowing Outokumpu’s export of special products from Europe to the US to continue. Thus, Q4 is in all likelihood already clearly stronger. And from the beginning of 2026, CBAM will also come into effect. From a share price perspective, it is very good that VVK is no longer complicating the upward trend that will likely begin later this year due to the improving market situation.
That was a weak performance again.
Undoubtedly, the market situation is not great, and undoubtedly, European protection mechanisms are naive, and the European operating environment, in general, penalizes business chains (taxes, energy prices, etc.).
But,
It would be interesting to hear Outokumpu’s own analytical calculation of how others manage to succeed at this price level, even though Asian imports incur transport costs and tied-up capital costs on top of everything else.
However, Outokumpu, according to its own statements, benefits from the superior efficiency of Tornio, and Finland’s energy prices are not the worst, at least compared to Spain (Acerinox factories).
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Acerinox Stainless (see tables a couple of messages above)
EBITDA
1Q: 65 meur
2Q: 78 meur
= 142 meur (171 meur 1H2024)
3Q guidance: EBITDA flat (for the whole company) vs 2Q2025
Vepu interviewed Outokumpu’s CEO Kati ter Horst right after the Q2 earnings release.
00:00 New EVOLVE strategy
01:40 What gives confidence to invest
03:10 Tornio investment
04:38 Cost savings
05:50 Cheap imports from Asia
09:00 Demand situation in America
11:19 European market
It occurred to me, couldn’t some AI tune these interviews into written form?
Especially at the cottage or during holidays, watching videos is a bit of a tiring task…
Edit: there could well be a mention of automatic translation, and that it may contain errors due to this, and that the video material is the correct reference.
A cry of anguish, that’s what the quarterly report felt like to me.
Inderes: 3.8 (Reduce) → 3.8 eur & Add
So according to Inderes, the super-cyclical price of 3.8 eur is okay,
Markets are starting to price in the chronicization of the European situation
Meaning perhaps good times are just better, and are further away and milder…
Well, Europe has spoken and is planning, but it just can’t seem to create an operating environment that would be equal for energy-intensive industries, a level-playing field, says Outokumpu.
Let’s see if Russia’s aggressiveness and USA’s unpredictability have led to a situation where domestic industry should not be penalized more than others, when calculated comprehensively.
We are again eager for additional purchases
With this year’s weak result, the share’s earnings-based valuation multiples are unusable (P/E and EV/EBIT multiples negative). Relative to an earnings level looking beyond the cycle, the share is again moderately priced (P/E multiple ~ 8x and EV/EBIT ~ 6x). The same valuation picture is also drawn by the valuation relative to the long-term historical average free cash flow (P/FCF about 9x). Thus, the current valuation, in our opinion, reflects a scenario where Europe’s very weak economic situation becomes chronic, and this, together with import pressure, keeps Outokumpu’s result permanently below historical levels. This is, in our opinion, an overly pessimistic scenario, even though the long-standing difficulties in both the European economy and the stainless steel market test optimism.
Here is Jussi Halme’s new video from Outokumpu.
Outokumpu released its second-quarter results amidst a challenging and volatile steel market – and the numbers were like cold water and cautious light in the same equation. EBITDA exceeded expectations, but the operating profit remained in the red. Europe’s contribution is dragging the company down, even though America and ferrochrome are holding their own.
The new EVOLVE strategy promises structural change, savings, and investments in the premium segment – but can it truly turn the ship around amidst overcapacity, Asian price dumping, and the EU’s muddled industrial policy?
In this video, I delve into Outokumpu’s Q2/2025 results, the drivers behind them, strategic moves, and market pain points. At the end, I give my own view: is this an opportunity, a trap, or something in between?
Welcome to an analysis where stainless steel won’t leave you cold.
Following Outokumpu (and owning it 
) is painful!
In Excel, it showed that 7 quarters were completed when the rolling 12-month EPS is negative 
. According to Inderes’ forecasts, this will be the third consecutive year that the net result will be a loss
The group has three strong pillars:
The only chrome mine in the Western world
The second largest stainless steel plant within the world’s largest economy, protected by customs barriers
Europe’s largest and most efficient stainless steel plant
“Competitive advantages” come from scale, expertise, lower-emission products, own mine, vertical integration, Circle Green with a price premium, cheap green electricity, etc.
Two CEOs in a row have now been cutting costs for many years 
. Interestingly, after hundreds of millions in EBITDA improvement, the number of employees remains quite steady, and the result is negative year after year.
Nordea gives a target price of 4.0 euros and a buy recommendation.
The justification is “We believe the company is well positioned for an eventual market recovery, which is not yet reflected in the share price.”
Forecasts show about 8% dividend yield year after year while waiting for that upturn.
In my opinion, the Evolve strategy was quite as expected, and I understand why it was made.
Knowing the owners and history, I didn’t expect any “more dynamic” strategy.
Still, secretly in my mind, I hoped for some moves that would have aimed to maximize shareholder value a bit faster. The current Evolve strategy incurs costs now, and positive effects might come years later, if at all.
However, a brave activist investor or consultant’s toolkit could have included something like:
Good summary of what the reality of speeches and the last few years looks like. And even longer if we forget the two-year golden age after the pandemic.
Regarding investments, as you said, costs are immediate and returns come later. A challenging combination for a shareholder with a stock whose balance sheet-based value P/BV hovers <0.5, and whose earning capacity is weak.
In itself, ‘Evolve’ stated that it emphasizes investments specifically towards high-return investments. Trivial in itself, but good to clarify.
It’s a shame, though, that Outsan’s investments also seem to be largely pure maintenance. I.e., money is spent on maintaining the operation and productivity of heavy industry machinery. Perhaps 75% of current investments, so there doesn’t seem to be much to reallocate without increasing the investment level.
Something needs to be done that is visible.
By the company, but also by EU politicians.
Politicians don’t really wake up even if the house roof is burning, the neighbor is at war, and old partners have become volatile and emphasize their own interests.
Barclays has abandoned its positive outlook, and lowers Outokumpu’s target price to €3.0. According to them, politicians play a decisive role: an upside if they can implement some safeguards, etc., a downside if they don’t, or energy could also cause a downturn.
Barclays has downgraded earnings expectations for major European steelmakers, citing weaker demand, soft pricing, and rising cost pressures, while warning that any potential upside hinges on policy developments in the second half of the year.
In a note dated Monday, Barclays cut its FY25 EBITDA forecasts by 2-6% for ArcelorMittal (AS:MT), Aperam (AS:APAM) and Outokumpu (HE:OUT1V), placing them 5-11% below Bloomberg consensus.
The brokerage flagged that the Q2 earnings season has been challenging, with steel stocks underperforming the STOXX Europe 600 by an average of 4.3% on their respective results days due to disappointing forward guidance, despite earnings largely meeting expectations.
For ArcelorMittal (NYSE:MT), Barclays maintained an “equal weight” rating and €27 price target.
The brokerage lowered its 2025 EBITDA forecast by 6% to $6.5 billion, citing weaker performance in North America, where $40 million in outage costs and $140 million in tariff expenses weighed on results.
The outlook includes risks tied to tariff cost guidance and a pending supply contract expiry in early 2026. Adjusted EPS was revised down by 13% to $3.88.
Aperam’s rating remained “underweight” with a €25 price target. While Q2 EBITDA came in slightly ahead of consensus due to stronger shipments in Brazil and European cost savings, guidance for lower Q3 earnings fell short of market expectations.
Barclays cut Aperam’s 2025 EBITDA forecast by 6% to €413 million and adjusted EPS by 17% to €1.07.
The brokerage said the EU stainless sector’s outlook is highly dependent on stronger protectionist policy, with downside risks from pricing pressures and energy costs.
Outokumpu was also kept at “underweight” with a €3 price target. Despite a 9% beat on EBITDA in Q2, driven by raw material and metal derivative gains, Barclays flagged a weaker Q3 outlook, citing 5-15% volume declines, negative inventory effects and maintenance in Europe.
FY25 EBITDA was cut 2% to €220 million and adjusted EPS to negative €0.06. Additional risk stems from a new Finnish mining tax that could reduce annual earnings by up to €30 million.
Barclays warned that continued earnings downgrades are likely unless policy catalysts materialize.
These include a safeguard replacement mechanism in September, further detail on the Carbon Border Adjustment Mechanism (CBAM), potential Chinese production cuts, and U.S. trade deals with Brazil, Mexico and Canada.
Until then, the brokerage maintains a neutral stance on the broader European metals and mining sector.
Ummoni and Opa have good thoughts and a critical attitude. I don’t disagree at all; the company’s profitability and efficiency currently leave much room for improvement, and one cannot be satisfied with it, even if Q2 was ultimately slightly above forecasts.
In summary, I would now highlight significant short-term drivers that, either together or separately, could quickly change market dynamics and the company’s earnings performance. Having experienced the turns of 2016-2017 and 2020-2021, and having reviewed those period’s overviews again yesterday, the market situation tends to turn “without warning” eventually.
Here are some news drivers that came to mind for the rest of the year, which could be significant for the market’s turnaround and the company’s valuation on the stock exchange.
A couple of small positive fresh news items:
For those who have invested in Outokumpu, it is of paramount importance that the European Commission implements its promised “highly effective trade measure” to replace the current safeguard mechanism. However, this involves a significant political risk. The current safeguard mechanism, introduced in 2018, has not prevented the growth of imports, which has led to capacity closures and job losses in Europe.
Between 2018 and 2024, EU steel production has decreased by 31 million tonnes.
News from Friday below. This month, a proposal for compensation for protective measures ending in summer 2026 is still expected – with good luck, it could come into force even before June, perhaps starting from the turn of the year (?). In my view, we are on the threshold from which the news flow will begin to turn positive.