Key Takeaways:
- Alcoa's Q2 revenue rose roughly 30% year over year, in line with estimates
- Full-year outlook trimmed on weather disruption at Australian facility
- Shares fell as market focused on guidance over earnings strength
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Alcoa slides after earnings as guidance cut overshadows 30% revenue growth
Alcoa Corp. shares fell after the aluminum producer reported Q2 earnings and trimmed its full-year outlook, partly citing a weather disruption at an Australian facility.
The company's Q2 revenue was in line with the consensus estimate of $3.93 billion, according to Zacks Investment Research, representing a 30% increase from a year earlier. Earnings per share surged more than 500% year over year, extending Alcoa's streak of beating estimates to four consecutive quarters with an average surprise of 35.3%.
The aluminum segment, which benefited from the restart of the San Ciprián smelter in Spain, Alumar in Brazil and Lista in Norway, generated an estimated $3.34 billion in sales, up 70% from a year ago, per Zacks. Healthy demand across packaging, electrical and transportation end markets supported the segment's performance. The alumina segment posted $976 million in total sales, down 36% year over year, as shipment delays in Australia from Cyclone Narelle and the Middle East conflict weighed on results.
Alcoa completed its acquisition of Alumina Limited in August 2024 and formed a joint venture with IGNIS EQT in March 2025, giving it a 75% stake in the San Ciprián operations. The company faces headwinds from higher input costs and a stronger US dollar, which pressured margins during the quarter. Rival Rio Tinto and other aluminum producers face similar cost pressures from rising energy prices and raw material inflation.
The selloff may be overdone. The weather disruption is a one-time event, and demand trends in packaging, electrical and transportation remain healthy. Alcoa's diversified geographic footprint, while exposing it to currency risk, also provides operational flexibility across its smelter network. Investors will watch Alcoa's next update for signs that Australian operations have normalized and whether the aluminum segment can sustain its growth trajectory.
This article is for informational purposes only and does not constitute investment advice.
