What changed in this filing

/stocks — the workspaceLOADING

Item 2. Management’s Discussion and Analysis

2025-05-08 compared with 2024-11-05 · 241 added, 314 removed, 276 unchanged (67% of the section changed)

4 unchanged sentences

We are vertically integrated from the mining of iron ore, production of pellets and direct reduced iron, and processing of ferrous scrap through primary steelmaking and downstream finishing, stamping, tooling, and tubing.

Headquartered in Cleveland, Ohio, with the closing of the Stelco Acquisition, we employ approximately 30,000 people across our operations in the United States and Canada.

Unless otherwise noted, discussion of our business and results of operations in this Quarterly Report on Form 10-Q refers to our continuing operations on a stand-alone basis without giving effect to the Stelco Acquisition.

Headquartered in Cleveland, Ohio, we employ approximately 30,000 people across our operations in the United States and Canada.

FINANCIAL SUMMARY

The following is a summary of our consolidated results for the three and nine months ended September 30, 2024 and 2023 (in millions, except for diluted EPS):

Total Revenue Net Income (Loss) Adjusted EBITDA Diluted EPS

See "— Non-GAAP Financial Measures" below for a reconciliation of our Net income (loss) to Adjusted EBITDA.

The following is a summary of our consolidated results for the three months ended March 31, 2025 and 2024 (in millions, except for diluted EPS):

Total Revenue Net Loss Adjusted EBITDA Diluted EPS

See "— Non-GAAP Financial Measures" below for a reconciliation of our Net loss to Adjusted EBITDA.

ECONOMIC OVERVIEW

STEEL MARKET OVERVIEW

Steel market conditions in 2024 have been driven by weaker than anticipated light vehicle production, lower demand and higher import levels.

The price for domestic HRC, the most significant index impacting our revenues and profitability, averaged $677 per net ton for the third quarter of 2024, 14% lower than the third quarter of 2023, and the lowest quarterly average per net ton since the second quarter of 2020.

Import levels have been elevated in 2024, which has contributed to downward pressure on HRC pricing.

Looking forward, we expect domestic steel demand to grow as interest rates have started to decline, steel imports are currently unattractive, other end-user demand is healthy, and incremental steel demand stimulated by recent government legislation and manufacturing on-shoring is realized.

The Infrastructure and Jobs Act, the CHIPS Act and the Inflation Reduction Act should provide meaningful support for overall domestic steel demand for years to come.

Our extensive portfolio of products should result in increased steel demand from most of our end markets.

The Infrastructure and Jobs Act includes approximately $550 billion of authorized spending for new investments and programs.

This legislation provides direct spending support for roads, bridges and other infrastructure projects, including upgrades to the domestic power grid and building out a national network of EV chargers.

The CHIPS Act promotes semiconductor manufacturing in the U.S., which should help support non-residential construction as well as machinery and equipment.

The Inflation Reduction Act provides incentives for the use of domestic steel for investments in clean energy projects, including wind and solar projects, which consume a substantial amount of steel.

Additionally, the on-shoring of manufacturing in the U.S.

should prompt more domestic steel demand as well as reduce the risk of supply chain issues in the future.

We continued to navigate unfavorable market conditions throughout the first quarter of 2025.

Steel market conditions in the first quarter of 2025 were driven by weaker than anticipated light vehicle production, inconsistent buying behavior from customers and higher import levels.

The steel market in the first quarter of 2025 continued to be impacted by the poor domestic steel demand environment experienced in the second half of 2024, which resulted in downward pressure on HRC pricing.

The price for domestic HRC, the most significant index impacting our revenues and profitability, averaged $792 per net ton during the first quarter of 2025, 16% lower than first quarter of 2024.

The HRC price increased to above $960 per ton in April 2025, as the recently announced steel tariffs have helped support domestic steel pricing.

Import levels were elevated in the first quarter of 2025 in anticipation of the recently implemented steel tariffs, which contributed to downward pressure on HRC pricing.

Looking forward, we expect domestic steel demand to grow, as recently implemented steel and automotive tariffs will support demand for domestically produced steel, other end-user demand improves, and incremental steel demand stimulated by recent government legislation and manufacturing on-shoring is realized.

Steel and light vehicles remain at the top of the Trump administration's trade agenda, and we are at the intersection of both of these industries.

During 2025, to appropriately respond to market conditions and to optimize our footprint, we made the decision to fully or partially idle six of our operations.

As a consequence of continued weak automotive production, we made the decision to idle our blast furnace, BOF steel shop, and continuous casting facilities at our Dearborn Works facility.

We also made the decision to idle Conshohocken, Riverdale and Steelton due to financial underperformance at these operations.

Additionally, we made the decision to idle the Minorca mine and partially idle the Hibbing Taconite mine in order to consume excess pellet inventory produced in 2024.

These operational changes will allow us to streamline our operations and enhance efficiency, with minimal expected impact to our flat-rolled steel output.

Lastly, in an effort to match our production capabilities with our order book, we intend to restart our idled C-6 blast furnace at Cleveland Works during 2025.

We believe that steel tariffs play a crucial role in protecting the U.S.

economy, national security and industrial base from violators of fair trade.

The steel industry has long faced significant challenges due to overcapacity and overproduction of steel beyond certain countries' domestic needs, along with other unfair trade practices.

The overproduction by certain countries results in dumping of steel in the U.S.

at below market value.

remains the only major steel-producing country that produces less steel than it consumes.

Additionally, foreign steel producers often take advantage of government subsidies, currency manipulation and weak environmental regulations.

Furthermore, there is an overall lack of foreign countries holding their own steel producers accountable

for unfair trade practices.

We believe that the steel tariffs recently implemented by President Trump are critical to addressing global overproduction issues, confronting unfair trade practices and supporting a healthy domestic steel market.

As a leading domestic steel producer, we expect to benefit for years to come from the recently implemented tariffs, not only for steel but also for the automotive industry.

OTHER KEY DRIVERS

The largest market for our steel products is the automotive industry in North America, which makes light vehicle production a key driver of demand.

Light vehicle production in 2024 has fallen well below expectations.

Full-year 2024 North American light vehicle production is estimated to be 15.5 million units, a significant decrease from original estimates of 16.3 million units, and a decrease from 15.7 million units in 2023.

During the third quarter of 2024, North American light vehicle production was approximately 3.8

million units, down from 4.1 million units in the second quarter of 2024.

During the third quarter of 2024, light vehicle sales in the U.S.

saw an average seasonally adjusted annualized rate of 15.6 million units sold, the same rate as the second quarter of 2024.

North American light vehicle production in 2025 and beyond is expected to remain above 15 million units annually.

North American light vehicle production in the first quarter of 2025 was approximately 3.8 million units, down from approximately 4.0 million units in the first quarter of 2024.

During the first quarter of 2025, light vehicle sales in the U.S.

saw an average seasonally adjusted annualized rate of 16.5 million units sold, representing a 7% increase compared to the first quarter of 2024.

The March 2025 seasonally adjusted annualized rate was 17.8 million units sold, the highest published rate since 2021, indicating healthy consumer demand.

Additionally, the average age of light vehicles on the road in the U.S.

is at an all-time high of 12.6 years, which should support demand as older vehicles need to be replaced.

We also expect declining interest rates to increase demand for vehicles in the United States as buyers have been cautious due to elevated interest rates.

As the leading supplier of automotive-grade steel in the U.S., we expect to benefit from healthy vehicle production levels over the coming years.

Since 2021, the price for busheling scrap, a necessary input for flat-rolled steel production in EAFs in the U.S., has continued to average above the prior annual ten-year average of approximately $400 per long ton.

The busheling price averaged $408 per long ton during the third quarter of 2024 and has averaged $434 per long ton through the first nine months of 2024.

We expect the supply of busheling scrap to further tighten due to decreasing prime scrap generation from original equipment manufacturers and the growth of EAF capacity in the U.S., reduced metallics import availability, and a push for expanded scrap use globally.

is at an all-time high of 12.6 years, surpassing the previous record set in 2023, which should support demand as older vehicles need to be replaced.

Furthermore, we expect the recently implemented 25% tariff on imports of automobiles and certain automobile parts to lead to increased demand for domestically produced vehicles that consume domestically made steel.

As a leading supplier of automotive-grade steel in the U.S., we expect to benefit from healthier vehicle production over the coming years as we continue to be an established and reliable supplier.

Since 2021, the price for busheling scrap, a necessary input for flat-rolled steel production in EAFs in the U.S., has continued to average well above the prior annual ten-year average of approximately $400 per long ton.

The busheling price averaged $471 per long ton during the first quarter of 2025.

As we are fully integrated and have primarily a blast furnace footprint, increased prices for busheling scrap in the U.S.

bolster our competitive advantage, as we source the majority of our iron feedstock from our stable-cost mining and pelletizing operations in Minnesota and Michigan.

As for iron ore, the Platts 62% price averaged $100 per metric ton in the third quarter of 2024, which is 5% higher than the prior annual ten-year average.

While higher iron ore prices play a role in increased global steel prices, we also directly benefit from higher iron ore prices for the portion of iron ore pellets we sell to third parties.

OTHER FACTORS

On July 10, 2024, the United States and Mexico announced key measures to protect the North American steel markets from unfair trade.

Both countries are expected to implement policies to jointly curb tariff evasion on steel being exported from Mexico to the United States.

If implemented as announced, it will be required that steel imported from Mexico must be melted and poured in Mexico, Canada or the United States to be eligible for Section 232 exemptions.

This will effectively put a 25% tariff on any steel that is transshipped through Mexico that originated in China or other countries outside of North America.

We believe it is vital that all members adhere to the USMCA and view this as a positive development to ensuring fair trade in the North American steel market.

On April 4, 2024, the DOE issued its final transformer efficiency standards rule that will provide for the continued utilization of GOES in virtually all of our distribution transformer end markets.

With the revised rule, the DOE acknowledged the fundamental importance of GOES and the essential role played by our steel plants in Butler, Pennsylvania and Zanesville, Ohio in effectively sustaining the functionality of the U.S.

electric grid.

The originally proposed distribution transformer rule would have required the use of amorphous metal in nearly all transformer production in the U.S., putting demand for our GOES product at serious risk.

The final rule provides clarity going forward on production requirements, allowing for increased investments in the transformer market, which should ultimately lead to increased GOES demand.

During 2023, we significantly reduced costs compared to the prior year, as we had higher production volume and normalized repair and maintenance spending, and inflationary pressures on input and energy costs eased.

We expect that full-year 2024 costs will be reduced year-over-year, compared to 2023, as we have worked through higher cost inventory and lower natural gas, coal and alloy costs should mitigate any inflationary cost increases.

COMPETITIVE STRENGTHS

As a leading North America-based steel producer, we benefit from having the size and scale necessary in a competitive, capital intensive business.

Our sizeable operating footprint provides us with the operational leverage and flexibility to achieve competitive margins throughout the business cycle.

We also have a unique vertically integrated profile from mined raw materials, direct reduced iron, and ferrous scrap to primary steelmaking and downstream finishing, stamping, tooling and tubing.

We have a unique vertically integrated profile from mined raw materials, direct reduced iron, and ferrous scrap to primary steelmaking and downstream finishing, stamping, tooling and tubing.

This positioning gives us more predictable costs throughout our supply chain and more control over both our manufacturing inputs and our end-product destination.

One of our most critical strengths that differentiates us from others in our industry is a unique and powerful partnership with our unionized workforce, particularly the USW.

With approximately 20,000 employees subject to collective bargaining agreements, our strong and productive labor relationships are key to our long-term success and allow us to work together in achieving our goals.

With over 20,000 employees subject to collective bargaining agreements, our strong and productive labor relationships are key to our long-term success and allow us to work together in achieving our goals.

A clear example of the strength of our relationship is how we partner together to fight against dumped and illegally subsidized imported steel products.

4 unchanged sentences

This dedication to service and the infrastructure in place to meet our automotive customers’ demanding needs took decades to develop.

We have continued to invest capital and resources to meet the requirements needed to serve the automotive industry and intend to maintain our position as an industry leader going forward.

We have continued to invest capital and resources to meet the requirements needed to serve the automotive industry.

We continue to be an established and reliable supplier of automotive-grade steel and intend to bolster our position as an industry leader going forward.

Due to its demanding nature, the automotive steel business typically generates higher through-the-cycle margins, making it a desirable end market.

Demand for our automotive-grade steel is expected to be healthy in the coming years as a result of a low unemployment rate, declining interest rates and the replacement of older vehicles.

Demand for our automotive-grade steel is expected to be healthier in the coming years as a result of government support for domestically produced vehicles, low unemployment rate, declining interest rates and the replacement of older vehicles.

As an established and reliable supplier of domestically produced automotive-grade steel, we expect customers to continue to look to us to serve increased demand in the coming years.

Our footprint provides us with a competitive advantage in supplying automotive and other highly demanding end markets, as we are able to produce a wide range of high-quality products.

Our integrated facilities utilize domestic internally sourced iron ore as the primary feedstock, which allows us to produce a high-quality product with low residual content.

We also possess the breadth and depth related to customer service, technical support, and research and development, which are necessary to supply the demanding needs of the automotive industry.

Since the acquisition of our steelmaking assets in 2020, we have dedicated significant resources to maintain and upgrade our facilities and equipment.

Our integrated facilities utilize domestic, and primarily internally sourced, iron ore as the primary feedstock, which allows us to produce a high-quality product with low residual content.

We also possess the breadth and depth of customer service, technical support, and research and development necessary to supply the demanding needs of the automotive industry.

Since becoming a steel company in 2020, we have dedicated significant resources to maintain and upgrade our facilities and equipment.

The quality of our assets gives us a unique advantage in product offerings and operational efficiencies.

After elevated spend in 2022 to perform overdue maintenance work at the facilities acquired as part of our 2020 acquisitions, we resumed normalized levels of maintenance capital and operating expenses in 2023, which has continued throughout 2024.

The necessary resources that we have invested in our footprint are expected to keep our assets at an automotive-grade level of quality and reliability for years to come.

Our industry leading portfolio of fixed price contracts provides us a competitive advantage, as the steel industry is often viewed as volatile and subject to the market price of steel.

Our fixed price contracts mitigate pricing volatility and support us in achieving healthy margins through the cycle.

Our ability to source our primary feedstock domestically and internally is a competitive strength.

Our utilization of fixed price contracts provides us a competitive advantage, as the steel industry is often viewed as volatile and subject to the market price of steel.

Our fixed price contracts mitigate pricing volatility through the cycle.

Approximately 30-35% of our volumes are sold under these contracts.

Our ability to source our primary feedstock domestically, and primarily internally, is a competitive strength.

This model reduces our exposure to volatile pricing and unreliable global sourcing.

The ongoing conflict between Russia and Ukraine, along with other global tensions, has displayed the importance of our U.S.-centric footprint, as our competitors who primarily operate EAF facilities rely on imported pig iron to produce flat-rolled steel, the supply of which has been disrupted.

The ongoing conflict between Russia and Ukraine, along with other global tensions, and the new administration's focus on U.S.

manufactured products, has displayed the importance of our North American-centric footprint, as our competitors who primarily operate EAF facilities rely on imported pig iron to produce flat-rolled steel, the supply of which has been disrupted.

The best example is our legacy business of producing iron ore pellets.

By controlling our iron ore pellet supply, our primary steelmaking raw material feedstock can be secured at a stable and predictable cost and not be subject to as many factors outside of our control.

By internally sourcing the vast majority of our iron ore pellet requirements, our primary steelmaking raw material feedstock can be secured at a stable and predictable cost and not be subject to as many factors outside of our control.

We believe we offer the most comprehensive flat-rolled steel product selection in the industry, along with several complementary products and services.

A sampling of our offering includes advanced high-strength steel, hot-dipped galvanized, aluminized, galvalume, electrogalvanized, galvanneal, HRC, cold-rolled coil, plate, GOES, NOES, stainless steels, tool and die, stamped components, rail, slab and cast ingot.

Across the quality spectrum and the supply chain, our customers can frequently find the solutions they need from our product selection.

We are currently a leading producer of electrical steels referred to as GOES and NOES in the U.S.

The Infrastructure and Jobs Act provides funding to be used for the modernization of the electrical grid and the infrastructure needed to allow for increased EV adoption, both of which require electrical steels.

Because of these incentives and our current customer base, our electrical steel business is expected to continue to achieve strong profitability in the coming years.

We are a leading producer of electrical steels referred to as GOES and NOES in the U.S., which we believe will be critical for the modernization of the electrical grid and the infrastructure needed to allow for increased EV adoption, both of which require electrical steels.

Distribution transformers are critical to the maintenance and expansion of America’s electric grid.

Transformers are in short supply, and that shortage stifles economic growth across the country.

The shortage will continue to be exacerbated by the widespread adoption of Artificial Intelligence in virtually all sectors of the economy, which will exponentially increase the consumption of electricity in the U.S.

and worldwide.

Because of these industry dynamics and our current customer base, our electrical steel business is expected to continue to achieve strong profitability in the coming years.

We are the first and the only producer of HBI in the Great Lakes region.

1 unchanged sentence

We use HBI to stretch our hot metal production, lowering carbon intensity and reliance on coke.

With increasing tightness in the scrap and metallics markets combined with our own internal needs, we expect our Toledo direct reduction plant to support healthy margins for us going forward.

With increasing tightness in the scrap and metallics markets combined with our own internal needs, we expect our Toledo direct reduction plant to continue to support our operational efficiency going forward.

MAXIMIZE OUR COMMERCIAL STRENGTHS

1 unchanged sentence

We are a leading supplier to the automotive sector, where our portfolio of high-end products delivers a broad range of differentiated solutions for this highly sought after customer base.

As an established and reliable supplier of domestically produced automotive-grade steel, we expect to bolster our position as an industry leader going forward.

Our unique capabilities, driven by our portfolio of assets and technical expertise, give us an advantage in our flat-rolled product offering.

1 unchanged sentence

In addition, our state-of-the-art Research and Innovation Center in Middletown, Ohio gives us the ability to collaborate with our customers and create new products and develop new and efficient steel manufacturing processes.

During 2022, we introduced our MOTOR-MAX™ product line of NOES for high frequency motors and generators.

During 2023, we introduced our C-STAR™ protection design, which was developed for the purpose of providing EV battery protection for improved safety purposes, but can be used in any type of light vehicle.

Our five-year contract to supply semi-finished steel slabs that was initiated in connection with the closing of the acquisition of ArcelorMittal USA concludes in December 2025.

This has historically represented approximately 10 percent of our sales volume and has recently become unprofitable as a result of current market conditions.

The conclusion of this contract provides a significant opportunity to shift sales and product mix to higher margin business and improve efficiency within our operations.

In recent years, we introduced our MOTOR-MAX® product line of NOES for high frequency motors and generators and our C-STAR™ protection design, which was developed for the purpose of providing EV battery protection for improved safety purposes and can be used in any type of light vehicle.

These unique product offerings and customer service capabilities enable us to remain a leading steel supplier to the automotive industry.

SUPPORT DOMESTICALLY PRODUCED AUTOMOTIVE SALES

On March 7, 2025, we announced a "Buy American" incentive program for all of our employees in an effort to support President Trump's long-term vision of bringing manufacturing back to the U.S.

Under this program, any Cleveland-Cliffs employee who purchases or leases a new American-built vehicle in 2025 with substantial Cliffs steel content will receive a $1,000 cash bonus in connection with the purchase or lease.

As the domestic automotive market has long been undermined by excessive imports, we are proud to play a role in encouraging the purchase of domestically produced vehicles.

Since the program's inception, feedback has been extremely positive, and employees have been very enthusiastic about the opportunity to support the sale of domestically produced vehicles.

We continue to work with our automotive partners to ensure the availability of domestically produced, automotive-grade steel.

With the recently announced automotive tariffs, we expect to see an increase in demand for domestically produced vehicles, which should result in an increase in production of vehicles in the U.S.

As a leading supplier of automotive-grade steel, we expect to benefit from increased production of vehicles in the U.S.

over the coming years.

OPTIMIZE OUR FULLY-INTEGRATED STEELMAKING FOOTPRINT

We are a fully-integrated steel enterprise with the size and scale to achieve margins above industry averages for flat-rolled steel.

Our focus remains on realizing our inherent cost advantage in flat-rolled steel while also lowering carbon emissions.

We are a fully-integrated steel enterprise with an expansive footprint providing the opportunity to achieve healthy margins for flat-rolled steel throughout the business cycle.

Our focus remains on realizing our inherent cost advantage in flat-rolled steel while

continuing to optimize our footprint.

The combination of our ferrous raw materials, including iron ore, scrap and HBI, allows us to do so relative to peers who must rely on more unpredictable and unreliable raw material sourcing strategies.

1 unchanged sentence

Our ability to optimize use of these raw materials in our blast furnaces and BOFs ultimately boosts liquid steel output, reduces coke needs and lowers carbon emissions from our operations.

As a result of successful operational improvements, we announced the indefinite idle of the Indiana Harbor #4

blast furnace in the first quarter of 2022.

This indefinite idle reduced our operational blast furnaces from eight to seven.

Our strategic use of HBI in our blast furnaces and maximizing scrap usage in our BOFs has allowed us to achieve the same steel production with one less blast furnace in our footprint.

The necessary resources that we have invested in our footprint are expected to keep our assets at an automotive-grade level of quality and reliability for years to come, positioning us to benefit from operating efficiencies and improved capabilities in the coming years.

PURSUE VALUE-ENHANCING MERGERS AND ACQUISITIONS

We have a proven track record of successfully identifying undervalued assets and completing value-enhancing transactions through mergers and acquisitions.

With our strong balance sheet, proven ability to integrate acquired assets and capture synergies, along with our powerful partnership with our union and non-union employees, we are confident in our ability to identify and execute value-enhancing mergers and acquisitions.

On July 15, 2024, we announced that we had entered into the Arrangement Agreement to acquire Stelco.

The Stelco Acquisition confirms our commitment and leadership in integrated steel production in North America and is expected to strengthen our cost position by incorporating one of the lowest cost flat-rolled steelmaking assets in North America within our footprint.

The Stelco Acquisition has the full endorsement of the USW and brings an additional 1,800 USW-represented employees into our workforce.

The Stelco Acquisition expands our existing presence in Canada and diversifies our customer base across service centers, construction and other industrial end markets with higher volumes of spot sales.

As a result of the Stelco Acquisition, our exposure to the North American spot market is expected to double, giving us further insight into spot market dynamics and diversifying our customer base toward spot customers.

On September 16, 2024, we announced that the holders of common shares of Stelco voted in favor of, and overwhelmingly approved, the special resolution regarding the Stelco Acquisition at a special meeting of shareholders.

The special resolution received support of 99.97% of the total votes cast.

On October 8, 2024, we announced the expiration of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 in connection with the Stelco Acquisition.

As a result, we cleared U.S.

Department of Justice antitrust review for the Stelco Acquisition.

On October 9, 2024, we announced that we received a “no-action letter” from the Canadian Competition Bureau, confirming that the Commissioner of Competition does not intend to challenge the Stelco Acquisition.

On October 30, 2024, we announced that we received regulatory and program approvals under the Investment Canada Act and Strategic Innovation Fund, the final approvals needed to complete the Stelco Acquisition.

Subsequently, we completed the Stelco Acquisition on November 1, 2024.

Going forward, we will continue to be opportunistic in our pursuit of assets that would grow our business and offer opportunities to generate significant synergies.

Our strong partnership with our union-represented employees was crucial in prior mergers and acquisitions as well as with the Stelco Acquisition.

We remain the only domestic steel company in recent years to successfully acquire steel producing assets with USW-represented employees.

EXPLORE ATTRACTIVE DOWNSTREAM OPPORTUNITIES

On July 22, 2024, we announced our investment plan for our new electrical distribution transformer production plant near our indefinitely idled Weirton, West Virginia facility.

We intend to invest approximately $150 million to repurpose a warehouse to commence production of distribution transformers used in electric power distribution.

We expect to receive $50 million in support from the West Virginia Economic Development Authority in relation to the project, which reduces our net capital investment to approximately $100 million.

Our planned Weirton distribution transformer production plant benefits from the ability to use existing building assets, infrastructure and re-employment opportunities for members of the workforce that were previously employed at our indefinitely idled Weirton tinplate mill.

This project is also expected to increase demand for American-made GOES produced at our Butler Works steel mill as well as for our carbon and stainless steel products used in the manufacturing of distribution transformers.

We believe that distribution transformers are critical to America’s electrical infrastructure maintenance and expansion, and we look to benefit from a market that is undersupplied in the United States and currently experiencing extended lead times with a strong demand outlook.

This project is expected to be completed in the first half of 2026.

ADVANCE OUR PARTICIPATION IN THE GREEN ECONOMY

We are seeking to expand our customer base with the desirable EV market.

As this market grows, it will require more advanced steel applications to meet the needs of EV producers and consumers.

These features include the already existing sophisticated steel supply for internal combustion engine vehicle parts, along with the added need for steel-based battery enclosures and reinforcement in EVs.

With our unique technical capabilities and leadership in the automotive industry, we believe we are positioned better than any other North American steelmaker to supply the steel and parts necessary to fill these needs.

We also have the right products to meet the growing demand for renewable energy as well as for the modernization of the U.S.

electrical grid.

We offer plate products that can be used in windmills, which we estimate contain 130 tons of steel per megawatt of electricity.

In addition, panels for solar power are heavy consumers of galvanized steel, where we are a leading producer.

We estimate solar panels consume 40 tons of steel per megawatt of electricity.

We are currently a leading producer of electrical steel in the U.S., which can facilitate the modernization of the U.S.

electrical grid.

Along with charging networks, electrical steels are also needed in the motors of EVs.

During 2025, we made the decision to fully or partially idle six of our operations.

We made the decision to idle our blast furnace, BOF steel shop, and continuous casting facilities at our Dearborn Works facility.

We also made the decision to idle Conshohocken, Riverdale and Steelton due to underperformance at these operations.

Additionally, we made the decision to idle the Minorca mine and partially idle the Hibbing Taconite mine in order to consume excess pellet inventory produced in 2024.

Our recent changes allow us to streamline our operations and enhance efficiency, with minimal impact to our flat-rolled steel output.

During 2024, we announced our intention to establish a new electrical distribution transformer production plant in Weirton, West Virginia.

During the early stages of this project, we realized that the project would require a partner that could supply the technology and licensing required to produce transformers.

After careful evaluation, we have decided to no longer deploy capital toward the distribution transformer production plant due to suggested changes in scope from the project partner.

CAPTURE SYNERGIES FROM RECENT ACQUISITIONS

On November 1, 2024, we completed the Stelco Acquisition.

The Stelco Acquisition confirms our commitment and leadership in integrated steel production in North America and strengthens our cost position by incorporating one of the lowest cost flat-rolled steelmaking assets in North America within our footprint.

The Stelco Acquisition expands our existing presence in Canada and diversifies our customer base in Canada across service centers, construction and other industrial end markets with higher volumes of spot sales.

As a result of the Stelco Acquisition, our exposure to the North American spot market has doubled, giving us further insight into spot market dynamics and diversifying our customer base toward spot customers.

We have demonstrated a consistent track record of exceeding our initial synergy estimates associated with value-enhancing transactions through mergers and acquisitions.

Significant synergy opportunities from the Stelco Acquisition have been identified, including asset and capital expenditure optimization, procurement savings, selling, general and administrative expenses, duplicative public company costs and other opportunities.

With our proven ability to integrate acquired assets and capture synergies, along with our powerful partnership with our union and non-union employees, we are confident in our ability to achieve identified synergies related to the Stelco Acquisition.

ENHANCE OUR ENVIRONMENTAL SUSTAINABILITY

Our commitment to operating our business in a more environmentally responsible manner remains constant.

A major issue impacting our industry, our stakeholders and our planet is climate change.

In May 2024, we announced our commitment to new GHG emissions reductions targets after we successfully achieved our prior commitment set in 2021 to reduce Scope 1 (direct emissions) and Scope 2 (indirect emissions from purchased electricity or other forms of energy) GHG emissions by 25% by 2030, relative to 2017 levels, well ahead of our 2030 target year.

Our new goals set forth below, relative to 2023 levels, are all supported by ongoing and planned technological developments with respect to our ironmaking and steelmaking practices.

We remain committed to operating our business in a more sustainable manner.

In May 2024, we announced our commitment to achieve new GHG emissions reduction targets after we successfully achieved our prior commitment set in 2021 to reduce Scope 1 (direct emissions) and Scope 2 (indirect emissions from purchased electricity or other forms of energy) GHG emissions by 25% by 2030, relative to 2017 levels, well ahead of our 2030 target year.

Our new goals set forth below, relative to 2023 levels, include:

• A target to reduce Scope 1 and 2 GHG emissions intensity per metric ton of crude steel by 30% by 2035;

1 unchanged sentence

• A long-term target aligned with the Paris Agreement’s 1.5 degrees Celsius scenario to reduce Scope 1, 2 and material upstream 3 emissions intensity per metric ton of crude steel to near net zero by 2050.

Additionally, we have made significant progress in reducing our emissions on a per ton basis.

Since 2020, we have reduced our average Scope 1 and 2 emissions of integrated mills from 1.82 to 1.54 metric tons of CO 2 e per metric ton of crude steel produced in 2023, which is 28% lower than the global average.

Our future GHG emissions reductions are expected to be primarily driven by the use of direct reduced iron in electric melting furnaces, direct reduced iron in blast furnaces, the stretching of hot metal with additional scrap, enhancing productivity out of fewer blast furnaces, implementing hydrogen use where possible, adopting carbon capture and utilization, procuring more clean energy, electrification of process equipment and operating with higher energy efficiency.

In March 2024, we were selected by the DOE's OCED for award negotiations to receive up to $575 million in total funding for two projects to accelerate industrial decarbonization initiatives.

If fully awarded, we would receive up to a $500 million federal investment to replace our existing blast furnace at Middletown Works with a 2.5 million ton per annum hydrogen-ready direct reduced iron plant and two 120 megawatt electric melting furnaces to feed molten iron to the existing infrastructure already on site, including the BOF, caster, hot strip mill and various finishing facilities.

The project is designed so that Middletown Works would maintain its existing raw steel production capacity of approximately 3 million net tons per year and would no longer use coke for iron production.

We expect that the process would dramatically reduce carbon emissions intensity with no impact to product quality or capability and would consolidate Middletown Works as the most advanced, lowest GHG emitting integrated iron and steel facility in the world.

Following negotiations, in the third quarter of 2024, the OCED awarded us $9.5 million to begin Phase 1 of the Middletown project, with the remaining award being subject to future award negotiations at the end of each project phase.

The Middletown project is expected to be completed by 2029.

Additionally, if fully awarded, we would receive up to $75 million at our Butler Works facility to replace two of our existing natural gas fired high temperature slab reheat furnaces with four electrified induction slab reheat furnaces, to bring optimum efficiency to our production of electrical steel.

This project would lower carbon emissions, substantially reduce energy costs and improve slab quality.

Following negotiations, in the third quarter of 2024, the OCED awarded us $19 million to begin Phase 1 of the Butler project, with the remaining award being subject to future award negotiations at the end of each project phase.

The Butler project is expected to be completed by 2029.

As a result of both of these projects, we would anticipate generating in excess of $500 million in annual cost savings and yield improvements.

In October 2023, the DOE announced its intention to award funding under the Infrastructure and Jobs Act for seven regional hydrogen hubs, including the Midwest Alliance for Clean Hydrogen.

This hub, covering Illinois, Indiana and Michigan, was selected for $1 billion in funding and is near our two largest steel plants, Indiana Harbor and Burns Harbor.

In January 2024, we commissioned a pipeline and successfully completed a hydrogen injection trial at our Indiana Harbor blast furnace #7.

This follows an initial similar trial of hydrogen at our blast furnace in Middletown earlier in 2023.

The use of hydrogen within our blast furnace is expected to partially reduce coke rate and displace the release of CO 2 with H 2 O, reducing our overall emissions.

IMPROVE FINANCIAL FLEXIBILITY

We have made significant progress in reducing our emissions on a per ton basis.

Since 2020, we have reduced our average Scope 1 and 2 emissions of integrated mills from 1.82 to 1.58 metric tons of CO 2 e per metric ton of crude steel produced in 2024, which is 27% lower than the global industry average.

MAINTAIN FINANCIAL FLEXIBILITY

Given the cyclicality of our business, it is important to us to be in the financial position to easily withstand economic cycles and be opportunistic when attractive strategic opportunities arise.

Since the acquisition of our steelmaking assets in 2020, we have demonstrated our ability to generate healthy free cash flow and use it to reduce substantial amounts of debt, return capital to shareholders through share repurchases and make investments to both improve and grow our business.

Since becoming a steel company in 2020, we have demonstrated our ability to generate healthy free cash flow and use it to reduce substantial amounts of debt, return capital to shareholders through share repurchases and make investments to both improve and grow our business.

We have a track record of demonstrating that we can quickly deleverage our balance sheet and have also historically shown our ability to take advantage of volatility in the debt markets and repurchase notes at a discount.

We expect to continue to generate healthy free cash flow in the coming years and intend to utilize it to deleverage our balance sheet following the closing of the Stelco Acquisition.

We also maintain a long maturity runway with our outstanding debt, with our nearest maturity coming in 2027, supporting our flexibility to navigate varied economic environments for extended periods of time.

We expect to generate healthy free cash flow in the coming years and intend to utilize it to deleverage our balance sheet.

We also maintain a long maturity runway with our outstanding debt, with our nearest maturities coming in 2027, have healthy liquidity, and have approximately $3.3 billion of secured debt capacity, which supports our flexibility to navigate varied economic environments for extended periods of time.

STEELMAKING RESULTS

The following is a summary of our Steelmaking segment operating results for the three and nine months ended September 30, 2024 and 2023 (dollars in millions, except for average selling price, and shipments in thousands of net tons):

The following is a summary of our Steelmaking segment operating results, net of intersegment eliminations, for the three months ended March 31, 2025 and 2024 (dollars in millions, except for average selling price, and shipments in thousands of net tons):

Total Revenue Gross Margin Adjusted EBITDA Steel Shipments (nt)

Q3 2024 Q3 2023 YTD 2024 YTD 2023 Q3 2024 Q3 2023 YTD 2024 YTD 2023 Q3 2024 Q3 2023 YTD 2024 YTD 2023 Q3 2024 Q3 2023 YTD 2024 YTD 2023

2025 2024 2025 2024 2025 2024 2025 2024

STEEL PRODUCT REVENUE:

5 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

(In thousands of net tons) 2024 2023 % Change 2024 2023 % Change

(In thousands of net tons) 2025 2024 % Change

Steel shipments by product:

7 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

(In millions) 2024 2023 % Change 2024 2023 % Change

(In millions) 2025 2024 % Change

Steelmaking revenues by market:

4 unchanged sentences

Total Steelmaking revenues by market $ 4,467 $ 5,027 (11) %

Revenues decreased by 19% during the three months ended September 30, 2024, as compared to the prior-year period, primarily due to:

• A decrease of $624 million, or 32%, in revenues from the direct automotive market, predominantly due to a decrease in demand;

• A decrease of $267 million, or 19%, in revenues from the infrastructure and manufacturing market, predominantly due to a decrease in shipments and steel index pricing;

• A decrease of $129 million, or 18%, in revenues from the steel producers markets, predominantly due to the decrease in pricing indices for slabs and busheling scrap.

Revenues decreased by 12% during the nine months ended September 30, 2024, as compared to the prior-year period, primarily due to:

Revenues decreased by 11% during the three months ended March 31, 2025, as compared to the prior-year period, primarily due to:

• A decrease of $320 million, or 20%, in revenues from the direct automotive market, predominantly due to a decrease in demand;

• A decrease of $342 million, or 8%, in revenues from the infrastructure and manufacturing market, predominantly due to a decrease in shipments and steel index pricing;

• A decrease of $388 million, or 17%, in revenues from the steel producers markets, predominantly due to the decrease in pricing indices for slabs and busheling scrap.

Gross margin decreased by $587 million, or 124%, during the three months ended September 30, 2024, as compared to the prior-year period, primarily due to:

• A decrease in average selling price (approximately $460 million impact), predominantly due to lower spot prices and lower direct automotive mix;

• A decrease in sales volume (approximately $140 million impact);

• A $71 million unfavorable arbitration decision related to iron ore mining royalties for periods of time from 2020 through 2022.

• These decreases were partially offset by a decrease in cost of production driven by lower raw materials and utilities costs, including natural gas, coal, coke, alloys and scrap.

Gross margin decreased by $895 million, or 75%, during the nine months ended September 30, 2024, as compared to the prior-year period, primarily due to:

• A decrease in average selling price (approximately $590 million impact), predominantly due to lower spot prices and lower direct automotive mix;

• A decrease in sales volume (approximately $340 million impact).

• These decreases were partially offset by a decrease in cost of production driven by lower raw materials and utilities costs, including natural gas, coal, coke, alloys and scrap.

• A decrease of $184 million, or 13%, in revenues from the distributors and converters market, predominantly due to a decrease in average selling price;

which was partially offset by

• An increase in revenues related to incremental tons sold related to the addition of Stelco.

Gross margin decreased by $670 million, or 248%, during the three months ended March 31, 2025, as compared to the prior-year period, primarily due to:

• A decrease in average selling price (approximately $500 million impact), predominantly due to lower index prices and a lower direct automotive mix.

The average selling price was additionally impacted as a result of incremental hot-rolled steel tons sold related to the addition of Stelco;

• An increase in idled facilities employment charges of $44 million related to our idling of our Minorca mine and partial idling of our Hibbing Taconite mine.

ADJUSTED EBITDA

Adjusted EBITDA from our Steelmaking segment for the three months ended September 30, 2024, decreased by $490 million, as compared to the three months ended September 30, 2023, primarily due to the decreased gross margin from our operations.

Additionally, our Steelmaking Adjusted EBITDA included $105 million and $133 million of Selling, general and administrative expenses for the three months ended September 30, 2024 and 2023, respectively.

Adjusted EBITDA from our Steelmaking segment for the nine months ended September 30, 2024, decreased by $794 million, as compared to the nine months ended September 30, 2023, primarily due to the decreased gross margin from our operations.

Additionally, our Steelmaking Adjusted EBITDA included $326 million and $393 million of Selling, general and administrative expenses for the nine months ended September 30, 2024 and 2023, respectively.

Adjusted EBITDA from our Steelmaking segment for the three months ended March 31, 2025, decreased by $579 million, as compared to the three months ended March 31, 2024, primarily due to the decreased gross margin from our operations.

Additionally, our Steelmaking Adjusted EBITDA included $126 million and $125 million of Selling, general and administrative expenses for the three months ended March 31, 2025 and 2024, respectively.

RESULTS OF OPERATIONS

REVENUES & GROSS MARGIN

During the three and nine months ended September 30, 2024, our consolidated Revenues decreased by $1,036 million and $2,024 million, respectively, compared to the prior-year periods.

During the three and nine months ended September 30, 2024, our consolidated gross margin decreased by $584 million and $880 million, respectively, as compared to the prior-year periods.

During the three months ended March 31, 2025, our consolidated Revenues decreased by $570 million, and our consolidated gross margin decreased by $676 million, as compared to the prior-year period.

See "— Steelmaking Results" above for further detail on our operating results.

SELLING, GENERAL AND ADMINISTRATIVE EXPENSES

During the three and nine months ended September 30, 2024, Selling, general and administrative expenses decreased by $27 million and $68 million, respectively.

The decreases primarily relate to lower employment-related costs.

RESTRUCTURING AND OTHER CHARGES & ASSET IMPAIRMENTS

On February 15, 2024, we announced the indefinite idle of our Weirton tinplate production plant.

This resulted in restructuring and other charges primarily related to severance, other employee-related benefits and asset retirement obligation charges of $2 million and $131 million for the three and nine months ended September 30, 2024, respectively.

Additionally, this resulted in an asset impairment of $79 million for the nine months ended September 30, 2024.

RESTRUCTURING AND OTHER CHARGES

As a result of the announcement of the indefinite idle of our Weirton tinplate production plant in the first quarter of 2024, we recorded $3 million and $104 million of restructuring and other charges during the three months ended March 31, 2025 and 2024, respectively.

These charges primarily related to severance, other employee-related benefits and asset retirement obligation charges.

ASSET IMPAIRMENT

During the three months ended March 31, 2024, we announced the indefinite idle of our Weirton tinplate production plant, resulting in $64 million of asset impairment, which was not repeated during the three months ended March 31, 2025.

MISCELLANEOUS - NET

During the three months ended March 31, 2025, miscellaneous expense decreased by $12 million, as compared to the prior-year period.

The decrease in miscellaneous expense is primarily related to decreased expenses associated with our indefinitely idled and closed operations.

LOSS ON EXTINGUISHMENT OF DEBT

During the three months ended March 31, 2024, we used a portion of the net proceeds from the issuance of the 7.000% 2032 Senior Notes to repurchase $640 million in aggregate principal amount of our 6.750% 2026 Secured Senior Notes, resulting in a $21 million loss on extinguishment of debt.

During the three months ended March 31, 2025, we did not repurchase any outstanding debt.

Refer to NOTE 7 - DEBT AND CREDIT FACILITIES for further information.

INTEREST EXPENSE, NET

During the three and nine months ended September 30, 2024, our consolidated Interest expense, net increased by $32 million and $9 million, respectively, compared to the prior-year periods.

The increases primarily relate to financing fees incurred during the third quarter associated with entering into the Commitment Letter, providing an optional Bridge Facility to finance the Stelco Acquisition.

For the nine months ended September 30, 2024, the increase is partially offset by a decrease in interest expense incurred on our outstanding long-term debt.

Our effective tax rate is impacted by state income tax expense and permanent items, primarily depletion.

During the three months ended March 31, 2025, our consolidated Interest expense, net increased by $76 million compared to the three months ended March 31, 2024.

This increase is primarily due to an increase in our outstanding borrowings.

Our effective tax rate is impacted by state and foreign income taxes as well as permanent items, such as depletion.

It also is affected by discrete items that may occur in any given period but are not consistent from period to period.

The following represents a summary of our tax provision:

Three Months Ended

September 30, Nine Months Ended

September 30,

(In millions) 2024 2023 2024 2023

Income tax benefit (expense) $ 76 $ (29) $ 99 $ (118)

The changes in income tax benefit for the three and nine months ended September 30, 2024, as compared to the income tax expense for the prior-year periods, are primarily related to depletion in excess of state income tax expense and the impact of immaterial discrete items relative to changes in pre-tax income.

During the three months ended March 31, 2025, our consolidated Income tax benefit increased by $139 million compared to the three months ended March 31, 2024.

This increase is primarily due to an increase in Loss before income taxes and the impact of immaterial discrete items relative to those losses.

LIQUIDITY, CASH FLOWS AND CAPITAL RESOURCES

Our capital allocation decision-making process is focused on preserving healthy liquidity levels while maintaining the strength of our balance sheet and creating financial flexibility to manage through the cyclical demand for our products and volatility in commodity prices.

We are focused on maximizing the cash generation of our operations, reducing debt, returning capital to shareholders, and aligning capital investments with our strategic priorities and the requirements of our business plan, including regulatory and permission-to-operate related projects.

Our capital allocation decision-making process is focused on preserving healthy liquidity levels, strengthening our balance sheet, and creating financial flexibility to manage through the cyclical demand for our products and volatility in commodity prices.

We are focused on maximizing the cash generation of our operations, reducing debt, and aligning capital investments with our strategic priorities and the requirements of our business plan, including regulatory and permission-to-operate related projects.

The following table provides a summary of our cash flow:

Nine Months Ended

September 30,

Three Months Ended

(In millions) 2025 2024

3 unchanged sentences

Financing activities 499 (131)

Net increase (decrease) in cash and cash equivalents $ (159) $ 5

Net increase (decrease) in cash, cash equivalents and restricted cash $ 3 $ (168)

Free cash flow 1

$ (503) $ (40)

1 See "— Non-GAAP Financial Measures" for a reconciliation of our free cash flow.

The current market environment has provided us the ability to take advantage of favorable debt markets and return capital to shareholders, as follows:

• During the first quarter of 2024, we issued $825 million aggregate principal amount of our 7.000% 2032 Senior Notes.

A portion of the net proceeds from the 7.000% 2032 Senior Notes issuance was used to repurchase $640 million in aggregate principal amount of our 6.750% 2026 Senior Secured Notes pursuant to a tender offer.

On April 3, 2024, we redeemed the remaining $189 million in aggregate principal amount of our then-outstanding 6.750% 2026 Senior Secured Notes with the remaining portion of the net proceeds from the 7.000% 2032 Senior Notes issuance and available liquidity.

After these transactions, we no longer have any secured notes outstanding.

• During the third quarter of 2024, we issued an additional $600 million aggregate principal amount of our $7.000% 2032 Senior Notes.

The net proceeds from the transaction were used to finance a portion of the cash consideration paid in connection with the Stelco Acquisition, which we completed on November 1, 2024.

• Additionally, during the nine months ended September 30, 2024, we returned capital to shareholders through our share repurchase programs, repurchasing 37.9 million common shares at a cost of $733 million in the aggregate.

During the first quarter of 2025, we issued $850 million aggregate principal amount of our 7.500% 2031 Senior Notes at par.

A portion of the net proceeds from the 7.500% 2031 Senior Notes was used for repayment of borrowings under the ABL Facility, with the remainder being utilized for general operational purposes.

Our financial flexibility has allowed us to remain active in our opportunistic pursuit of value-enhancing mergers and acquisitions.

During the third quarter of 2024, we announced that we had entered into an Arrangement Agreement to acquire Stelco.

On October 22, 2024, we issued $900 million aggregate principal amount of 6.875% Senior Guaranteed Notes due 2029 at par and $900 million aggregate principal amount of 7.375% Senior Guaranteed Notes due 2033 at par.

The net proceeds from the

transaction were used to finance a portion of the cash consideration payable in connection with the Stelco Acquisition, which we completed on November 1, 2024.

We expect to continue to generate healthy free cash flow in the coming years and intend to utilize it to deleverage our balance sheet following the Stelco Acquisition.

Going forward, we will continue to use the financial levers available to us in order to continue to pursue assets that would grow our business, reduce our debt and return capital to shareholders.

We have a track record of demonstrating that we can quickly deleverage our balance sheet following acquisitions, which is our current priority.

We expect to generate healthy free cash flow in the coming years and intend to utilize it to deleverage our balance sheet.

OPERATING ACTIVITIES

Nine Months Ended

September 30,

Three Months Ended

(In millions) 2025 2024 Variance

Net income (loss) $ (274) $ 589 $ (863)

Non-cash adjustments to net income (loss) 839 872 (33)

Net loss $ (483) $ (53) $ (430)

Non-cash adjustments to net loss 148 412 (264)

Working capital:

6 unchanged sentences

Total working capital (16) (217) 201

Net cash provided by operating activities $ 577 $ 1,615 $ (1,038)

Net cash provided (used) by operating activities $ (351) $ 142 $ (493)

The variance was primarily driven by:

• A $896 million decrease in net income after non-cash adjustments primarily due to lower gross margins resulting from a decrease in both volume and selling prices for our steel products.

• A $694 million decrease in net loss after adjustments for non-cash items primarily due to lower gross margins resulting from a decrease in selling prices for our steel products as compared to the first quarter of 2024.

See "— Steelmaking Results" above for further detail on our operating results;

• A $348 million decrease in our change in inventories, due to more aggressive inventory reduction in 2023 that did not repeat in 2024.

• This was partially offset by a $422 million improvement in our change in accounts receivable, due primarily to falling selling prices and volume in 2024.

• A $196 million decrease in cash primarily related to increasing average selling prices of our steel products during the first quarter of 2025 as compared to the fourth quarter of 2024 resulting in growing accounts receivable balances;

which was partially offset by

• A $190 million increase in cash primarily related to a reduction in iron ore pellet inventories during the first quarter of 2025;

• A $227 million increase in cash primarily as a result of lower incentive-based compensation paid in the first quarter of 2025, as compared to the first quarter of 2024.

INVESTING ACTIVITIES

Nine Months Ended

September 30,

Three Months Ended

(In millions) 2025 2024 Variance

3 unchanged sentences

Our capital expenditures primarily relate to sustaining capital spend, which includes infrastructure, mobile equipment, fixed equipment, product quality, environmental, and health and safety spend.

As a result, our cash used for capital expenditures was consistent, as compared to the prior-year period.

Included within cash used for capital expenditures was $20 million for the nine months ended September 30, 2024, compared to $21 million for the nine months ended September 30, 2023, related to our non-owned SunCoke Middletown VIE.

We anticipate total cash used for capital expenditures during the next 12 months to be approximately $600 million, which primarily consists of sustaining capital spend as well as initial spend on our capital projects at Middletown Works, Butler Works and Weirton.

Our cash used for capital expenditures during the first quarter of 2025 was $30 million less as compared to the prior-year period.

Included within cash used for capital expenditures was a nominal amount related to our non-owned SunCoke Middletown VIE for the three months ended March 31, 2025, compared to $4 million for the three months ended March 31, 2024.

We anticipate total cash used for capital expenditures during the next 12 months to be approximately $650 million, which primarily consists of sustaining capital spend.

FINANCING ACTIVITIES

Nine Months Ended

September 30,

Three Months Ended

(In millions) 2025 2024 Variance

3 unchanged sentences

Other financing activities (46) (38) (8)

Net cash used by financing activities $ (259) $ (1,140) $ 881

Net cash provided (used) by financing activities $ 499 $ (131) $ 630

The variance was primarily driven by:

• A $1.4 billion decrease in cash used resulting from higher net repayments of debt during the nine months ended September 30, 2023;

• A $581 million increase in cash used to repurchase common shares during the nine months ended September 30, 2024.

During the nine months ended September 30, 2024, we repurchased 37.9 million of our common shares on the open market, as compared to the 10.4 million common shares repurchased in the prior-year period.

• The repurchase of 30.4 million common shares for the three months ended March 31, 2024, while no shares were repurchased during the three months ended March 31, 2025.

LIQUIDITY AND CAPITAL RESOURCES

Our primary sources of liquidity are Cash and cash equivalents, cash generated from our operations, availability under our ABL Facility and access to capital markets.

We generally maintain minimal cash balances and utilize our access to our ABL Facility to cover fluctuations in our cash requirements.

Cash and cash equivalents, which totaled $39 million as of September 30, 2024, include cash on hand and on deposit.

The combination of cash and availability under our ABL Facility gave us $3.8 billion in liquidity as of September 30, 2024.

During the first nine months of 2024, we issued $1.4 billion in aggregate principal amount of 7.000% 2032 Senior Notes.

We used a portion of the net proceeds from the initial offering of the 7.000% 2032 Senior Notes and available liquidity to repurchase $829 million in aggregate principal amount of our 6.750% 2026 Secured Senior Notes pursuant to a tender offer and subsequent redemption.

Our primary sources of liquidity are Cash and cash equivalents, cash generated from our operations, availability under the ABL Facility and access to capital markets.

Cash and cash equivalents, which totaled $57 million as of March 31, 2025, include cash on hand and on deposit, as well as short-term securities held for the primary purpose of general liquidity.

The combination of cash and availability under our ABL Facility equated to $3.0 billion in liquidity as of March 31, 2025.

On February 6, 2025, we issued $850 million aggregate principal amount of 7.500% Senior Notes due 2031 at par.

The net proceeds were used for general corporate purposes, including repayment of borrowings under our ABL Facility.

We believe our liquidity and access to capital markets will be adequate to fund our cash requirements for the next 12 months and for the foreseeable future.

On July 14, 2024, we entered into the Arrangement Agreement to acquire all of the issued and outstanding common shares of Stelco from the holders thereof.

In addition to the $600 million aggregate principal amount of additional 7.000% 2032 Senior Notes issued in the third quarter of 2024, on October 22, 2024, we issued $900 million aggregate principal amount of 6.875% Senior Guaranteed Notes due 2029 at par and $900 million aggregate principal amount of 7.375% Senior Guaranteed Notes due 2033 at par.

The net proceeds from these transactions were used to finance a portion of the cash consideration paid in connection with the Stelco Acquisition, which we completed on November 1, 2024.

Subsequent to completing the Stelco Acquisition, our pro forma liquidity has remained above $2.5 billion.

During the third quarter of 2024, we amended our $4.75 billion ABL Facility, which matures in June 2028, as part of the financing for the Stelco Acquisition.

The ABL Facility amendments provide conditions to utilize the ABL Facility to finance a portion of the purchase price of the Stelco Acquisition and enable us to include assets from Canadian subsidiaries as part of the Stelco Acquisition.

However, our ability in the future to issue additional notes could be limited by market conditions.

Our ABL Facility, which matures in June 2028, has a maximum borrowing base of $4.75 billion, including a $500 million multicurrency sub-facility, a $555 million sublimit for the issuance of letters of credit and a $200 million sublimit for swingline loans.

The available borrowing base is determined by applying customary advance rates to eligible accounts receivable, inventory and certain mobile equipment.

Our ABL Facility includes a $555 million sublimit for the issuance of letters of credit and a $200 million sublimit for swingline loans.

As of September 30, 2024, outstanding letters of credit totaled $46 million, which reduced availability under our ABL Facility.

We issue standby letters of credit with certain financial institutions to support business obligations, including, but not limited to, workers' compensation, operating agreements, employee severance, environmental obligations and insurance.

As of March 31, 2025, outstanding letters of credit totaled $55 million, which reduced availability.

We issue standby letters of credit with certain financial institutions in order to support business obligations, including, but not limited to, workers' compensation, operating agreements, employee severance, environmental obligations and insurance.

Our ABL Facility agreement contains various financial and other covenants.

As of September 30, 2024, we were in compliance with all of our ABL Facility covenants.

We have the capability to issue additional unsecured notes and, subject to the limitations set forth in our existing senior notes indentures and ABL Facility, to issue secured notes, if we elect to access the debt capital markets.

However, our ability to issue additional notes could be limited by market conditions.

As of March 31, 2025, we were in compliance with all of our ABL Facility covenants.

We have the capability to issue additional unsecured notes and, subject to the limitations set forth in our existing senior notes indentures and ABL Facility, additional secured debt, if we elect to access the debt capital markets.

We currently have approximately $3.3 billion of secured debt capacity.

We intend from time to time to seek to redeem or repurchase our outstanding senior notes with cash on hand, borrowings from existing credit sources or new debt financings and/or exchanges for debt or equity securities, in open market purchases, privately negotiated transactions or otherwise.

3 unchanged sentences

The following provides a description and reconciliation of each of our non-GAAP financial measures to its most directly comparable respective GAAP measure.

The presentation of these measures is not intended to be considered in isolation from, as a substitute for, or as superior to, the financial information prepared and presented in accordance with GAAP.

The presentation of these measures is not intended to be considered in isolation from, as a substitute

for, or as superior to, the financial information prepared and presented in accordance with GAAP.

The presentation of these measures may be different from non-GAAP financial measures used by other companies.

1 unchanged sentence

We evaluate performance on an operating segment basis, as well as a consolidated basis, based on Adjusted EBITDA, which is a non-GAAP measure.

This measure is used by management, investors, lenders and other external users of our financial statements to assess our operating performance and to compare operating performance to other companies in the steel industry, showing results exclusive of certain non-recurring and/or non-cash items.

In addition, management believes Adjusted EBITDA is a useful measure to assess the earnings power of the business without the impact of capital structure and can be used to assess our ability to service debt and fund future capital expenditures in the business.

The following table provides a reconciliation of our Net income (loss) to Adjusted EBITDA:

The following table provides a reconciliation of our Net loss to Adjusted EBITDA:

Three Months Ended

September 30, Nine Months Ended

September 30,

(In millions) 2025 2024

Net income (loss) $ (230) $ 275 $ (274) $ 589

Net loss $ (483) $ (53)

Interest expense, net (140) (64)

Income tax benefit (expense) 76 (29) 99 (118)

Income tax benefit 147 8

Depreciation, depletion and amortization (282) (230)

2 unchanged sentences

Weirton indefinite idle 2

(2) — (219) —

Idled facilities employment charges (41) —

Changes in fair value of derivatives, net (9) —

Amortization of inventory step-up 7 —

Loss on extinguishment of debt — (21)

Acquisition-related costs (14) (3) (14) (5)

Changes in fair value of foreign currency contracts, net (7) — (7) —

Arbitration decision (71) — (71) —

Other, net (6) (4)

7 unchanged sentences

Three Months Ended

September 30, Nine Months Ended

September 30,

(In millions) 2025 2024

2 unchanged sentences

Other Businesses 10 17

Eliminations 3 2 4 (8)

Intersegment Eliminations — 2

Total Adjusted EBITDA $ (174) $ 414

FREE CASH FLOW

Free cash flow is a non-GAAP financial measure defined as operating cash flow less purchase of property, plant and equipment.

Free cash flow is a non-GAAP measure defined as operating cash flow less purchase of property, plant and equipment.

Management believes it is an important measure to assess the cash generation available to service debt, strategic initiatives or other financing activities.

The following table provides a reconciliation of our operating cash flow to free cash flow:

Nine Months Ended

September 30,

The following table provides a reconciliation of our Net cash provided (used) by operating activities to free cash flow:

Three Months Ended

(In millions) 2025 2024

Net cash provided by operating activities $ 577 $ 1,615

Net cash provided (used) by operating activities $ (351) $ 142

Purchase of property, plant and equipment (152) (182)

1 unchanged sentence

INFORMATION ABOUT OUR GUARANTORS AND THE ISSUER OF OUR GUARANTEED SECURITIES

The accompanying summarized financial information has been prepared and presented pursuant to SEC Regulation S-X, Rule 3-10, “Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered,” and Rule 13-01 "Financial Disclosures about Guarantors and Issuers of Guaranteed Securities and Affiliates Whose Securities Collateralized a Registrant's Securities." Certain of our subsidiaries (the "Guarantor subsidiaries") as of September 30, 2024 have fully and unconditionally, and jointly and severally, guaranteed the obligations under the 5.875% 2027 Senior Notes, the 7.000% 2027 Senior Notes, the 4.625% 2029 Senior Notes, the 6.750% 2030 Senior Notes, the 4.875% 2031 Senior Notes and the

7.000% 2032 Senior Notes issued by Cleveland-Cliffs Inc.

The accompanying summarized financial information has been prepared and presented pursuant to SEC Regulation S-X, Rule 3-10, “Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered,” and Rule 13-01 "Financial Disclosures about Guarantors and Issuers of Guaranteed Securities and Affiliates Whose Securities Collateralized a Registrant's Securities." Certain of our subsidiaries (the "Guarantor subsidiaries") as of March 31, 2025 have fully and unconditionally, and jointly and severally, guaranteed the obligations under the 5.875% 2027 Senior Notes, the 7.000% 2027 Senior Notes, the 4.625% 2029 Senior Notes, the 6.875% 2029 Senior Notes, the 6.750% 2030 Senior Notes, the 4.875% 2031 Senior Notes, the 7.500% 2031 Senior Notes, the 7.000% 2032 Senior Notes and the 7.375% 2033 Senior Notes issued by Cleveland-Cliffs Inc.

on a senior unsecured basis.

5 unchanged sentences

Each Guarantor subsidiary is consolidated by Cleveland-Cliffs Inc.

as of September 30, 2024.

Refer to Exhibit 22 , incorporated herein by reference, for the detailed list of entities included within the obligated group as of September 30, 2024.

As of September 30, 2024, the guarantee of a Guarantor subsidiary with respect to the 5.875% 2027 Senior Notes, the 7.000% 2027 Senior Notes, the 4.625% 2029 Senior Notes, the 6.750% 2030 Senior Notes, the 4.875% 2031 Senior Notes and the 7.000% 2032 Senior Notes will be automatically and unconditionally released and discharged, and such Guarantor subsidiary’s obligations under the guarantee and the related indentures (the “Indentures”) will be automatically and unconditionally released and discharged, upon the occurrence of any of the following, along with the delivery to the trustee of an officer’s certificate and an opinion of counsel, each stating that all conditions precedent provided for in the applicable Indenture relating to the release and discharge of such Guarantor subsidiary’s guarantee have been complied with:

as of March 31, 2025.

Refer to Exhibit 22 , incorporated herein by reference, for the detailed list of entities included within the obligated group as of March 31, 2025.

As of March 31, 2025, the guarantee of a Guarantor subsidiary with respect to the 5.875% 2027 Senior Notes, the 7.000% 2027 Senior Notes, the 4.625% 2029 Senior Notes, the 6.875% 2029 Senior Notes, the 6.750% 2030 Senior Notes, the 4.875% 2031 Senior Notes, the 7.500% 2031 Senior Notes, the 7.000% 2032 Senior Notes and the 7.375% 2033 Senior Notes will be automatically and unconditionally released and discharged, and such Guarantor subsidiary’s obligations under the guarantee and the related indentures (the “Indentures”) will be automatically and unconditionally released and discharged, upon the occurrence of any of the following, along with the delivery to the trustee of an officer’s certificate and an opinion of counsel, each stating that all conditions precedent provided for in the applicable Indenture relating to the release and discharge of such Guarantor subsidiary’s guarantee have been complied with:

(a) any sale, exchange, transfer or disposition of such Guarantor subsidiary (by merger, consolidation, or the sale of) or the capital stock of such Guarantor subsidiary after which the applicable Guarantor subsidiary is no longer a subsidiary of the Company or the sale of all or substantially all of such Guarantor subsidiary’s assets (other than by lease), whether or not such Guarantor subsidiary is the surviving entity in such transaction, to a person which is not the Company or a subsidiary of the Company;

9 unchanged sentences

The following table is summarized combined financial information from the Statements of Unaudited Condensed Consolidated Financial Position of the obligated group:

(In millions) September 30, 2024 December 31, 2023

(In millions) March 31, 2025 December 31, 2024

Current assets $ 6,642 $ 6,463

3 unchanged sentences

The following table is summarized combined financial information from the Statements of Unaudited Condensed Consolidated Operations of the obligated group:

Nine Months Ended

(In millions) September 30, 2024

Three Months Ended

(In millions) March 31, 2025

Revenues $ 4,176

Cost of goods sold (4,548)

Loss from continuing operations (300)

Net loss (409)

1 unchanged sentence

The obligated group had the following balances with non-Guarantor subsidiaries and other related parties:

(In millions) September 30, 2024 December 31, 2023

(In millions) March 31, 2025 December 31, 2024

Balances with non-Guarantor subsidiaries:

4 unchanged sentences

Accounts payable (13) (20)

Additionally, for the nine months ended September 30, 2024, the obligated group had Revenues of $63 million and Cost of goods sold of $51 million, in each case, with other related parties.

We are subject to a variety of risks, including those caused by changes in commodity prices and interest rates.

Additionally, for the three months ended March 31, 2025, the obligated group had Revenues of $19 million and Cost of goods sold of $17 million, in each case, with other related parties.

We are subject to a variety of risks, including those caused by changes in commodity prices, foreign currency exchange rates, and interest rates.

We have established policies and procedures to manage such risks;

1 unchanged sentence

PRICING RISKS

In the ordinary course of business, we are exposed to market risk and price fluctuations related to the sale of our products, which are impacted primarily by market prices for HRC and other related spot pricing indices, and the purchase of energy and raw materials used in our operations, which are impacted by market prices for natural gas, electricity, ferrous and stainless steel scrap, chrome, metallurgical coal, coke, zinc, chrome, nickel and other alloys.

Our strategy to address market risk has generally been to obtain competitive prices for our products and services and allow operating results to reflect market price movements dictated by supply and demand;

however, we make forward physical purchases and enter into hedge contracts to manage exposure to price risk related to the purchases of certain raw materials and energy used in the production process.

Our financial results can vary for our operations as a result of fluctuations in market prices.

We attempt to mitigate these risks by aligning fixed and variable components in our customer pricing contracts, supplier purchasing agreements and derivative financial instruments.

In the ordinary course of business, we are exposed to price fluctuations in both the production and sale of our products.

Price fluctuations related to the production of our products are impacted by market prices for natural gas, electricity, ferrous and stainless steel scrap, metallurgical coal, coke, zinc, chrome, nickel and other alloys.

Price fluctuations related to the sale of our products are primarily impacted by market prices for HRC and other related spot indices.

Our financial results can vary for our operations as a result of these fluctuations.

Our strategy to address the risk of changes in the prices of both energy and raw materials that are purchased and utilized in our operations includes improving efficiency in energy usage, identifying alternative providers, utilizing the lowest cost alternative fuels and making forward physical purchases.

Some customer contracts have fixed pricing terms, which increase our exposure to fluctuations in raw material and energy costs.

10 unchanged sentences

There is a risk, however, that the variable-price mechanisms in the sales contracts may not necessarily change in tandem with the variable-price mechanisms in our purchase agreements, negatively affecting our results of operations and cash flows.

Our strategy to address volatile natural gas rates and electricity rates includes improving efficiency in energy usage, identifying alternative providers and utilizing the lowest cost alternative fuels.

If we are unable to align fixed and variable components between customer contracts and supplier purchase agreements, we routinely evaluate the use of derivative instruments to hedge market risk.

2 unchanged sentences

However, since we do not typically hedge 100% of our exposure, abnormal price increases in any of these commodity markets might still negatively affect operating costs.

The following table summarizes the negative effect of a hypothetical change in the fair value of our derivative instruments outstanding as of September 30, 2024, due to a 10% and 25% change in the market price of each of the indicated commodities:

Commodity Derivative (In millions) 10% Change 25% Change

Our strategy to address price fluctuations related to the selling price of our products has generally been to obtain competitive prices for our products and allow operating results to reflect market price movements dictated by supply and demand;

however, to an extent, we also utilize sales swaps to manage our exposure to HRC price fluctuations in the average selling price of our products.

The following table summarizes the negative effect of a hypothetical change in the fair value of our derivative instruments outstanding as of March 31, 2025, due to a 10% and 25% change in the market price of each of the hedge contracts:

Contract Type (In millions) 10% Change 25% Change

Natural gas $ 54 $ 135

1 unchanged sentence

Any resulting changes in fair value would be recorded as adjustments to AOCI, net of income taxes, or recognized in net earnings, as appropriate.

These hypothetical losses would be partially offset by the benefit of lower prices paid for the related commodities.

These hypothetical losses would be partially offset by the benefit of lower prices paid for the related commodities or the benefit of higher selling prices related to the HRC price, respectively.

VALUATION OF GOODWILL AND OTHER LONG-LIVED ASSETS

We assign goodwill arising from acquired companies to the reporting units that are expected to benefit from the synergies of the acquisition.

Goodwill is tested on a qualitative or quantitative basis for impairment at the reporting unit level on an annual basis (October 1) and between annual tests if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value.

These events or circumstances could include a significant change in the business climate, legal factors, operating performance indicators, competition, or sale or disposition of a significant portion of a reporting unit.

Goodwill is tested on a qualitative or quantitative basis for impairment at the reporting unit level on an annual basis (October 1) and between annual tests if a triggering event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying value.

We have an unconditional option to bypass the qualitative test for any reporting unit in any period and proceed directly to performing the quantitative test.

Should our qualitative test indicate that it is more likely than not that the fair value of a reporting unit is less than its carrying value, we perform a quantitative test to determine the amount of impairment, if any, to the carrying value of the reporting unit and its associated goodwill.

Application of the goodwill impairment test requires judgment, including the identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to reporting units and if a quantitative assessment is deemed necessary in determination of the fair value of each reporting unit.

Triggering events could include a significant and sustained change in the business climate, including, among other factors, declines in historical or projected revenue, operating income, Adjusted EBITDA or cash flows, and declines in the stock price or market capitalization, considered both in absolute terms and relative to peers, legal factors, competition, or sale or disposition of a significant portion of a reporting unit.

Automotive production and sales are cyclical and sensitive to general economic conditions and other factors, including interest rates, consumer credit, spending and preferences, and supply chain disruptions.

Additionally, to the extent that commodity prices, including the HRC price, coated and other specialty steel prices, international steel prices and scrap metal prices, significantly decline for an extended period, we may have to further revise our operating plans.

As a result, testing for potential impairment on our goodwill may be adversely affected by uncertain market conditions for the global steel industry, as well as changes in interest rates, inflation, commodity prices and general economic conditions.

Changes in general economic and/or industry specific conditions, such as the impacts of significant recent shifts in trade policies, including the imposition of tariffs, retaliatory tariff measures and subsequent modifications or suspensions thereof, and market reactions to such policies and resulting trade disputes, could further impact our impairment assessments.

We do not believe the current challenging macroeconomic and industry conditions, or our depressed market capitalization, have significantly changed our assessment of the fair value of our reporting units.

Application of a goodwill impairment test requires judgment, including the identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to reporting units, and the determination of the fair value of each reporting unit, if a quantitative assessment is deemed necessary.

The fair value of each reporting unit is estimated using the guideline public company method, the discounted cash flow methodology, or a combination of both, which considers forecasted cash flows discounted at an estimated weighted average cost of capital.

Assessing the recoverability of our goodwill requires significant assumptions regarding the estimated future cash flows and other factors to determine the fair value of a reporting unit, including, among other things, estimates related to forecasts of future revenues, expected Adjusted EBITDA, expected capital expenditures and working capital requirements, which are based upon our long-range plan estimates.

The assumptions used to calculate the fair value of a reporting unit may change from year to year based on operating results, market conditions and other factors.

Assessing the recoverability of our goodwill requires significant assumptions regarding discount rates, market multiples, the estimated future cash flows and other factors to determine the fair value of a reporting unit, including, among other things, estimates related to forecasts of future revenues, Adjusted EBITDA, capital expenditures and working capital requirements, which are based upon our long-range plan estimates.

The assumptions used to calculate the fair value of a reporting unit may change based on operating results, market conditions and other factors.

Changes in these assumptions could materially affect the determination of fair value for each reporting unit.

12 unchanged sentences

We estimate fair value using a market approach, an income approach or a cost approach.

For the three and nine months ended September 30, 2024, we concluded that there were no additional triggering events resulting in the need for an impairment assessment except for the announcement of the indefinite idle of our Weirton tinplate production plant, which resulted in a $46 million impairment charge to Property, plant and equipment, net for the nine months ended September 30, 2024.

For the three months ended March 31, 2025, we concluded that there were no additional triggering events resulting in the need for an impairment assessment.

The triggering events discussed above related to goodwill additionally apply to testing for potential impairment of other long-lived assets, including property, plant and equipment and/or intangible assets.

FOREIGN CURRENCY EXCHANGE RATE RISK

We are subject to changes in foreign currency exchange rates primarily as a result of our operations in Canada, which could impact our financial condition.

Foreign exchange rate risk arises from our exposure to fluctuations in foreign currency exchange rates because our reporting currency is the U.S.

dollar, but the functional currency of our Stelco subsidiaries is the Canadian dollar.

Specifically, we are primarily exposed to fluctuations in foreign currency rates in relation to an intercompany note with our Stelco subsidiary that is denominated in the Canadian dollar.

Changes in the Canadian dollar exchange rate may result in volatility in our financial condition due to the routine remeasurement of this note.

As of March 31, 2025, a 1% change in the Canadian dollar foreign currency exchange rate would result in a $9 million change in currency exchange income (expense).

Additionally, we engage in routine transactions denominated in foreign currencies, such as the purchases of goods and services.

However, the potential impact of these transactions to our financial condition is significantly less than the potential impact of the routine remeasurement of the intercompany note.

INTEREST RATE RISK

1 unchanged sentence

Interest payable under our ABL Facility is at a variable rate based upon the applicable base rate plus the applicable base rate margin depending on the excess availability.

As of September 30, 2024, we had $47 million outstanding under our ABL Facility.

As of March 31, 2025, we had $1,255 million of outstanding borrowings under our ABL Facility.

An increase in prevailing interest rates would increase interest expense and interest paid for any outstanding borrowings under our ABL Facility.

For example, a 100 basis point change to interest rates under our ABL Facility at the March 31, 2025 borrowing level would result in a change of $13 million to interest expense on an annual basis.

SUPPLY CONCENTRATION RISKS

1 unchanged sentence

A significant interruption or change in service or rates from our energy suppliers could materially impact our production costs, margins and profitability.

FOREIGN CURRENCY EXCHANGE RATE RISK

On July 15, 2024, we announced that we had entered into the Arrangement Agreement with Stelco to acquire all of its common shares in a cash and stock transaction valued, at the time, at approximately $2.5 billion.

We hedged a portion of the purchase price by entering into foreign currency option contracts with a notional amount of $1.5 billion as of September 30, 2024.

These option contracts, with a maturity date of October 15, 2024, expired without being exercised.

We may enter into additional hedging instruments in the future, as needed, to further mitigate foreign currency exchange rate risk.

FORWARD-LOOKING STATEMENTS

6 unchanged sentences

Uncertainties and risk factors that could affect our future performance and cause results to differ from the forward-looking statements in this report include, but are not limited to:

• continued volatility of steel, iron ore and scrap metal market prices, which directly and indirectly impact the prices of the products that we sell to our customers;

• continued volatility of steel, scrap metal and iron ore market prices, which directly and indirectly impact the prices of the products that we sell to our customers;

• uncertainties associated with the highly competitive and cyclical steel industry and our reliance on the demand for steel from the automotive industry;

• potential weaknesses and uncertainties in global economic conditions, excess global steelmaking capacity, oversupply of iron ore, prevalence of steel imports and reduced market demand;

• potential weaknesses and uncertainties in global economic conditions, excess global steelmaking capacity and production, prevalence of steel imports, reduced market demand and oversupply of iron ore;

• severe financial hardship, bankruptcy, temporary or permanent shutdowns or operational challenges of one or more of our major customers, key suppliers or contractors, which, among other adverse effects, could disrupt our operations or lead to reduced demand for our products, increased difficulty collecting receivables, and customers and/or suppliers asserting force majeure or other reasons for not performing their contractual obligations to us;

• risks related to U.S.

government actions with respect to Section 232, the USMCA and/or other trade agreements, tariffs, treaties or policies, as well as the uncertainty of obtaining and maintaining effective antidumping and countervailing duty orders to counteract the harmful effects of unfairly traded imports;

• impacts of existing and increasing governmental regulation, including potential environmental regulations relating to climate change and carbon emissions, and related costs and liabilities, including failure to receive or maintain required operating and environmental permits, approvals, modifications or other authorizations of, or from, any governmental or regulatory authority and costs related to implementing improvements to ensure compliance with regulatory changes, including potential financial assurance requirements, and reclamation and remediation obligations;

government actions and other countries' reactions with respect to Section 232, the United States-Mexico-Canada Agreement and/or other trade agreements, tariffs, treaties or policies, as well as the uncertainty of obtaining and maintaining effective antidumping and countervailing duty orders to counteract the harmful effects of unfairly traded imports;

• impacts of existing and changing governmental regulation, including actual and potential environmental regulations relating to climate change and carbon emissions, and related costs and liabilities, including failure to receive or maintain required operating and environmental permits, approvals, modifications or other authorizations of, or from, any governmental or regulatory authority and costs related to implementing improvements to ensure compliance with regulatory changes, including potential financial assurance requirements, and reclamation and remediation obligations;

• potential impacts to the environment or exposure to hazardous substances resulting from our operations;

2 unchanged sentences

• adverse changes in credit ratings, interest rates, foreign currency rates and tax laws;

• challenges to successfully implementing our business strategy to achieve operating results in line with our guidance;

• the outcome of, and costs incurred in connection with, lawsuits, claims, arbitrations or governmental proceedings relating to commercial and business disputes, antitrust claims, environmental matters, government investigations, occupational or personal injury claims, property-related matters, labor and employment matters, or suits involving legacy operations and other matters;

4 unchanged sentences

• uncertainties associated with natural or human-caused disasters, adverse weather conditions, unanticipated geological conditions, critical equipment failures, infectious disease outbreaks, tailings dam failures and other unexpected events;

• cybersecurity incidents relating to, disruptions in, or failures of, information technology systems that are managed by us or third parties that host or have access to our data or systems, including the loss, theft or corruption of sensitive or essential business or personal information and the inability to access or control systems;

• liabilities and costs arising in connection with any business decisions to temporarily or indefinitely idle or permanently close an operating facility or mine, which could adversely impact the carrying value of associated assets and give rise to impairment charges or closure and reclamation obligations, as well as uncertainties associated with restarting any previously idled operating facility or mine;

• cybersecurity incidents relating to, disruptions in, or failures of, information technology systems that are managed by us or third parties that host or have access to our data or systems, including the loss, theft or corruption of our or third parties' sensitive or essential business or personal information and the inability to access or control systems;

• liabilities and costs arising in connection with any business decisions to temporarily or indefinitely idle or permanently close an operating facility or mine, which could adversely impact the carrying value of associated assets, trigger contractual liabilities or termination costs, and give rise to impairment charges or closure and reclamation obligations, as well as uncertainties associated with restarting any previously idled operating facility or mine;

• our ability to realize the anticipated synergies or other expected benefits of the Stelco Acquisition, as well as the impact of additional liabilities and obligations incurred in connection with the Stelco Acquisition;

• our level of self-insurance and our ability to obtain sufficient third-party insurance to adequately cover potential adverse events and business risks;

1 unchanged sentence

• challenges to maintaining our social license to operate with our stakeholders, including the impacts of our operations on local communities, reputational impacts of operating in a carbon-intensive industry that produces GHG emissions, and our ability to foster a consistent operational and safety track record;

• our actual economic mineral reserves or reductions in current mineral reserve estimates, and any title defect or loss of any lease, license, easement or other possessory interest for any mining property;

• our actual economic mineral reserves or reductions in current mineral reserve estimates, and any title defect or loss of any lease, license, option, easement or other possessory interest for any mining property;

• our ability to maintain satisfactory labor relations with unions and employees;

1 unchanged sentence

• uncertain availability or cost of skilled workers to fill critical operational positions and potential labor shortages caused by experienced employee attrition or otherwise, as well as our ability to attract, hire, develop and retain key personnel;

• the amount and timing of any repurchases of our common shares;

• potential significant deficiencies or material weaknesses in our internal control over financial reporting.

• the risk that the Stelco Acquisition may be less accretive than expected, or may be dilutive, to our earnings per share, which may negatively affect the market price of our common shares;

• the risk that adverse reactions or changes to business or regulatory relationships may result from the Stelco Acquisition;

• the risk that the financing transactions undertaken in connection with the Stelco Acquisition may have a negative impact on the combined company's credit profile, financial condition or financial flexibility;

• the possibility that the anticipated benefits of the Stelco Acquisition are not realized to the same extent as projected and that the integration of the acquired business into our existing business, including uncertainties associated with maintaining relationships with customers, vendors and employees, is not as successful as expected;

• the risk that future synergies from the Stelco Acquisition may not be realized or may take longer than expected to achieve;

• the possibility that the business and management strategies currently in place or implemented in the future for the maintenance, expansion and growth of the combined company's operations may not be as successful as anticipated;

• the risk associated with the retention and hiring of key personnel, including those of Stelco;

• the risk that the Stelco Acquisition could have adverse effects on the market price of our common shares;

• the risk of any unforeseen liabilities and future capital expenditures related to the Stelco Acquisition.

For additional factors affecting our business, refer to Part II – Item 1A.

7 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 2. Management’s Discussion and Analysis