Commercial Metals 2026 Q1 Earnings Strong Turnaround as Net Income Surges 200%

Commercial Metals (CMC) delivered a dramatic turnaround in Q1 2026, reporting net income of $177.28 million—a 200.9% improvement from a $175.72 million loss in the prior-year period. The company also exceeded revenue expectations and raised guidance for long-term margin expansion, though it warned of near-term seasonal challenges.

Revenue

Total revenue surged 11.0% to $2.12 billion in Q1 2026, driven by robust performance across its core segments. Steel products led the charge with $918.41 million in revenue, while raw materials and downstream products contributed $370.10 million and $602.72 million, respectively. Construction products and ground stabilization solutions added $85.97 million and $72.59 million, with other segments rounding out the total at $70.52 million. The diversified revenue streams underscore CMC’s strategic pivot toward higher-margin operations.

Earnings/Net Income

The company returned to profitability with EPS of $1.60, reversing a $1.54 loss in 2025 Q1. This 200.9% net income swing reflects CMC’s successful cost optimization and margin expansion, with CEO Peter Matt highlighting a 50% year-over-year increase in consolidated core EBITDA to $316.9 million.

Post-Earnings Price Action Review

The stock edged down 1.30% on the latest trading day but gained 5.61% month-to-date. A post-earnings strategy of buying shares after a revenue drop quarter-over-quarter yielded moderate returns, with a CAGR of 12.91% but underperformance relative to the market by 64.95 percentage points. The strategy’s Sharpe ratio of 0.37 and zero maximum drawdown suggest it appeals to risk-averse investors.

CEO Commentary

Peter Matt emphasized Q1 2026 as one of CMC’s best performances, crediting the TAG program, scrap optimization, and precast acquisitions for a 14.9% margin expansion. Strategic priorities include scaling TAG to deliver $150 million in EBITDA benefits and leveraging newly acquired precast businesses for growth.

Guidance

CMC anticipates Q2 2026 core EBITDA to decline modestly due to seasonality but expects offsetting gains from precast acquisitions. North America Steel Group adjusted EBITDA is projected to dip due to maintenance outages, while Construction Solutions Group results should improve. Europe Steel Group remains breakeven, with margin growth anticipated post-CBAM implementation.

Additional News

CMC’s strategic acquisitions of CP&P and Foley in December 2025 positioned it as a leading precast concrete provider, with $2.5 billion in capital deployed. These moves are expected to generate $165–175 million in EBITDA for fiscal 2026. The company also announced a $0.18 quarterly dividend, reflecting confidence in its cash flow generation. Analysts upgraded CMC to “overweight” and raised price targets, citing its margin resilience and growth platform in construction solutions.