C. Acquisitions and Divestitures
Saudi Arabia Joint Venture
On July 1, 2025, Alcoa completed the sale of its 25.1% ownership interest in the Saudi Arabia joint venture, comprised of the Ma’aden Bauxite and Alumina Company (MBAC) and the Ma’aden Aluminium Company (MAC), to Saudi Arabian Mining Company (Ma’aden) in exchange for total consideration of $1,350, comprised of 85,977,547 shares of Ma’aden (valued at SAR 52.35 per share at closing, or $1,200) and $150 in cash (related to taxes and transaction costs).
The shares of Ma’aden are presented as Noncurrent marketable securities on the Consolidated Balance Sheet, as they are subject to transfer and sale restrictions, including a restriction requiring Alcoa to hold the shares for a minimum of three years, with one-third of the shares becoming transferable after each of the third, fourth, and fifth anniversaries of the closing of the transaction (the Holding Period). During the Holding Period, Alcoa is permitted, under certain conditions, to hedge and borrow against its Ma’aden shares. Under certain circumstances, such minimum Holding Period may be reduced.
Subsequent to July 1, 2025, the fair value of the shares is based on the unadjusted quoted price on the Saudi Exchange (Tadawul). For the quarter ended March 31, 2026, the Company recorded a mark-to-market gain of $88 in Other income, net (see Note O) on the Statement of Consolidated Operations related to changes in fair value of the shares. At March 31, 2026 and December 31, 2025, the shares of Ma’aden were valued at SAR 64.80 per share, or $1,485, and SAR 60.95 per share, or $1,397, respectively.
San Ciprián Joint Venture
On March 31, 2025, Alcoa and Trento Equity Holdings, S.L.U. (Trento EQT), formerly known as IGNIS Equity Holdings, SL, entered into a joint venture agreement (the Agreement) with respect to the San Ciprián operations, whereby Alcoa holds a 75% ownership interest and continues as the managing operator and Trento EQT holds the remaining 25% interest.
Under the terms of the Agreement, Alcoa and Trento EQT contributed $81 (€75) and $27 (€25), respectively, to form the joint venture. The formation of the joint venture was accounted for as an equity transaction where Trento EQT’s noncontrolling interest was reflected as a decrease to Additional capital on the accompanying Consolidated Balance Sheet. Noncontrolling interest was measured at 25 percent of the net assets included in the joint venture at formation ($103), which included the initial contributions described above ($108). Additionally, certain amounts related to foreign currency translation adjustments previously included within Accumulated other comprehensive loss ($31) were reclassified to Additional capital.
The Agreement also provides Trento EQT a put option, pursuant to which Trento EQT may require the Company to purchase its 25% interest at the then fair market value upon certain change in control provisions. Noncontrolling interest is classified within Mezzanine equity on the Consolidated Balance Sheet, as Trento EQT’s redemption of the put option is not solely within the Company’s control. Subsequent to the formation of the joint venture, changes in the carrying value of Noncontrolling interest on the Consolidated Balance Sheet were solely comprised of the comprehensive loss attributable to Trento EQT’s 25% interest, as a change in control of the San Ciprián operations was not deemed probable.
H. Receivables
A wholly-owned special purpose entity (SPE) of the Company has an agreement with a financial institution to transfer up to $175 of certain customer receivables without recourse on a revolving basis. The agreement was entered into in 2023, most recently amended in November 2025, and matures on November 13, 2026. Company subsidiaries sell customer receivables to the SPE, which then transfers the receivables to the financial institution. The Company does not maintain effective control over the transferred receivables and accounts for the transfers as sales of receivables.
Alcoa Corporation guarantees the performance obligations of the Company subsidiaries, and unsold customer receivables are pledged as collateral to secure the sold receivables. The SPE held unsold customer receivables of $616 and $486 pledged as collateral against the sold receivables as of March 31, 2026 and December 31, 2025, respectively.
The Company continues to service the customer receivables and as customer payments are collected by the Company, the SPE transfers additional receivables to the financial institution rather than remitting cash.
In the first quarter of 2026, the Company sold gross customer receivables of $211 and reinvested collections of $211 from previously sold receivables. In the first quarter of 2025, the Company sold gross customer receivables of $199 and reinvested collections of $199 from previously sold receivables. There were no cash remittances to or from the financial institution in either period.
Cash collections from previously sold receivables yet to be reinvested of $42 and $69 were included in Accounts payable, trade on the Consolidated Balance Sheet as of March 31, 2026 and December 31, 2025, respectively. Cash received from sold receivables under the agreement are presented within operating activities in the Statement of Consolidated Cash Flows.
I. Inventories
|
|
|
|
|
|
|
|
|
|
|
March 31, 2026 |
|
|
December 31, 2025 |
|
Finished goods |
|
$ |
442 |
|
|
$ |
394 |
|
Work-in-process |
|
|
332 |
|
|
|
282 |
|
Bauxite and alumina |
|
|
604 |
|
|
|
580 |
|
Purchased raw materials |
|
|
608 |
|
|
|
633 |
|
Operating supplies |
|
|
311 |
|
|
|
288 |
|
|
|
$ |
2,297 |
|
|
$ |
2,177 |
|
J. Debt
Short-term Borrowings
Inventory Repurchase Agreements
The Company periodically enters into inventory repurchase agreements whereby the Company sells aluminum to a third party and agrees to subsequently repurchase substantially similar inventory. Upon shipment of inventory, the Company does not record the sale and reflects cash received in Short-term borrowings within Other current liabilities on the Consolidated Balance Sheet. The cash received and subsequently paid under these agreements is included in Cash provided from financing activities on the Statement of Consolidated Cash Flows.
During the first quarter of 2026, the Company recorded borrowings of $104 and repurchased $4 of inventory related to these agreements. During the first quarter of 2025, the Company recorded borrowings of $44 and repurchased $49 of inventory related to these agreements.
The net borrowings from inventory repurchase agreements was $109 and $9 as of March 31, 2026 and December 31, 2025, respectively. The associated inventory sold and not yet repurchased was reflected in Prepaid expenses and other current assets on the accompanying Consolidated Balance Sheet.
144A Debt
Redemption
On April 14, 2026, the Company announced that its wholly-owned subsidiary Alcoa Nederland Holding B.V. (ANHBV), issued a notice to redeem the remaining $219 aggregate principal amount of its outstanding 6.125% notes due in 2028. The notes will be redeemed on May 15, 2026 at a price equal to 100 percent of the principal amount, plus accrued and unpaid interest, using cash on hand.
N. Contingencies
Environmental Matters
Alcoa Corporation participates in environmental assessments and cleanups at several locations. These include currently or previously owned or operated facilities and adjoining properties, and waste sites, including Superfund (Comprehensive Environmental Response, Compensation and Liability Act (CERCLA)) sites.
Alcoa Corporation’s environmental remediation reserve balance reflects the most probable costs to remediate identified environmental conditions for which costs can be reasonably estimated. The following table details the changes in the carrying value of recorded environmental remediation reserves:
|
|
|
|
|
Balance at December 31, 2024 |
|
$ |
220 |
|
Liabilities incurred |
|
85 |
|
Cash payments |
|
|
(25 |
) |
Reversals of previously recorded liabilities |
|
|
(2 |
) |
Foreign currency translation and other |
|
4 |
|
Balance at December 31, 2025 |
|
|
282 |
|
Liabilities incurred |
|
|
4 |
|
Cash payments |
|
|
(6 |
) |
Foreign currency translation and other |
|
|
3 |
|
Balance at March 31, 2026 |
|
$ |
283 |
|
At March 31, 2026 and December 31, 2025, the current portion of the remediation reserve balance was $80 and $76, respectively.
During the first quarter of 2026, the Company incurred liabilities of $4 for increases in estimated scope and costs associated with ongoing remediation work at various sites which was recorded in Cost of goods sold.
Payments related to remediation expenses applied against the reserve were $6 and $8 in the first quarters of 2026 and 2025, respectively. These amounts include mandated expenditures as well as those not required by any regulatory authority or third party.
The estimated timing of cash outflows from the environmental remediation reserve at March 31, 2026 was as follows:
|
|
|
|
2026 (excluding the three months ended March 31, 2026) |
$ |
76 |
|
2027 – 2031 |
|
134 |
|
Thereafter |
|
73 |
|
Total |
$ |
283 |
|
Reserve balances at March 31, 2026 and December 31, 2025, associated with significant sites with active remediation underway or for future remediation were $208 and $202, respectively. In management’s judgment, the Company’s reserves are sufficient to satisfy the provisions of the respective action plans. Upon changes in facts or circumstances, a change to the reserve may be required. The Company’s significant sites include:
Huntly, Australia—The reserve associated with enforceable undertakings with the Department of Climate Change, Energy, the Environment and Water (DCCEEW) relates to mining activities for the period from 2019 to 2025 at the Huntly mine. Under the terms of the enforceable undertakings, Alcoa is required to provide $38 (A$55) for investments in environmental offsets to counterbalance impacts caused by mine development and the funding of various conservation programs. Associated cash outlays are expected in 2026.
Kwinana, Australia—The reserve associated with the 2025 closure of the Kwinana refinery is for subsurface remediation, investigation of potential site contamination, transportation of refinery waste, and ground water monitoring. Remediation work is expected in 2026. The final remediation plan is currently being developed, which may result in a change to the existing reserve.
Suriname—The reserve associated with the 2017 closure of the Suralco refinery and bauxite mine is for treatment and disposal of refinery waste and soil remediation. The work began in 2017 and is expected to be completed by the end of 2030.
Massena, New York—The reserve associated with the 2015 closure of the Massena East smelter by the Company’s subsidiary, Reynolds Metals Company, is for subsurface soil remediation to be performed after demolition of the structures. Remediation work commenced in 2021 and will take up to eight years to complete.
Point Comfort, Texas—The reserve associated with the 2019 closure of the Point Comfort alumina refinery is for disposal of industrial wastes contained at the site, subsurface remediation, and post-closure monitoring and maintenance. The final remediation plan is currently being developed, which may result in a change to the existing reserve.
Addy, Washington—The reserve associated with the 2022 closure of the Addy magnesium smelter facility is for site-wide remediation and investigation and post-closure monitoring and maintenance. Remediation work is not expected to begin until 2027 and will take three to five years to complete. The final remediation plan is currently being developed, which may result in a change to the existing reserve.
Ferndale, Washington—The reserve associated with the 2023 closure of the Intalco aluminum smelter in Ferndale, Washington is for subsurface remediation and post-closure maintenance and monitoring. The final remediation plan is under review.
Other Sites—The Company is in the process of decommissioning various other plants and remediating sites in several countries for potential redevelopment or to return the land to a natural state. In aggregate, there are remediation projects at 28 other sites that are planned or underway. These activities will be completed at various times in the future over the next two to four years, after which ongoing monitoring and other activities may be required. At March 31, 2026 and December 31, 2025, the reserve balance associated with these activities was $75 and $80, respectively.
Tax
Brazil (AWAB)—In 2012, Alcoa World Alumina Brasil Ltda. (AWAB) requested monetization of value added tax credits of $136 (R$273) related to fixed assets and export sales associated with the Juruti bauxite mine and Alumar refinery expansion for tax years 2009 through 2011. In 2013, the Brazilian Federal Revenue Office (RFB) disallowed credits of $110 (R$220) asserting that certain credits should have been claimed by the Alumar consortium rather than AWAB and raising challenges related to apportionment methods, use of credits, and documentation. AWAB received $41 (R$82) of cash in 2013 related to the disallowed amounts, and the remainder related to disallowed amounts was offset against other federal taxes.
Separately, during 2022 through 2024, the RFB completed inspections of credits claimed for 2012 through 2014, allowing certain credits which were similar to those disallowed for 2009 through 2011. The decisions on the 2012 through 2014 credits provide support for management’s view that there is no basis for the disallowance of the credits for tax years 2009 through 2011. Additionally, in connection with these inspections, the RFB disallowed credits of $19 (R$92) related to the 2012 through 2014 tax years. AWAB continues to dispute the credits disallowed through an administrative process and may pursue judicial remedies if necessary.
The Company is unable to reasonably predict the outcome for these matters. The estimated range of reasonably possible loss is $0 to $59 (R$312).
General
In addition to the matters discussed above, various other lawsuits, claims, and proceedings have been or may be instituted or asserted against Alcoa Corporation, including those pertaining to environmental, safety and health, commercial, tax, product liability, intellectual property infringement, governance, employment, and employee and retiree benefit matters, and other actions and claims arising out of the normal course of business. While the amounts claimed in these other matters may be substantial, the ultimate liability is not readily determinable because of the considerable uncertainties that exist. Accordingly, it is possible that the Company’s liquidity or results of operations in a particular period could be materially affected by one or more of these other matters. However, based on facts currently available, management believes that the disposition of these other matters that are pending or asserted will not have a material adverse effect, individually or in the aggregate, on the financial position of the Company.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
(dollars in millions, except per-share amounts, average realized prices, and average cost amounts; metric tons in thousands (kmt); dry metric tons in millions (mdmt))
Business Update
During the first quarter of 2026, Alcoa continued to maintain operational performance across its operations while navigating disruptions related to the Middle East conflict (see below) and Cyclone Narelle, which impacted Western Australia at the end of the quarter. The Company remained focused on disciplined execution and its strategic priorities, maintaining continuity of operations and customer supply despite these challenges. In addition, the Company progressed the restart of the San Ciprián (Spain) smelter during the first quarter of 2026, and on April 7, 2026, safely completed the smelter restart.
The global economy has been impacted by the conflict in the Middle East, which has included curtailments of more than 2,500 kmt of annual smelting capacity and nearly 2,000 kmt of refining capacity in the region. Additionally, the disruption of transit through the Strait of Hormuz has restricted the inflow of raw materials and caused vessel constraints globally. In the first quarter of 2026, vessel constraints, along with vessel loading issues caused by Cyclone Narelle, delayed alumina shipments from the Australia refineries into April 2026. Subsequent to March 31, 2026, the Company continues to support its customers in managing the logistics for certain alumina shipments.
Average alumina prices decreased by 4 percent and average aluminum prices increased 12 percent in the first quarter of 2026 compared with the fourth quarter of 2025. In addition, the average Midwest premium increased 21 percent sequentially. Alumina prices continued to be impacted by refinery expansions primarily in China and Indonesia, while the aluminum price increase was driven by historically low inventory levels and supply disruptions, which included impacts related to the Middle East conflict. The conflict in the Middle East also caused increases in energy costs and freight costs; Alcoa has limited its exposure to volatility in spot energy through long-term natural gas and electricity contracts and financial hedges.
The Company continued to advance mine approvals for its next major mine regions (Myara North and Holyoake) and the rolling five-year mine plan (2023-2027) referred to the Western Australia Environmental Protection Authority (WA EPA) in 2023 by a third party. During the first quarter of 2026, Alcoa submitted to the WA EPA responses to all comments received during a 12-week public comment period for the Company’s mining activities in Australia. The Company is committed to continuing to work collaboratively with stakeholders to achieve Ministerial decisions by the end of 2026, and anticipates mining in new major mine regions will commence no earlier than 2029. Until then, the Company expects bauxite quality will remain similar to recent grades.
On April 14, 2026, the Company announced that its wholly-owned subsidiary, Alcoa Nederland Holding B.V. (ANHBV), issued a notice to redeem the remaining $219 aggregate principal amount of its outstanding 6.125% notes due in 2028 (the 2028 Notes). The notes will be redeemed on May 15, 2026 at a price equal to 100 percent of the principal amount, plus accrued and unpaid interest, using cash on hand.
See the below sections for additional details on the above-described actions.
Results of Operations
The discussion that follows includes a comparison of our results of operations and liquidity and capital resources for the quarterly and year-to-date periods outlined in the table below.
Selected Financial Data:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter ended |
|
|
Three months ended |
|
|
|
Sequential |
|
|
Year-to-date |
|
Statement of Operations |
|
March 31,
2026 |
|
|
December 31,
2025 |
|
|
March 31,
2026 |
|
|
March 31,
2025 |
|
Sales |
|
$ |
3,193 |
|
|
$ |
3,449 |
|
|
$ |
3,193 |
|
|
$ |
3,369 |
|
Cost of goods sold (exclusive of expenses below) |
|
|
2,512 |
|
|
|
2,873 |
|
|
|
2,512 |
|
|
|
2,438 |
|
Selling, general administrative, and other expenses |
|
|
83 |
|
|
|
68 |
|
|
|
83 |
|
|
|
71 |
|
Research and development expenses |
|
|
10 |
|
|
|
(11 |
) |
|
|
10 |
|
|
|
12 |
|
Provision for depreciation, depletion, and amortization |
|
|
162 |
|
|
|
162 |
|
|
|
162 |
|
|
|
148 |
|
Impairment of goodwill |
|
|
— |
|
|
|
144 |
|
|
|
— |
|
|
|
— |
|
Restructuring and other charges, net |
|
|
18 |
|
|
|
14 |
|
|
|
18 |
|
|
|
5 |
|
Interest expense |
|
|
35 |
|
|
|
16 |
|
|
|
35 |
|
|
|
53 |
|
Other (income) expenses, net |
|
|
(126 |
) |
|
|
115 |
|
|
|
(126 |
) |
|
|
(26 |
) |
Total costs and expenses |
|
|
2,694 |
|
|
|
3,381 |
|
|
|
2,694 |
|
|
|
2,701 |
|
Income before income taxes |
|
|
499 |
|
|
|
68 |
|
|
|
499 |
|
|
|
668 |
|
Provision for (benefit from) income taxes |
|
|
82 |
|
|
|
(134 |
) |
|
|
82 |
|
|
|
120 |
|
Net income |
|
|
417 |
|
|
|
202 |
|
|
|
417 |
|
|
|
548 |
|
Less: Net loss attributable to noncontrolling interest |
|
|
(8 |
) |
|
|
(11 |
) |
|
|
(8 |
) |
|
|
— |
|
Net income attributable to Alcoa Corporation |
|
$ |
425 |
|
|
$ |
213 |
|
|
$ |
425 |
|
|
$ |
548 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter ended |
|
|
Three months ended |
|
Selected Financial Metrics |
|
March 31,
2026 |
|
|
December 31,
2025 |
|
|
March 31,
2026 |
|
|
March 31,
2025 |
|
Diluted income per share attributable to Alcoa
Corporation common shareholders |
|
$ |
1.60 |
|
|
$ |
0.80 |
|
|
$ |
1.60 |
|
|
$ |
2.07 |
|
Third-party shipments of alumina (kmt) |
|
|
1,611 |
|
|
|
2,324 |
|
|
|
1,611 |
|
|
|
2,105 |
|
Third-party shipments of aluminum (kmt) |
|
|
613 |
|
|
|
667 |
|
|
|
613 |
|
|
|
609 |
|
Average realized price per metric ton of alumina |
|
$ |
324 |
|
|
$ |
341 |
|
|
$ |
324 |
|
|
$ |
575 |
|
Average realized price per metric ton of aluminum |
|
$ |
4,209 |
|
|
$ |
3,749 |
|
|
$ |
4,209 |
|
|
$ |
3,213 |
|
Average Alumina Price Index (API)(1) |
|
$ |
309 |
|
|
$ |
323 |
|
|
$ |
309 |
|
|
$ |
612 |
|
Average London Metal Exchange (LME) 15-day lag(2) |
|
$ |
3,120 |
|
|
$ |
2,790 |
|
|
$ |
3,120 |
|
|
$ |
2,607 |
|
(1)API (Alumina Price Index) is a pricing mechanism that is calculated by the Company based on the weighted average of a prior month’s daily spot prices published by the following three indices: CRU Metallurgical Grade Alumina Price; Platts Metals Daily Alumina PAX Price; and FastMarkets Metal Bulletin Non-Ferrous Metals Alumina Index.
(2)LME (London Metal Exchange) is a globally recognized exchange for commodity trading, including aluminum. The LME pricing component represents the underlying base metal component, based on quoted prices for aluminum on the exchange.
Overview
Sequential period comparison
Net income attributable to Alcoa Corporation increased $212 primarily a result of:
•Favorable mark-to-market results on the Saudi Arabian Mining Company (Ma’aden) shares
•Absence of impairment of goodwill associated with a 1994 acquisition in the Alumina segment
•Net favorable currency impacts
Partially offset by:
•Higher taxes and absence of reversal of valuation allowances on related deferred tax assets
•Absence of carbon dioxide compensation in Spain and Norway
•Lower seasonal shipments of aluminum and alumina
•Lower volumes and price from bauxite offtake and supply agreements
Year-to-date comparison
Net income attributable to Alcoa Corporation decreased $123 primarily a result of:
•Tariffs on U.S. imports of aluminum from Canada
•Higher costs associated with the restart of the San Ciprián smelter
•Net unfavorable currency impacts
•Lower volumes and price from bauxite offtake and supply agreements
Partially offset by:
•Favorable mark-to-market results on the Ma’aden shares
Sales
Sequential period comparison
Sales decreased $256 primarily as a result of:
•Lower shipments of alumina and aluminum primarily related to seasonally lower first quarter shipments
•Lower volumes and price from bauxite offtake and supply agreements
•Lower average realized price of alumina
•Unfavorable currency impacts
•Unfavorable impacts from certain energy contracts linked to metal pricing
Partially offset by:
•Higher average realized price of aluminum
Year-to-date comparison
Sales decreased $176 primarily as a result of:
•Lower average realized price of alumina
•Lower shipments of alumina primarily related to externally sourced alumina to satisfy certain customer commitments
•Lower volumes and price from bauxite offtake and supply agreements
Partially offset by:
•Higher average realized price of aluminum
•Higher shipments of aluminum
•Higher pricing at the Brazil hydro-electric facilities
Cost of goods sold
Sequential period comparison
Cost of goods sold as a percentage of sales decreased 5 percent primarily as a result of:
•Absence of a charge to increase environmental reserves related to investments in environmental offsets at the Huntly (Australia) mine
Partially offset by:
•Lower seasonal shipments of aluminum and alumina
•Absence of recognition of carbon dioxide compensation in Spain
•Unfavorable currency impacts
•Lower volumes and price from bauxite offtake and supply agreements
Year-to-date comparison
Cost of goods sold as a percentage of sales increased 6 percent primarily as a result of:
•Tariffs on U.S. imports of aluminum from Canada
•Higher costs associated with the restart of the San Ciprián smelter
•Unfavorable currency impacts
•Lower volumes and price from bauxite offtake and supply agreements
Partially offset by:
•Higher pricing at the Brazil hydro-electric facilities
•Lower energy costs in the Aluminum segment
Selling, general administrative, and other expenses
Sequential period comparison
Selling, general administrative, and other expenses increased $15 primarily as a result of higher labor costs, partially offset by decreased fees for professional services.
Year-to-date comparison
Selling, general administrative, and other expenses increased $12 primarily as a result of unfavorable currency impacts and higher labor costs.
Provision for depreciation, depletion, and amortization
The Provision for depreciation, depletion, and amortization did not fluctuate in comparison to the fourth quarter of 2025 and increased $14 in comparison to the first quarter of 2025, primarily as a result of:
•Unfavorable currency impacts
•Higher depreciation in Australia for asset retirement obligations
•Higher amortization for Australian mine development costs
•Write off of assets for projects no longer being pursued
Partially offset by:
•Lower depreciation expense related to the Kwinana (Australia) refinery closure
Interest expense
Sequential period comparison
Interest expense increased $19 primarily as a result of:
•Absence of correction to capitalized interest recognized in the fourth quarter of 2025
Year-to-date comparison
Interest expense decreased $18 primarily as a result of:
•Absence of interest and debt settlement expenses for $609 of 5.500% Senior Notes due 2027 (the 2027 Notes) and $281 of 2028 Notes extinguished in March 2025
Partially offset by:
•Interest on $500 6.125% Senior Notes due 2030 (the 2030 Notes) and $500 6.375% Senior Notes due 2032 (the 2032 Notes) issued in March 2025
Other (income) expenses, net
Sequential period comparison
Other (income) expenses, net was ($126) in the first quarter of 2026 compared with $115 in the fourth quarter of 2025. The favorable change of $241 was primarily a result of:
•Favorable mark-to-market results on the Ma’aden shares
•Favorable currency revaluation impacts primarily due to gains in the current quarter from the U.S. dollar weakening against the Brazilian real and the absence of losses recognized in the fourth quarter of 2025 when the U.S. dollar strengthened against the Brazilian real
•Settlement of insurance claim related to property damage incurred in 2024
•Favorable mark-to-market results on derivative instruments primarily due to favorable power price changes under a firming contract, partially offset by changes in the euro foreign exchange rate
Year-to-date comparison
Other (income) expenses, net was ($126) in the first quarter of 2026 compared with ($26) in the first quarter of 2025. The favorable change of $100 was primarily a result of:
•Favorable mark-to-market results on Ma’aden shares subsequent to July 1, 2025
•Settlement of insurance claim related to property damage incurred in 2024
•Favorable currency revaluation impacts primarily due to gains in the current year from the U.S. dollar weakening against the Brazilian real, partially offset by absence of gains recognized in the prior year when the U.S. dollar weakened against the Brazilian real
Partially offset by:
•Unfavorable mark-to-market results on derivative instruments primarily due to changes in the euro foreign exchange rate and lower power prices in the current year, partially offset by favorable power price changes under a firming contract executed in June 2025
Restructuring and other charges, net
Sequential period comparison
In the first quarter of 2026, Restructuring and other charges, net of $18 primarily related to:
•$18 for take-or-pay power contract costs at previously closed sites
In the fourth quarter of 2025, Restructuring and other charges, net of $14 primarily related to:
•$13 for take-or-pay power contract costs at previously closed sites
Year-to-date comparison
In the first quarter of 2026, Restructuring and other charges, net of $18 primarily related to:
•$18 for take-or-pay power contract costs at previously closed sites
In the first quarter of 2025, Restructuring and other charges, net of $5 primarily related to:
•$3 for certain employee obligations related to the February 2023 updated viability agreement for the San Ciprián aluminum smelter
•$2 for take-or-pay power contract costs at a previously closed site
Provision for (benefit from) income taxes
Sequential period comparison
The Provision for income taxes in the first quarter of 2026 was $82 on income before taxes of $499 or 16.4 percent. In comparison, the fourth quarter of 2025 Benefit from income taxes was ($134) on income before taxes of $68 or (197.1 percent).
The increase in tax expense of $216 is primarily due to the absence of a net discrete benefit of $127 related to net benefits recorded at Alcoa World Alumina Brasil Ltda. and ANHBV in the fourth quarter of 2025, primarily for the reversal of valuation allowances on related deferred tax assets. Additionally, tax expense increased as a result of the impact of the annualized effective tax rate when applied to current period earnings, higher income in jurisdictions where taxes are paid, and a valuation allowance of $22 recorded against certain deferred tax assets of a wholly-owned subsidiary in Canada during the first quarter of 2026.
Year-to-date comparison
The Provision for income taxes in the first quarter of 2026 was $82 on income before taxes of $499 or 16.4 percent. In comparison, the first quarter of 2025 Provision for income taxes was $120 on income before taxes of $668 or 18.0 percent.
The decrease in tax expense of $38 is primarily attributable to an overall reduction in income in jurisdictions where taxes are paid, partially offset by a valuation allowance of $22 recorded against certain deferred tax assets of a wholly-owned subsidiary in Canada during the first quarter of 2026.
Noncontrolling interest
On March 31, 2025, Alcoa and Trento Equity Holdings, S.L.U. (Trento EQT) entered into a joint venture agreement with respect to the San Ciprián operations. Alcoa holds a 75% ownership interest and continues as managing operator, while Trento EQT holds the remaining 25% interest. Alcoa began recognizing earnings attributable to Trento EQT’s ownership interest within Noncontrolling interest in the second quarter of 2025.
Net loss attributable to noncontrolling interest decreased $3 in comparison to the fourth quarter of 2025 and increased $8 in comparison to the first quarter of 2025. The sequential decrease is primarily a result of higher average realized price of aluminum and favorable currency revaluation impacts. The year-to-date increase is a result of the losses incurred at the San Ciprián smelter and refinery in 2026.
Segment Information
Alcoa Corporation is a producer of bauxite, alumina, and aluminum products. The Company has two operating and reportable segments: (i) Alumina and (ii) Aluminum. The primary measure of performance is Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization) for each segment.
The Company calculates Segment Adjusted EBITDA as Total sales (third-party and intersegment) minus the following items: Cost of goods sold; Selling, general administrative, and other expenses; and Research and development expenses. Alcoa Corporation’s Segment Adjusted EBITDA may not be comparable to similarly titled measures of other companies. The Chief Operating Decision Maker regularly reviews Segment Adjusted EBITDA to assess performance and allocate resources.
Alumina
Business Update. The average API of $309 per metric ton decreased 4 percent compared to the prior quarter. Compared to the first quarter of 2025, the average API decreased 50 percent year-over-year.
In the first quarter of 2026, vessel constraints related to the Middle East conflict, along with vessel loading issues caused by Cyclone Narelle, delayed alumina shipments from the Australia refineries into April 2026. Subsequent to March 31, 2026, the Company continues to support its customers in managing the logistics for certain alumina shipments.
Capacity. The Alumina segment had a base capacity of 11,653 kmt with 1,014 kmt of curtailed refining capacity. There was no change in curtailed capacity during the quarter.
In the table below, total alumina shipments include metric tons that were not produced by the Alumina segment. Such alumina was purchased to satisfy certain customer commitments. The Alumina segment bears the risk of loss of the purchased alumina until control of the product has been transferred to this segment’s customers.
Adjusted operating costs include all production related costs for alumina produced and shipped: raw materials consumed; conversion costs, such as labor, materials, and utilities; and plant administrative expenses. Other segment items include costs associated with trading activity, the purchase of bauxite from offtake or other supply agreements, and commercial shipping services; other direct and non-production related charges; Selling, general administrative, and other expenses; and Research and development expenses.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter ended |
|
|
Three months ended |
|
|
|
March 31,
2026 |
|
|
December 31,
2025 |
|
|
March 31,
2026 |
|
|
March 31,
2025 |
|
Bauxite production (mdmt) |
|
|
9.1 |
|
|
|
9.4 |
|
|
|
9.1 |
|
|
|
9.5 |
|
Third-party bauxite shipments (mdmt) |
|
|
2.1 |
|
|
|
2.4 |
|
|
|
2.1 |
|
|
|
3.0 |
|
Alumina production (kmt) |
|
|
2,355 |
|
|
|
2,481 |
|
|
|
2,355 |
|
|
|
2,355 |
|
Third-party alumina shipments (kmt) |
|
|
1,611 |
|
|
|
2,324 |
|
|
|
1,611 |
|
|
|
2,105 |
|
Intersegment alumina shipments (kmt) |
|
|
1,186 |
|
|
|
1,177 |
|
|
|
1,186 |
|
|
|
1,093 |
|
Produced alumina shipments (kmt) |
|
|
2,206 |
|
|
|
2,514 |
|
|
|
2,206 |
|
|
|
2,316 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Third-party bauxite sales |
|
$ |
124 |
|
|
$ |
173 |
|
|
$ |
124 |
|
|
$ |
243 |
|
Third-party alumina sales |
|
|
533 |
|
|
|
806 |
|
|
|
533 |
|
|
|
1,220 |
|
Total segment third-party sales |
|
$ |
657 |
|
|
$ |
979 |
|
|
$ |
657 |
|
|
$ |
1,463 |
|
Intersegment alumina sales |
|
|
445 |
|
|
|
457 |
|
|
|
445 |
|
|
|
712 |
|
Total sales |
|
$ |
1,102 |
|
|
$ |
1,436 |
|
|
$ |
1,102 |
|
|
$ |
2,175 |
|
Adjusted operating costs |
|
|
737 |
|
|
|
789 |
|
|
|
737 |
|
|
|
723 |
|
Other segment items |
|
|
405 |
|
|
|
635 |
|
|
|
405 |
|
|
|
788 |
|
Segment Adjusted EBITDA |
|
$ |
(40 |
) |
|
$ |
12 |
|
|
$ |
(40 |
) |
|
$ |
664 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average realized third-party price per metric ton of alumina |
|
$ |
324 |
|
|
$ |
341 |
|
|
$ |
324 |
|
|
$ |
575 |
|
Adjusted operating cost per metric ton of produced alumina shipped |
|
$ |
334 |
|
|
$ |
314 |
|
|
$ |
334 |
|
|
$ |
312 |
|
Production
Sequential period comparison
Alumina production decreased 5 percent primarily as a result of:
•Reduced production at the Australia refineries due to the beginning of seasonal maintenance cycles
Year-to-date comparison
Alumina production was consistent with the first quarter of 2025.
Third-party sales
Sequential period comparison
Third-party sales decreased $322 primarily as a result of:
•Lower shipments of alumina primarily due to lower sales of externally sourced alumina to satisfy certain customer commitments, seasonally lower first quarter shipments, and shipment delays in Australia primarily related to the Middle East conflict and Cyclone Narelle
•Lower volumes and price from bauxite offtake and supply agreements
•Lower average realized price of $17 per metric ton principally driven by a lower average API
•Unfavorable currency impacts
Year-to-date comparison
Third-party sales decreased $806 primarily as a result of:
•Lower average realized price of $251 per metric ton principally driven by a lower average API
•Lower shipments of alumina primarily due lower sales of externally sourced alumina to satisfy certain customer commitments and shipment delays in Australia primarily related to the Middle East conflict and Cyclone Narelle
•Lower volumes and price from bauxite offtake and supply agreements
Intersegment alumina sales
Sequential period comparison
Intersegment alumina sales decreased $12 primarily as a result of:
•Lower average API on sales to the Aluminum segment
Partially offset by:
•Higher alumina shipments primarily due to the San Ciprián smelter restart
Year-to-date comparison
Intersegment alumina sales decreased $267 primarily as a result of:
•Lower average API on sales to the Aluminum segment
Partially offset by:
•Higher alumina shipments primarily due to the San Ciprián smelter restart
Segment Adjusted EBITDA
Sequential period comparison
Segment Adjusted EBITDA decreased $52 primarily as a result of:
•Lower average realized price
•Lower volumes and price from bauxite offtake and supply agreements
•Unfavorable currency impacts
•Lower seasonal shipments of alumina
Partially offset by:
•Absence of a charge to increase environmental reserves related to investments in environmental offsets at the Huntly mine
Year-to-date comparison
Segment Adjusted EBITDA decreased $704 primarily as a result of:
•Lower average realized price
•Lower volumes and price from bauxite offtake and supply agreements
•Unfavorable currency impacts
Forward Look. For the second quarter of 2026 in comparison to the first quarter of 2026, the Alumina segment expects lower price from bauxite offtake and supply agreements and higher energy costs, primarily related to increased diesel prices associated with the Middle East conflict.
Alcoa expects 2026 total Alumina segment production and shipments to remain unchanged from its prior projection, ranging between 9.7 to 9.9 million metric tons, and between 11.8 and 12.0 million metric tons, respectively. The difference between production and shipments reflects trading volumes and externally sourced alumina to fulfill customer contracts.
Aluminum
Business Update. Aluminum prices increased sequentially with LME prices on a 15-day lag averaging $3,120 per metric ton in the first quarter of 2026. Additionally, the average Midwest premium increased 21 percent sequentially.
In the first quarter of 2026, the Aluminum segment proactively repositioned inventory within North America to provide casthouse flexibility for additional value add product production.
San Ciprián Smelter
The restart of the San Ciprián smelter was completed on April 7, 2026. At March 31, 2026, in connection with the viability agreement reached with the workers’ representatives of the San Ciprián smelter in December 2021 and subsequently updated in February 2023, the Company had restricted cash of $75 available for capital improvement commitments and restart costs incurred (which is subject to review by the workers’ representatives prior to release) at the site.
In the table below, total aluminum third-party shipments include metric tons that were not produced by the Aluminum segment. Such aluminum was purchased by this segment to satisfy certain customer commitments. The Aluminum segment bears the risk of loss of the purchased aluminum until control of the product has been transferred to this segment’s customers. Additionally, Total shipments in 2025 include offtake from a joint venture supply agreement with Ma’aden prior to its termination in the first quarter of 2025. The contract was terminated in accordance with Alcoa’s sale of its 25.1% ownership in the Saudi Arabia joint venture to Ma’aden, which was completed on July 1, 2025.
The average realized third-party price per metric ton of aluminum includes three elements: a) the underlying base metal component, based on quoted prices from the LME; b) the regional premium, which represents the incremental price over the base LME component that is associated with the physical delivery of metal to a particular region (e.g., the Midwest premium for metal sold in the United States); and c) the product premium, which represents the incremental price for receiving physical metal in a particular shape (e.g., billet, slab, rod, etc.) or alloy.
Adjusted operating costs include all production related costs for aluminum produced and shipped: raw materials consumed; conversion costs, such as labor, materials, and utilities; and plant administrative expenses. Other segment items include costs associated with trading activity and energy assets; other direct and non-production related charges, including tariff costs; Selling, general administrative, and other expenses; and Research and development expenses.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter ended |
|
|
Three months ended |
|
|
|
March 31,
2026 |
|
|
December 31,
2025 |
|
|
March 31,
2026 |
|
|
March 31,
2025 |
|
Aluminum production (kmt) |
|
|
607 |
|
|
|
604 |
|
|
|
607 |
|
|
|
564 |
|
Total aluminum shipments (kmt) |
|
|
613 |
|
|
|
667 |
|
|
|
613 |
|
|
|
609 |
|
Produced aluminum shipments (kmt) |
|
|
580 |
|
|
|
625 |
|
|
|
580 |
|
|
|
567 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Third-party aluminum sales |
|
$ |
2,582 |
|
|
$ |
2,499 |
|
|
$ |
2,582 |
|
|
$ |
1,955 |
|
Other(1) |
|
|
(46 |
) |
|
|
(37 |
) |
|
|
(46 |
) |
|
|
(54 |
) |
Total segment third-party sales |
|
$ |
2,536 |
|
|
$ |
2,462 |
|
|
$ |
2,536 |
|
|
$ |
1,901 |
|
Intersegment sales |
|
|
5 |
|
|
|
6 |
|
|
|
5 |
|
|
|
4 |
|
Total sales |
|
$ |
2,541 |
|
|
$ |
2,468 |
|
|
$ |
2,541 |
|
|
$ |
1,905 |
|
Adjusted operating costs |
|
|
1,430 |
|
|
|
1,549 |
|
|
|
1,430 |
|
|
|
1,574 |
|
Other segment items |
|
|
417 |
|
|
|
399 |
|
|
|
417 |
|
|
|
197 |
|
Segment Adjusted EBITDA |
|
$ |
694 |
|
|
$ |
520 |
|
|
$ |
694 |
|
|
$ |
134 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average realized third-party price per metric ton of aluminum |
|
$ |
4,209 |
|
|
$ |
3,749 |
|
|
$ |
4,209 |
|
|
$ |
3,213 |
|
Adjusted operating cost per metric ton of produced aluminum shipped |
|
$ |
2,468 |
|
|
$ |
2,478 |
|
|
$ |
2,468 |
|
|
$ |
2,775 |
|
(1)Other includes third-party sales of energy, as well as realized gains and losses related to embedded derivative instruments designated as cash flow hedges of forward sales of aluminum.
Production
Sequential period comparison
Production was consistent with the fourth quarter of 2025 primarily as a result of:
•San Ciprián smelter restart
Partially offset by:
•Two fewer days in the period
Year-to-date comparison
Production increased 8 percent primarily as a result of:
•San Ciprián smelter restart
Third-party sales
Sequential period comparison
Third-party sales increased $74 primarily as a result of:
•Higher average realized price of $460 per metric ton driven by a higher average LME (on a 15-day lag) and higher regional premiums, particularly the Midwest premium (United States and Canada) which rose by an average of 21 percent
Partially offset by:
•Lower shipments primarily due to seasonally lower first quarter shipments, proactive inventory repositioning within North America, and decreased trading activities, partially offset by the San Ciprián smelter restart
•Impacts from certain energy contracts linked to metal pricing
Year-to-date comparison
Third-party sales increased $635 primarily as a result of:
•Higher average realized price of $996 per metric ton driven by higher regional premiums, particularly the Midwest premium (United States and Canada) which rose by an average of 215 percent, and a higher average LME (on a 15-day lag)
•Higher shipments primarily due to the San Ciprián smelter restart, partially offset by proactive inventory repositioning within North America and decreased trading activities
•Higher pricing at the Brazil hydro-electric facilities
Partially offset by:
•Impacts from certain energy contracts linked to metal pricing
Segment Adjusted EBITDA
Sequential period comparison
Segment Adjusted EBITDA increased $174 primarily as a result of:
•Higher average realized price
•Favorable raw material costs primarily on lower average alumina input costs
Partially offset by:
•Absence of recognition of carbon dioxide compensation in Spain and Norway
•Lower seasonal shipments
•Higher costs associated with the restart of the San Ciprián smelter
Year-to-date comparison
Segment Adjusted EBITDA increased $560 primarily as a result of:
•Higher average realized price
•Favorable raw material costs primarily on lower average alumina input costs
•Higher pricing at the Brazil hydro-electric facilities
•Lower energy costs primarily in Europe
Partially offset by:
•Tariffs on U.S. imports of aluminum from Canada, which were subject to a 25 percent tariff beginning March 12, 2025 until increasing to 50 percent on June 4, 2025 under Section 232 of the Trade Expansion Act of 1962
•Higher costs associated with the restart of the San Ciprián smelter
•Unfavorable currency impacts
The following table provides consolidated capacity and curtailed capacity (each in kmt) for each smelter owned by Alcoa Corporation:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31, 2026 |
|
|
December 31, 2025 |
|
|
March 31, 2025 |
|
Facility |
|
Country |
|
Capacity(1) |
|
|
Curtailed |
|
|
Capacity(1) |
|
|
Curtailed |
|
|
Capacity(1) |
|
|
Curtailed |
|
Portland(2) |
|
Australia |
|
|
197 |
|
|
|
24 |
|
|
|
197 |
|
|
|
28 |
|
|
|
197 |
|
|
|
33 |
|
São Luís (Alumar)(3) |
|
Brazil |
|
|
268 |
|
|
|
25 |
|
|
|
268 |
|
|
|
25 |
|
|
|
268 |
|
|
|
27 |
|
Baie-Comeau |
|
Canada |
|
|
324 |
|
|
|
— |
|
|
|
324 |
|
|
|
— |
|
|
|
324 |
|
|
|
— |
|
Bécancour |
|
Canada |
|
|
350 |
|
|
|
— |
|
|
|
350 |
|
|
|
— |
|
|
|
350 |
|
|
|
— |
|
Deschambault |
|
Canada |
|
|
287 |
|
|
|
— |
|
|
|
287 |
|
|
|
— |
|
|
|
287 |
|
|
|
— |
|
Fjarðaál |
|
Iceland |
|
|
351 |
|
|
|
— |
|
|
|
351 |
|
|
|
— |
|
|
|
351 |
|
|
|
— |
|
Lista(4) |
|
Norway |
|
|
95 |
|
|
|
5 |
|
|
|
95 |
|
|
|
8 |
|
|
|
95 |
|
|
|
31 |
|
Mosjøen |
|
Norway |
|
|
200 |
|
|
|
— |
|
|
|
200 |
|
|
|
— |
|
|
|
200 |
|
|
|
— |
|
San Ciprián(5) |
|
Spain |
|
|
228 |
|
|
|
4 |
|
|
|
228 |
|
|
|
81 |
|
|
|
228 |
|
|
|
214 |
|
Massena West |
|
U.S. |
|
|
130 |
|
|
|
— |
|
|
|
130 |
|
|
|
— |
|
|
|
130 |
|
|
|
— |
|
Warrick |
|
U.S. |
|
|
215 |
|
|
|
54 |
|
|
|
215 |
|
|
|
54 |
|
|
|
215 |
|
|
|
54 |
|
|
|
|
|
|
2,645 |
|
|
|
112 |
|
|
|
2,645 |
|
|
|
196 |
|
|
|
2,645 |
|
|
|
359 |
|
(1)These figures represent Alcoa Corporation’s share of the facility Nameplate Capacity based on its ownership interest in the respective smelter.
(2)In the first quarter of 2026, the Company began the restart of 15 kmt of previously curtailed capacity at the Portland smelter in Australia.
(3)In 2021, the Company announced the restart of its 268 kmt share of capacity at the Alumar smelter in São Luís, Brazil. Production began in the second quarter of 2022. Curtailed capacity decreased from March 31, 2025 as a result of the restart process.
(4)In the second quarter of 2025, the Company began the restart of one potline (31 kmt) at the Lista smelter in Norway that was curtailed in August 2022.
(5)In the third quarter of 2025, the Company resumed the restart at the San Ciprián smelter in Spain that was paused in April 2025 following a widespread power outage across Spain. The restart was completed on April 7, 2026.
Forward Look. For the second quarter of 2026 in comparison to the first quarter of 2026, the Aluminum segment expects to benefit from inventory repositioning actions taken in the first quarter of 2026, higher shipments and value add product sales, and lower production costs due to the completion of the San Ciprián smelter restart, partially offset by lower third-party energy sales and increased tariff costs on higher U.S. imports of aluminum from Canada. At recent Midwest premium pricing, tariff costs are fully covered by the Midwest premium revenue.
Alcoa expects 2026 total Aluminum segment production and shipments to remain unchanged from its prior projection, ranging between 2.4 and 2.6 million metric tons, and between 2.6 and 2.8 million metric tons, respectively.
Reconciliations of Certain Segment Information
Reconciliation of Total Segment Third-Party Sales to Consolidated Sales
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter ended |
|
|
Three months ended |
|
|
|
March 31,
2026 |
|
|
December 31,
2025 |
|
|
March 31,
2026 |
|
|
March 31,
2025 |
|
Alumina |
|
$ |
657 |
|
|
$ |
979 |
|
|
$ |
657 |
|
|
$ |
1,463 |
|
Aluminum |
|
|
2,536 |
|
|
|
2,462 |
|
|
|
2,536 |
|
|
|
1,901 |
|
Total segment third-party sales |
|
$ |
3,193 |
|
|
$ |
3,441 |
|
|
$ |
3,193 |
|
|
$ |
3,364 |
|
Other |
|
|
— |
|
|
|
8 |
|
|
|
— |
|
|
|
5 |
|
Consolidated sales |
|
$ |
3,193 |
|
|
$ |
3,449 |
|
|
$ |
3,193 |
|
|
$ |
3,369 |
|
Reconciliation of Total Segment Adjusted EBITDA to Consolidated Net Income Attributable to Alcoa Corporation
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Quarter ended |
|
|
Three months ended |
|
|
|
March 31,
2026 |
|
|
December 31,
2025 |
|
|
March 31,
2026 |
|
|
March 31,
2025 |
|
Total Segment Adjusted EBITDA |
|
$ |
654 |
|
|
$ |
532 |
|
|
$ |
654 |
|
|
$ |
798 |
|
Unallocated amounts: |
|
|
|
|
|
|
|
|
|
|
|
|
Transformation(1) |
|
|
(27 |
) |
|
|
(27 |
) |
|
|
(27 |
) |
|
|
(12 |
) |
Intersegment eliminations |
|
|
7 |
|
|
|
53 |
|
|
|
7 |
|
|
|
103 |
|
Corporate expenses(2) |
|
|
(39 |
) |
|
|
(26 |
) |
|
|
(39 |
) |
|
|
(37 |
) |
Provision for depreciation, depletion, and amortization |
|
|
(162 |
) |
|
|
(162 |
) |
|
|
(162 |
) |
|
|
(148 |
) |
Impairment of goodwill |
|
|
— |
|
|
|
(144 |
) |
|
|
— |
|
|
|
— |
|
Restructuring and other charges, net |
|
|
(18 |
) |
|
|
(14 |
) |
|
|
(18 |
) |
|
|
(5 |
) |
Interest expense |
|
|
(35 |
) |
|
|
(16 |
) |
|
|
(35 |
) |
|
|
(53 |
) |
Other income (expenses), net |
|
|
126 |
|
|
|
(115 |
) |
|
|
126 |
|
|
|
26 |
|
Other(3) |
|
|
(7 |
) |
|
|
(13 |
) |
|
|
(7 |
) |
|
|
(4 |
) |
Consolidated income before income taxes |
|
|
499 |
|
|
|
68 |
|
|
|
499 |
|
|
|
668 |
|
(Provision for) benefit from income taxes |
|
|
(82 |
) |
|
|
134 |
|
|
|
(82 |
) |
|
|
(120 |
) |
Net loss attributable to noncontrolling interest |
|
|
8 |
|
|
|
11 |
|
|
|
8 |
|
|
|
— |
|
Consolidated net income attributable to Alcoa Corporation |
|
$ |
425 |
|
|
$ |
213 |
|
|
$ |
425 |
|
|
$ |
548 |
|
(1)Transformation includes, among other items, the Adjusted EBITDA of previously closed operations.
(2)Corporate expenses are composed of general administrative and other expenses of operating the corporate headquarters and other global administrative facilities, as well as research and development expenses of the corporate technical center.
(3)Other includes certain items that are not included in the Adjusted EBITDA of the reportable segments.
Environmental Matters
See Part I Item 1 of this Form 10-Q in Note N to the Consolidated Financial Statements under caption Environmental Matters.
Liquidity and Capital Resources
Management believes that the Company’s cash on hand, projected cash flows, and liquidity options, combined with its strategic actions, will be adequate to fund its short-term (at least 12 months) and long-term operating and investing needs. Further, the Company has flexibility related to its use of cash; ANHBV issued notice to redeem the remaining $219 of outstanding 2028 Notes in May 2026 and the Company has no other significant debt maturities until 2029. Additionally, the Company has no significant cash contribution requirements related to its pension plan obligations.
Although management believes that Alcoa’s projected cash flows and other liquidity options will provide adequate resources to fund operating and investing needs, the Company’s access to, and the availability of, financing on acceptable terms in the future will be affected by many factors, including: (i) Alcoa Corporation’s credit rating; (ii) the liquidity of the overall capital markets; (iii) the current state of the economy and commodity markets, and (iv) short- and long-term debt ratings. There can be no assurances that the Company will continue to have access to capital markets on terms acceptable to Alcoa Corporation.
Changes in market conditions caused by U.S., global, or macroeconomic events, such as ongoing regional conflicts, high inflation, and changing U.S. or global monetary or trade policies could have adverse effects on Alcoa’s ability to obtain additional financing and cost of borrowing. Inability to generate sufficient earnings could impact the Company’s ability to meet the financial covenants in our outstanding debt and revolving credit facility agreements and limit our ability to access these sources of liquidity or refinance or renegotiate our outstanding debt or credit agreements on terms acceptable to the Company. Additionally, the impact on market conditions from such events could adversely affect the liquidity of Alcoa’s customers, suppliers, and joint venture partners and equity method investments, which could negatively impact the collectability of outstanding receivables and our cash flows.
Cash from Operations
Cash used for operations was $179 in the three-month period of 2026 compared with cash provided from operations of $75 in the same period in 2025. Notable changes included:
•$118 unfavorable change in net income, excluding the impacts from restructuring charges, primarily due to lower alumina pricing, tariffs on U.S. imports of aluminum from Canada, and higher production costs primarily within the Aluminum segment, partially offset by higher aluminum pricing; and,
•$49 unfavorable change in certain working capital accounts, primarily an increase in inventories in the three-month period of 2026 due to higher volumes mainly in the Alumina segment from delayed shipments and an increase in receivables in the three-month period of 2026 on higher pricing for aluminum, partially offset by a decrease in accounts payable in the three-month period of 2025 due to lower alumina trading.
The Company utilizes a Receivables Purchase Agreement facility to sell up to $175 of certain receivables through a wholly-owned special purpose entity (SPE) to a financial institution on a revolving basis. Alcoa Corporation guarantees the performance obligations of the Company subsidiaries, and unsold customer receivables are pledged as collateral to secure the sold receivables. At March 31, 2026, the SPE held unsold customer receivables of $616 pledged as collateral against the sold receivables.
The Company continues to service the customer receivables and as customer payments are collected by the Company, the SPE transfers additional receivables to the financial institution rather than remitting cash.
In the three-month period of 2026, the Company sold gross customer receivables of $211 and reinvested collections of $211 from previously sold receivables. In the three-month period of 2025, the Company sold gross customer receivables of $199 and reinvested collections of $199 from previously sold receivables. There were no cash remittances to or from the financial institution in either period.
Cash collections from previously sold receivables yet to be reinvested of $42 were included in Accounts payable, trade on the Consolidated Balance Sheet as of March 31, 2026. Cash received from sold receivables under the agreement are presented within operating activities in the Statement of Consolidated Cash Flows. See Part I Item 1 of this Form 10-Q in Note H to the Consolidated Financial Statements.
Financing Activities
Cash provided from financing activities was $60 in the three-month period of 2026 compared with $77 in the same period in 2025.
The source of cash in the three-month period of 2026 was primarily $100 of net short-term borrowings (see below), partially offset by $27 of dividends paid on stock.
The source of cash in the three-month period of 2025 was primarily $985 net proceeds from the issuance of the 2030 Notes and 2032 Notes and $27 of contributions from Trento EQT (see Noncontrolling interest above), partially offset by $890 to settle tender offers on the 2027 Notes and 2028 Notes and $26 of dividends paid on common stock.
Short-term Borrowings
The Company periodically enters into inventory repurchase agreements whereby the Company sells aluminum to a third party and agrees to subsequently repurchase substantially similar inventory. Upon shipment of inventory, the Company does not record the sale and reflects cash received in Short-term borrowings within Other current liabilities on the Consolidated Balance Sheet. The cash received and subsequently paid under these agreements is included in Cash provided from financing activities on the Statement of Consolidated Cash Flows.
During the three-month period of 2026, the Company recorded borrowings of $104 and repurchased $4 of inventory related to these agreements. During the three-month period of 2025, the Company recorded borrowings of $44 and repurchased $49 of inventory related to these agreements.
The net borrowings from inventory repurchase agreements was $109 as of March 31, 2026.
144A Debt
On April 14, 2026, the Company announced that its wholly-owned subsidiary ANHBV, issued a notice to redeem the remaining $219 aggregate principal amount of its outstanding 2028 Notes. The notes will be redeemed on May 15, 2026 at a price equal to 100 percent of the principal amount, plus accrued and unpaid interest, using cash on hand.
Credit Facilities
Revolving Credit Facility
The Company and ANHBV, a wholly-owned subsidiary of Alcoa Corporation and the borrower, have a $1,250 revolving credit and letter of credit facility in place for working capital and/or other general corporate purposes (the Revolving Credit Facility). The Revolving Credit Facility, established in September 2016, most recently amended and restated in June 2022 and amended in August 2025, is scheduled to mature in June 2027. Subject to the terms and conditions under the Revolving Credit Facility, the Company or ANHBV may borrow funds or issue letters of credit. Under the terms of the January 2024 amendment (Amendment No. 1), the Company agreed to provide collateral for its obligations under the Revolving Credit Facility. In August 2025, Alcoa Corporation, ANHBV, and certain subsidiaries of the Company entered into Amendment No. 2 to the Revolving Credit Facility to allow for certain changes in the Company’s legal structure and update certain exceptions to collateral requirements. See Part II Item 8 of Alcoa Corporation’s Annual Report on Form 10-K in Note M to the Consolidated Financial Statements for the year ended December 31, 2025 for more information on the Revolving Credit Facility.
As of March 31, 2026, the Company was in compliance with all financial covenants. The Company may access the entire amount of commitments under the Revolving Credit Facility. There were no borrowings outstanding at March 31, 2026, and no amounts were borrowed during the three-month periods of 2026 and 2025 under the Revolving Credit Facility.
Japanese Yen Revolving Credit Facility
At March 31, 2026, the Company and ANHBV had a $200 revolving credit facility available to be drawn in Japanese yen (the Japanese Yen Revolving Credit Facility). See Part II Item 8 of Alcoa Corporation’s Annual Report on Form 10-K in Note M to the Consolidated Financial Statements for the year ended December 31, 2025 for more information on the Japanese Yen Revolving Credit Facility.
As of March 31, 2026, the Company was in compliance with all financial covenants. There were no borrowings outstanding at March 31, 2026, and no amounts were borrowed during the three-month periods of 2026 and 2025 under the Japanese Yen Revolving Credit Facility.
On April 24, 2026, the Japanese Yen Revolving Credit Facility matured with no amounts outstanding at expiration.
Dividend
On February 26, 2026, the Board of Directors declared a quarterly cash dividend of $0.10 per share of the Company’s common stock to stockholders of record as of the close of business on March 10, 2026. In March 2026, the Company paid cash dividends of $27.
Ratings
Alcoa Corporation’s cost of borrowing and ability to access the capital markets are affected not only by market conditions but also by the short- and long-term debt ratings that the major credit rating agencies assign to Alcoa Corporation’s debt. Each agency’s rating is on a consolidated basis; therefore, the rating assessment applies to Alcoa Corporation, ANHBV, and Alumina Pty Ltd.
On March 11, 2026, Fitch Ratings affirmed Alcoa’s long-term debt rating as BB+ and revised the outlook from stable to positive.
On March 3, 2026, Standard and Poor’s Global Ratings upgraded the rating of Alcoa’s long-term debt to BB+ from BB and revised the outlook from positive to stable.
February 6, 2026, Moody’s Investor Service affirmed the rating of Alcoa’s long-term debt as Ba1 and affirmed the outlook as stable.
Ratings are not a recommendation to buy or hold any of Alcoa’s securities and they may be revised or revoked at any time at the sole discretion of the rating organization.
Investing Activities
Cash used for investing activities was $129 in the three-month period of 2026 compared with $108 for the same period in 2025.
In the three-month period of 2026, the use of cash was primarily attributable to $119 related to capital expenditures and $15 of cash contributions to the ELYSIS® partnership.
In the three-month period of 2025, the use of cash was primarily attributable to $93 related to capital expenditures and $15 of cash contributions to the ELYSIS partnership.
Recently Adopted and Recently Issued Accounting Guidance
See Part I Item 1 of this Form 10-Q in Note B to the Consolidated Financial Statements.
Dissemination of Company Information
Alcoa Corporation intends to make future announcements regarding company developments and financial performance through its website, https://www.alcoa.com, as well as through press releases, filings with the U.S. Securities and Exchange Commission, conference calls, media broadcasts, and webcasts. The Company does not incorporate the information contained on, or accessible through, its corporate website into this quarterly report.
Item 3. Quantitative and Qualitative Disclosures About Market Risk.
See Part II Item 7A Quantitative and Qualitative Disclosures About Market Risk of Alcoa Corporation’s Annual Report on Form 10-K for the year ended December 31, 2025. Our exposure to market risk has not changed materially since December 31, 2025. See Part I Item 1 of this Form 10-Q in Note L to the Consolidated Financial Statements under caption Derivatives for additional information.
Item 4. Controls and Procedures.
(a) Evaluation of Disclosure Controls and Procedures
Alcoa Corporation’s Chief Executive Officer and Chief Financial Officer have evaluated the Company’s disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the U.S. Securities Exchange Act of 1934, as amended, as of the end of the period covered by this report, and they have concluded that these controls and procedures were effective as of March 31, 2026.
(b) Changes in Internal Control over Financial Reporting
There have been no changes in internal control over financial reporting during the first quarter of 2026 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.