Alcoa Corp (NYSE:AA) Posts Mixed Q3 2025 Results, Missing Revenue and Adjusted EPS Estimates

Alcoa Corporation (NYSE:AA) reported financial results for the third quarter of 2025, delivering a mixed performance that fell short of analyst expectations on key profitability and revenue metrics. The market reaction in after-hours trading reflected this disappointment, with shares declining approximately 2.5%.

Earnings and Revenue Versus Estimates

The company's third-quarter performance presented a complex picture, with reported figures differing significantly from analyst projections once special items are accounted for.

• Revenue: $2.995 billion, compared to analyst estimates of $3.225 billion.
• Adjusted Earnings Per Share (EPS): A loss of $0.02 per share, missing the estimate for a profit of $0.0113 per share.
• Reported Net Income: $232 million, or $0.88 per share, which includes substantial one-time items.

The discrepancy between the reported net income and the adjusted loss per share stems from several significant special items recorded during the quarter. These included a $786 million gain on the sale of the company's interest in a joint venture with Saudi Arabian Mining Company (Ma’aden) and a $267 million mark-to-market gain on Ma’aden shares. These gains were largely offset by $895 million in restructuring and related charges connected to the permanent closure of the Kwinana refinery in Australia.

Operational Performance and Segment Analysis

Alcoa's operational results showed stability in production but faced headwinds from pricing and costs.

• Production: Alumina production increased 4% sequentially to 2.5 million metric tons, while aluminum production rose 1% to 579,000 metric tons.
• Adjusted EBITDA: This metric, which excludes special items, was $270 million, a decrease of $43 million from the previous quarter. The decline was attributed to increased tariff costs on imported aluminum, charges for asset retirement obligations, unfavorable currency impacts, and lower alumina prices, which were partially offset by higher aluminum prices.
• Cash Position: The company ended the quarter with a cash balance of $1.5 billion, having fully repaid a $74 million term loan.

Fourth Quarter and Full-Year Outlook

Management provided an outlook for the fourth quarter of 2025, which offers a comparative context against existing analyst estimates.

For the upcoming quarter, Alcoa anticipates:

• Favorable impacts of approximately $80 million in the Alumina segment due to the absence of certain charges and lower maintenance costs.
• Unfavorable impacts of approximately $20 million in the Aluminum segment due to restart inefficiencies.
• A significant sequential increase of about $50 million in tariff costs on aluminum imports from Canada.
• Operational tax expense is projected to be between $40 million and $50 million.

The company's full-year production and shipment guidance for both alumina and aluminum remains unchanged from prior projections. When compared to analyst estimates, which forecast Q4 2025 revenue of $3.318 billion, Alcoa's own commentary suggests ongoing cost pressures and operational challenges that may factor into achieving that top-line figure.

Strategic Developments and Capital Allocation

The earnings release highlighted several key strategic actions undertaken during the quarter:

• Portfolio Optimization: The decision to permanently close the Kwinana refinery in Australia represents a significant step in streamlining operations, albeit with a substantial near-term financial charge.
• Energy Security: The securing of a long-term energy contract for the Massena smelter in New York provides greater operational stability for a key U.S. asset.
• Future Growth: The company is advancing a gallium plant project in Australia with support from U.S. and Australian governments, positioning it in the critical minerals sector.

Conclusion

Alcoa's third-quarter results underscore the volatile nature of the commodities business, where strategic portfolio moves create large one-time accounting impacts that obscure the underlying operational performance. While the company demonstrated production stability and a solid cash position, its failure to meet analyst expectations on adjusted EPS and revenue, coupled with a negative after-market stock reaction, indicates investor concern over its core profitability amid cost inflation and pricing pressures. The outlook for the fourth quarter points to a continued challenging environment, particularly regarding tariff expenses.

For a detailed look at historical earnings and future analyst estimates for Alcoa Corporation, you can review the data here.

Disclaimer: This article is for informational purposes only and does not constitute financial advice or a recommendation to buy or sell any security. Investors should conduct their own research and consult with a qualified financial advisor before making any investment decisions.