# Cleveland-Cliffs Inc. (CLF) — Financial Analysis

**Exchange:** NYSE  
**Coverage as of:** 2026-Q2  
**Updated:** 2026-05-29  
**Tier:** Free primer (step 2 of 19)  
**Sibling pages:** /stocks/CLF/thesis · /stocks/CLF/memo

## Financial Snapshot

---
source: coverage-next-full
ticker: CLF
step: "04"
title: Financial Snapshot
created: 2026-05-29
---

### Step 04 — Financial Snapshot

#### Three-Year P&L Summary

| Metric | FY2021 | FY2022 | FY2023 |
|--------|--------|--------|--------|
| Revenue | $20.4B | $22.3B | $21.9B |
| Cost of Goods Sold | ~$16.1B | ~$18.2B | ~$19.0B |
| Gross Profit | ~$4.3B | ~$4.1B | ~$2.9B |
| Gross Margin | ~21% | ~18% | ~13% |
| EBITDA | ~$4.5B | ~$3.5B | ~$1.7B |
| EBITDA Margin | ~22% | ~16% | ~8% |
| D&A | ~$0.9B | ~$1.0B | ~$1.0B |
| EBIT | ~$3.6B | ~$2.5B | ~$0.7B |
| Interest Expense | ~$(0.4B) | ~$(0.3B) | ~$(0.3B) |
| Pre-tax Income | ~$3.2B | ~$2.2B | ~$0.4B |
| Tax Expense | ~$(0.7B) | ~$(0.5B) | ~$(0.1B) |
| Net Income | ~$2.5B | ~$1.6B | ~$0.3B |
| EPS (diluted) | ~$4.50 | ~$3.10 | ~$0.60 |
| Shares (diluted, M) | ~555M | ~510M | ~480M |

#### The 2021 Profit Peak — Understanding the Supercycle

FY2021 was a once-in-a-generation steel pricing event. COVID-19 disrupted global supply chains while simultaneously triggering massive fiscal stimulus and a goods demand boom. HRC spot prices in the US hit $1,900/ton (vs. a historical range of $400–900/ton), producing extraordinary margins.

CLF's FY2021 results were the first full year incorporating both AK Steel and ArcelorMittal USA, and the timing was exceptional — the company acquired two businesses at compressed cycle prices and immediately benefited from the supercycle. This windfall allowed CLF to pay down ~$2.5B+ in debt and repurchase ~15% of shares outstanding within 18 months.

**Key insight**: The 2021 EBITDA of ~$4.5B is NOT a normalized run-rate. Mid-cycle EBITDA (at ~$700–800/ton HRC) is approximately $1.5–2.0B.

#### 2022–2023 Normalization

As HRC prices normalized from their supercycle peak, CLF's margins compressed sharply. This is exactly as expected for a cyclical business with high operating leverage:

- FY2022: Prices declining through the year, still elevated in H1 → $3.5B EBITDA
- FY2023: HRC averaging $700–800/ton for most of the year → $1.7B EBITDA
- FY2024: Continued normalization; auto sector headwinds from EV slowdown, weaker demand → estimated $1.0–1.4B EBITDA

#### Margin Analysis

**Gross Margin**: Highly cyclical (13–21% range). Variable costs (iron ore [captive, so transfer-priced], scrap, energy) set a floor.

**EBITDA Margin**: The blast furnace model has high fixed costs (~$400–500/ton in fixed cost per ton capacity). At mid-cycle HRC (~$750/ton), the integrated model earns 8–12% EBITDA margins. At supercycle prices ($1,500+), margins expand dramatically due to operating leverage.

**Net Margin**: Even more volatile than EBITDA — ranges from negative (trough cycles) to 12%+ (supercycle). Interest expense (~$300M/year) and the tax shield from depreciation ($1B+/year) are important factors.

#### EBITDA Bridge — Key Cost Components

| Cost Component | Annual Amount | Per-Ton Equivalent |
|---------------|--------------|-------------------|
| Raw materials (iron ore — captive) | ~$3.5B | ~$140/ton |
| Purchased scrap (EAF input) | ~$1.0B | ~$40/ton |
| Energy (natural gas, electricity) | ~$1.2B | ~$50/ton |
| Labor (including benefits) | ~$3.0B | ~$120/ton |
| D&A | ~$1.0B | ~$40/ton |
| SG&A | ~$0.3B | ~$12/ton |
| **Total cost/ton** | | **~$400–420/ton** |

At $750/ton HRC, this implies ~$330–350/ton EBITDA margin... but the blended ASP across all products (including higher-value cold-rolled, coated, specialty) is typically $50–100/ton above HRC spot, so realized EBITDA is higher than a pure HRC analysis suggests.

#### Key Profitability Metrics

| Metric | FY2021 | FY2022 | FY2023 |
|--------|--------|--------|--------|
| Return on Equity | ~45% | ~28% | ~5% |
| Return on Assets | ~18% | ~11% | ~2% |
| ROIC | ~28% | ~17% | ~6% |
| FCF (operating CF - CapEx) | ~$2.8B | ~$1.9B | ~$0.5B |
| FCF Yield (on mkt cap) | High | High | Low (stock fell less than earnings) |

#### Tax Dynamics

CLF had significant deferred tax assets (NOL carryforwards) from prior loss years that partially sheltered 2021–2022 income. By 2023, the effective tax rate normalized toward the statutory ~21% rate. The large D&A from blast furnace assets creates ongoing tax shield benefits.

#### FY2024 Partial View

Through Q3 2024:
- Stelco acquisition closed, adding Canadian capacity
- HRC prices ranged $600–800/ton — below mid-cycle
- Automotive production below expectations (EV transition uncertainty)
- Full-year 2024 EBITDA estimate: ~$1.0–1.4B
- Stelco integration costs created near-term drag

The company entered 2025 with elevated leverage (Stelco acquisition funded partly with debt) and below-mid-cycle pricing — a challenging setup requiring either HRC price recovery or cost reduction to drive meaningful earnings improvement.

## Deeper Financial Analysis

The fundamental tier ($1.00) adds 8 dimensions not included here:

- Revenue Breakdown — segment revenue, geographic mix, product-line margins
- Financial Trends — QoQ momentum, leading indicators, inflection points
- Balance Sheet — debt structure, dilution risk, working capital dynamics
- Capital Allocation — ROIC, buyback cadence, reinvestment efficiency
- Earnings Analysis — beats/misses, guidance vs actuals, transcript highlights
- Competitive Positioning — market share, pricing power, peer benchmarks
- Industry Context — TAM, sector tailwinds/headwinds, regulatory backdrop

**API endpoint:** GET /api/v1/research/CLF/fundamental

## Navigation

- Overview: /stocks/CLF
- Financials (this page): /stocks/CLF/financials
- Thesis: /stocks/CLF/thesis
- Investment Memo: /stocks/CLF/memo
- Coverage universe: /stocks