Aluminum price gains insufficient to offset overcapacity Alcoa Corporation (AA. US) second quarter performance lower than expected, revising down full-year aluminum production guidance.

Alcoa Corporation (AA.US) announced its second-quarter earnings for 2026 after the U.S. stock market closed on Thursday. The data showed that the company's Q2 revenue increased by 31% year-over-year to $3.97 billion, reaching a quarterly high, but falling short of market expectations; adjusted earnings per share were $2.12, also below market expectations, compared to $0.39 in the same period last year. Due to operational issues at a refining plant in Australia, Alcoa Corporation lowered its alumina production guidance, which overshadowed the revenue growth from higher aluminum prices during the quarter. The company currently expects alumina production for 2026 to be between 9.5 million to 9.6 million tons, down from the previous estimate of 9.7 million to 9.9 million tons. The company also lowered alumina shipment volume expectations, but maintained its aluminum production and shipment volume expectations. After the financial report was released, Alcoa Corporation's stock price fell by over 7% after hours, but the decline narrowed slightly later. The company stated that the production guidance downgrade was due to a decline in production capacity at the Pinjarra alumina refinery in Western Australia. The refinery has been experiencing production instability since late March, and the disruption in natural gas supply caused by Cyclone Narelle further exacerbated the production issues. The refinery is one of Alcoa Corporation's largest alumina production bases, and alumina is a crucial intermediate raw material in the process of extracting aluminum from bauxite. The production guidance downgrade overshadowed the strong performance of the company's aluminum business in the second quarter. Its adjusted EBITDA for the aluminum business reached $1.07 billion, exceeding analyst expectations, mainly due to the increase in aluminum prices and the restart of idle smelters. Over the past 12 months, aluminum prices have risen by about 20%, primarily driven by supply disruptions in the Middle East and market expectations that the demand for aluminum in power networks, data centers, and energy transition will exceed the impact of new production. The rise in aluminum prices also helped Alcoa Corporation achieve a quarterly revenue high in the second quarter. Just a few weeks ago, Alcoa Corporation agreed to acquire South32's alumina, aluminum, and bauxite business for up to $5.6 billion, betting on the continued growth in demand for this light metal.