Shares of Nucor (NUE), the largest steel producer in the United States, plummeted 5.20% in after-hours trading on Monday, despite reporting better-than-expected second-quarter earnings. The sharp decline reflects investor concerns over the company's cautious third-quarter outlook and ongoing challenges related to rising raw material costs.

For the second quarter ended July 5, Nucor reported earnings per share (EPS) of $2.60, surpassing analysts' expectations of $2.55. While this represents a slight decrease from $2.68 a year earlier, the company's adjusted net income of $706 million significantly exceeded the projected $557 million. Revenue also saw a 4.7% increase to $8.46 billion, although it fell slightly short of the anticipated $8.54 billion.

However, the positive Q2 results were overshadowed by Nucor's cautious outlook for the third quarter. The company stated it expects Q3 earnings to be "nominally lower" than Q2, citing decreased earnings in the steel mills segment. This forecast, coupled with ongoing concerns about rising raw material costs pressuring the company's steelmaking segment, appears to have spooked investors. As the steel industry navigates through these challenges, market participants will be closely monitoring Nucor's ability to maintain its performance in the face of increasing input costs and potential market headwinds.