Al Root

Steel maker Cleveland-Cliffs said something surprising with its third-quarter results Monday. It wasn't about its earnings, which looked solid. Instead, the company said it was looking at how to produce rare-earths minerals from its iron ore deposits.

For the quarter, Cleveland-Ciffs announced adjusted earnings before interest, taxes, depreciation, and amortization, or Ebitda, of $143 million. Its per-share loss was 45 cents from sales of $4.7 billion. Wall Street was looking for Ebitda of $128 million, a loss of 45 cents, and sales of $4.9 billion.

A year ago, in the third quarter of 2024, Cliffs reported Ebitda $122 million, a per-share loss of 35 cents, and sales of $4.6 billion. Benchmark steel prices averaged roughly $800 per ton in the current quarter. A year ago, they averaged closer to $700 per ton.

For the full year, Cliffs lowered its capital spending guidance to $525 million from $600 million and its guidance for selling, general, and administrative costs to $550 million from $575 million.

It was a solid report. Cleveland-Cliffs stock jumped 7.8% in premarket trading, while S&P 500 and Dow Jones Industrial Average futures were up 0.2% and 0.1%, respectively.

Coming into Monday, Cliffs' stock has risen about 42% this year, boosted by President Donald Trump's import tariffs that have helped raise domestic steel prices.

"Our third quarter results marked a clear sign of demand recovery for automotive-grade steel made in the U.S.," said CEO Lourenco Goncalves in a news release. "Our Q3 results [also] show a richer sales mix and improved pricing, further bolstered by our continued execution on costs."

Beyond steel, Goncalves added that Cleveland-Cliffs is looking into rare earths metals.

Interest in rare earths is sky high after China, which dominates production and processing, threatened export controls on the materials, which put U.S. manufacturing at risk. Rare earths materials end up in everything from an electric vehicle to a wind turbine to a fighter jet. Shares of MP Materials, the largest rare earths producer in the Western hemisphere, have risen more than 400% in 2025. The move has left MP Materials with a market value of about $14 billion. Cliffs' market value was less than $7 billion to start the week.

"The renewed importance of rare earths has driven us to re-focus on this potential opportunity at our upstream mining assets," said Goncalves, adding that two assets in Michigan and Minnesota show some evidence of rare earths metals. "If successful, it would align Cleveland-Cliffs with the broader national strategy for critical material independence, similar to what we achieved in steel. American manufacturing shouldn't rely on China or any foreign nation for essential minerals, and Cliffs intends to be part of the solution."

It's a surprising turn that potentially overshadows another announcement. Cliffs signed a memorandum of understanding with an undisclosed global steel maker looking for more access to U.S. markets. Cliffs expects the deal to be "highly accretive" to shareholders, and more details will come in the fourth quarter of 2025 or the first quarter of 2026.

It was a busy quarter for the company. Investors will be digesting the news.

Write to Al Root at allen.root@dowjones.com

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October 20, 2025 07:31 ET (11:31 GMT)

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