Alcoa Posts $232M Net Income on $3B Revenue Despite Major Charges
Alcoa Corporation reported a $232 million net income in Q3 2025 despite significant restructuring costs, driven by increased alumina and aluminum production and strategic asset sales.
- Q3 revenue of $3.0 billion with $232 million net income
- Includes $895 million restructuring charge from Kwinana refinery closure
- $786 million gain from sale of Ma’aden joint venture interest
- Alumina production up 4%, aluminum production up 1% sequentially
- Progress on Massena energy contract and Australian gallium plant
Strong Earnings Amid Restructuring
Alcoa Corporation’s third quarter 2025 financial results reveal a company balancing operational growth with significant portfolio adjustments. The Pittsburgh-based aluminum and alumina producer reported $3.0 billion in revenue and a net income of $232 million, or $0.88 per share. This performance includes a hefty $895 million restructuring charge tied to the permanent closure of its Kwinana refinery in Australia, offset by a $786 million gain from selling its interest in the Ma’aden joint venture.
Operational Highlights and Production Gains
Operationally, Alcoa saw a 4% sequential increase in alumina production to 2.5 million metric tons, primarily due to reduced maintenance downtime at Australian refineries. Aluminum production also edged up 1% to 579,000 metric tons, helped by progress restarting the San Ciprián smelter in Spain. While alumina shipments remained flat, aluminum shipments dipped 3%, reflecting timing and trading activity shifts.
Strategic Initiatives and Cash Position
Strategic moves included finalising a long-term energy contract with the New York Power Authority for the Massena smelter, supported by a $60 million investment in anode baking furnace upgrades. Additionally, Alcoa secured backing from U.S. and Australian governments to develop a gallium plant co-located at the Wagerup refinery, signalling a diversification into critical materials. The company ended the quarter with a robust $1.5 billion cash balance, having fully repaid a $74 million term loan.
Financial Nuances and Adjusted Results
Excluding special items, Alcoa posted an adjusted net loss of $6 million, reflecting the challenging tariff environment and currency headwinds. Adjusted EBITDA, excluding special items, declined sequentially to $270 million, pressured by increased tariff costs on aluminum imports and asset retirement obligations, partially offset by higher aluminium prices. The Midwest premium earned on U.S. aluminum production helped mitigate some tariff impacts.
Outlook and Regulatory Landscape
Looking ahead, Alcoa maintained its 2025 production and shipment guidance for both alumina and aluminum segments. The company anticipates operational improvements in Q4, including lower maintenance costs and higher shipments, though tariff costs on U.S. aluminum imports from Canada are expected to rise by about $50 million sequentially. Regulatory progress continues in Australia, with the Western Australian Environmental Protection Authority reviewing public comments on new mining plans, with final recommendations expected by mid-2026.
Bottom Line?
Alcoa’s Q3 results underscore resilience amid restructuring and tariff pressures, setting the stage for operational focus and regulatory milestones ahead.
Questions in the middle?
- How will Alcoa manage rising tariff costs and their impact on profitability in 2026?
- What are the prospects and timelines for the Australian mine approvals and their effect on production?
- How significant will the new gallium plant be for Alcoa’s diversification and future growth?
