Brazilian steelmaker’s second-quarter earnings soared year-on-year, yet a softer sequential result and cautious outlook point to tougher months ahead for investors.
Usiminas profit for the second quarter of 2026 came in at R$ 428.2 million (about US$84 million), a 236% jump from the same period last year. The headline number looks strong at first glance. Dig deeper, and you see profit fell 52% from the first quarter’s R$ 896.2 million. That sequential slide, plus cautious company outlook, tells a more nuanced story for investors. If you hold Usiminas shares or follow Brazilian steel, the swing matters. The company is profitable, but momentum is cooling.
Key Facts
- Net profit — R$ 428.2 million (about US$84 million) in 2Q26, up 236% year-on-year.
- Sequential drop — Profit fell 52% from R$ 896.2 million in 1Q26.
- core earnings strength — Adjusted core earnings hit R$ 761.3 million, up 17% quarter-on-quarter.
- Year-on-year base — 2Q25 profit was only R$ 127.6 million, a low bar.
- Cautious outlook — Company warns of market instability pressuring the next quarter.
- Dividend question — Profit remains solid, but investors watch payout sustainability.
- Market reaction — Results beat expectations, per analysts tracked by UOL Economia.
Usiminas Profit: The Year-on-Year Surge Has a Catch
Usiminas profit for the second quarter reached R$ 428.2 million (about US$84 million), against R$ 127.6 million in the same period last year. That 236% rise is impressive on paper.
But you must remember the base. The second quarter of 2025 was weak, dragged down by lower steel prices and high costs.
A low base makes percentage gains look bigger than they are.
Adjusted earnings before interest, taxes, depreciation, and amortization tell a clearer story. It reached R$ 761.3 million in the second quarter, up 86% from R$ 408.4 million a year earlier.
Sequentially, that measure rose 17% from R$ 653.2 million in the first quarter. This is a genuine operational improvement, and it beat market expectations tracked by UOL Economia and InfoMoney.
The company’s mining division, in particular, benefited from stronger iron ore prices and higher sales volumes.
Why Profit Dropped From the First Quarter
The sequential fall of 52% in net profit needs explanation. The first quarter of 2026 included one-off gains, likely from tax credits or financial results.
Those did not repeat in the second quarter. The company also faced higher depreciation and financial expenses, which ate into the bottom line.
Earnings before interest, taxes, depreciation, and amortization rose sequentially, but net profit did not follow. That gap points to non-operational items, not a deterioration in the steel business.
For investors, this matters. Adjusted earnings before interest, taxes, depreciation, and amortization is often a better gauge of underlying performance than net profit, which swings with one-offs.
Usiminas management highlighted this in their results release on 30 July, according to the company’s official statement.
Management Warns of Pressure Ahead
Usiminas kept a cautious tone in its outlook. The company said market instability could pressure results in the next quarter, per Estadão and the firm’s official release.
Steel prices in Brazil have softened, and imported products continue to compete aggressively. Domestic demand remains patchy, especially from the industrial sector.
The mining side offers some buffer. Iron ore prices have held up better than steel prices globally.
But management did not promise a repeat of this quarter’s performance. They highlighted cost control and operational efficiency as priorities.
For shareholders, that suggests margins could compress in the third quarter of 2026 if prices fall further.
There is also a macro angle. Brazil’s central bank has kept interest rates elevated, which raises borrowing costs and cools construction activity.
That feeds directly into steel demand. Usiminas sells heavily to local manufacturers and construction firms, so any slowdown there hits revenue.
What This Means for Your Portfolio
If you invest in Latin American equities, Usiminas offers a used play on Brazilian industrial activity. The stock, listed as USIM5 on B3, tends to move sharply with steel prices and domestic GDP expectations.
A 236% profit jump sounds impressive, but the sequential drop and cautious outlook temper the optimism.
Traders often react to earnings before interest, taxes, depreciation, and amortization beats rather than net profit noise. That is why the 17% sequential growth in that measure got attention.
Yet the outlook for the third quarter of 2026 is less clear. If you hold the stock, watch steel price trends and the exchange rate of the Brazilian real.
A weaker real helps exports but raises imported input costs.
The company also remains exposed to global trade flows. Chinese steel exports continue to pressure prices worldwide, including Brazil.
Usiminas has lobbied for tariffs on imports, but policy changes are unpredictable. Until demand firms up, expect volatility in both earnings and the share price.
More: Brazil news in English, every day from The Rio Times.
Sources: Usiminas investor relations; NordInvestimentos; Valor Econômico
Frequently Asked Questions
Why did Usiminas profit fall sequentially in 2Q26?
Net profit dropped 52% from R$ 896.2 million in 1Q26 to R$ 428.2 million. The first quarter included one-off gains that did not repeat. Higher depreciation and financial expenses also weighed on the bottom line.
How does core operating earnings compare across quarters?
Adjusted core earnings rose to R$ 761.3 million in 2Q26, up 17% from R$ 653.2 million in 1Q26. Year-on-year, it increased 86% from R$ 408.4 million in 2Q25.
What is Usiminas’ outlook for the next quarter?
Management expressed caution, citing market instability. Steel price softening and import competition could pressure results in 3Q26, according to the company’s official release on 30 July.
How does this affect shareholders in Latin America?
Usiminas is a direct play on Brazilian industrial and construction activity. Strong core earnings growth is encouraging, but the sequential profit drop and cautious outlook suggest near-term volatility. Monitor steel prices and local demand signals.
This article was produced by The Rio Times’ automated AI newsroom. Editorial responsibility: Matthias Camenzind, Publisher and Editor-in-Chief. The Rio Times also runs Ask Rio Times, which answers from 100,000+ of our own articles, the daily Latin America Power Map, and prediction-market odds on elections and markets.. How we use AI · Report an error
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