Alcoa Q3 2026: EPS beats by 22%, free cash flow surges to $472M

Alcoa posted adjusted earnings of $1.82 per share for the third quarter, beating expectations, as alumina production jumped sequentially on improved stability at its Pinjarra refinery in Australia. Revenue came in slightly below the consensus estimate, and operational leverage carried the difference to the bottom line.

Free cash flow swung to $472 million in the quarter, reflecting the production gains and tighter capital discipline as capital expenditures fell. Operating income and net income both improved sharply from a year ago.

Alcoa's recent quarters have been uneven, and this quarter's $1.82 marks a solid showing even though it steps back from last quarter's peak. CEO William Oplinger pointed to the completed Alumar smelter restart in Brazil as another piece of the production improvement, noting that aluminum output has now increased for six consecutive quarters.

The most consequential forward-looking item is the AliGroup acquisition of South32's bauxite, alumina, and aluminum assets, which received South32 shareholder approval on October 15 and remains on track to close in the first half of 2027. To fund the roughly $3.1 billion cash consideration, Alcoa completed senior notes offerings that investors will monitor closely.

Management flagged approximately $60 million in combined Q4 headwinds for the Aluminum segment, split roughly evenly between higher raw material costs and planned maintenance on one side and alumina pricing pressure on the other. Full-year production targets for both segments were reaffirmed, and Alcoa separately entered agreements to sell portions of its Massena East, New York site for data center development.