Century Aluminum (CENX 5.30%), a top producer of primary aluminum with operations in the U.S. and Iceland, released its second quarter results on August 7, 2025. The biggest news: GAAP revenue for Q2 2025 beat expectations, totaling $628.1 million versus the analyst forecast of $611.35 million. Adjusted earnings per share (non-GAAP) for Q2 2025, however, fell short of consensus at $0.30 versus the $0.34 estimate. Management pointed to strong aluminum shipments, improving regional pricing, and support from U.S. tariffs as positives, but bottom-line results were weighed down by increased raw material costs and several unique charges. Overall, Q2 2025 demonstrated revenue momentum but continued to face margin and cost challenges.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (Non-GAAP) | $0.30 | $0.34 | Data not provided | N/A |
| Revenue (GAAP) | $628.1 million | $611.35 million | $452.3 million | 38.8 % |
| Aluminum Shipments (tonnes) | 175,741 | 167,908 | 4.7 % |
Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report.
About the Business and What Drives Performance
Century Aluminum is a leading U.S.-based aluminum producer, operating large-scale smelting facilities in both the United States and Iceland. Its business centers on producing raw aluminum, which is sold as both standard billets and value-added products for industries such as transportation, construction, and packaging. The company’s results are heavily influenced by the market price of aluminum, which is set on the London Metal Exchange, as well as regional premiums reflecting local demand and supply dynamics.
Key success factors for Century Aluminum include effectively managing aluminum price volatility, controlling input costs for raw materials like alumina and energy, and maintaining stable relationships with critical customers such as Glencore. Its recent focus areas also include expanding low-carbon product lines, securing reliable power and supply contracts, and capitalizing on U.S. trade policies that support domestic producers. Operational cost management and efficiency continue to be vital due to the energy- and labor-intensive nature of aluminum production.
Quarter Highlights and Financial Performance
Century Aluminum's GAAP revenue exceeded analyst forecasts in Q2 2025. Sales from the U.S. segment were $324.4 million, while Iceland sales were $233.7 million for Q2 2025, both exceeding their respective prior quarter results.
Despite the revenue beat, profitability faced headwinds. Adjusted EPS (non-GAAP) of $0.30 for Q2 2025 missed consensus by more than 10%, while Net loss on a GAAP basis was $4.6 million in Q2 2025, a reversal from the prior quarter’s profit. The company attributed the Q2 2025 decline to several nonrecurring items, including a $14.5 million inventory adjustment, $11.5 million in derivative instrument losses, a $2.9 million charge for inefficiency at the Iceland casthouse, and $2.1 million related to a transformer failure, all of which affected the bottom line.
Operationally, Q2 2025 saw cost of goods sold (GAAP) increase to $591.9 million, up from $573.3 million in Q1 2025. Selling, general, and administrative expenses edged up to $14.0 million in Q2 2025. Higher input costs for energy, coke, pitch, and caustic continued to put pressure on profitability.
Strategic moves during Q2 2025 included announcing the restart of the final 50,000 tonnes of production capacity at the Mt. Holly smelter in South Carolina. Century Aluminum also refinanced its 7.50% Senior Secured Notes with new 6.875% notes, extending maturity to 2032 and lowering interest expenses. Sustainability efforts continued, with Icelandic operations running on renewable energy and supporting the premium Natur-Al™ aluminum product line.
Looking Ahead: Guidance and Investor Focus
For Q3 2025, management provided adjusted EBITDA guidance of $115 million to $125 million. This represents a substantial increase from Q2 2025 adjusted EBITDA of $74.3 million, with the improvement driven mainly by expectations of higher realized premiums in the U.S. Midwest in Q3 2025, following further increases to Section 232 aluminum tariffs. No explicit EPS guidance was provided for Q2 2025, and the company did not address potential changes to dividend policy.
Investors should continue monitoring the impact of cost inflation, particularly for raw materials and energy, along with ongoing operational reliability at the company’s key facilities. Attention is also warranted on how well Century Aluminum is able to convert higher pricing, benefiting from tariff policy, into improved profits in the quarters ahead. CENX does not currently pay a dividend.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
