NUE 10-K & 10-Q changes, risk factors and insider trading

Many of the factors that affect our business and operations involve risk and uncertainty. The factors described below are some of the risks that could materially negatively affect our business, financial condition, results of operationsoperations, financial condition and cash flows.

Global steel production overcapacity continues to be an ongoing risk to Nucor and the entire steel industry. The Organisation for Economic Co-operation and Development (the “OECD”) has estimated that global steel production overcapacity could grow to 710be approximately 704 million net tons in 2025,2025. withThis additionallevel of excess capacity expectedis toeight come online overtimes the nextcurrent fewannual years.steel production in the United States. China continues to be a significant contributor to excess steelmaking capacity, producing more than one billion net tons of steel in each of the past fiveeight years, despite experiencing slower economic growth. Chinese steel producers are also investing in new steelmaking capacity in several countries in southeast Asia and Africa. As a result, the OECD projects that excess global steel capacity could increase nearly 20% to an estimated 795 million net tons by 2027.

InAfter 2018,recent ayears 25%of tariffweakened oreffectiveness quotadue limitsto werecountry exemptions and product exclusions, steel tariffs first imposed underin the first Trump Administration2018 under Section 232 of the Trade Expansion Act onwere allfully importedreinstated in 2025 without exceptions or exclusions, and were broadened to cover approximately 600 fabricated steel productsproducts. forThese ancomprehensive indefinitetariffs periodhave been more effective in combating circumvention behaviors and keeping unfairly traded imports out of time.the However,U.S. overmarket. timeThere can be no assurance as to when or if the Section 232 measuresor wereother weakenedimport throughtariffs, countryquotas exemptions,or quotaother arrangementsduties andmay individualbe productenacted, exclusions.enforced, Asextended, amodified result,or terminated in the Section 232 program’s coverage narrowed significantly since its initial implementation, with duties eventually applicable to less than 20% of total import volumes.future. If the Section 232 or other import tariffs, quotas or duties expire or if others are further relaxed or repealed, or if relatively higher U.S. steel prices or a stronger U.S. dollar make it attractive for foreign steelmakers to export their steel products to the United States, despite the presence of import tariffs, quotas or duties, the resurgence of substantial imports of foreign steel could create downward pressure on U.S. steel prices.

Our operations are subject to numerous federal, state and local laws and regulations relating to the protection of the environment, and, accordingly, we make provision in our financial statements for the estimated costs of compliance. There are inherent uncertainties in these estimates. Most notably, the uncertainty of policies, enforcement priorities, legislation and international regulations related to climate change mitigation strategies pose the greatest risk.

As a carbon steel producer, Nucor could be increasingly affected both directly and indirectly by new or changing carbon policy decisions and mandates. Carbon is an essential raw material in Nucor’s steel production processes. Furthermore, Nucor steel mills use significant amounts of electricity as all100% of itsour mills utilize EAFsEAF technology for 100% of theirour steel melting operations and the decarbonization of electricity generation may lead to high power costs and decreaseduncertainty in reliability. Significant changes to the regional power grids serving our steel mills and/or new rulemaking or legislation affecting the operation of these power grids may negatively affect our business, results of operations, financial condition and cash flows.

In addition to the above mentionedabove-mentioned statutes, revisions to National Ambient Air Quality Standards ("NAAQS"), including the implementation actions/decisions of environmental agencies, could make it significantly more difficult to obtain construction permits and permits to expand existing operations. Resulting cancellations, delays or unanticipated costs to these projects could negatively impact our ability to generate expected returns on our investments. Emission reductions for existing operations due to a NAAQS revision canmay also be required. These regulations can also increase our cost of energy, primarily electricity, which we use extensively in the steelmaking process. We may in the future incur substantially increased costs complying with such regulations, particularly if federal regulatory agencies were to change their enforcement posture with respect to such regulations.

Emerging customer preferences for greater product transparency and less GHG intensive materials may put us at a competitive disadvantage oras reducea demandcarbon forsteel our products.producer.

The federal government and numerous states are considering establishing, or have already established, requirements for Environmental Product Declarations (“EPDs”) so that consumers may more readily evaluate the environmental impacts of products. California has enacted the “Buy Clean California Act” and California has also established Global Warming Potential benchmarks through EPDs for certain materials, including certain steel products. The federal government has also implemented a "Buy Clean" guidance associated with the Inflation Reduction Act. EPD legislation has caused Nucor to incur additional costs and has the potential to put Nucor and its customers at a disadvantage to foreign competitors unless standardized mechanisms are used to fully evaluate and track products produced by foreign producers.

We utilize various information technology systems to efficiently address business functions ranging from the operation of our production equipment to administrative computation to the storage of data such as intellectual property and proprietary business information. We also utilize third-party service providers for certain information technology services that are important to our operations. We continuously evaluate our cybersecurity systems and practices, assess potential threats, and improve our information technology networks, policies and procedures to address potential vulnerabilities. Despite efforts to assure secure and uninterrupted operations, threats from increasingly sophisticated cyberattacks or system failures could result in materially adverse operational disruptions or security breaches of our systems or those of our third-party service providers. These risks could result in disclosure or destruction of key proprietary information or personal data or reputational damage, theft of assets or trade secrets, or could adversely affect our ability to physically produce or transport steel, resulting in lost revenues, as well as delays in reporting our financial results. We also could be required to spend significant financial and other resources to remedy the damage caused by a cyber-securitycybersecurity breach, including to repair or replace networks and information technology systems. We may also contend with potential liability for stolen information, increased cyber-securitycybersecurity protection costs, litigation expense and increased insurance premiums.

Certain of our businesses and investments are located outside of the United States, in Canada, Mexico and in emerging markets. There are a number of risks inherent in doing business in or sourcing raw materials from such markets. These risks include, but are not limited to: unfavorable political or economic factors; local labor and social issues; changes in regulatory requirements; fluctuations in foreign currency exchange rates, interest rates and inflation; and complex foreign laws, treaties including tax laws, and the Foreign Corrupt Practices Act of 1977. These risks could restrict our ability to operate our international businesses profitably and therefore have a negative impact on our financial position and results of operations.operations and financial condition. In addition, our reported results of operations and financial position could also be negatively affected by exchange rates when the activities and balances of our foreign operations are translated into U.S. dollars for financial reporting purposes.

We spend substantial resources ensuring that we comply with domestic and foreign regulations, contractual obligations and other legal standards. Notwithstanding this, we are subject to a variety of legal proceedings and legal compliance risks in respect of various issues, including regulatory, safety, environmental, employment, transportation, intellectual property, contractual, import/export, international trade and governmental matters that arise in the course of our business and in our industry. For information regarding our current significant legal proceedings, see “Item 3. Legal Proceedings.” A negative outcome in an unusual or significant legal proceeding or compliance investigation could adversely affect our financial condition and results of operations.operations and financial condition. While we believe that we have adopted appropriate risk management and compliance programs, the nature of our operations means that legal compliance risks will continue to exist and additional legal proceedings and other contingencies, the outcome of which cannot be predicted with certainty, will arise from time to time.

Global steel production overcapacity continues to be an ongoing risk to Nucor and the health of the entire steel industry. The OrganisationOECD for Economic Co-operation and Development ( the “OECD”)has estimated that global crude steel production overcapacity wouldin grow2025 fromis approximately 632704 million net tonstons. This level of excess capacity is eight times the current annual steel production in 2024the toUnited approximatelyStates. 710 million net tons in 2025.However,However, additional capacity continues to come online and China’s steel production, the largest steel producing country, is still near record levels. In 2024,2025, China’s steel production was more than 1 billion net tons for the fiftheighth consecutive year.year, and China exported a record 131 million net tons to offset weak domestic consumption. Circumvention of trade duties also continues to pose a risk, as countries route products through third-party countries to evade duties. Increasingly, China is seeking to evade trade duties by building new steelmaking capacity in other countries with a focus on neighboring countries in southeast Asia, as well as Africa.

An uncertainty we continue to face in our business is the price of our principal raw material, ferrous scrap, which is volatile and often increases or decreases rapidly in response to changes in domestic demand, unanticipated events that affect the flow of scrap into scrap yards, the availability of scrap substitutes, currency fluctuations and changes in foreign demand for scrap. In periods of rapidly increasing raw material prices in the industry, which are often also associated with periods of stronger or rapidly improving steel market conditions, being able to increase our prices for the products we sell quickly enough to offset increases in the prices we pay for ferrous scrap is challenging but critical to maintaining our profitability. We attempt to mitigate the scrap price risk by managing scrap inventory levels at the steel mills to match the anticipated demand over the next several weeks. Certain scrap substitutes, including pig iron, have longer lead times for delivery than scrap, which can make this inventory management strategy difficult to achieve. Continued successful implementation of our raw material strategy, including key investments in DRI production, coupled with the scrap brokerage and processing services performed by our team at DJJ, give us greater control over our metallic inputs and thus also helps us to mitigate this risk. See "Item 1A. Risk Factors- IndustryFactors-Industry Specific Risk Factors" for further discussion of raw material risks.

Our highly variable, low-cost structure, combined with our financial strength and liquidity, have allowed us to successfully navigate cyclical steel industry market conditions in the past. In such times, our incentive-based pay system reduces our payroll costs, both hourly and salary, which helps to offset lower selling prices. Our pay-for-performance system that is closely tied to our levels of production also allows us to keep our highly experienced workforce intact and to continue operating our facilities when some of our competitors with greater fixed costs are forcedcompelled to shut down some of their facilities. Because we use EAFs to produce our steel, we can easily vary our production levels to match short-term changes in demand.

Net sales for 20242025 decreasedincreased 11%6% from the prior year. Average sales price per ton decreased 10%2% from $1,377 in 2023 to $1,241 in 2024.2024 to $1,221 in 2025. Total tons shipped to outside customers decreasedincreased 2%7% from 25,205,000 tons in 2023 to 24,767,000 tons in 2024.2024 to 26,615,000 tons in 2025.

Net sales for the steel productsmills segment decreasedincreased 21%7% in 20242025 fromcompared to the prior year due to a 12%7% decreaseincrease in thevolumes. averageAverage sales price per ton, from $2,845ton in 2023the steel mills segment was $1,008 in 2025, which was similar to $2,510$1,013 in 2024, as well as a 10% decrease in volumes.2024.

Net sales for the raw materials segment increased 3%13% in 20242025 from the prior year, primarily due to increased average sales price and volumes at DJJ’s brokerage operations. In 2024,2025, approximately 93%95% of outside sales for the raw materials segment were from theDJJ's brokerage operations of DJJ,operations, and approximately 4%3% of outside sales were from theDJJ's scrap processing operations of DJJ (92%93% and 4%, respectively, in 20232024).

The primary driver forof the decrease in gross margins in 20242025 as compared to 20232024 was the decrease in gross margins in the steel products segment. Gross margins decreased across mostmany businesses within the segment due to lower volumes and decreased average selling prices. The largest decreases were at our joist and deckdeck, businesses,building assystems, and rebar fabrication businesses due to decreased average selling prices and volumesmargin continued to moderate from the historically high levels reached in 2022.compression.

Gross margins in the rawsteel materialsmills segment decreased significantlyincreased in 2024 as2025 compared to 20232024 due to the decreasedpreviously profitabilitymentioned ofincrease ourin scrapvolumes processingand operations.increased metal margins.

A major component of marketing, administrative and other expenses is profit sharing and other incentive compensation costs. These costs, which are based upon and fluctuate with Nucor’s financial performance, decreased from 20232024 to 20242025 due to the decreased profitability of the Company. In 2024,2025, profit sharing costs consisted of $298$256 million, including the Company’s matching contribution, made to the Company’s Profit Sharing and Retirement Savings Plan for qualified employees ($611$298 million in 20232024). Other employee bonus costs also fluctuate based on Nucor’s achievement of certain financial performance goals, including achieving record earnings, and comparisons of Nucor’s financial performance to peers in the steel industry and other companies. Stock-based compensation included in marketing, administrative and other expenses decreasedincreased by 4%7% to $56 million in 2025 compared with $52 million in 2024 compared with $54 million in 2023 and includes expenses associated with vesting of stock awards granted in prior years.

Equity in earnings of unconsolidated affiliates was $35 million in 2025 and $30 million in 2024 and $13 million in 2023.2024. The increase in equity method investment earnings from 20232024 to 20242025 was primarily due to decreased losses at NJSM. In October 2023, Nucor purchased an additional 1% interest in NJSM, bringing our investment in NJSM to a 51% controlling interest. Beginning in the fourthincreased quarterresults of 2023, Nucor has accounted for NJSM on a consolidated basis.NuMit.

Included in 2024 net earnings were $137 million of losses and impairments of assets (none in 2023). During the third quarter of 2024, management determined that it was probable that a long-term note receivable in the raw materials segment would no longer be collectable and recorded an $83 million impairment charge to fully reserve the note receivable. The other primary component of losses and impairments of assets in 2024 was a $40 million impairment charge of certain assets, mostly property, plant, and equipment, net, related to a business in the steel products segment.

Noncontrolling interests represent the income attributable to the noncontrolling partners of Nucor’s joint ventures, Nucor-Yamato, CSI and NJSM. Nucor owns a 51% controlling interest in each of Nucor-Yamato, CSI and NJSM. The decreaseincrease in earnings attributable to noncontrolling interests in 20242025 as compared to 20232024 was due to the decreasedincreased earnings of Nucor-Yamato andcombined CSI. Furthermore,with the decrease in earnings attributable to noncontrolling interests was due to thedecreased losses of NJSM, forpartially whichoffset resultsby werelosses consolidatedat beginning in the fourth quarter of 2023 following Nucor's purchase of an additional 1% interest in NJSM to bring the total investment to a 51% controlling interest.CSI.

The Internal Revenue Service (“IRS”) is currently examining Nucor’s 2015, 2019, and 2020 federal income tax returns. Nucor has concluded U.S. federal income tax matters for tax years through 2014, and for the tax years 2016 and 2018.2021. The tax years 20212022 through 20232024 remain open to examination by the IRS.Internal Revenue Service. The 2015 through 2021 Canadian income tax returns for Nucor Rebar Fabrication Group Inc. (formerly known as Harris Steel Group Inc.) and certain related affiliates are currently under examination by the Canada Revenue Agency. The tax years 20162017 through 20232024 remain open to examination by other major taxing jurisdictions to which Nucor is subject (primarily Canada, Trinidad & Tobago, and other state and local jurisdictions).

We believe our financial strength is a key strategic advantage, particularly during recessionary business cycles. We carry the highest credit ratings of any steel producer headquartered in North America, with an A- long-term rating from Standard and Poor’s, aan Baa1A3 long-term rating from Moody’s and an A- long-term rating from Fitch. Our credit ratings are dependent, however, on many factors, both qualitative and quantitative, and are subject to change at any time. The disclosure of our credit ratings is made to enhance investors’ understanding of our sources of liquidity and the impact of our credit ratings on our cost of funds.

Nucor’s cash and cash equivalents, short-term investments and restricted cash and cash equivalents and short-term investments position remained strong at $2.70 billion as of December 31, 2025, compared with $4.14 billion as of December 31, 2024, compared with $7.13 billion as of December 31, 2023.2024. Approximately $970$931 million and $1.05$970 billionmillion of the cash and cash equivalents position as of December 31, 20242025 and 2023,2024, respectively, was held by our majority-owned joint ventures. Cash flows provided by operating activities provide us with a significant source of liquidity. When needed, we have external short-term financing sources available, including the issuance of commercial paper and borrowings under our bank credit facilities.

We also issue long-term debt securities from time-to-time. On MayMarch 23,5, 2022,2025, Nucor completed the issuance and sale of $500 million aggregate principal amount of its 3.950%4.650% Notes due 20252030 (the “20252030 Notes”) and $500 million aggregate principal amount of its 4.300%5.100% Notes due 20272035 (the “20272035 Notes” and, together with the 2030 Notes, the “Notes”). Net proceeds from the issuance and sale of the Notes were $997 million. Costs of $9 million associated with the issuance and sale of the Notes have been capitalized and will be amortized over the life of the Notes.

The current ratio, which is calculated by dividing current assets by current liabilities, was 2.9 at year-end 2025 compared with 2.5 at year-end 2024 compared with 3.6 at year-end 2023.2024. The current ratio was impacted by lower cash and cash equivalents and the increasedecrease in the current portion of long-term debt at December 31, 2024.2025.

In 2025 and 2024, total accounts receivable turned approximately every five weeks and inventories turned approximately every ten10 weeks. These ratios compare with accounts receivable turnover of approximately every five weeks and inventory turnover of approximately every 11 weeks for 2023.

Funds provided by operations, cash and cash equivalents, short-term investments, restricted cash and cash equivalentsinvestments and new borrowings under existing credit facilities are expected to be adequate to meet future capital expenditures, current debt maturities and working capital requirements for existing operations for at least the next 24 months. We also believe we have adequate access to capital markets for liquidity purposes.

We believe that our conservative financial practices have served us well in the past and are serving us well today. Nucor’s financial strength allows for a consistent, balanced approach to capital allocation throughout the business cycle. Nucor’sNucor highest capital allocation priority is to investinvests in our business for profitable growth over the long term. We have historically done this by investing to optimize our existing operations, initiate greenfield expansions and make acquisitions. OurAdditionally, second priority is towe return capital to our stockholders through cash dividends and share repurchases. We intend to return a minimum of 40% of our net earnings to our stockholders through dividends and share repurchases, while maintaining a debt-to-capital ratio that supports a strong investment grade credit rating. Nucor returned approximately $2.7$1.2 billion in capital to its stockholders in the form of base dividends and share repurchases in 2024.2025.

For 20242025 compared to 2023,2024, the $3.13$745 billionmillion decrease in cash provided by operating activities was primarily driven by a decrease in net earnings and changes in operating assets and liabilities. Net earnings decreased $2.59$281 billionmillion over the prior year, which included $47 million of non-cash losses and impairments of assets in 2025, compared to $137 million of non-cash losses and impairments of assets in 2024 (none in 2023).2024. The changes in operating assets and liabilities resulted in a net outflow of $636 million in 2025 and a net inflow of $156 million and $858 million in 2024 and 2023, respectively.2024. The changes in working capital were primarily due to aan decreaseincrease in accounts receivable and inventories from year-end 20232024 to year-end 2024.2025. Accounts receivable at the end of 20242025 decreasedincreased from the prior year-end resulting in a cash inflowoutflow of $319$428 million due to aan decreaseincrease in the sales volumes and price per ton compared to the prior year. FromThis compares to accounts receivable at year-end 2024 decreasing from year-end 2023 and resulting in a $319 million cash inflow. From year-end 2024 to year-end 2024,2025, inventories decreasedincreased resulting in an inflowoutflow of $518$366 million due primarily to ana 18%6% decreaseincrease in raw material tons. This compares to inventories at year-end 20232024 increasingdecreasing from year-end 20222023 and resulting in a $75$518 million cash outflow.inflow. Salaries, wages and related accruals decreased $385from year-end 2024 to year-end 2025 resulting in a cash inflow of $2 million due to lower current year profit sharing accrual and other benefit related accruals. AccountsThis payablecompares decreasedto salaries, wages and related accruals at year-end 2024 decreasing from year-end 2023 and resulting in a $321$385 million cash outflowoutflow. Accounts payable increased resulting in an $80 million cash inflow due to the decreasesincreases in inventory mentioned previously.

OurMany businessof isour businesses are capital intensive; therefore, cash used in investing activities primarily represents capital expenditures for the construction of new facilities, the expansion and upgrading of existing facilities and the acquisition of other companies. The $1.24$508 billionmillion increasedecrease in cash used in investing activities was primarily due to $758a decrease in the funding of acquisitions of over $750 million used in 2024 to fund acquisitions2025 compared to $71 million used to fund acquisitions in 2023.2024. $565 million of this was used in the acquisition of Rytec in 2024. Cash used for capital expenditures increased by $959$249 million to $3.42 billion in 2025 as compared to $3.17 billion in 2024 as compared to $2.21 billion in 2023.2024. The increase in capital expenditures was primarily due to the sheet mill under construction in West Virginia, the sheetconstruction of a manufacturing location to expand NTS, the construction of a melt shop at our bar mill expansion in IndianaArizona and the rebargalvanizing microline at our sheet mill under construction in NorthSouth Carolina. Capital expenditures for 20252026 are estimated to be approximately $3.00$2.50 billion. The projects that we anticipate will have the largest capital expenditures in 20252026 are the sheet mill under construction in West Virginia, the construction of twoa manufacturing locationslocation to expand NTS, and the galvanizing line at our sheet mill in South Carolina.

The primary uses of cash were: (i) stock repurchases of $2.22$700 billionmillion in 20242025 as compared to $1.55$2.22 billion in 2023,2024, ana increasedecrease of $663$1.52 millionbillion; (ii) cash dividends to stockholders of $512 million in 2025 as compared to $522 million in 2024 as compared to $515 million in 2023; and (iii) distributions to noncontrolling interestsrepayments of $352long-term milliondebt of $1.02 billion in 20242025 as compared to $435$10 million in 2023,2024, aan decreaseincrease of $83$1.01 million.billion. In 2022,March 2025, Nucor issued $500 million aggregate principal amount of the 20252030 Notes,Notes and $500 million aggregate principal amount of the 20272035 Notes,Notes. $550Net millionproceeds from the issuance and sale of the Notes were used during the second quarter of 2025 to redeem all of the outstanding $1.00 billion aggregate principal amount of the 20322025 Notes andpursuant $550to millionthe aggregate principal amountterms of the 2052indenture governing the 2025 Notes. OnFurthermore, Aprilin 25,November 2022,2025, Nucor redeemedissued all $500$220 million aggregatein principal40-year amountvariable outstandingrate West Virginia Economic Development Authority IDRBs to partially fund the construction of the 2023West Notes.Virginia Onsheet August 15, 2022, Nucor redeemed all $600 million aggregate principal amount outstanding of the 2022 Notes.mill.

OurIn $1.75March billion2025, Nucor amended and restated its revolving credit facility isto undrawnincrease the borrowing capacity from $1.75 billion to $2.25 billion and hasto aextend its maturity date ofto NovemberMarch 5,11, 2026.2030. The revolving credit facility includes only one financial covenant, which is a limit of 60% on the ratio of funded debt to total capital. In addition, the undrawn revolving credit facility contains customary non-financial covenants, including a limit on Nucor’s ability to pledge the Company’s assets and a limit on consolidations, mergers and sales of assets. As of December 31, 2024,2025, Nucor’s funded debt to total capital ratio was 24.5%,24.4%, and Nucor was in compliance with all covenants under the credit facility.

Nucor manages interest rate risk by using a combination of variable-rate and fixed-rate debt. At December 31, 2024,2025, approximately 21%24% of Nucor’s long-term debt was comprisedconsisted of instruments with variable interest rates, primarily industrial development revenue bonds ("IDRBs") that are adjusted weekly. The remaining 79%76% of Nucor’s long-term debt was at fixed rates. Future changes in interest rates are not expected to significantly impact earnings. From time to time, Nucor makes use of interest rate swaps to manage interest rate risk. As of December 31, 2024,2025, there were no such contracts outstanding. Nucor’s investment practice is to invest in securities that are highly liquid with short maturities. As a result, we do not expect changes in interest rates to have a significant impact on the value of our investment securities recorded as short-term investments.

Capital deploymentexpenditures isare expected to decrease in 2025 with planned capital expenditures ofto approximately $3.0$2.5 billion,billion continuedin evaluation of acquisitions, and share repurchases expected to moderate.2026. As we have in the past, we intend to allocate capital to investments that advance our strategy to grow the core and expand beyond, with the goal of keeping Nucor in a position of strength well into the future.

We evaluate our property, plant and equipment and finite-lived intangible assets for potential impairment on an individual asset basis or at the lowest level asset grouping for which cash flows can be independently identified. Asset impairments are assessed whenever circumstances indicate that the carrying amounts of those productive assets could exceed their projected undiscounted cash flows. In developing estimated values for assets that we currently use in our operations, we utilize judgments and assumptions of future undiscounted cash flows that the assets will produce. When it is determined that an impairment exists, the related assets are written down to estimated fair market value. Certain long-lived asset groupings were tested for impairment during the fourth quarter of 2024.2025. Undiscounted cash flows for each asset grouping were estimated using management’s long-range estimates of market conditions associated with each asset grouping over the estimated useful life of the principal asset within the group. Our undiscounted cash flow analysis indicated that the tested long-lived asset groupings were recoverable as of December 31, 2024. Management determined that no long-lived asset impairment testing was required in 2023.2025.

When appropriate, Nucor performs a qualitative assessment to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount. For certain reporting units, it is necessary to perform a quantitative analysis. In these instances, a discounted cash flow model is used to determine the current estimated fair value of these reporting units. Significant assumptions used to determine the fair value of each reporting unit as part of our annual testing (and any required interim testing) include: (i) expected cash flow for the five-year period following the testing date (including market share, sales volumes and prices, raw materials and other costs to produce and estimated capital needs); (ii) an estimated terminal value using a terminal year growth rate determined based on the growth prospects of the reporting unit; (iii) a discount rate based on management’s best estimate of the after-tax weighted-average cost of capital; and (iv) a probability-weighted scenario approach by which varying cash flows are assigned to certain scenarios based on the likelihood of occurrence. Management considers historical and anticipated future results, general economic and market conditions, the impact of planned business and operational strategies and all available information at the time the fair values of its reporting units are estimated. Those estimates and judgments may or may not ultimately prove appropriate.

KeyIn the event that an impairment review is necessary, a discounted cash flow model is used to determine the current estimated fair value of the equity method investment. Significant assumptions used to determine the fair value of ourthe equity method investmentsinvestment include: (i) expected cash flow for the five-year period following the testing date (including market share, sales volumes and prices, raw materials and other costs to produce and estimated capital needs); (ii) an estimated terminal value using a terminal year growth rate determined based on the growth prospects of the equity method investment; and (iii) a discount rate based on management’s best estimate of the after-tax weighted-average cost of capital; and (iv) a probability-weighted scenario approach by which varying cash flows are assigned to certain scenarios based on the likelihood of occurrence.capital. Management considers historical and anticipated future results, general economic and market conditions, the impact of planned business and operational strategies and all available information at the time the fair values of its equity method investments are estimated. Those estimates and judgments may or may not ultimately prove appropriate.

Certain statements made in this report, or in other public filings, press releases, or other written or oral communications made by Nucor Corporation, a Delaware corporation incorporated in 1958, and its affiliates (collectively, "Nucor,Nucor", the "Company,Company", "we,we", "us", or "our"), which are not historical facts are forward-looking statements subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties which we expect will or may occur in the future and may impact our business, financial condition and results of operations. The words “anticipate,” “believe,” “expect,” “intend,” “project,” “may,” “will,” “should,” “could” and similar expressions are intended to identify those forward-looking statements. These forward-looking statements reflect the Company’s best judgment based on current information, and, although we base these statements on circumstances that we believe to be reasonable when made, there can be no assurance that future events will not affect the accuracy of such forward-looking information. As such, the forward-looking statements are not guarantees of future performance, and actual results may vary materially from the projected results and expectations discussed in this report. Factors that might cause the Company’s actual results to differ materially from those anticipated in forward-looking statements include, but are not limited to: (1) competitive pressure on sales and pricing, including pressure from imports and substitute materials; (2) U.S. and foreign trade policies affecting steel imports or exports; (3) the sensitivity of the results of our operations to general market conditions, and in particular, prevailing market steel prices and changes in the supply and cost of raw materials, including pig iron, iron ore and scrap steel; (4) the availability and cost of electricity and natural gas, which could negatively affect our cost of steel production or result in a delay or cancellation of existing or future drilling within our natural gas drilling programs; (5) critical equipment failures and business interruptions; (6) market demand for steel products, which, in the case of many of our products, is driven by the level of nonresidential construction activity in the United States; (7) impairment in the recorded value of inventory, equity investments, fixed assets, goodwill or other long-lived assets; (8) uncertainties and volatility surrounding the global economy, including excess world capacity for steel production, inflation and interest rate changes; (9) fluctuations in currency conversion rates; (10) significant changes in laws or government regulations affecting environmental compliance, including legislation and regulations that result in greater regulation of greenhouse gas emissions that could increase our energy costs, capital expenditures and operating costs or cause one or more of our permits to be revoked or make it more difficult to obtain permit modifications; (11) the cyclical nature of the steel industry; (12) capital investments and their impact on our performance; (13) our safety performance; (14) our ability to integrate businesses we acquire; (15) the impact of any pandemic or public health situation; and (16) the risks discussed in “Item 1A. Risk Factors” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2025.

Nucor reports its results in the following segments: steel mills, steel products and raw materials. The steel mills segment includes carbon and alloy steel in sheet, bars, structural and plate; steel trading businesses; and rebar distribution businesses; and Nucor’s equity method investment in NuMit LLC. The steel products segment includes steel joists and joist girders, steel deck, fabricated concrete reinforcing steel, cold finished steel, precision castings, steel fasteners, metal building systems, insulated metal panels, overhead doors, steel grating, tubular products businesses,products, steel racking, piling products business,products, wire and wire mesh, overhead doors, and utility towers and structures. The raw materials segment includes DJJ, primarily a scrap broker and processor; Nu-Iron Unlimited and Nucor Steel Louisiana LLC ("Nucor Steel Louisiana"),Louisiana, two facilities that produce DRI used by the steel mills; and our natural gas production operations.

The average utilization rates of all operating facilities in the steel mills, steel products and raw materials segments were approximately 86%,88%, 60%65% and 76%, respectively, in the first quartersix months of 2026, compared towith approximately 80%, 55%82%,61% and 73%, respectively, in the first quartersix months of 2025.

Nucor reported net earnings attributable to Nucor stockholders of $743$1.16 million,billion, or $3.23$5.04 per diluted share, infor the firstsecond quarter of 2026, which represented an increase compared to net earnings attributable to Nucor stockholders of $156$603 million, or $0.67$2.60 per diluted share, infor the firstsecond quarter of 2025.

Earnings in the raw materials segment increased in the firstsecond quarter of 2026 as compared to the firstsecond quarter of 2025,2025 primarily due to increased average selling prices and shipments, and the increasedimproved profitability of our scrapdirect processingreduced operations.iron Included in the raw materials segment’s earnings in the first quarter of 2026 was $15 million of impairment charges related to certain assets within the segment.facilities.

The following discussion provides a greater quantitative and qualitative analysis of Nucor’s performance in the second quarter and first quartersix months of 2026 as compared to the second quarter and first quartersix months of 2025.

Net sales to external customers by segment for the second quarter and first quartersix months of 2026 and 2025 were as follows (in millions):

Net sales for the firstsecond quarter of 2026 increased 21%23% from the firstsecond quarter of 2025. Average sales price per ton increased 12%10% from $1,146$1,240 in the firstsecond quarter of 2025 to $1,279$1,367 in the firstsecond quarter of 2026. Total tons shipped to outsideexternal customers in the firstsecond quarter of 2026 were approximately 7,427,0007,605,000 tons, a 9%12% increase from the firstsecond quarter of 2025.

In the steel mills segment, sales tons for the second quarter and first quartersix months of 2026 and 2025 were as follows (in thousands):

Net sales for the steel mills segment increased 23% in the firstsecond quarter of 2026 compared tofrom the firstsecond quarter of 2025, primarily due to a 14%12% increase in tons shipped to external customers and a 10% increase in the average sales price per ton, from $938$1,041 to $1,074,$1,145 in the second quarter of 2025 and an2026, 8% increase in tons sold to outside customers.respectively.

Net sales for the steel productsmills segment increased 16%23% in the first quartersix months of 2026 compared tofrom the first quartersix months of 2025, primarily due to a 5%10% increase in thetons shipped to external customers and a 12% increase in average sales price per ton,ton from $2,294$989 to $2,405,$1,110 in the first six months of 2025 and an2026, 11% increase in tons sold to outside customers.respectively.

Net sales to external customers for the raw materials segment increased 30%49% in the firstsecond quarter of 2026 compared to the firstsecond quarter of 2025, primarily due to increased volumes and average selling prices at DJJ's scrap brokerage operations.2025. In the firstsecond quarter of 2026, approximately 96%95% of outside sales for the raw materials segment were from DJJ'sthe scrap brokerage operations,operations of DJJ, and approximately 3%2% of outside sales for the raw materials segment were from DJJ'sthe scrap processing operations of DJJ (approximately 94% and 4%,3%, respectively, in the firstsecond quarter of 2025).

The majority of the raw materials segment's total sales are to internal customers in the steel mills segment. Net sales to outside customers represented approximately 18%20% and 19% of the raw materials segment's total sales in the firstsecond quarter and first six months of 20262026, respectively (approximately 16% in the second quarter and first quartersix months of 2025).

Nucor recorded gross margins of $1.50$2.03 billion (16%20%) in the firstsecond quarter of 2026, which was an increase compared to $605$1.22 millionbillion (8%14%) in the firstsecond quarter of 2025.

The primary driver of the increase in gross marginsmargin in the firstsecond quarter of 2026 as compared to the firstsecond quarter of 2025 was increaseddue primarily to higher metal margins in the steel mills segment caused by higher metal margins.segment. Metal margin is the difference between the selling price of steel and the cost of scrap and scrap substitutes. Additionally, the steel mills segment had decreased conversion costs per ton in the first quarter of 2026 as compared to the first quarter of 2025 due to higher utilization rates.

Scrap and scrap substitutes are the most significant element in the total cost of steel production. The average scrap and scrap substitute cost per gross ton used in the firstsecond quarter of 2026 was $403,$422, a 2%5% increase compared to $394$403 in the firstsecond quarter of 2025. TheDespite the increase in average scrap and scrap substitute costscost wasper moregross thanton offsetused, bymetal margins increased in the second quarter of 2026 as compared to the second quarter of 2025 due to the previously mentioned increases in average selling prices,prices resultingand inshipping higher metal margins.volumes.

Pre-operating and start-up costs of new facilities were approximately $108$120 million in the firstsecond quarter of 2026 and approximately $170$136 million in the firstsecond quarter of 2025. Pre-operating and start-up costs in the firstsecond quarter of 2026 primarily included costs related to the sheet mill being built in West Virginia and the coating complex at our sheet mill in Indiana. Pre-operating and start-up costs in the firstsecond quarter of 2025 primarily included costs related to the sheet mill in West Virginia, the plate mill in KentuckyKentucky, the rebar micro mill in North Carolina and the sheetmelt shop addition at the bar mill being built in West Virginia.Arizona. Nucor defines pre-operating and start-up costs, all of which are expensed, as the losses attributable to facilities or major projects that are either under construction or in the early stages of operation. Once these facilities or projects have attained a utilization rate that is consistent with our other similar operating facilities, Nucor no longer considers them to be in start-up.

Gross margins in the rawsteel materialsproducts segment increaseddecreased in the firstsecond quarter of 2026 as compared to the firstsecond quarter of 2025,2025. primarilyIncreased dueaverage tosales theprices and volumes were outpaced by increased profitabilitysteel ofinput ourcosts scrapcausing processingmargin operations.compression.

A major component of marketing, administrative and other expenses is profit sharing and other incentive compensation costs. These profit sharing and other incentive compensation costs, which are based upon and fluctuate with Nucor’s financial performance, increased by $88$86 million in the second quarter of 2026 compared to the second quarter of 2025, and increased by $174 million in the first quartersix months of 2026 as compared to the first quartersix months of 2025. TheThese increaseincreases was primarilywere due to the Company’sNucor's increased earningsprofitability in the second quarter and first quartersix months of 2026 as compared to the firstrespective quarterprior ofyear 2025.periods, which resulted in increased expenses related to profit sharing and other incentive compensation.

Included in the first quartersix months of 2026 net earnings was $15 million of impairment charges related to certain assets in the raw materials segment.segment, all of which was recorded in the first quarter of 2026 (none was recorded in the second quarter of 2026).

Included in the second quarter and first quartersix months of 2025 net earnings was $29$11 million and $40 million, respectively, of losses and impairments of assets. OfThese thischarges amount,consisted of the following: $19 million was related to the closure or repurposing of certain facilities in the steel products segment.segment The(all remainingof $10which was recorded in the first quarter of 2025); $17 million was related to the repurposing of a facility in the steel mills segment.segment ($7 million of which was recorded in the second quarter of 2025); and $4 million related to the write-off of certain assets in the raw materials segment (all of which was recorded in the second quarter of 2025).

Net interest expense for the second quarter and first quartersix months of 2026 and 2025 was as follows (in millions):

Interest expense decreased in the second quarter and first quartersix months of 2026 compared to the firstsecond quarter and first six months of 2025,2025 primarilymainly due to an increase in capitalized interest. Interest income decreased in the second quarter and first quartersix months of 2026 compared to the firstsecond quarter and first six months of 2025, primarily2025 due to lower average investments and a decrease in average interest rates on investments.

The table below presents earnings before income taxes and noncontrolling interests by segment for the second quarter and first quartersix months of 2026 and 2025 (in millions). The changes between periods were driven by the quantitative and qualitative factors previously discussed.

Noncontrolling interests represent the income attributable to the noncontrolling partners of Nucor'sNucor’s joint ventures, Nucor-Yamato Steel Company (Limited Partnership) ("NYS"), California Steel Industries, Inc. ("CSI") and Nucor-JFE Steel Mexico, S. de R.L. de C.V. ("NJSM"). Nucor owns a 51% controlling interest in each of NYS, CSI and NJSM. The increase in earnings attributable to noncontrolling interests in the firstsecond quarter of 2026 as compared to the firstsecond quarter of 2025 was primarily due to the increased earnings of NYSNYS. andThe CSI.increase in earnings attributable to noncontrolling interests in the first six months of 2026 compared to the first six months of 2025 was primarily due to the increased earnings of NYS.

The effective tax rate for the firstsecond quarter of 2026 was 20.6%21.2% compared to 20.7%21.5% for the firstsecond quarter of 2025. The expected effective tax rate for the full year 2026 is between 20.0% and 22.0%.

Nucor is subject to taxation in the United States,States (“U.S.”), as well as various state and foreign jurisdictions. Nucor has concluded U.S. federal income tax matters for the tax years through 2021. The tax years 2022 through 2024 remain open to examination by the IRS.Internal Revenue Service (the “IRS”). The 2015 through 2021 Canadian income tax returns for Nucor Rebar Fabrication Group Inc. (formerly known as Harris Steel Group Inc.) and certain related affiliates are currently under examination by the Canada Revenue Agency. Additional state and foreign taxing authorities are examining open tax years. The resolution of these audits is not expected to have a material impact on our consolidated financial statements. The tax years 20172018 through 20242025 remain open to examination by other major taxing jurisdictions to which Nucor is subject (primarily Canada, Trinidad & Tobago, and other state and local jurisdictions).

Nucor reported net earnings attributable to Nucor stockholders of $743$1.16 million,billion, or $3.23$5.04 per diluted share, in the firstsecond quarter of 2026, as compared to net earnings attributable to Nucor stockholders of $156$603 million, or $0.67$2.60 per diluted share, in the firstsecond quarter of 2025. Net earnings attributable to Nucor stockholders as a percentage of net sales were 7.8%11.1% and 2.0%7.1% in the firstsecond quarter of 2026 and 2025, respectively. Annualized return on average stockholders’ equity was 14.0% and 3.1% in the first quarter of 2026 and 2025, respectively.

We expect higher consolidated reported earnings in the secondthird quarter of 2026, with improved earnings across all three operating segments.2026. In the steel mills segment,segment thewe expectedexpect an increase isin earnings due to higher realized sellingpricing pricesacross all major product categories with stable volumes. In the steel products segment, we expect improvedincreased earnings due to both higher volumes onand stablehigher realized pricing. The raw materials segment is expected to have increaseddecreased earnings due to higherlower realized pricing.margins.

Nucor’s largest exposure to market risk is in our steel mills and steel products segments. Our largest single customer in the firstsecond quarter of 2026 represented approximately 5% of sales and has consistently paid within terms. In the raw materials segment, we are exposed to price fluctuations related to the purchase of scrap and scrap substitutes, pig iron and iron ore. Businesses within the steel mills segment account for the majority of the raw materials segment’s sales.

Our liquidity position as of AprilJuly 4, 2026 remained strong, consisting of total cash and cash equivalents and short-term investments of $2.48$2.69 billion ($2.70 billion as of December 31, 2025). Approximately $730$843 million of the cash and cash equivalents position at AprilJuly 4, 20262026, was held by our majority-owned joint ventures as compared to approximately $931 million at December 31, 2025.

Cash provided by operating activities duringwas $2.29 billion in the first quartersix months of 2026 was $886 million as compared to $364$1.10 millionbillion duringin the first quartersix months of 2025. The $522$1.19 millionbillion increase was primarily driven by a $1.22 billion increase in net earnings before noncontrolling interests offrom $870$932 million forin the first quartersix months of 2026,2025 anto increase$2.15 billion in the first six months of $6442026. millionChanges fromin net earnings before noncontrolling interests for the prior year perioduse of $226 million. Partially offsetting this increase were changes in operating assets and operating liabilities (exclusive of acquisitions), whichincreased usedslightly cashto in the amount of $378$668 million in the first quartersix months of 2026 as compared to $239$643 million in the first quartersix months of 2025. The increase in the amount of cash used related to changes in operating assets and operating liabilities was primarily attributable to the change in accounts receivable using cash of $463 million and $291 million during the first quarter of 2026 and 2025, respectively, an increase of $172 million from the prior year period.

Cash used in investing activities during the first quartersix months of 2026 was $446$956 million as compared to $1.18$1.72 billion during the first quartersix months of 2025. The $734$767 million decrease in usage was primarily driven by a decrease in funds used to purchase short-term investments of $311$509 million and ana increasedecrease in proceeds from the sale of short-term investments of $199$335 million. Cash used for capital expenditures was $661$1.23 millionbillion in the first quartersix months of 2026 as compared to $859$1.81 millionbillion infor the prior year period. Capital expenditures in the first quartersix months of 2026 primarily related to the sheet mill under construction in West Virginia and the construction of two manufacturing locations to expand Nucor Towers & Structures ("NTS"). Capital expenditures for 2026 are estimated to be approximately $2.50 billion as compared to $3.42 billion in 2025. The projects that we anticipate will have the largest capital expenditures in 2026 are the sheet mill under construction in West Virginia, the construction of two manufacturing locations to expand NTS, and the galvanizing line at our sheet mill in South Carolina.