KALU earnings analysis
What we found in KALU's 10-Q: the parts that mattered, the offsets in the same document, and what the company said about what comes next.
Our reading of the filing · Free to read, no account needed
Kaiser Aluminum delivered exceptional Q2 growth, with net sales up 52.7% year over year to $1.2566B and GAAP diluted EPS rising to $5.72 from $1.41. Margins and cash generation improved as higher shipments, pricing/mix, manufacturing benefits and lower maintenance costs outweighed higher operating and employee costs. Management remains constructive on demand and maintains an outlook for 10%-15% Conversion Revenue growth and 45%-55% Adjusted EBITDA growth in 2026, but explicitly assumes no further metal-price-lag benefit.
The parts that mattered.
Pulled out of the filing itself, with the figures the company reported.
- Sales surge on price and volume
- Q2 net sales rose 52.7% year over year to $1.2566B from $823.1M, driven by a $1.26 per pound (44%) increase in realized sales price and a 17.3M-pound (6%) increase in shipments. This also increased 13.2% sequentially from Q1 2026 revenue of $1.11B.
- Material earnings and margin expansion
- GAAP net income increased to $96.8M from $23.2M and diluted EPS rose to $5.72 from $1.41 year over year. Gross margin expanded to 15.8% from 12.2%, while calculated operating margin rose to 10.6% from approximately 4.6%.
- EBITDA more than doubles
- Adjusted EBITDA more than doubled to $166.3M from $67.7M, an increase of $98.6M. Management cited higher volume, improved pricing/mix, favorable metal consumption and valuation, and lower major maintenance costs.
- Packaging and GE lead end-market growth
- All four end markets posted higher sales, led by Packaging at $580.4M, up $239.5M year over year, and GE Products at $280.7M, up $95.3M. Packaging conversion revenue increased to $174.0M from $129.7M.
- Liquidity strengthened and revolver cleared
- Liquidity improved to $628.4M at June 30, 2026 from $547.2M at December 31, 2025, including cash of $58.5M versus $7.0M. The revolving-credit facility had no borrowings outstanding at June 30, 2026.
- Operating cash generation improved
- Six-month operating cash flow increased to $147.4M from $72.9M, while investing cash outflow fell to $36.7M from $81.9M, implying $110.7M of six-month free cash flow. Capital investment was 24.9% of operating cash flow.
And the other side of it.
The offsets in the same document — the things a summary that only listed the good news would have left out.
- Metal-price tailwind is not assumed to persist
- Management's full-year outlook assumes neutral metal-price impact, versus favorable Metal Price Lag of approximately $27.0M in Q2 and $64.0M in the first six months of 2026. The absence of this tailwind could reduce the reported earnings run rate.
- Higher metal costs increase working-capital exposure
- Working-capital needs rose with metal prices and volume: six-month receivables increased $151.8M and inventory increased $123.6M, partly offset by a $229.0M increase in accounts payable. Approximately 27% of Q2 net sales involved customer supply-chain-financing programs.
- Second-half capex requirement remains sizable
- The company anticipates $120.0M to $130.0M of 2026 capital spending, compared with $36.7M of investing cash outflow in the first six months. Spending may be adjusted based on demand, fabricated-product pricing and liquidity.
- Commodity hedge valuations remain volatile
- At June 30, 2026, a $0.10/lb decline in LME aluminum prices was estimated to create a $7.6M unrealized mark-to-market loss on aluminum derivatives; a $1.00/mmbtu decline in natural-gas prices would create a $4.3M loss.
- No material risk-factor updates disclosed
- The filing states there were no material changes in risk factors or material legal-proceeding developments since December 31, 2025. Accordingly, no newly disclosed risk-factor update was identified.
What they reported.
What the company itself reported, taken out of the document.
- Earnings per share
- $5.72
- Gross margin
- 15.8%
- Operating margin
- 10.6%
- Segment
- Aero/HS Products: $305.3M net sales, up $77.4M year over year; shipments 60.8M lbs, up 0.9M lbs.
- Segment
- Packaging: $580.4M net sales, up $239.5M year over year; shipments 155.8M lbs, up 14.7M lbs.
- Segment
- GE Products: $280.7M net sales, up $95.3M year over year; shipments 67.7M lbs, up 4.3M lbs.
- Segment
- Automotive Extrusions: $90.2M net sales, up $21.3M year over year; shipments 21.4M lbs, down 2.6M lbs (11%).
What they said about what is next.
The 10-Q provides no numeric revenue or EPS outlook. Management expects full-year 2026 Conversion Revenue to improve 10% to 15% year over year and Adjusted EBITDA to grow 45% to 55%, assuming neutral metal-price impact through year-end; 2026 capital spending is anticipated at approximately $120.0M to $130.0M.
The filing reads better than the one before it.
What came before.
- 10-Q · April 23, 2026
- Kaiser Aluminum reported record Q1 net sales of $1,106.8 million (up $329.4 million or 42% vs Q1 2025) with Conversion Revenue of $404.4 million and net income of $62.5 million (diluted EPS $3.71). Adjusted EBITDA was…
- 10-K · February 19, 2026
- Kaiser Aluminum (KALU) emphasizes a focused strategy on high‑barrier, engineered end markets (Aero/HS, Packaging, GE Products, Automotive Extrusions) supported by proprietary KaiserSelect® products, KPS continuous…
- 10-Q · April 24, 2025
- Kaiser Aluminum reported quarter net sales of $777.4 million and diluted EPS of $1.31 for the quarter ended March 31, 2025, both improving versus the prior-year quarter. Operating income rose to $41.4 million and the…
- 10-K · February 20, 2025
- Kaiser Aluminum reported consolidated net sales of $3,024.0 million in 2024 on 1,172.3 million pounds shipped, emphasizing a strategy to serve technically demanding markets (Aero/HS, Packaging, GE, Automotive…
This is our reading of a public filing, not the filing. Read the original on SEC.gov · Educational only. Nothing here is investment advice.
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