Alcoa Corp: Form 10-Q for the period ended Mar 31, 2026

(dollars in millions, except per-share amounts, average realized prices, and average cost amounts; metric tons in thousands (kmt); dry metric tons in millions (mdmt))

Business Update

During the first quarter of 2026, Alcoa continued to maintain operational performance across its operations while navigating disruptions related to the Middle East conflict (see below) and Cyclone Narelle, which impacted Western Australia at the end of the quarter. The Company remained focused on disciplined execution and its strategic priorities, maintaining continuity of operations and customer supply despite these challenges. In addition, the Company progressed the restart of the San Ciprián (Spain) smelter during the first quarter of 2026, and on April 7, 2026, safely completed the smelter restart.

The global economy has been impacted by the conflict in the Middle East, which has included curtailments of more than 2,500 kmt of annual smelting capacity and nearly 2,000 kmt of refining capacity in the region. Additionally, the disruption of transit through the Strait of Hormuz has restricted the inflow of raw materials and caused vessel constraints globally. In the first quarter of 2026, vessel constraints, along with vessel loading issues caused by Cyclone Narelle, delayed alumina shipments from the Australia refineries into April 2026. Subsequent to March 31, 2026, the Company continues to support its customers in managing the logistics for certain alumina shipments.

Average alumina prices decreased by 4 percent and average aluminum prices increased 12 percent in the first quarter of 2026 compared with the fourth quarter of 2025. In addition, the average Midwest premium increased 21 percent sequentially. Alumina prices continued to be impacted by refinery expansions primarily in China and Indonesia, while the aluminum price increase was driven by historically low inventory levels and supply disruptions, which included impacts related to the Middle East conflict. The conflict in the Middle East also caused increases in energy costs and freight costs; Alcoa has limited its exposure to volatility in spot energy through long-term natural gas and electricity contracts and financial hedges.

The Company continued to advance mine approvals for its next major mine regions (Myara North and Holyoake) and the rolling five-year mine plan (2023-2027) referred to the Western Australia Environmental Protection Authority (WA EPA) in 2023 by a third party. During the first quarter of 2026, Alcoa submitted to the WA EPA responses to all comments received during a 12-week public comment period for the Company’s mining activities in Australia. The Company is committed to continuing to work collaboratively with stakeholders to achieve Ministerial decisions by the end of 2026, and anticipates mining in new major mine regions will commence no earlier than 2029. Until then, the Company expects bauxite quality will remain similar to recent grades.

On April 14, 2026, the Company announced that its wholly-owned subsidiary, Alcoa Nederland Holding B.V. (ANHBV), issued a notice to redeem the remaining $219 aggregate principal amount of its outstanding 6.125% notes due in 2028 (the 2028 Notes). The notes will be redeemed on May 15, 2026 at a price equal to 100 percent of the principal amount, plus accrued and unpaid interest, using cash on hand.

See the below sections for additional details on the above-described actions.

Results of Operations

The discussion that follows includes a comparison of our results of operations and liquidity and capital resources for the quarterly and year-to-date periods outlined in the table below.

Selected Financial Data:

(1) API (Alumina Price Index) is a pricing mechanism that is calculated by the Company based on the weighted average of a prior month’s daily spot prices published by the following three indices: CRU Metallurgical Grade Alumina Price; Platts Metals Daily Alumina PAX Price; and FastMarkets Metal Bulletin Non-Ferrous Metals Alumina Index.

(2) LME (London Metal Exchange) is a globally recognized exchange for commodity trading, including aluminum. The LME pricing component represents the underlying base metal component, based on quoted prices for aluminum on the exchange.

Overview

Sequential period comparison

Net income attributable to Alcoa Corporation increased $212 primarily a result of:

• Higher aluminum prices
• Favorable mark-to-market results on the Saudi Arabian Mining Company (Ma’aden) shares
• Absence of impairment of goodwill associated with a 1994 acquisition in the Alumina segment
• Net favorable currency impacts

Partially offset by:

• Higher taxes and absence of reversal of valuation allowances on related deferred tax assets
• Absence of carbon dioxide compensation in Spain and Norway
• Lower seasonal shipments of aluminum and alumina
• Lower volumes and price from bauxite offtake and supply agreements

Year-to-date comparison

Net income attributable to Alcoa Corporation decreased $123 primarily a result of:

• Lower alumina prices
• Tariffs on U.S. imports of aluminum from Canada
• Higher costs associated with the restart of the San Ciprián smelter
• Net unfavorable currency impacts
• Lower volumes and price from bauxite offtake and supply agreements

Partially offset by:

• Higher aluminum prices
• Favorable mark-to-market results on the Ma’aden shares

Sales

Sequential period comparison

Sales decreased $256 primarily as a result of:

• Lower shipments of alumina and aluminum primarily related to seasonally lower first quarter shipments
• Lower volumes and price from bauxite offtake and supply agreements
• Lower average realized price of alumina
• Unfavorable currency impacts
• Unfavorable impacts from certain energy contracts linked to metal pricing

Partially offset by:

• Higher average realized price of aluminum

Year-to-date comparison

Sales decreased $176 primarily as a result of:

• Lower average realized price of alumina
• Lower shipments of alumina primarily related to externally sourced alumina to satisfy certain customer commitments
• Lower volumes and price from bauxite offtake and supply agreements

Partially offset by:

• Higher average realized price of aluminum
• Higher shipments of aluminum
• Higher pricing at the Brazil hydro-electric facilities

Cost of goods sold

Sequential period comparison

Cost of goods sold as a percentage of sales decreased 5 percent primarily as a result of:

• Higher aluminum prices
• Absence of a charge to increase environmental reserves related to investments in environmental offsets at the Huntly (Australia) mine

Partially offset by:

• Lower seasonal shipments of aluminum and alumina
• Absence of recognition of carbon dioxide compensation in Spain
• Unfavorable currency impacts
• Lower volumes and price from bauxite offtake and supply agreements

Year-to-date comparison

Cost of goods sold as a percentage of sales increased 6 percent primarily as a result of:

• Lower alumina prices
• Tariffs on U.S. imports of aluminum from Canada
• Higher costs associated with the restart of the San Ciprián smelter
• Unfavorable currency impacts
• Lower volumes and price from bauxite offtake and supply agreements

Partially offset by:

• Higher aluminum prices
• Higher pricing at the Brazil hydro-electric facilities
• Lower energy costs in the Aluminum segment

Selling, general administrative, and other expenses

Sequential period comparison

Selling, general administrative, and other expenses increased $15 primarily as a result of higher labor costs, partially offset by decreased fees for professional services.

Year-to-date comparison

Selling, general administrative, and other expenses increased $12 primarily as a result of unfavorable currency impacts and higher labor costs.

Provision for depreciation, depletion, and amortization

The Provision for depreciation, depletion, and amortization did not fluctuate in comparison to the fourth quarter of 2025 and increased $14 in comparison to the first quarter of 2025, primarily as a result of:

• Unfavorable currency impacts
• Higher depreciation in Australia for asset retirement obligations
• Higher amortization for Australian mine development costs
• Write off of assets for projects no longer being pursued

Partially offset by:

• Lower depreciation expense related to the Kwinana (Australia) refinery closure

Interest expense

Sequential period comparison

Interest expense increased $19 primarily as a result of:

• Absence of correction to capitalized interest recognized in the fourth quarter of 2025

Year-to-date comparison

Interest expense decreased $18 primarily as a result of:

• Absence of interest and debt settlement expenses for $609 of 5.500% Senior Notes due 2027 (the 2027 Notes) and $281 of 2028 Notes extinguished in March 2025

Partially offset by:

• Interest on $500 6.125% Senior Notes due 2030 (the 2030 Notes) and $500 6.375% Senior Notes due 2032 (the 2032 Notes) issued in March 2025

Other (income) expenses, net

Sequential period comparison

Other (income) expenses, net was ($126) in the first quarter of 2026 compared with $115 in the fourth quarter of 2025. The favorable change of $241 was primarily a result of:

• Favorable mark-to-market results on the Ma’aden shares
• Favorable currency revaluation impacts primarily due to gains in the current quarter from the U.S. dollar weakening against the Brazilian real and the absence of losses recognized in the fourth quarter of 2025 when the U.S. dollar strengthened against the Brazilian real
• Settlement of insurance claim related to property damage incurred in 2024
• Favorable mark-to-market results on derivative instruments primarily due to favorable power price changes under a firming contract, partially offset by changes in the euro foreign exchange rate

Year-to-date comparison

Other (income) expenses, net was ($126) in the first quarter of 2026 compared with ($26) in the first quarter of 2025. The favorable change of $100 was primarily a result of:

• Favorable mark-to-market results on Ma’aden shares subsequent to July 1, 2025
• Settlement of insurance claim related to property damage incurred in 2024
• Favorable currency revaluation impacts primarily due to gains in the current year from the U.S. dollar weakening against the Brazilian real, partially offset by absence of gains recognized in the prior year when the U.S. dollar weakened against the Brazilian real

Partially offset by:

• Unfavorable mark-to-market results on derivative instruments primarily due to changes in the euro foreign exchange rate and lower power prices in the current year, partially offset by favorable power price changes under a firming contract executed in June 2025

Restructuring and other charges, net

Sequential period comparison

In the first quarter of 2026, Restructuring and other charges, net of $18 primarily related to:

• $18 for take-or-pay power contract costs at previously closed sites

In the fourth quarter of 2025, Restructuring and other charges, net of $14 primarily related to:

• $13 for take-or-pay power contract costs at previously closed sites

Year-to-date comparison

In the first quarter of 2026, Restructuring and other charges, net of $18 primarily related to:

• $18 for take-or-pay power contract costs at previously closed sites

In the first quarter of 2025, Restructuring and other charges, net of $5 primarily related to:

• $3 for certain employee obligations related to the February 2023 updated viability agreement for the San Ciprián aluminum smelter
• $2 for take-or-pay power contract costs at a previously closed site

Provision for (benefit from) income taxes

Sequential period comparison

The Provision for income taxes in the first quarter of 2026 was $82 on income before taxes of $499 or 16.4 percent. In comparison, the fourth quarter of 2025 Benefit from income taxes was ($134) on income before taxes of $68 or (197.1 percent).

The increase in tax expense of $216 is primarily due to the absence of a net discrete benefit of $127 related to net benefits recorded at Alcoa World Alumina Brasil Ltda. and ANHBV in the fourth quarter of 2025, primarily for the reversal of valuation allowances on related deferred tax assets. Additionally, tax expense increased as a result of the impact of the annualized effective tax rate when applied to current period earnings, higher income in jurisdictions where taxes are paid, and a valuation allowance of $22 recorded against certain deferred tax assets of a wholly-owned subsidiary in Canada during the first quarter of 2026.

Year-to-date comparison

The Provision for income taxes in the first quarter of 2026 was $82 on income before taxes of $499 or 16.4 percent. In comparison, the first quarter of 2025 Provision for income taxes was $120 on income before taxes of $668 or 18.0 percent.

The decrease in tax expense of $38 is primarily attributable to an overall reduction in income in jurisdictions where taxes are paid, partially offset by a valuation allowance of $22 recorded against certain deferred tax assets of a wholly-owned subsidiary in Canada during the first quarter of 2026.

Noncontrolling interest

On March 31, 2025, Alcoa and Trento Equity Holdings, S.L.U. (Trento EQT) entered into a joint venture agreement with respect to the San Ciprián operations. Alcoa holds a 75% ownership interest and continues as managing operator, while Trento EQT holds the remaining 25% interest. Alcoa began recognizing earnings attributable to Trento EQT’s ownership interest within Noncontrolling interest in the second quarter of 2025.

Net loss attributable to noncontrolling interest decreased $3 in comparison to the fourth quarter of 2025 and increased $8 in comparison to the first quarter of 2025. The sequential decrease is primarily a result of higher average realized price of aluminum and favorable currency revaluation impacts. The year-to-date increase is a result of the losses incurred at the San Ciprián smelter and refinery in 2026.

Segment Information

Alcoa Corporation is a producer of bauxite, alumina, and aluminum products. The Company has two operating and reportable segments: (i) Alumina and (ii) Aluminum. The primary measure of performance is Adjusted EBITDA (Earnings before interest, taxes, depreciation, and amortization) for each segment.

The Company calculates Segment Adjusted EBITDA as Total sales (third-party and intersegment) minus the following items: Cost of goods sold; Selling, general administrative, and other expenses; and Research and development expenses. Alcoa Corporation’s Segment Adjusted EBITDA may not be comparable to similarly titled measures of other companies. The Chief Operating Decision Maker regularly reviews Segment Adjusted EBITDA to assess performance and allocate resources.

Alumina

Business Update. The average API of $309 per metric ton decreased 4 percent compared to the prior quarter. Compared to the first quarter of 2025, the average API decreased 50 percent year-over-year.

In the first quarter of 2026, vessel constraints related to the Middle East conflict, along with vessel loading issues caused by Cyclone Narelle, delayed alumina shipments from the Australia refineries into April 2026. Subsequent to March 31, 2026, the Company continues to support its customers in managing the logistics for certain alumina shipments.

Capacity. The Alumina segment had a base capacity of 11,653 kmt with 1,014 kmt of curtailed refining capacity. There was no change in curtailed capacity during the quarter.

In the table below, total alumina shipments include metric tons that were not produced by the Alumina segment. Such alumina was purchased to satisfy certain customer commitments. The Alumina segment bears the risk of loss of the purchased alumina until control of the product has been transferred to this segment’s customers.

Adjusted operating costs include all production related costs for alumina produced and shipped: raw materials consumed; conversion costs, such as labor, materials, and utilities; and plant administrative expenses. Other segment items include costs associated with trading activity, the purchase of bauxite from offtake or other supply agreements, and commercial shipping services; other direct and non-production related charges; Selling, general administrative, and other expenses; and Research and development expenses.

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Production

Sequential period comparison

Alumina production decreased 5 percent primarily as a result of:

• Reduced production at the Australia refineries due to the beginning of seasonal maintenance cycles

Year-to-date comparison

Alumina production was consistent with the first quarter of 2025.

Third-party sales

Sequential period comparison

Third-party sales decreased $322 primarily as a result of:

• Lower shipments of alumina primarily due to lower sales of externally sourced alumina to satisfy certain customer commitments, seasonally lower first quarter shipments, and shipment delays in Australia primarily related to the Middle East conflict and Cyclone Narelle
• Lower volumes and price from bauxite offtake and supply agreements
• Lower average realized price of $17 per metric ton principally driven by a lower average API
• Unfavorable currency impacts

Year-to-date comparison

Third-party sales decreased $806 primarily as a result of:

• Lower average realized price of $251 per metric ton principally driven by a lower average API
• Lower shipments of alumina primarily due lower sales of externally sourced alumina to satisfy certain customer commitments and shipment delays in Australia primarily related to the Middle East conflict and Cyclone Narelle
• Lower volumes and price from bauxite offtake and supply agreements

Intersegment alumina sales

Sequential period comparison

Intersegment alumina sales decreased $12 primarily as a result of:

• Lower average API on sales to the Aluminum segment

Partially offset by:

• Higher alumina shipments primarily due to the San Ciprián smelter restart

Year-to-date comparison

Intersegment alumina sales decreased $267 primarily as a result of:

• Lower average API on sales to the Aluminum segment

Partially offset by:

• Higher alumina shipments primarily due to the San Ciprián smelter restart

Segment Adjusted EBITDA

Sequential period comparison

Segment Adjusted EBITDA decreased $52 primarily as a result of:

• Lower average realized price
• Lower volumes and price from bauxite offtake and supply agreements
• Unfavorable currency impacts
• Lower seasonal shipments of alumina

Partially offset by:

• Absence of a charge to increase environmental reserves related to investments in environmental offsets at the Huntly mine

Year-to-date comparison

Segment Adjusted EBITDA decreased $704 primarily as a result of:

• Lower average realized price
• Lower volumes and price from bauxite offtake and supply agreements
• Unfavorable currency impacts

Forward Look. For the second quarter of 2026 in comparison to the first quarter of 2026, the Alumina segment expects lower price from bauxite offtake and supply agreements and higher energy costs, primarily related to increased diesel prices associated with the Middle East conflict.

Alcoa expects 2026 total Alumina segment production and shipments to remain unchanged from its prior projection, ranging between 9.7 to 9.9 million metric tons, and between 11.8 and 12.0 million metric tons, respectively. The difference between production and shipments reflects trading volumes and externally sourced alumina to fulfill customer contracts.

Aluminum

Business Update. Aluminum prices increased sequentially with LME prices on a 15-day lag averaging $3,120 per metric ton in the first quarter of 2026. Additionally, the average Midwest premium increased 21 percent sequentially.

In the first quarter of 2026, the Aluminum segment proactively repositioned inventory within North America to provide casthouse flexibility for additional value add product production.

San Ciprián Smelter

The restart of the San Ciprián smelter was completed on April 7, 2026. At March 31, 2026, in connection with the viability agreement reached with the workers’ representatives of the San Ciprián smelter in December 2021 and subsequently updated in February 2023, the Company had restricted cash of $75 available for capital improvement commitments and restart costs incurred (which is subject to review by the workers’ representatives prior to release) at the site.

In the table below, total aluminum third-party shipments include metric tons that were not produced by the Aluminum segment. Such aluminum was purchased by this segment to satisfy certain customer commitments. The Aluminum segment bears the risk of loss of the purchased aluminum until control of the product has been transferred to this segment’s customers. Additionally, Total shipments in 2025 include offtake from a joint venture supply agreement with Ma’aden prior to its termination in the first quarter of 2025. The contract was terminated in accordance with Alcoa’s sale of its 25.1% ownership in the Saudi Arabia joint venture to Ma’aden, which was completed on July 1, 2025.

The average realized third-party price per metric ton of aluminum includes three elements: a) the underlying base metal component, based on quoted prices from the LME; b) the regional premium, which represents the incremental price over the base LME component that is associated with the physical delivery of metal to a particular region (e.g., the Midwest premium for metal sold in the United States); and c) the product premium, which represents the incremental price for receiving physical metal in a particular shape (e.g., billet, slab, rod, etc.) or alloy.

Adjusted operating costs include all production related costs for aluminum produced and shipped: raw materials consumed; conversion costs, such as labor, materials, and utilities; and plant administrative expenses. Other segment items include costs associated with trading activity and energy assets; other direct and non-production related charges, including tariff costs; Selling, general administrative, and other expenses; and Research and development expenses.

(1) Other includes third-party sales of energy, as well as realized gains and losses related to embedded derivative instruments designated as cash flow hedges of forward sales of aluminum.

Production

Sequential period comparison

Production was consistent with the fourth quarter of 2025 primarily as a result of:

• San Ciprián smelter restart

Partially offset by:

• Two fewer days in the period

Year-to-date comparison

Production increased 8 percent primarily as a result of:

• San Ciprián smelter restart

Third-party sales

Sequential period comparison

Third-party sales increased $74 primarily as a result of:

• Higher average realized price of $460 per metric ton driven by a higher average LME (on a 15-day lag) and higher regional premiums, particularly the Midwest premium (United States and Canada) which rose by an average of 21 percent

Partially offset by:

• Lower shipments primarily due to seasonally lower first quarter shipments, proactive inventory repositioning within North America, and decreased trading activities, partially offset by the San Ciprián smelter restart
• Impacts from certain energy contracts linked to metal pricing

Year-to-date comparison

Third-party sales increased $635 primarily as a result of:

• Higher average realized price of $996 per metric ton driven by higher regional premiums, particularly the Midwest premium (United States and Canada) which rose by an average of 215 percent, and a higher average LME (on a 15-day lag)
• Higher shipments primarily due to the San Ciprián smelter restart, partially offset by proactive inventory repositioning within North America and decreased trading activities
• Higher pricing at the Brazil hydro-electric facilities

Partially offset by:

• Impacts from certain energy contracts linked to metal pricing

Segment Adjusted EBITDA

Sequential period comparison

Segment Adjusted EBITDA increased $174 primarily as a result of:

• Higher average realized price
• Favorable raw material costs primarily on lower average alumina input costs

Partially offset by:

• Absence of recognition of carbon dioxide compensation in Spain and Norway
• Lower seasonal shipments
• Higher costs associated with the restart of the San Ciprián smelter

Year-to-date comparison

Segment Adjusted EBITDA increased $560 primarily as a result of:

• Higher average realized price
• Favorable raw material costs primarily on lower average alumina input costs
• Higher pricing at the Brazil hydro-electric facilities
• Lower energy costs primarily in Europe

Partially offset by:

• Tariffs on U.S. imports of aluminum from Canada, which were subject to a 25 percent tariff beginning March 12, 2025 until increasing to 50 percent on June 4, 2025 under Section 232 of the Trade Expansion Act of 1962
• Higher costs associated with the restart of the San Ciprián smelter
• Unfavorable currency impacts

The following table provides consolidated capacity and curtailed capacity (each in kmt) for each smelter owned by Alcoa Corporation:

(1) These figures represent Alcoa Corporation’s share of the facility Nameplate Capacity based on its ownership interest in the respective smelter.

(2) In the first quarter of 2026, the Company began the restart of 15 kmt of previously curtailed capacity at the Portland smelter in Australia.

(3) In 2021, the Company announced the restart of its 268 kmt share of capacity at the Alumar smelter in São Luís, Brazil. Production began in the second quarter of 2022. Curtailed capacity decreased from March 31, 2025 as a result of the restart process.

(4) In the second quarter of 2025, the Company began the restart of one potline (31 kmt) at the Lista smelter in Norway that was curtailed in August 2022.

(5) In the third quarter of 2025, the Company resumed the restart at the San Ciprián smelter in Spain that was paused in April 2025 following a widespread power outage across Spain. The restart was completed on April 7, 2026.

Forward Look. For the second quarter of 2026 in comparison to the first quarter of 2026, the Aluminum segment expects to benefit from inventory repositioning actions taken in the first quarter of 2026, higher shipments and value add product sales, and lower production costs due to the completion of the San Ciprián smelter restart, partially offset by lower third-party energy sales and increased tariff costs on higher U.S. imports of aluminum from Canada. At recent Midwest premium pricing, tariff costs are fully covered by the Midwest premium revenue.

Alcoa expects 2026 total Aluminum segment production and shipments to remain unchanged from its prior projection, ranging between 2.4 and 2.6 million metric tons, and between 2.6 and 2.8 million metric tons, respectively.

Reconciliations of Certain Segment Information

Reconciliation of Total Segment Third-Party Sales to Consolidated Sales

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Reconciliation of Total Segment Adjusted EBITDA to Consolidated Net Income Attributable to Alcoa Corporation

(1) Transformation includes, among other items, the Adjusted EBITDA of previously closed operations.

(2) Corporate expenses are composed of general administrative and other expenses of operating the corporate headquarters and other global administrative facilities, as well as research and development expenses of the corporate technical center.

(3) Other includes certain items that are not included in the Adjusted EBITDA of the reportable segments.

Environmental Matters

See Part I Item 1 of this Form 10-Q in Note N to the Consolidated Financial Statements under caption Environmental Matters.

Liquidity and Capital Resources

Management believes that the Company’s cash on hand, projected cash flows, and liquidity options, combined with its strategic actions, will be adequate to fund its short-term (at least 12 months) and long-term operating and investing needs. Further, the Company has flexibility related to its use of cash; ANHBV issued notice to redeem the remaining $219 of outstanding 2028 Notes in May 2026 and the Company has no other significant debt maturities until 2029. Additionally, the Company has no significant cash contribution requirements related to its pension plan obligations.

Although management believes that Alcoa’s projected cash flows and other liquidity options will provide adequate resources to fund operating and investing needs, the Company’s access to, and the availability of, financing on acceptable terms in the future will be affected by many factors, including: (i) Alcoa Corporation’s credit rating; (ii) the liquidity of the overall capital markets; (iii) the current state of the economy and commodity markets, and (iv) short- and long-term debt ratings. There can be no assurances that the Company will continue to have access to capital markets on terms acceptable to Alcoa Corporation.

Changes in market conditions caused by U.S., global, or macroeconomic events, such as ongoing regional conflicts, high inflation, and changing U.S. or global monetary or trade policies could have adverse effects on Alcoa’s ability to obtain additional financing and cost of borrowing. Inability to generate sufficient earnings could impact the Company’s ability to meet the financial covenants in our outstanding debt and revolving credit facility agreements and limit our ability to access these sources of liquidity or refinance or renegotiate our outstanding debt or credit agreements on terms acceptable to the Company. Additionally, the impact on market conditions from such events could adversely affect the liquidity of Alcoa’s customers, suppliers, and joint venture partners and equity method investments, which could negatively impact the collectability of outstanding receivables and our cash flows.

Cash from Operations

Cash used for operations was $179 in the three-month period of 2026 compared with cash provided from operations of $75 in the same period in 2025. Notable changes included:

• $118 unfavorable change in net income, excluding the impacts from restructuring charges, primarily due to lower alumina pricing, tariffs on U.S. imports of aluminum from Canada, and higher production costs primarily within the Aluminum segment, partially offset by higher aluminum pricing; and,
• $49 unfavorable change in certain working capital accounts, primarily an increase in inventories in the three-month period of 2026 due to higher volumes mainly in the Alumina segment from delayed shipments and an increase in receivables in the three-month period of 2026 on higher pricing for aluminum, partially offset by a decrease in accounts payable in the three-month period of 2025 due to lower alumina trading.

The Company utilizes a Receivables Purchase Agreement facility to sell up to $175 of certain receivables through a wholly-owned special purpose entity (SPE) to a financial institution on a revolving basis. Alcoa Corporation guarantees the performance obligations of the Company subsidiaries, and unsold customer receivables are pledged as collateral to secure the sold receivables. At March 31, 2026, the SPE held unsold customer receivables of $616 pledged as collateral against the sold receivables.

The Company continues to service the customer receivables and as customer payments are collected by the Company, the SPE transfers additional receivables to the financial institution rather than remitting cash.

In the three-month period of 2026, the Company sold gross customer receivables of $211 and reinvested collections of $211 from previously sold receivables. In the three-month period of 2025, the Company sold gross customer receivables of $199 and reinvested collections of $199 from previously sold receivables. There were no cash remittances to or from the financial institution in either period.

Cash collections from previously sold receivables yet to be reinvested of $42 were included in Accounts payable, trade on the Consolidated Balance Sheet as of March 31, 2026. Cash received from sold receivables under the agreement are presented within operating activities in the Statement of Consolidated Cash Flows. See Part I Item 1 of this Form 10-Q in Note H to the Consolidated Financial Statements.

Financing Activities

Cash provided from financing activities was $60 in the three-month period of 2026 compared with $77 in the same period in 2025.

The source of cash in the three-month period of 2026 was primarily $100 of net short-term borrowings (see below), partially offset by $27 of dividends paid on stock.

The source of cash in the three-month period of 2025 was primarily $985 net proceeds from the issuance of the 2030 Notes and 2032 Notes and $27 of contributions from Trento EQT (see Noncontrolling interest above), partially offset by $890 to settle tender offers on the 2027 Notes and 2028 Notes and $26 of dividends paid on common stock.

Short-term Borrowings

The Company periodically enters into inventory repurchase agreements whereby the Company sells aluminum to a third party and agrees to subsequently repurchase substantially similar inventory. Upon shipment of inventory, the Company does not record the sale and reflects cash received in Short-term borrowings within Other current liabilities on the Consolidated Balance Sheet. The cash received and subsequently paid under these agreements is included in Cash provided from financing activities on the Statement of Consolidated Cash Flows.

During the three-month period of 2026, the Company recorded borrowings of $104 and repurchased $4 of inventory related to these agreements. During the three-month period of 2025, the Company recorded borrowings of $44 and repurchased $49 of inventory related to these agreements.

The net borrowings from inventory repurchase agreements was $109 as of March 31, 2026.

144A Debt

On April 14, 2026, the Company announced that its wholly-owned subsidiary ANHBV, issued a notice to redeem the remaining $219 aggregate principal amount of its outstanding 2028 Notes. The notes will be redeemed on May 15, 2026 at a price equal to 100 percent of the principal amount, plus accrued and unpaid interest, using cash on hand.

Credit Facilities

Revolving Credit Facility

The Company and ANHBV, a wholly-owned subsidiary of Alcoa Corporation and the borrower, have a $1,250 revolving credit and letter of credit facility in place for working capital and/or other general corporate purposes (the Revolving Credit Facility). The Revolving Credit Facility, established in September 2016, most recently amended and restated in June 2022 and amended in August 2025, is scheduled to mature in June 2027. Subject to the terms and conditions under the Revolving Credit Facility, the Company or ANHBV may borrow funds or issue letters of credit. Under the terms of the January 2024 amendment (Amendment No. 1), the Company agreed to provide collateral for its obligations under the Revolving Credit Facility. In August 2025, Alcoa Corporation, ANHBV, and certain subsidiaries of the Company entered into Amendment No. 2 to the Revolving Credit Facility to allow for certain changes in the Company’s legal structure and update certain exceptions to collateral requirements. See Part II Item 8 of Alcoa Corporation’s Annual Report on Form 10-K in Note M to the Consolidated Financial Statements for the year ended December 31, 2025 for more information on the Revolving Credit Facility.

As of March 31, 2026, the Company was in compliance with all financial covenants. The Company may access the entire amount of commitments under the Revolving Credit Facility. There were no borrowings outstanding at March 31, 2026, and no amounts were borrowed during the three-month periods of 2026 and 2025 under the Revolving Credit Facility.

Japanese Yen Revolving Credit Facility

At March 31, 2026, the Company and ANHBV had a $200 revolving credit facility available to be drawn in Japanese yen (the Japanese Yen Revolving Credit Facility). See Part II Item 8 of Alcoa Corporation’s Annual Report on Form 10-K in Note M to the Consolidated Financial Statements for the year ended December 31, 2025 for more information on the Japanese Yen Revolving Credit Facility.

As of March 31, 2026, the Company was in compliance with all financial covenants. There were no borrowings outstanding at March 31, 2026, and no amounts were borrowed during the three-month periods of 2026 and 2025 under the Japanese Yen Revolving Credit Facility.

On April 24, 2026, the Japanese Yen Revolving Credit Facility matured with no amounts outstanding at expiration.

Dividend

On February 26, 2026, the Board of Directors declared a quarterly cash dividend of $0.10 per share of the Company’s common stock to stockholders of record as of the close of business on March 10, 2026. In March 2026, the Company paid cash dividends of $27.

Ratings

Alcoa Corporation’s cost of borrowing and ability to access the capital markets are affected not only by market conditions but also by the short- and long-term debt ratings that the major credit rating agencies assign to Alcoa Corporation’s debt. Each agency’s rating is on a consolidated basis; therefore, the rating assessment applies to Alcoa Corporation, ANHBV, and Alumina Pty Ltd.

On March 11, 2026, Fitch Ratings affirmed Alcoa’s long-term debt rating as BB+ and revised the outlook from stable to positive.

On March 3, 2026, Standard and Poor’s Global Ratings upgraded the rating of Alcoa’s long-term debt to BB+ from BB and revised the outlook from positive to stable.

February 6, 2026, Moody’s Investor Service affirmed the rating of Alcoa’s long-term debt as Ba1 and affirmed the outlook as stable.

Ratings are not a recommendation to buy or hold any of Alcoa’s securities and they may be revised or revoked at any time at the sole discretion of the rating organization.

Investing Activities

Cash used for investing activities was $129 in the three-month period of 2026 compared with $108 for the same period in 2025.

In the three-month period of 2026, the use of cash was primarily attributable to $119 related to capital expenditures and $15 of cash contributions to the ELYSIS® partnership.

In the three-month period of 2025, the use of cash was primarily attributable to $93 related to capital expenditures and $15 of cash contributions to the ELYSIS partnership.

Recently Adopted and Recently Issued Accounting Guidance

See Part I Item 1 of this Form 10-Q in Note B to the Consolidated Financial Statements.

Dissemination of Company Information

Alcoa Corporation intends to make future announcements regarding company developments and financial performance through its website, https://www.alcoa.com, as well as through press releases, filings with the U.S. Securities and Exchange Commission, conference calls, media broadcasts, and webcasts. The Company does not incorporate the information contained on, or accessible through, its corporate website into this quarterly report.

See Part II Item 7A Quantitative and Qualitative Disclosures About Market Risk of Alcoa Corporation’s Annual Report on Form 10-K for the year ended December 31, 2025. Our exposure to market risk has not changed materially since December 31, 2025. See Part I Item 1 of this Form 10-Q in Note L to the Consolidated Financial Statements under caption Derivatives for additional information.

(a) Evaluation of Disclosure Controls and Procedures

Alcoa Corporation’s Chief Executive Officer and Chief Financial Officer have evaluated the Company’s disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) of the U.S. Securities Exchange Act of 1934, as amended, as of the end of the period covered by this report, and they have concluded that these controls and procedures were effective as of March 31, 2026.

(b) Changes in Internal Control over Financial Reporting

There have been no changes in internal control over financial reporting during the first quarter of 2026 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

We face a number of risks that could materially and adversely affect our business, results of operations, cash flow, liquidity, or financial condition. A full discussion of our risk factors can be found in Part I Item 1A. Risk Factors of Alcoa Corporation’s Annual Report on Form 10-K for the fiscal year ended December 31, 2025.