CLEVELAND-CLIFFS INC.

Previous wording

Management's Discussion and Analysis of Financial Condition and Results of Operations is designed to provide a reader of our financial statements with a narrative from the perspective of management on our financial condition, results of operations, liquidity and other factors that may affect our future results. We believe it is important to read our Management's Discussion and Analysis of Financial Condition and Results of Operations in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2024, as well as other publicly available information.

Current wording

Management's Discussion and Analysis of Financial Condition and Results of Operations is designed to provide a reader of our financial statements with a narrative from the perspective of management on our financial condition, results of operations, liquidity and other factors that may affect our future results. We believe it is important to read our Management's Discussion and Analysis of Financial Condition and Results of Operations in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2024, as well as other publicly available information. During the third quarter of 2025, we identified an immaterial error related to our accrual for certain employment costs, resulting in an understatement of Costs of goods sold in prior periods. Prior periods affected include the interim periods ended March 31, 2025 and June 30, 2025, and the interim and annual periods during the years 2022, 2023 and 2024. Refer to NOTE 1 - BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES for further information.

Previous wording

The following is a summary of our consolidated results for the three and six months ended June 30, 2025 and 2024 (in millions, except for diluted EPS):

Current wording

The following is a summary of our consolidated results for the three and nine months ended September 30, 2025 and 2024 (in millions, except for diluted EPS):

Previous wording

See "— Non-GAAP Financial Measures" below for a reconciliation of our Net income (loss) to Adjusted EBITDA.

Current wording

See "— Non-GAAP Financial Measures" below for a reconciliation of our Net loss to Adjusted EBITDA.

Previous wording

We continued to navigate volatile but improving market conditions throughout the second quarter of 2025. Steel market conditions in the second quarter of 2025 benefited from higher HRC pricing and lower import levels, but demand remained impacted by weak light vehicle production and inconsistent buying behavior from customers. The price for domestic HRC, the most significant index impacting our revenues and profitability, averaged $910 per net ton during the second quarter of 2025, 16% higher than the second quarter of 2024. Finished steel import levels declined in the second quarter of 2025 after being elevated in early 2025 in anticipation of the recently implemented steel tariffs, which helped support domestic steel pricing. Looking forward, we expect domestic steel demand to grow, as recently implemented steel and automotive tariffs support demand for domestically produced steel, other end-user demand improves, and incremental steel demand stimulated by recent government legislation and manufacturing on-shoring is realized. Steel and light vehicles remain at the top of the Trump administration's trade agenda, and we are at the intersection of both of these industries.

Current wording

We continued to navigate volatile but improving market conditions throughout the third quarter of 2025. Steel market conditions in the third quarter of 2025 benefited from higher than historical HRC pricing and lower import levels, but demand remained impacted by inconsistent buying behavior from weaker non-automotive demand. The price for domestic HRC, the most significant index impacting our revenues and profitability, averaged $843 per net ton during the third quarter of 2025, 24% higher than the third quarter of 2024. Finished steel import levels continued to decline in the third quarter of 2025 after being elevated in early 2025 in anticipation of the recently implemented steel tariffs, which helped support domestic steel pricing. Looking forward, we expect domestic steel demand to grow, as recently implemented steel and automotive tariffs support demand for domestically produced steel, other end-user demand improves, interest rates continue to decline, and incremental steel demand stimulated by recent government legislation and manufacturing on-shoring is realized. Steel and light vehicles remain at the top of the Trump administration's trade agenda, and we are at the intersection of both of these industries.

Previous wording

During 2025, to appropriately respond to market conditions and to optimize our footprint, we made the decision to fully or partially idle six of our operations. As a consequence of continued weak automotive production, we made the decision to idle our blast furnace, BOF steel shop, and continuous casting facilities at our Dearborn Works facility. We also made the decision to idle Conshohocken, Riverdale and Steelton due to financial underperformance at these operations. Additionally, we made the decision to idle the Minorca mine and partially idle the Hibbing Taconite mine in order to consume excess pellet inventory produced in 2024.

Current wording

During 2025, to appropriately respond to market conditions and to optimize our footprint, we made the decision to fully or partially idle or permanently close six of our operations. As a consequence of weak automotive production, we made the decision to idle our blast furnace, BOF steel shop, and continuous casting facilities at our Dearborn Works facility. We also made the decision to permanently close Steelton, Conshohocken and Riverdale due to financial underperformance at these operations. Additionally, we made the decision to idle the Minorca mine and partially idle the Hibbing Taconite mine in order to consume excess pellet inventory produced in 2024. These operational changes allow us to streamline our operations and enhance efficiency, with minimal expected impact to our flat-rolled steel output.

Previous wording

The largest market for our steel products is the automotive industry in North America, which makes light vehicle production a key driver of demand. North American light vehicle production in the second quarter of 2025 was approximately 4.0 million units, down from approximately 4.1 million units in the second quarter of 2024. During the second quarter of 2025, light vehicle sales in the U.S. saw an average seasonally adjusted annualized rate of 16.1 million units sold, representing a 3% increase compared to the second quarter of 2024. The seasonally adjusted annualized rate reached 17.3 million units sold during the second quarter of 2025, indicating healthy consumer demand. Additionally, the average age of light vehicles on the road in the U.S. is at an all-time high of 12.8 years, surpassing the previous record set in 2024, which should support demand as older vehicles need to be replaced. Furthermore, we expect the recently implemented 25% tariff on imports of automobiles and certain automobile parts to lead to increased demand for domestically produced vehicles that consume domestically made steel. As a leading supplier of automotive-grade steel in the U.S., we expect to benefit from healthier domestic vehicle production over the coming years as we continue to be an established and reliable supplier.

Current wording

The largest market for our steel products is the automotive industry in North America, which makes light vehicle production a key driver of demand. North American light vehicle production in the third quarter of 2025 was approximately 3.9 million units, up from approximately 3.8 million units in the third quarter of 2024. During the third quarter of 2025, light vehicle sales in the U.S. saw an average seasonally adjusted annualized rate of 16.3 million units sold, representing a 5% increase compared to the third quarter of 2024. The seasonally adjusted annualized rate has averaged 16.3 million units sold during the first nine months of 2025, 5% higher compared to the same period of 2024, indicating healthy consumer demand. Additionally, the average age of light vehicles on the road in the U.S. is at an all-time high of 12.8 years, surpassing the previous record set in 2024, which should support demand as older vehicles need to be replaced. Furthermore, we expect the recently implemented 25% tariff on imports of automobiles and certain automobile parts to lead to increased demand for domestically produced vehicles that consume domestically made steel. As a leading supplier of automotive-grade steel in the U.S., we expect to benefit from healthier domestic vehicle production over the coming years as we continue to be an established and reliable supplier.

Previous wording

Since 2021, the price for busheling scrap, a necessary input for flat-rolled steel production in EAFs in the U.S., has continued to average well above the prior annual ten-year average of approximately $400 per long ton. The busheling price averaged $466 per long ton during the second quarter of 2025, representing a 9% increase compared to the second quarter of 2024. We expect the supply of busheling scrap to further tighten due to decreasing prime scrap generation from original equipment manufacturers as they improve their production efficiency, the growth of EAF capacity in the U.S., reduced metallics imports due to recently announced tariffs on all Brazilian imports, potential for higher prices as a result of tariffs, and a push for expanded scrap use globally. As we are fully integrated and have primarily a blast furnace footprint, increased prices for busheling scrap in the U.S. bolster our competitive advantage, as we source the majority of our iron feedstock from our stable-cost mining and pelletizing operations in Minnesota and Michigan.

Current wording

Since 2021, the price for busheling scrap, a necessary input for flat-rolled steel production in EAFs in the U.S., has continued to average well above the prior annual ten-year average of approximately $400 per long ton. The busheling price averaged $461 per long ton during the third quarter of 2025, representing a 13% increase compared to the third quarter of 2024. We expect the supply of busheling scrap to further tighten due to decreasing prime scrap generation from original equipment manufacturers as they improve their production efficiency, the growth of EAF capacity in the U.S., potential for higher prices as a result of tariffs, and a push for expanded scrap use globally. As we are fully integrated and have primarily a blast furnace footprint, increased prices for busheling scrap in the U.S. bolster our competitive advantage, as we source the majority of our iron feedstock from our stable-cost mining and pelletizing operations in Minnesota and Michigan.

Previous wording

Our utilization of fixed price contracts provides us a competitive advantage, as the steel industry is often viewed as volatile and subject to the market price of steel. Our fixed price contracts mitigate pricing volatility through the cycle. Approximately 30-35% of our volumes are sold under these contracts.

Current wording

Our utilization of annual or multi-year fixed price contracts provides us a competitive advantage, as the steel industry is often viewed as volatile and subject to the market price of steel. Our fixed price contracts mitigate pricing volatility through the cycle. Approximately 30-35% of our volumes are sold under these contracts.

Previous wording

Our ability to source our primary feedstock domestically, and primarily internally, is a competitive strength. This model reduces our exposure to volatile pricing and unreliable global sourcing. The ongoing conflict between Russia and Ukraine, along with recently announced tariffs impacting Brazilian pig iron, and the Trump administration's focus on U.S. manufactured products, has displayed the importance of our North American-centric footprint, as our competitors primarily operating EAF facilities rely on imported pig iron, mostly from Brazil, to produce flat-rolled steel, the supply of which is expected to be disrupted. Additionally, the outcome of ongoing trade discussions could result in additional tariffs on imported pig iron and other raw materials that could further elevate the cost structure for our competitors who import raw materials. The best example is our legacy business of producing iron ore pellets. By internally sourcing the vast majority of our iron ore pellet requirements, our primary steelmaking raw material feedstock can be secured at a stable and predictable cost and not be subject to as many factors outside of our control.

Current wording

Our ability to source our primary feedstock domestically, and primarily internally, is a competitive strength. This model reduces our exposure to volatile pricing and unreliable global sourcing. The ongoing conflict between Russia and Ukraine and the Trump administration's focus on U.S. manufactured products have displayed the importance of our North American-centric footprint, as our competitors primarily operating EAF facilities rely on imported pig iron to produce flat-rolled steel, the supply of which is expected to be disrupted. Additionally, the outcome of ongoing trade discussions could result in additional tariffs on other raw materials that could further elevate the cost structure for our competitors who import raw materials. The best example is our legacy business of producing iron ore pellets. By internally sourcing the vast majority of our iron ore pellet requirements, our primary steelmaking raw material feedstock can be secured at a stable and predictable cost and not be subject to as many factors outside of our control.

Previous wording

Our five-year contract to supply semi-finished steel slabs that was initiated in connection with the closing of the acquisition of ArcelorMittal USA concludes in December 2025. This has historically represented approximately 10 percent of our sales volume and has recently become unprofitable as a result of current market conditions. The conclusion of this contract provides a significant opportunity to shift sales and product mix to higher margin business and improve efficiency within our operations.

Current wording

Our five-year contract to supply semi-finished steel slabs that was initiated in connection with the closing of the acquisition of ArcelorMittal USA concludes in December 2025. This contract has historically represented approximately 10 percent of our sales volume and has recently become unprofitable as a result of current market conditions. The conclusion of this contract provides a significant opportunity to shift sales and product mix to higher margin business and improve efficiency within our operations.

Previous wording

During 2025, we made the decision to fully or partially idle six of our operations. We made the decision to idle our blast furnace, BOF steel shop, and continuous casting facilities at our Dearborn Works facility. We also made the decision to idle Conshohocken, Riverdale and Steelton due to underperformance at these operations. Additionally, we made the decision to idle the Minorca mine and partially idle the Hibbing Taconite mine in order to consume excess pellet inventory produced in 2024. Our recent changes allow us to streamline our operations and enhance efficiency, with minimal impact to our flat-rolled steel output.

Current wording

During 2025, we made the decision to fully or partially idle or permanently close six of our operations. We made the decision to idle our blast furnace, BOF steel shop, and continuous casting facilities at our Dearborn Works facility. We also made the decision to permanently close Steelton, Conshohocken and Riverdale due to underperformance at these operations. Additionally, we made the decision to idle the Minorca mine and partially idle the Hibbing Taconite mine in order to consume excess pellet inventory produced in 2024. Our recent changes allow us to streamline our operations and enhance efficiency, with minimal impact to our flat-rolled steel output.

Previous wording

We have a track record of demonstrating that we can quickly deleverage our balance sheet and have also historically shown our ability to take advantage of volatility in the debt markets and repurchase notes at a discount. We expect to generate healthy free cash flow in the coming years and intend to utilize it to deleverage our balance sheet. We also maintain a long maturity runway with our outstanding debt, with our nearest maturities coming in 2027, have healthy liquidity, and have approximately $3.2 billion of secured debt capacity, which supports our flexibility to navigate varied economic environments for extended periods of time.

Current wording

We have a track record of demonstrating that we can quickly deleverage our balance sheet and have also historically shown our ability to take advantage of volatility in the debt markets and repurchase notes at a discount. We expect to generate healthy free cash flow in the coming years and intend to utilize it to deleverage our balance sheet. We also maintain a long maturity runway with our outstanding debt, with our nearest senior notes maturities coming in 2029 (after redeeming in October 2025 all senior notes that had a maturity date in 2027), have healthy liquidity, and have approximately $3.2 billion of secured debt capacity, which supports our flexibility to navigate varied economic environments for extended periods of time.

Previous wording

The following is a summary of our Steelmaking segment operating results, net of intersegment eliminations, for the three and six months ended June 30, 2025 and 2024 (dollars in millions, except for average selling price, and shipments in thousands of net tons):

Current wording

The following is a summary of our Steelmaking segment operating results, net of intersegment eliminations, for the three and nine months ended September 30, 2025 and 2024 (dollars in millions, except for average selling price, and shipments in thousands of net tons):

Previous wording

•An increase in revenues related to incremental tons sold related to the addition of Stelco.

Current wording

•An increase in revenues related to incremental tons sold attributed to the addition of Stelco (approximately $400 million); which is partially offset by

Previous wording

•An increase in revenues related to incremental tons sold related to the addition of Stelco.

Current wording

•An increase in revenues related to incremental tons sold related to the addition of Stelco (approximately $1.2 billion).

Previous wording

•An increase in depreciation expense of approximately $120 million as a result of the indefinite idling of our Conshohocken and Riverdale facilities; and

Current wording

•An increase in depreciation and amortization expense as a result of the indefinite idling of our Conshohocken and Riverdale facilities and acquisition of Stelco (approximately $220 million); and

Previous wording

•An increase in idled facilities charges of approximately $60 million as a result of the operational adjustments related to our Hibbing, Minorca and Dearborn facilities.

Current wording

•An increase in idled facilities charges as a result of the operational adjustments related to our Hibbing, Minorca and Dearborn facilities (approximately $60 million).

Previous wording

Adjusted EBITDA from our Steelmaking segment for the three months ended June 30, 2025, decreased by $225 million, as compared to the three months ended June 30, 2024, primarily due to the decreased gross margin from our operations. Additionally, our Steelmaking Adjusted EBITDA included $130 million and $96 million of Selling, general and administrative expenses for the three months ended June 30, 2025 and 2024, respectively.

Current wording

Adjusted EBITDA from our Steelmaking segment for the three months ended September 30, 2025, increased by $20 million, as compared to the three months ended September 30, 2024, primarily due to the increased gross margin from our Steelmaking operations. Additionally, our Steelmaking Adjusted EBITDA included $123 million and $105 million of Selling, general and administrative expenses for the three months ended September 30, 2025 and 2024, respectively.

Previous wording

Adjusted EBITDA from our Steelmaking segment for the six months ended June 30, 2025, decreased by $804 million, as compared to the six months ended June 30, 2024, primarily due to the decreased gross margin from our operations. Additionally, our Steelmaking Adjusted EBITDA included $256 million and $221 million of Selling, general and administrative expenses for the six months ended June 30, 2025 and 2024, respectively.

Current wording

Adjusted EBITDA from our Steelmaking segment for the nine months ended September 30, 2025, decreased by $787 million, as compared to the nine months ended September 30, 2024, primarily due to the decreased gross margin from our Steelmaking operations. Additionally, our Steelmaking Adjusted EBITDA included $378 million and $326 million of Selling, general and administrative expenses for the nine months ended September 30, 2025 and 2024, respectively.

Previous wording

During the three and six months ended June 30, 2025, our consolidated Revenues decreased by $158 million and $728 million, respectively, and our consolidated gross margin decreased by $371 million and $1,047 million, respectively, as compared to the prior-year periods. See "— Steelmaking Results" above for further detail on our operating results.

Current wording

During the three and nine months ended September 30, 2025, our consolidated Revenues increased by $165 million and decreased by $563 million, respectively, and our consolidated gross margin increased by $60 million and decreased by $990 million, respectively, as compared to the prior-year periods. See "— Steelmaking Results" above for further detail on our operating results.

Previous wording

As a result of the announcements to indefinitely idle two of our non-core Steelmaking assets, we recorded both Restructuring and other charges and Asset impairment. The indefinite idling of our Steelton rail production facility occurred in the second quarter of 2025, while the idling of our Weirton tinplate production facility was announced in the first quarter of 2024.

Current wording

As a result of the announcements to indefinitely idle two of our non-core Steelmaking operations, we recorded both Restructuring and other charges and Asset impairment. The indefinite idling of our Steelton rail production facility occurred in the second quarter of 2025, while the idling of our Weirton tinplate production facility was announced in the first quarter of 2024.

Previous wording

In connection with these decisions, we recorded $86 million and $89 million of Restructuring and other charges during the three and six months ended June 30, 2025, respectively, and $25 million and $129 million for the three and six months ended June 30, 2024, respectively. Additionally, Asset impairment of $39 million was recorded for both the three and six months ended June 30, 2025, and $15 million and $79 million for the three and six months ended June 30, 2024, respectively.

Current wording

In connection with these decisions, we recorded $3 million and $92 million of Restructuring and other charges during the three and nine months ended September 30, 2025, respectively, compared to $2 million and $131 million for the three and nine months ended September 30, 2024, respectively. Additionally, Asset impairment of $39 million was recorded for the nine months ended September 30, 2025, compared to $79 million for the nine months ended September 30, 2024.

Previous wording

During the six months ended June 30, 2024, we used a portion of the net proceeds from the issuance of the 7.000% 2032 Senior Notes to repurchase $829 million in aggregate principal amount of our 6.750% 2026 Secured Senior Notes, resulting in a $6 million and $27 million of Loss on extinguishment of debt for the three and six months ended June 30, 2024, respectively. During the three and six months ended June 30, 2025, we did not repurchase any outstanding senior notes. Refer to NOTE 8 - DEBT AND CREDIT FACILITIES for further information.

Current wording

During the nine months ended September 30, 2024, we used a portion of the net proceeds from the issuance of the 7.000% 2032 Senior Notes to repurchase $829 million in aggregate principal amount of our 6.750% 2026 Secured Senior Notes, resulting in a $27 million of Loss on extinguishment of debt for the nine months ended September 30, 2024. During the three and nine months ended September 30, 2025, we did not repurchase any outstanding senior notes. Refer to NOTE 8 - DEBT AND CREDIT FACILITIES for further information.

Previous wording

During the three and six months ended June 30, 2025, our consolidated Interest expense, net increased by $80 million and $156 million, respectively, as compared to the prior-year period. This increase is primarily due to an increase in our outstanding borrowings.

Current wording

During the three and nine months ended September 30, 2025, our consolidated Interest expense, net increased by $51 million and $207 million, respectively, as compared to the prior-year periods. This increase is primarily due to an increase in our outstanding borrowings.

Previous wording

During the three and six months ended June 30, 2025, our consolidated Income tax benefit increased by $133 million and $272 million, respectively, as compared to the prior-year period. This increase is primarily due to an increase in Loss before income taxes and the impact of immaterial discrete items relative to those losses.

Current wording

During the three and nine months ended September 30, 2025, our consolidated Income tax benefit increased by $2 million and $275 million, respectively, as compared to the prior-year periods. This increase is primarily due to an increase in Loss from continuing operations before income taxes and the impact of immaterial discrete items relative to those losses.

Previous wording

•A $1.1 billion decrease in net loss after adjustments for non-cash items primarily due to lower gross margins resulting from a decrease in selling prices for our steel products as compared to the first half of 2024. See "— Steelmaking Results" above for further detail on our operating results; and

Current wording

•A $1.0 billion decrease in net loss after adjustments for non-cash items primarily due to lower gross margins resulting from a decrease in selling prices for our steel products as compared to the prior-year period. See "— Steelmaking Results" above for further detail on our operating results; and

Previous wording

•A $169 million increase in cash primarily related to a reduction in raw material inventories, including iron ore pellets and coke, during the first half of 2025.

Current wording

•A $209 million increase in cash primarily related to a reduction in raw material inventories, including iron ore pellets and coke, during the first three quarters of 2025; and

Previous wording

•A $173 million increase in cash primarily as a result of lower incentive-based compensation paid in the first half of 2025, as compared to the prior-year period; and

Current wording

•A $179 million increase in cash primarily as a result of lower incentive-based compensation paid in the first three quarters of 2025, as compared to the prior-year period.

Previous wording

Our capital expenditures primarily relate to sustaining capital spend, which includes infrastructure, mobile equipment, fixed equipment, product quality, environmental, and health and safety spend. Our cash used for capital expenditures during the first half of 2025 was $75 million less as compared to the prior-year period. Included within cash used for capital expenditures was a nominal amount related to our non-owned SunCoke Middletown VIE for the six months ended June 30, 2025, compared to $12 million for the six months ended June 30, 2024.

Current wording

Our cash used for capital expenditures during the nine months ended September 30, 2025 was $69 million less as compared to the prior-year period. Our cash used for capital expenditures primarily relates to sustaining capital spend, which includes infrastructure, mobile equipment, fixed equipment, product quality, environmental, and health and safety spend. Included within cash used for capital expenditures was $3 million related to our non-owned SunCoke Middletown VIE for the nine months ended September 30, 2025, compared to $20 million for the nine months ended September 30, 2024.

Previous wording

•The repurchase of 37.9 million common shares during the six months ended June 30, 2024, while no shares were repurchased during the six months ended June 30, 2025; and

Current wording

•The repurchase of 37.9 million common shares during the nine months ended September 30, 2024, while no shares were repurchased during the nine months ended September 30, 2025; which was partially offset by

Previous wording

Our primary sources of liquidity are Cash and cash equivalents, cash generated from our operations, availability under the ABL Facility and access to capital markets. Cash and cash equivalents, which totaled $61 million as of June 30, 2025, include cash on hand and on deposit, as well as short-term securities held for the primary purpose of general liquidity. The combination of cash and availability under our ABL Facility equated to $2.7 billion in liquidity as of June 30, 2025.

Current wording

Our primary sources of liquidity are Cash and cash equivalents, cash generated from our operations, availability under the ABL Facility and access to capital markets. Cash and cash equivalents, which totaled $66 million as of September 30, 2025, include cash on hand and on deposit, as well as short-term securities held for the primary purpose of general liquidity. The combination of cash and availability under our ABL Facility equated to $3.1 billion in liquidity as of September 30, 2025.

Previous wording

On February 6, 2025, we issued $850 million aggregate principal amount of 7.500% Senior Notes due 2031 at par. The net proceeds were used for general corporate purposes, including repayment of borrowings under our ABL Facility. We believe our liquidity and access to capital markets will be adequate to fund our cash requirements for the next 12 months and for the foreseeable future. However, our ability in the future to issue additional notes could be limited by market conditions.

Current wording

On February 6, 2025, we issued $850 million aggregate principal amount of 7.500% Senior Notes due 2031 at par. The net proceeds from this offering were used for general corporate purposes, including repayment of borrowings under our ABL Facility.

Previous wording

We have the capability to issue additional unsecured notes and, subject to the limitations set forth in our existing senior notes indentures and ABL Facility, additional secured debt, if we elect to access the debt capital markets. We currently have approximately $3.2 billion of secured debt capacity. We intend from time to time to seek to redeem or repurchase our outstanding senior notes with cash on hand, borrowings from existing credit sources or new debt financings and/or exchanges for debt or equity securities, in open market purchases, privately negotiated transactions or otherwise. Such redemptions or repurchases, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors, and the amounts involved may be material. We also have the potential to generate liquidity from the sale of non-core assets.

Current wording

We have the capability to issue additional unsecured notes and, subject to the limitations set forth in our existing senior notes indentures and ABL Facility, additional secured debt, if we elect to access the debt capital markets. We currently have approximately $3.2 billion of secured debt capacity. We believe our liquidity and access to capital markets will be adequate to fund our cash requirements for the next 12 months and for the foreseeable future. However, our ability in the future to issue additional debt could be limited by market conditions. We intend from time to time to seek to redeem or repurchase our outstanding senior notes with cash on hand, borrowings from existing credit sources or new debt financings and/or exchanges for debt or equity securities, in open market purchases, privately negotiated transactions or otherwise. Such redemptions or repurchases, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions and other factors, and the amounts involved may be material. We also have the potential to generate liquidity from the sale of non-core assets. In addition to non-core operating assets, we have received inbound inquiries for us to sell recently idled facilities and certain other inactive sites.

Previous wording

The following table provides a reconciliation of our Net income (loss) to Adjusted EBITDA:

Current wording

The following table provides a reconciliation of our Net loss to Adjusted EBITDA:

Previous wording

The accompanying summarized financial information has been prepared and presented pursuant to SEC Regulation S-X, Rule 3-10, “Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered,” and Rule 13-01 "Financial Disclosures about Guarantors and Issuers of Guaranteed Securities and Affiliates Whose Securities Collateralized a Registrant's Securities." Certain of our subsidiaries (the "Guarantor subsidiaries") as of June 30, 2025 have fully and unconditionally, and jointly and severally, guaranteed the obligations under the 5.875% 2027 Senior Notes, the 7.000% 2027 Senior Notes, the 4.625% 2029 Senior Notes, the 6.875% 2029 Senior Notes, the 6.750% 2030 Senior Notes, the 4.875% 2031 Senior Notes, the 7.500% 2031 Senior Notes, the 7.000% 2032 Senior Notes and the 7.375% 2033 Senior Notes issued by Cleveland-Cliffs Inc. on a senior unsecured basis. See NOTE 8 - DEBT AND CREDIT FACILITIES for further information.

Current wording

The accompanying summarized financial information has been prepared and presented pursuant to SEC Regulation S-X, Rule 3-10, “Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered,” and Rule 13-01 "Financial Disclosures about Guarantors and Issuers of Guaranteed Securities and Affiliates Whose Securities Collateralized a Registrant's Securities." Certain of our subsidiaries (the "Guarantor subsidiaries") as of September 30, 2025 have fully and unconditionally, and jointly and severally, guaranteed the obligations under the 5.875% 2027 Senior Notes, the 7.000% 2027 Senior Notes, the 4.625% 2029 Senior Notes, the 6.875% 2029 Senior Notes, the 6.750% 2030 Senior Notes, the 4.875% 2031 Senior Notes, the 7.500% 2031 Senior Notes, the 7.000% 2032 Senior Notes, the 7.375% 2033 Senior Notes, and the 7.625% 2034 Senior Notes issued by Cleveland-Cliffs Inc. on a senior unsecured basis. See NOTE 8 - DEBT AND CREDIT FACILITIES for further information.

Previous wording

As of June 30, 2025, the guarantee of a Guarantor subsidiary with respect to the 5.875% 2027 Senior Notes, the 7.000% 2027 Senior Notes, the 4.625% 2029 Senior Notes, the 6.875% 2029 Senior Notes, the 6.750% 2030 Senior Notes, the 4.875% 2031 Senior Notes, the 7.500% 2031 Senior Notes, the 7.000% 2032 Senior Notes and the 7.375% 2033 Senior Notes will be automatically and unconditionally released and discharged, and such Guarantor subsidiary’s obligations under the guarantee and the related indentures (the “Indentures”) will be automatically and unconditionally released and discharged, upon the occurrence of any of the following, along with the delivery to the trustee of an officer’s certificate and an opinion of counsel, each stating that all conditions precedent provided for in the applicable Indenture relating to the release and discharge of such Guarantor subsidiary’s guarantee have been complied with:

Current wording

As of September 30, 2025, the guarantee of a Guarantor subsidiary with respect to the 5.875% 2027 Senior Notes, the 7.000% 2027 Senior Notes, the 4.625% 2029 Senior Notes, the 6.875% 2029 Senior Notes, the 6.750% 2030 Senior Notes, the 4.875% 2031 Senior Notes, the 7.500% 2031 Senior Notes, the 7.000% 2032 Senior Notes, the 7.375% 2033 Senior Notes, and the 7.625% 2034 Senior Notes will be automatically and unconditionally released and discharged, and such Guarantor subsidiary’s obligations under the guarantee and the related indentures (the “Indentures”) will be automatically and unconditionally released and discharged, upon the occurrence of any of the following, along with the delivery to the trustee of an officer’s certificate and an opinion of counsel, each stating that all conditions precedent provided for in the applicable Indenture relating to the release and discharge of such Guarantor subsidiary’s guarantee have been complied with:

Previous wording

Additionally, for the six months ended June 30, 2025, the obligated group had Revenues of $39 million and Cost of goods sold of $35 million, in each case, with other related parties.

Current wording

Additionally, for the nine months ended September 30, 2025, the obligated group had Revenues of $64 million and Cost of goods sold of $56 million, in each case, with other related parties.

Previous wording

Our strategy to address price fluctuations related to the selling price of our products has generally been to obtain competitive prices for our products and allow operating results to reflect market price movements dictated by supply and demand; however, to an extent, we also utilize sales swaps to manage our exposure to HRC price fluctuations in the average selling price of our products.

Current wording

Our strategy to address price fluctuations related to the selling price of our products has generally been to obtain competitive prices for our products and allow operating results to reflect market price movements dictated by supply and demand; however, from time to time, we also utilize sales swaps to manage our exposure to HRC price fluctuations in the average selling price of our products.

Previous wording

A comparison of each asset group's carrying value to the estimated undiscounted net future cash flows expected to result from the use of the assets, including cost of disposition, is used to determine if an asset is recoverable. Projected future cash flows reflect management's best estimate of economic and market conditions over the projected period, including growth rates in revenues and costs, and estimates of future expected changes in operating margins and capital expenditures. If the carrying value of the asset group is higher than its undiscounted net future cash flows, the asset group is measured at fair value and the difference is recorded as a reduction to the long-lived assets. We estimate fair value using a market approach, an income approach or a cost approach. For the three and six months ended June 30, 2025, we concluded that there were no additional triggering events resulting in the need for an impairment assessment except for the announcement of the indefinite idle of our Steelton rail production facility, which resulted in a $34 million impairment charge to Property, plant and equipment, net for the six months ended June 30, 2025.

Current wording

A comparison of each asset group's carrying value to the estimated undiscounted net future cash flows expected to result from the use of the assets, including cost of disposition, is used to determine if an asset is recoverable. Projected future cash flows reflect management's best estimate of economic and market conditions over the projected period, including growth rates in revenues and costs, and estimates of future expected changes in operating margins and capital expenditures. If the carrying value of the asset group is higher than its undiscounted net future cash flows, the asset group is measured at fair value and the difference is recorded as a reduction to the long-lived assets. We estimate fair value using a market approach, an income approach or a cost approach. For the nine months ended September 30, 2025, we concluded that there were no additional triggering events resulting in the need for an impairment assessment except for the announcement of the indefinite idle of our Steelton rail production facility, which resulted in a $34 million impairment charge to Property, plant and equipment, net for the nine months ended September 30, 2025.

Previous wording

Interest payable on our senior notes is at fixed rates. Interest payable under our ABL Facility is at a variable rate based upon the applicable base rate plus the applicable base rate margin depending on the excess availability. As of June 30, 2025, we had $1,377 million of outstanding borrowings under our ABL Facility. An increase in prevailing interest rates would increase interest expense and interest paid for any outstanding borrowings under our ABL Facility. For example, a 100 basis point change to interest rates under our ABL Facility at the June 30, 2025 borrowing level would result in a change of $14 million to interest expense on an annual basis.

Current wording

Interest payable on our senior notes is at fixed rates. Interest payable under our ABL Facility is at a variable rate based upon the applicable base rate plus the applicable base rate margin depending on the excess availability. As of September 30, 2025, we had $847 million of outstanding borrowings under our ABL Facility. An increase in prevailing interest rates would increase interest expense and interest paid for any outstanding borrowings under our ABL Facility. For example, a 100 basis point change to interest rates under our ABL Facility at the September 30, 2025 borrowing level would result in a change of $9 million to interest expense on an annual basis.