Tokyo: Japan’s largest steelmaker, Nippon Steel Corporation, has revealed a sharp downturn in its financial performance for the first half of the fiscal year, posting a loss of ¥113.4 billion for the six months ending September 2025. The result marks a stark reversal from the ¥243.4 billion profit recorded during the same period last year, highlighting mounting challenges in the global steel market and operational pressures in its overseas businesses.
The company attributed much of its loss to soft demand and heightened volatility in the U.S. steel market, where Nippon Steel has significant exposure following its recent $15 billion acquisition of U.S. Steel Corporation in June. While the acquisition initially promised expanded access to the North American market, the company now faces one-time cost deterioration and operational disruptions, prompting it to exclude the U.S. business from its profit guidance for the year.
For the full fiscal year ending March 2026, Nippon Steel has lowered its underlying business profit estimate to ¥680 billion, down roughly 14% from ¥793.7 billion in the previous year. Additionally, the company anticipates a full-year net loss of ¥60 billion, partly driven by a ¥21 billion loss on the planned sale of its minority stake in Brazilian steelmaker Usiminas. This divestment is part of a broader strategy to streamline the company’s global operations and concentrate on its core markets in the U.S., India, and Thailand.
Analysts note that Nippon Steel’s results reflect broader macro and cyclical pressures on the steel industry, including fluctuating raw material prices, regional overcapacity, and shifting trade policies. The U.S. steel market, in particular, has proven volatile due to weakening demand from construction and automotive sectors, complicating the integration of newly acquired assets. Meanwhile, the company’s focus on emerging markets such as India and Thailand underscores its attempt to balance exposure to mature markets with regions where industrial demand is still expanding.
Despite the setbacks, company executives remain committed to strategic restructuring and operational efficiency. Exiting non-core assets such as the Usiminas stake will free up capital and allow Nippon Steel to strengthen its balance sheet, while targeted investments in key regions aim to ensure sustainable long-term growth. The next few months will be critical in monitoring how the U.S. steel market stabilizes, as well as the impact of emerging-market expansion on overall revenue and profitability.
In conclusion, Nippon Steel’s first-half results underscore the challenges facing global steelmakers in a period of economic uncertainty. Investors and industry observers are watching closely as the company navigates these headwinds, balancing operational restructuring with growth ambitions in promising regional markets.