Worthington Steel Reports 18% Revenue Growth to $871.9 Million in Latest Quarter

Worthington Steel, Inc. reported significant financial performance in its latest quarterly filing, with net sales reaching $871.9 million for the three months ended November 30, 2025, an increase of 18% compared to $739.0 million in the same period last year. The company's operating income also rose to $21.7 million, up from $18.9 million, while net earnings attributable to controlling interest increased to $18.8 million, compared to $12.8 million in the prior year. This growth was driven primarily by higher direct volumes and improved average selling prices, despite a decline in toll processing volumes.

The company experienced notable changes in its financial metrics compared to the previous fiscal period. Gross margin improved to $93.2 million, reflecting a 16.5% increase from $80.0 million, largely due to higher direct spreads and volumes. However, selling, general, and administrative expenses also rose to $70.9 million from $61.1 million, primarily due to increased compensation and professional fees. The company recorded a pre-tax impairment charge of $0.6 million on certain machinery, which contributed to the overall increase in expenses.

Strategically, Worthington Steel completed the acquisition of a 52% stake in Sitem Group, a producer of electric motor laminations, in June 2025. This acquisition is expected to enhance the company's market position in Europe and contribute to its revenue growth. The integration of Sitem Group has already begun to show positive results, with the group contributing $52.6 million in net sales during the latest quarter. The company also declared a quarterly cash dividend of $0.16 per common share, reflecting its commitment to returning value to shareholders.

Operationally, Worthington Steel reported a decrease in total volume sold, down 4% year-over-year, with direct tons sold increasing by 13% and toll volumes decreasing by 24%. The automotive sector remains a key market, accounting for 56% of net sales, with significant contributions from the Detroit Three Automakers. The company noted that it has gained market share in the automotive sector, reflecting a recovery in production levels. Additionally, the company has been integrating artificial intelligence technologies into its operations to enhance productivity and decision-making.

Looking ahead, Worthington Steel anticipates continued growth driven by strategic initiatives and market demand. The company is focused on managing its costs and optimizing its operations amid fluctuating raw material prices and economic conditions. The outlook remains cautiously optimistic, with expectations for stable demand in key markets and ongoing efforts to leverage its expanded capabilities following the Sitem Group acquisition.