Gerdau S.A. (GGB) is rising today as investors react to newly released first-quarter 2026 results that showed a sharp improvement in profitability despite softer revenue. The quarter featured adjusted EBITDA of R$2.955 billion and an adjusted EBITDA margin of 17.7%, alongside adjusted net income of R$1.012 billion—numbers that highlight operating leverage and stronger pricing dynamics in key end markets.

For 1Q26, net sales were R$16.716 billion and steel shipments totaled 2.811 million tonnes, while profitability improved materially versus the prior quarter. The company also approved R$106 million in dividends (R$0.08 per share) to be paid as of June 10, 2026, adding a near-term capital-return catalyst alongside the stronger operating print.

Management highlighted North America as the primary earnings engine, with the segment generating about 75% of consolidated adjusted EBITDA (R$2.2 billion) and benefiting from a more favorable pricing environment and higher volumes coming out of year-end seasonality. The market focus is increasingly on whether that pricing backdrop can hold through mid-2026, given the sensitivity of steel spreads and demand to trade policy and construction/industrial cycles.

Beyond the initial earnings reaction, traders will watch the company’s conference call and any follow-through commentary on demand, domestic pricing, and cost discipline—especially in Brazil, where management described a pressured competitive environment and higher import levels in flat steel. Capex in 1Q26 came in at R$1.1 billion and was described as tracking the R$4.7 billion 2026 plan, keeping the spotlight on free-cash-flow conversion and incremental return-of-capital capacity for the remainder of the year.