NIPPON STEEL CORPORATION

Business Details

Manufactures and sells a broad range of steel products including bar and wire rod, steel sheet, steel pipe, specialty steel, and transportation and industrial machinery products. Serving diverse industries such as automotive, construction materials, and energy as customers, the segment creates added value through the restructuring of domestic steelworks and the expansion of integrated production systems at overseas group companies (India, ASEAN, and the United States). Following the completion of the acquisition of U.S. Steel in June 2025, the segment made a full-scale entry into the U.S. and European markets, expanding global crude steel production capacity to 82 million tons.

Recent Overview

The completion of the U.S. Steel acquisition drove a substantial increase in revenue, but business profit declined significantly due to business restructuring losses and other factors.

Completed the acquisition of U.S. Steel (acquisition consideration of ¥2,062,513 million) in June 2025, resulting in a significant increase in revenue from external customers to ¥9,173,227 million (up 17.3% year on year). On the other hand, business profit fell sharply to ¥439,961 million (down ¥181,044 million year on year). The main causes were the slump in global steel market conditions and the deterioration in international market conditions due to overproduction in China. Recorded business restructuring losses of ¥271,225 million (consolidated). Revenue and profit for the period from the acquisition date of U.S. Steel were ¥1,933,070 million and ¥21,249 million, respectively. Merged Nippon Steel Stainless Steel Corporation and Nippon Steel Pipe Co., Ltd. in April 2025. Held a groundbreaking ceremony for an integrated steelworks in Rajayapeta in southern India (March 2026).

Key Products

Growth Drivers

• Expansion of global crude steel production capacity to 82 million tons following the completion of the U.S. Steel acquisition (June 2025) and capturing demand for premium steel in the U.S. and European markets (expected to contribute over ¥100 billion in business profit on a normalized basis from U.S. Steel)
• Expansion of integrated production systems in demand-growth regions through capacity expansion at AM/NS India's Hazira Steelworks and the construction of a new integrated ironmaking-to-steelmaking works in Rajayapeta, southern India (construction commenced March 2026)
• Growing demand for carbon-neutral products (NSCarbolex®) and execution of investments in three new, expanded, or restarted electric arc furnaces (at Kyushu, Setouchi, and Yamaguchi Steelworks by fiscal year 2029) based on the GX Promotion Act
• Expansion of synergies in the bar and wire rod and specialty steel businesses through the decided merger with Sanyo Special Steel Co., Ltd. (May 2026), and strengthening of European operations through the transition to direct investment structures at European sites (U.S. Steel Košice and Ovako AB)
• Establishing future competitive advantage through accelerated development of carbon-neutral innovative technologies, including the achievement of a 45% reduction in CO2 emissions with Super COURSE50 and the startup of a hydrogen reduction test furnace

Risks

• Structural deterioration in global steel supply-demand balance and pressure on product margins due to overproduction and increased low-priced steel exports from China (segment profit down ¥181,044 million year on year)
• Deterioration of the D/E ratio (0.94x, or 0.71x after adjusting for capital-like items such as subordinated loans) due to business restructuring losses associated with the U.S. Steel merger (¥271,225 million recorded in the current period) and a substantial increase in interest-bearing debt (Steelmaking segment interest-bearing debt of ¥5,139,779 million, up ¥2,666,151 million year on year)
• Impact on performance from rising raw material and fuel costs and decreased steel exports to the Middle East due to deteriorating conditions in the Middle East (an impact of approximately ¥50 billion is assumed for the first quarter; effects from the second quarter onward are not quantifiable and are not reflected in the earnings forecast)
• Structural decline in domestic steel demand (due to population decline, aging, and expansion of overseas local production by customers) and the risk of additional cost recognition associated with production facility structural measures
• Time and cost risks associated with improving U.S. Steel's manufacturing capabilities and profitability, and impairment risk related to goodwill (¥140,351 million) and intangible assets (¥832,800 million)