CLEVELAND-CLIFFS INC.

Previous wording

The following is a summary of our consolidated results for the three months ended March 31, 2025 and 2024 (in millions, except for diluted EPS):

Current 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):

Previous wording

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

Current wording

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

Previous wording

We continued to navigate unfavorable market conditions throughout the first quarter of 2025. Steel market conditions in the first quarter of 2025 were driven by weaker than anticipated light vehicle production, inconsistent buying behavior from customers and higher import levels. The steel market in the first quarter of 2025 continued to be impacted by the poor domestic steel demand environment experienced in the second half of 2024, which resulted in downward pressure on HRC pricing. The price for domestic HRC, the most significant index impacting our revenues and profitability, averaged $792 per net ton during the first quarter of 2025, 16% lower than first quarter of 2024. The HRC price increased to above $960 per ton in April 2025, as the recently announced steel tariffs have helped support domestic steel pricing. Import levels were elevated in the first quarter of 2025 in anticipation of the recently implemented steel tariffs, which contributed to downward pressure on HRC pricing. Looking forward, we expect domestic steel demand to grow, as recently implemented steel and automotive tariffs will 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 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.

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. These operational changes will allow us to streamline our operations and enhance efficiency, with minimal expected impact to our flat-rolled steel output. Lastly, in an effort to match our production capabilities with our order book, we intend to restart our idled C-6 blast furnace at Cleveland Works during 2025.

Current 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.

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 first quarter of 2025 was approximately 3.8 million units, down from approximately 4.0 million units in the first quarter of 2024. During the first quarter of 2025, light vehicle sales in the U.S. saw an average seasonally adjusted annualized rate of 16.5 million units sold, representing a 7% increase compared to the first quarter of 2024. The March 2025 seasonally adjusted annualized rate was 17.8 million units sold, the highest published rate since 2021, 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 12.6 years, surpassing the previous record set in 2023, 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 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 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.

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 $471 per long ton during the first quarter of 2025. We expect the supply of busheling scrap to further tighten due to decreasing prime scrap generation from original equipment manufacturers and the growth of EAF capacity in the U.S., reduced metallics import availability, 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 $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.

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 other global tensions, and the new administration's focus on U.S. manufactured products, has displayed the importance of our North American-centric footprint, as our competitors who primarily operate EAF facilities rely on imported pig iron to produce flat-rolled steel, the supply of which has been disrupted. 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, 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.

Previous wording

We are a leading producer of electrical steels referred to as GOES and NOES in the U.S., which we believe will be critical for the modernization of the electrical grid and the infrastructure needed to allow for increased EV adoption, both of which require electrical steels. Distribution transformers are critical to the maintenance and expansion of America’s electric grid. Transformers are in short supply, and that shortage stifles economic growth across the country. The shortage will continue to be exacerbated by the widespread adoption of Artificial Intelligence in virtually all sectors of the economy, which will exponentially increase the consumption of electricity in the U.S. and worldwide. Because of these industry dynamics and our current customer base, our electrical steel business is expected to continue to achieve strong profitability in the coming years.

Current wording

We are a leading producer of electrical steels referred to as GOES and NOES in the U.S., which we believe will be critical for the modernization of the electrical grid and the infrastructure needed to allow for increased electric vehicle adoption, both of which require electrical steels. Distribution transformers are critical to the maintenance and expansion of America’s electric grid. Transformers are in short supply, and that shortage stifles economic growth across the country. The shortage will continue to be exacerbated by the widespread adoption of Artificial Intelligence in virtually all sectors of the economy, which will exponentially increase the consumption of electricity in the U.S. and worldwide. Because of these industry dynamics and our current customer base, our electrical steel business is expected to continue to achieve strong profitability in the coming years.

Previous wording

We are the first and the only producer of HBI in the Great Lakes region. From our Toledo, Ohio facility, we produce a high-quality, low-cost and low-carbon intensive HBI product that can be used in our blast furnaces as a productivity enhancer, or in our BOFs and EAFs as a premium scrap alternative. We use HBI to stretch our hot metal production, lowering carbon intensity and reliance on coke. With increasing tightness in the scrap and metallics markets combined with our own internal needs, we expect our Toledo direct reduction plant to continue to support our operational efficiency going forward.

Current wording

We are the first and the only producer of HBI in the Great Lakes region. From our Toledo, Ohio facility, we produce a high-quality, low-cost and low-carbon intensive HBI product that can be used in our blast furnaces as a productivity enhancer, or in our BOFs and EAFs as a premium scrap alternative. We use HBI to stretch our hot metal production, lowering carbon intensity and reliance on coke. With increasing tightness in the scrap and metallics markets combined with our own internal needs, we expect our Toledo direct reduction plant to continue to support our operational efficiency going forward. The unique value of our HBI facility is even more evident as recent trade discussions could result in tariffs on pig iron or other imported raw materials for competitors who rely on international suppliers.

Previous wording

On March 7, 2025, we announced a "Buy American" incentive program for all of our employees in an effort to support President Trump's long-term vision of bringing manufacturing back to the U.S. Under this program, any Cleveland-Cliffs employee who purchases or leases a new American-built vehicle in 2025 with substantial Cliffs steel content will receive a $1,000 cash bonus in connection with the purchase or lease. As the domestic automotive market has long been undermined by excessive imports, we are proud to play a role in encouraging the purchase of domestically produced vehicles. Since the program's inception, feedback has been extremely positive, and employees have been very enthusiastic about the opportunity to support the sale of domestically produced vehicles.

Current wording

On March 7, 2025, we announced a "Buy American" incentive program for all of our employees in an effort to support President Trump's long-term vision of bringing manufacturing back to the U.S. Under this program, any Cliffs employee who purchases or leases a new American-built vehicle in 2025 with substantial Cliffs steel content will receive a $1,000 cash bonus in connection with the purchase or lease. As the domestic automotive market has long been undermined by excessive imports, we are proud to play a role in encouraging the purchase of domestically produced vehicles. Since the program's inception, feedback has been extremely positive, and employees have been very enthusiastic about the opportunity to support the sale of domestically produced vehicles.

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 $3.3 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 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.

Previous wording

The following is a summary of our Steelmaking segment operating results, net of intersegment eliminations, for the three months ended March 31, 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 six months ended June 30, 2025 and 2024 (dollars in millions, except for average selling price, and shipments in thousands of net tons):

Previous wording

•A decrease of $320 million, or 20%, in revenues from the direct automotive market, predominantly due to a decrease in demand; and

Current wording

•A decrease of $531 million, or 17%, in revenues from the direct automotive market, predominantly due to a decrease in demand; and

Previous wording

•A decrease of $184 million, or 13%, in revenues from the distributors and converters market, predominantly due to a decrease in average selling price; which was partially offset by

Current wording

•A decrease of $153 million, or 5%, in revenues from the distributors and converters market, predominantly due to a decrease in average selling price; which was partially offset by

Previous wording

•A decrease in average selling price (approximately $500 million impact), predominantly due to lower index prices and a lower direct automotive mix. The average selling price was additionally impacted as a result of incremental hot-rolled steel tons sold related to the addition of Stelco; and

Current wording

•A decrease in average selling price (approximately $700 million impact), predominantly due to lower direct automotive mix and lower index prices. The average selling price was additionally impacted as a result of incremental hot-rolled steel tons sold related to the addition of Stelco;

Previous wording

Adjusted EBITDA from our Steelmaking segment for the three months ended March 31, 2025, decreased by $579 million, as compared to the three months ended March 31, 2024, primarily due to the decreased gross margin from our operations. Additionally, our Steelmaking Adjusted EBITDA included $126 million and $125 million of Selling, general and administrative expenses for the three months ended March 31, 2025 and 2024, respectively.

Current 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.

Previous wording

During the three months ended March 31, 2025, our consolidated Revenues decreased by $570 million, and our consolidated gross margin decreased by $676 million, as compared to the prior-year period. See "— Steelmaking Results" above for further detail on our operating results.

Current 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.

Previous wording

During the three months ended March 31, 2024, we used a portion of the net proceeds from the issuance of the 7.000% 2032 Senior Notes to repurchase $640 million in aggregate principal amount of our 6.750% 2026 Secured Senior Notes, resulting in a $21 million loss on extinguishment of debt. During the three months ended March 31, 2025, we did not repurchase any outstanding debt. Refer to NOTE 7 - DEBT AND CREDIT FACILITIES for further information.

Current 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.

Previous wording

During the three months ended March 31, 2025, our consolidated Interest expense, net increased by $76 million compared to the three months ended March 31, 2024. This increase is primarily due to an increase in our outstanding borrowings.

Current 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.

Previous wording

During the three months ended March 31, 2025, our consolidated Income tax benefit increased by $139 million compared to the three months ended March 31, 2024. 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 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.

Previous wording

•A $694 million 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 quarter of 2024. See "— Steelmaking Results" above for further detail on our operating results; and

Current 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

Previous wording

•A $196 million decrease in cash primarily related to increasing average selling prices of our steel products during the first quarter of 2025 as compared to the fourth quarter of 2024 resulting in growing accounts receivable balances; which was partially offset by

Current wording

•A $266 million decrease in cash primarily related to increasing average selling prices of our steel products during the first half of 2025 as compared to the end of 2024, resulting in growing accounts receivable balances; which was partially offset by

Previous wording

•A $227 million increase in cash primarily as a result of lower incentive-based compensation paid in the first quarter of 2025, as compared to the first quarter of 2024.

Current 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

Previous wording

•A $190 million increase in cash primarily related to a reduction in iron ore pellet inventories during the first quarter of 2025; and

Current 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.

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 quarter of 2025 was $30 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 three months ended March 31, 2025, compared to $4 million for the three months ended March 31, 2024.

Current 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.

Previous wording

We anticipate total cash used for capital expenditures during the next 12 months to be approximately $650 million, which primarily consists of sustaining capital spend.

Current wording

We anticipate total cash used for capital expenditures during the next 12 months to be approximately $700 million, which primarily consists of sustaining capital spend.

Previous wording

•The repurchase of 30.4 million common shares for the three months ended March 31, 2024, while no shares were repurchased during the three months ended March 31, 2025.

Current 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

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 $57 million as of March 31, 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 $3.0 billion in liquidity as of March 31, 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 $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.

Previous wording

Our ABL Facility, which matures in June 2028, has a maximum borrowing base of $4.75 billion, including a $500 million multicurrency sub-facility, a $555 million sublimit for the issuance of letters of credit and a $200 million sublimit for swingline loans. The available borrowing base is determined by applying customary advance rates to eligible accounts receivable, inventory and certain mobile equipment. As of March 31, 2025, outstanding letters of credit totaled $55 million, which reduced availability. We issue standby letters of credit with certain financial institutions in order to support business obligations, including, but not limited to, workers' compensation, operating agreements, employee severance, environmental obligations and insurance. Our ABL Facility agreement contains various financial and other covenants. As of March 31, 2025, we were in compliance with all of our ABL Facility covenants.

Current wording

Our ABL Facility, which matures in June 2028, has a maximum borrowing base of $4.75 billion, including a $500 million multicurrency sub-facility, a $555 million sublimit for the issuance of letters of credit and a $200 million sublimit for swingline loans. The available borrowing base is determined by applying customary advance rates to eligible accounts receivable, inventory and certain mobile equipment. As of June 30, 2025, outstanding letters of credit totaled $63 million, which reduced availability. We issue standby letters of credit with certain financial institutions in order to support business obligations, including, but not limited to, workers' compensation, operating agreements, employee severance, environmental obligations and insurance. Our ABL Facility agreement contains various financial and other covenants. As of June 30, 2025, we were in compliance with all of our ABL Facility covenants.

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 $3.3 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.

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 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.

Previous wording

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

Current wording

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

Previous wording

Additionally, for the three months ended March 31, 2025, the obligated group had Revenues of $19 million and Cost of goods sold of $17 million, in each case, with other related parties.

Current 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.

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.

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 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.

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 March 31, 2025, we had $1,255 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 March 31, 2025 borrowing level would result in a change of $13 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 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.

Previous wording

•our ability to consummate any public or private acquisition transactions and to realize any or all of the anticipated benefits or estimated future synergies, as well as to successfully integrate any acquired businesses into our existing businesses;

Current wording

•our ability to consummate any public or private acquisition or divestiture transactions and to realize any or all of the anticipated benefits or estimated future synergies, as well as to successfully integrate any acquired businesses into our existing businesses;