Voestalpine's 138% Profit Surge Cushions US Tariff Blow as EU Tightens Steel Import Screws

Austrian steelmaker Voestalpine reports €424M net income, boosted by EU trade barriers and green steel investments, despite 50% US tariffs and carbon costs.

The European steel industry is undergoing a regulatory revolution, and Voestalpine finds itself squarely in the crosshairs—both as a beneficiary of new trade barriers and as a target of US tariffs. The Austrian group’s net income more than doubled to €424 million in the 2025/26 financial year, powered by an EBITDA of €1.5 billion on €15.1 billion in sales. EBIT jumped 59% to €724 million, while free cash flow of €537 million allowed net financial debt to shrink to €1.3 billion, pushing the gearing ratio to 16.2%—its lowest level since the 2005/06 fiscal year.

Yet the gains were not without headwinds. US tariffs of 50% on steel imports carved a high double-digit million-euro hole in earnings, most acutely felt in the Tubulars division, where speciality pipes face both steep duties and depressed oil prices. The counterweight comes from Brussels: a sequence of measures that will increasingly shield European producers from cheap foreign competition.

From 1 July, the EU’s steel safeguard quota for duty-free imports will halve to 18.3 million tonnes annually—a 47% cut versus 2024. Shipments exceeding that level will face a 50% tariff, double the previous rate. Tougher still is the “melt-and-pour” principle, kicking in from October 2026, which forces importers to prove where their steel was melted and cast, closing loopholes that routed material through third countries. The European Parliament approved the regulation on 19 May, with the Council following on 8 June.

Carbon costs add another layer. The EU’s CBAM mechanism, fully operational since January 2026, already prices the CO? footprint of imports and adds an estimated €40–70 per tonne on shipments from China and Turkey. On 12 June, member states agreed to extend CBAM to downstream iron, steel and aluminium products, safeguarding the entire value chain. For Voestalpine, that turns emissions-intensive foreign steel into an increasingly expensive option while making its own lower-carbon output more competitive.

The company is betting heavily on that advantage with its greentec steel transformation. At the Linz site, a new electric-arc furnace hall—100 metres long, 60 metres wide and 65 metres high—takes shape daily with 750 workers on site, rising to over 1,200 at peak. More than 500 suppliers, 90% of them Austrian, have been contracted. The first arc furnace is scheduled to start in February 2027, followed by secondary metallurgy in April. In Donawitz, around 300 staff are working across 11 sub-projects; construction of a 220-kV high-voltage line to supply renewable power is under way. Core equipment deliveries began last summer, with the main aggregates arriving in autumn 2026.

Together, the two furnaces will produce 2.5 million tonnes of CO?-reduced steel annually—1.6 million tonnes in Linz and 850,000 tonnes in Donawitz. Voestalpine aims to cut its emissions by 30% by 2029, equivalent to up to four million tonnes of CO? per year, or 5% of Austria’s total annual emissions. From 2030, a second blast furnace at each site will be phased out. Approximately 60% of the programme’s budget has already been committed.

For the current financial year 2026/27, management forecasts EBITDA of €1.60–1.85 billion, up from the €1.5 billion reported last year. Shareholders are in line for a dividend increase to €0.75 per share from €0.60, a 25% lift subject to approval at the annual general meeting on 1 July.

The stock, trading at €47.42, has more than doubled over the past twelve months and gained nearly 23% since the start of the year. With the 52-week high of €49.22 just 4% above the current level, the market appears to be pricing in a regulatory tailwind that keeps blowing.