Warrior Q2 2026 earnings: Blue Creek lifts volumes and margins

Warrior Met Coal (NYSE: HCC) reported Q2 2026 revenue of $509.7 million, up approximately 71% from $297.5 million a year earlier, while diluted EPS rose to $1.65 from $0.11. Blue Creek’s ramp-up drove record sales volume and lower unit costs, lifting adjusted EBITDA margin to 30.8% and helping free cash flow reach $103.4 million.

Core Earnings Data

Revenue growth reflected a 65% increase in steelmaking coal sales volume and a 6% increase in average net selling price. The combination of higher volume, better pricing and lower cash cost per ton expanded operating income and adjusted EBITDA substantially despite higher total cost of sales.

The following figures cover the quarter ended June 30, 2026:

Adjusted EBITDA and free cash flow are non-GAAP measures. Operating margins above are calculated from the reported revenue and operating income figures.

Blue Creek Volume and Lower Unit Costs Outweighed Weaker Index Realization

Warrior sold a record 3.654 million short tons, its fourth consecutive quarterly volume record, while production reached 3.347 million short tons. Sales exceeded production, and coal inventory declined to 1.4 million short tons at June 30 from 1.9 million at March 31.

Average net selling price increased even though gross price realization fell to approximately 66% of the Platts Premium Low Vol Australian index from 80%. Warrior attributed the lower realization to a 21% higher sales mix of high-vol A coal, predominantly sold into the Pacific Basin at elevated freight rates, as well as persistently low second-tier price relativities.

Blue Creek’s lower cost structure and the Section 45X Advanced Manufacturing Production Tax Credit helped reduce cash cost per ton. Higher coal prices partly offset those benefits by increasing variable wages, transportation costs and royalties.

Cash cost of sales and cash margin per short ton are non-GAAP measures.

Cash Flow Benefited From Earnings Growth and Lower Project Spending

The improvement in free cash flow was supported by both stronger operating performance and the completion of Blue Creek’s main construction phase. Capital expenditures and mine development spending declined to $18.3 million from $94.3 million in the prior-year quarter.

Net working capital excluding cash increased by $13.7 million from Q1 2026, reflecting higher inventories and prepaid expenses as well as lower accrued expenses. Despite that increase, operating cash generation strengthened with earnings.

Warrior ended the quarter with $452.9 million of total liquidity, including $302.3 million of cash and cash equivalents, $10.1 million of short-term investments and $140.5 million available under its asset-based lending facility. Financing cash outflow was $14.2 million, mainly comprising $9.9 million of finance lease principal repayments and a $4.2 million regular dividend payment.

2026 Guidance

Warrior raised full-year volume guidance by 0.5 million short tons following positive customer reception of Blue Creek trial volumes and adoption by customers. The release did not provide the exact previous guidance ranges, but it supplied the following updated outlook:

Three additional longwall moves are planned before year-end—two in Q3 and one in Q4. Warrior also identified coal pricing, sales geography, freight rates, trade and tariff policies, a new labor contract and inflation as factors that could affect the outlook.

Management’s View

Management described Q2 as the start of a new phase centered on free cash flow, balance-sheet strength and long-term shareholder returns now that Blue Creek is operational and its development spending is complete. CEO Walt Scheller said Blue Creek was adding incremental earnings and cash flow as customers responded positively to its product.

On demand, management acknowledged regional fluctuations in steelmaking coal markets. It said Chinese import demand was supporting seaborne prices, while long-term steel production growth in India remained a positive demand catalyst.

Recent Insider Transactions

The supplied six-month insider summary shows 292,536 shares purchased across 23 transactions and 20,000 shares sold in one transaction, resulting in net purchases of 272,536 shares. Total insider holdings were listed at approximately 1.06 million shares, with net purchases equal to 34.6%.

Only the sale included complete transaction-level details in the supplied data:

Risks Investors Need to Watch

• Coal pricing and sales mix: Realization declined to 66% of the PLV index from 80%. Continued pressure from product mix, freight rates or second-tier price relativities could limit the revenue benefit from higher benchmark prices.
• Longwall execution: Three longwall moves are scheduled in the second half. Operational disruption could affect production volume and the company’s raised full-year volume guidance.
• Cost pressure: Blue Creek and the 45X credit reduced Q2 unit costs, but higher coal prices increased variable wages, transportation expenses and royalties. Inflation and the new labor contract could also affect the $95–$105 per-ton full-year cost range.
• Regional demand and trade policy: Warrior cited fluctuations in regional supply and demand, global tariff uncertainty and trade policy as factors that could influence pricing, customer demand and shipment geography.

Summary

Warrior’s Q2 2026 results showed Blue Creek beginning to change the company’s operating and cash-flow profile. Record volume, improved selling prices and lower unit costs expanded margins, while reduced project spending helped turn free cash flow positive. The main points to monitor are execution of the remaining longwall moves, the sustainability of Blue Creek’s cost benefits and how product mix, freight rates and global coal demand affect realized pricing.