CF Industries Q3 2026 Earnings Rise on Volume and Pricing

CF Industries Holdings, Inc. (NYSE: CF) reported higher third-quarter 2026 earnings as stronger sales volumes, improved pricing and lower realized natural gas costs lifted profitability. The nitrogen producer also maintained expectations for about 9.5 million tons of gross ammonia production in 2026 while advancing construction of its Blue Point low-carbon ammonia project.

Net sales increased 12% to $1.86 billion from $1.66 billion a year earlier. Net earnings attributable to common stockholders rose 24% to $436 million, or $2.87 per diluted share, from $353 million, or $2.19 per share, in the third quarter of 2025.

Adjusted EBITDA, a non-GAAP measure, increased to $833 million from $667 million. CF attributed the improvement primarily to favorable volume and pricing, which contributed $114 million and $78 million, respectively, while lower realized natural gas costs added $20 million. Business interruption insurance contributed $62 million, partly offset by $108 million of other items.

Gross margin expanded to $720 million from $632 million and represented 38.7% of net sales, compared with 38.1% a year earlier. The cost of natural gas used in production was $2.88 per MMBtu, down from $2.96 per MMBtu.

For the first nine months of 2026, net sales reached $6.07 billion, up from $5.21 billion in the prior-year period. Net earnings attributable to common stockholders increased to $1.78 billion, or $11.60 per diluted share, from $1.05 billion, or $6.39 per share. Adjusted EBITDA rose to $3.01 billion from $2.07 billion, driven mainly by stronger pricing. The 2026 figure included a $170 million litigation settlement gain.

Production and cash generation

CF reported 97% utilization of its available ammonia capacity during the first nine months of 2026. Available capacity excludes the Yazoo City Complex, which management expects to resume operations in the first half of 2027. The company’s rolling 12-month recordable incident rate was 0.10 per 200,000 work hours as of September 30.

For the 12 months ended September 30, CF generated $3.08 billion of cash from operating activities and $2.03 billion of free cash flow. Free cash flow equaled 53% of adjusted EBITDA, or 61% excluding $306 million of deposits related to a U.S.-Canada transfer-pricing matter. The deposits are expected to be applied against tax and interest ultimately due following bilateral government procedures.

The company returned $1.3 billion to shareholders through share repurchases and dividends during the same 12-month period. It had approximately $1.1 billion remaining under its current $2 billion share-repurchase authorization, which runs through 2029.

Outlook and strategic projects

CF expects 2026 gross ammonia production of approximately 9.5 million tons and company-funded capital expenditures of about $950 million. Roughly $400 million of that spending relates to Blue Point and excludes capital expenditures associated with rebuilding Yazoo City.

Construction has started at the Blue Point Complex, where ammonia production is expected to begin in 2029. Total project cost remains estimated at approximately $3.7 billion, with common facilities expected to cost about $550 million. CF holds a 40% interest in Blue Point One, while JERA and Mitsui funded their portions of the joint venture’s capital spending.

Management estimates current mid-cycle EBITDA at approximately $2.9 billion. By around 2030, CF expects strategic initiatives—including Blue Point One, margin-enhancement projects and revenue from tax credits and potential low-carbon premiums—to add about $400 million, bringing expected mid-cycle EBITDA to approximately $3.3 billion. The presentation indicated associated mid-cycle free cash flow of more than $2 billion, compared with more than $1.7 billion under the current mid-cycle framework.

The company described global nitrogen supply-and-demand conditions as constructive. It expects global seaborne urea exports to decline by about 5 million metric tons year over year in 2026, reflecting disruptions in the Middle East and Russia, European production curtailments linked to high energy costs, and permanent shutdowns affecting 35% of Trinidad’s ammonia capacity. CF also cited strong Indian demand, expected acceleration in Brazilian purchasing and support from North American UAN fill and fall ammonia programs.

The outlook remains exposed to volatile global nitrogen prices and natural gas costs, agricultural demand, weather, trade restrictions and geopolitical disruptions. CF also faces execution, funding and technology risks at Blue Point, including the possibility that construction costs exceed current estimates or that the project is delayed. Other uncertainties include the Yazoo City restart, environmental and tax regulation, qualification for tax credits, transportation constraints and the development of a commercial market for low-carbon ammonia.