COMMERCIAL METALS CoCMC
COMMERCIAL METALS Co Segments Disclosure
NOTE 19. SEGMENT INFORMATION
The Company's operating segments engage in business activities from which they may earn revenues and incur expenses and for which discrete financial information is available. The Company's CODM is the President and Chief Executive Officer. The CODM uses adjusted EBITDA to evaluate the underlying operational performance of the Company’s reportable segments and to guide strategic decisions aligned with Company-wide objectives, as it provides a consistent and comparable view of operating results across segments. In doing so, the CODM considers the performance of this measure relative to historical, planned and forecasted financial information when making decisions about capital and personnel allocation.
Adjusted EBITDA is the sum of the Company's earnings before interest expense, income taxes, depreciation and amortization expense, impairment expense and unrealized gains and losses on undesignated commodity hedges. During the fourth quarter of 2025, the Company modified its method of calculating adjusted EBITDA to exclude the impact of unrealized gains and losses on undesignated commodity derivatives. This change was primarily driven by heightened volatility in copper forward markets, which introduced significant non-cash fluctuations unrelated to core operations. By removing this volatility, the revised metric provides a more representative view of operating performance and cash-generating capability. The Company has recast adjusted EBITDA for all periods presented in this Annual Report to conform to the new presentation.
The Company structures its business into the following three reportable segments: North America Steel Group, Emerging Businesses Group and Europe Steel Group. See Note 1, Nature of Operations and Summary of Significant Accounting Policies, for more information about the reportable segments, including the types of products and services from which each reportable segment derives its net sales. Corporate and Other contains earnings or losses on assets and liabilities related to the Company's BRP assets and short-term investments, expenses of the Company's corporate headquarters, litigation-related expenses, interest expense related to long-term debt, other revenue resulting from the Company's NMTC transactions and intercompany eliminations. Certain corporate administrative expenses are allocated to the segments based upon the nature of the expense.
The following tables present net sales and the significant expense categories that are included in adjusted EBITDA and regularly provided to the Company's CODM:
| Year Ended August 31, 2025 | ||||||||||||||||||||||||||
| (in thousands) | North America Steel Group | Emerging Businesses Group | Europe Steel Group | Total | ||||||||||||||||||||||
| Net sales to external customers | $ | 6,083,849 | $ | 747,486 | $ | 918,320 | $ | 7,749,655 | ||||||||||||||||||
| Intersegment net sales | 66,953 | 58,596 | 2,839 | 128,388 | ||||||||||||||||||||||
| $ | 6,150,802 | $ | 806,082 | $ | 921,159 | $ | 7,878,043 | |||||||||||||||||||
| Reconciliation of net sales | ||||||||||||||||||||||||||
| Corporate and Other, excluding eliminations | 48,825 | |||||||||||||||||||||||||
| Eliminations | (128,388) | |||||||||||||||||||||||||
| Total consolidated net sales | $ | 7,798,480 | ||||||||||||||||||||||||
| Less: | ||||||||||||||||||||||||||
| Cost of goods sold | 5,286,310 | 547,607 | 859,269 | |||||||||||||||||||||||
| Selling, general and administrative expenses | 316,900 | 168,718 | 27,358 | |||||||||||||||||||||||
| Add: | ||||||||||||||||||||||||||
Depreciation and amortization(1) | 197,314 | 43,744 | 34,746 | |||||||||||||||||||||||
Asset impairments(1) | 383 | 4,220 | 4 | |||||||||||||||||||||||
Unrealized gain on undesignated commodity hedges(1) | (2,804) | — | — | |||||||||||||||||||||||
| Adjusted EBITDA reportable segments | $ | 742,485 | $ | 137,721 | $ | 69,282 | $ | 949,488 | ||||||||||||||||||
| Reconciliation of profit or loss | ||||||||||||||||||||||||||
| Interest expense | 45,498 | |||||||||||||||||||||||||
| Depreciation and amortization | 285,877 | |||||||||||||||||||||||||
| Asset impairments | 4,607 | |||||||||||||||||||||||||
| Unrealized gain on undesignated commodity hedges | (2,804) | |||||||||||||||||||||||||
| Corporate and Other expenses | 508,765 | |||||||||||||||||||||||||
| Earnings before income taxes | $ | 107,545 | ||||||||||||||||||||||||
| Capital expenditures | $ | 323,517 | $ | 38,315 | $ | 33,613 | ||||||||||||||||||||
| Assets | $ | 4,306,295 | $ | 883,232 | $ | 750,370 | ||||||||||||||||||||
__________________________________
(1) Depreciation and amortization, asset impairments and unrealized gain on undesignated commodity hedges are included in either cost of goods sold or SG&A expenses when those expenses are provided to the CODM.
| Year Ended August 31, 2024 | ||||||||||||||||||||||||||
| (in thousands) | North America Steel Group | Emerging Businesses Group | Europe Steel Group | Total | ||||||||||||||||||||||
| Net sales to external customers | $ | 6,309,730 | $ | 717,397 | $ | 848,566 | $ | 7,875,693 | ||||||||||||||||||
| Intersegment net sales | 73,376 | 33,357 | 3,044 | 109,777 | ||||||||||||||||||||||
| $ | 6,383,106 | $ | 750,754 | $ | 851,610 | $ | 7,985,470 | |||||||||||||||||||
| Reconciliation of net sales | ||||||||||||||||||||||||||
| Corporate and Other, excluding eliminations | 50,279 | |||||||||||||||||||||||||
| Eliminations | (109,777) | |||||||||||||||||||||||||
| Total consolidated net sales | $ | 7,925,972 | ||||||||||||||||||||||||
| Less: | ||||||||||||||||||||||||||
| Cost of goods sold | 5,319,787 | 512,883 | 839,872 | |||||||||||||||||||||||
| Selling, general and administrative expenses | 316,224 | 152,286 | 23,448 | |||||||||||||||||||||||
| Add: | ||||||||||||||||||||||||||
Depreciation and amortization(1) | 192,697 | 43,945 | 34,077 | |||||||||||||||||||||||
Asset impairments(1) | 6,558 | — | 150 | |||||||||||||||||||||||
Unrealized gain on undesignated commodity hedges(1) | (1,962) | — | — | |||||||||||||||||||||||
| Adjusted EBITDA reportable segments | $ | 944,388 | $ | 129,530 | $ | 22,517 | $ | 1,096,435 | ||||||||||||||||||
| Reconciliation of profit or loss | ||||||||||||||||||||||||||
| Interest expense | 47,893 | |||||||||||||||||||||||||
| Depreciation and amortization | 280,367 | |||||||||||||||||||||||||
| Asset impairments | 6,708 | |||||||||||||||||||||||||
| Unrealized gain loss on undesignated commodity hedges | (1,962) | |||||||||||||||||||||||||
| Corporate and Other expenses | 127,758 | |||||||||||||||||||||||||
| Earnings before income taxes | $ | 635,671 | ||||||||||||||||||||||||
| Capital expenditures | $ | 250,599 | $ | 20,479 | $ | 44,726 | ||||||||||||||||||||
| Assets | $ | 4,219,603 | $ | 861,025 | $ | 677,697 | ||||||||||||||||||||
__________________________________
(1) Depreciation and amortization, asset impairments and unrealized gain on undesignated commodity hedges are included in either cost of goods sold or SG&A expenses when those expenses are provided to the CODM.
| Year Ended August 31, 2023 | ||||||||||||||||||||||||||
| (in thousands) | North America Steel Group | Emerging Businesses Group | Europe Steel Group | Total | ||||||||||||||||||||||
| Net sales to external customers | $ | 6,704,305 | $ | 721,746 | $ | 1,328,791 | $ | 8,754,842 | ||||||||||||||||||
| Intersegment net sales | 93,522 | 22,802 | 2,353 | 118,677 | ||||||||||||||||||||||
| $ | 6,797,827 | $ | 744,548 | $ | 1,331,144 | $ | 8,873,519 | |||||||||||||||||||
| Reconciliation of net sales | ||||||||||||||||||||||||||
| Corporate and Other, excluding eliminations | 44,691 | |||||||||||||||||||||||||
| Eliminations | (118,677) | |||||||||||||||||||||||||
| Total consolidated net sales | $ | 8,799,533 | ||||||||||||||||||||||||
| Less: | ||||||||||||||||||||||||||
| Cost of goods sold | $ | 5,302,100 | $ | 509,905 | $ | 1,290,825 | ||||||||||||||||||||
| Selling, general and administrative expenses | 307,420 | 136,383 | 24,500 | |||||||||||||||||||||||
| Add: | ||||||||||||||||||||||||||
Depreciation and amortization(1) | 136,391 | 40,725 | 32,607 | |||||||||||||||||||||||
Asset impairments(1) | 3,733 | — | 47 | |||||||||||||||||||||||
Unrealized loss on undesignated commodity hedges(1) | 3,122 | — | — | |||||||||||||||||||||||
| Adjusted EBITDA reportable segments | $ | 1,331,553 | $ | 138,985 | $ | 48,473 | $ | 1,519,011 | ||||||||||||||||||
| Reconciliation of profit or loss | ||||||||||||||||||||||||||
| Interest expense | 40,127 | |||||||||||||||||||||||||
| Depreciation and amortization | 218,830 | |||||||||||||||||||||||||
| Asset impairments | 3,780 | |||||||||||||||||||||||||
| Unrealized loss on undesignated commodity hedges | 3,122 | |||||||||||||||||||||||||
| Corporate and Other expenses | 131,185 | |||||||||||||||||||||||||
| Earnings before income taxes | $ | 1,121,967 | ||||||||||||||||||||||||
| Capital expenditures | $ | 535,927 | $ | 19,986 | $ | 37,600 | ||||||||||||||||||||
| Assets | $ | 4,166,521 | $ | 874,330 | $ | 927,468 | ||||||||||||||||||||
__________________________________
(1) Depreciation and amortization, asset impairments and unrealized loss on undesignated commodity hedges are included in either cost of goods sold or SG&A expenses when those expenses are provided to the CODM.
The following tables present a reconciliation of certain financial information to consolidated totals for the reportable segments:
| Year Ended August 31, 2025 | ||||||||||||||||||||
| (in thousands) | Reportable Segments Total | Corporate and Other | Consolidated Total | |||||||||||||||||
| Depreciation and amortization | $ | 275,804 | $ | 10,073 | $ | 285,877 | ||||||||||||||
| Asset impairments | 4,607 | — | 4,607 | |||||||||||||||||
| Capital expenditures | 395,445 | 7,376 | 402,821 | |||||||||||||||||
| Assets | 5,939,897 | 1,231,937 | 7,171,834 | |||||||||||||||||
| Year Ended August 31, 2024 | ||||||||||||||||||||
| (in thousands) | Reportable Segments Total | Corporate and Other | Consolidated Total | |||||||||||||||||
| Depreciation and amortization | $ | 270,719 | $ | 9,648 | $ | 280,367 | ||||||||||||||
| Asset impairments | 6,708 | — | 6,708 | |||||||||||||||||
| Capital expenditures | 315,804 | 8,467 | 324,271 | |||||||||||||||||
| Assets | 5,758,325 | 1,059,514 | 6,817,839 | |||||||||||||||||
| Year Ended August 31, 2023 | ||||||||||||||||||||
| (in thousands) | Reportable Segments Total | Corporate and Other | Consolidated Total | |||||||||||||||||
| Depreciation and amortization | $ | 209,723 | $ | 9,107 | $ | 218,830 | ||||||||||||||
| Asset impairments | 3,780 | — | 3,780 | |||||||||||||||||
| Capital expenditures | 593,513 | 13,152 | 606,665 | |||||||||||||||||
| Assets | 5,968,319 | 670,775 | 6,639,094 | |||||||||||||||||
The following tables display net sales to external customers by reportable segment and Corporate and Other, disaggregated by major product:
| Year Ended August 31, 2025 | ||||||||||||||||||||||||||||||||
| (in thousands) | North America Steel Group | Emerging Businesses Group | Europe Steel Group | Corporate and Other | Total | |||||||||||||||||||||||||||
| Major product: | ||||||||||||||||||||||||||||||||
| Raw materials | $ | 1,305,753 | $ | — | $ | 22,859 | $ | — | $ | 1,328,612 | ||||||||||||||||||||||
| Steel products | 2,564,107 | — | 727,372 | — | 3,291,479 | |||||||||||||||||||||||||||
| Downstream products | 1,993,761 | 163,409 | 129,841 | — | 2,287,011 | |||||||||||||||||||||||||||
| Construction products | — | 304,130 | — | — | 304,130 | |||||||||||||||||||||||||||
| Ground stabilization solutions | — | 261,738 | — | — | 261,738 | |||||||||||||||||||||||||||
| Other | 220,228 | 18,209 | 38,248 | 48,825 | 325,510 | |||||||||||||||||||||||||||
| Net sales to external customers | 6,083,849 | 747,486 | 918,320 | 48,825 | 7,798,480 | |||||||||||||||||||||||||||
| Intersegment net sales, eliminated in consolidation | 66,953 | 58,596 | 2,839 | (128,388) | — | |||||||||||||||||||||||||||
| Net sales | $ | 6,150,802 | $ | 806,082 | $ | 921,159 | $ | (79,563) | $ | 7,798,480 | ||||||||||||||||||||||
| Year Ended August 31, 2024 | ||||||||||||||||||||||||||||||||
| (in thousands) | North America Steel Group | Emerging Businesses Group | Europe Steel Group | Corporate and Other | Total | |||||||||||||||||||||||||||
| Major product: | ||||||||||||||||||||||||||||||||
| Raw materials | $ | 1,311,995 | $ | — | $ | 17,943 | $ | — | $ | 1,329,938 | ||||||||||||||||||||||
| Steel products | 2,564,472 | — | 672,886 | — | 3,237,358 | |||||||||||||||||||||||||||
| Downstream products | 2,217,621 | 157,644 | 121,431 | — | 2,496,696 | |||||||||||||||||||||||||||
| Construction products | — | 290,304 | — | — | 290,304 | |||||||||||||||||||||||||||
| Ground stabilization solutions | — | 250,941 | — | — | 250,941 | |||||||||||||||||||||||||||
| Other | 215,642 | 18,508 | 36,306 | 50,279 | 320,735 | |||||||||||||||||||||||||||
| Net sales to external customers | 6,309,730 | 717,397 | 848,566 | 50,279 | 7,925,972 | |||||||||||||||||||||||||||
| Intersegment net sales, eliminated in consolidation | 73,376 | 33,357 | 3,044 | (109,777) | — | |||||||||||||||||||||||||||
| Net sales | $ | 6,383,106 | $ | 750,754 | $ | 851,610 | $ | (59,498) | $ | 7,925,972 | ||||||||||||||||||||||
| Year Ended August 31, 2023 | ||||||||||||||||||||||||||||||||
| (in thousands) | North America Steel Group | Emerging Businesses Group | Europe Steel Group | Corporate and Other | Total | |||||||||||||||||||||||||||
| Major product: | ||||||||||||||||||||||||||||||||
| Raw materials | $ | 1,324,373 | $ | — | $ | 21,010 | $ | — | $ | 1,345,383 | ||||||||||||||||||||||
| Steel products | 2,776,572 | — | 1,069,130 | — | 3,845,702 | |||||||||||||||||||||||||||
| Downstream products | 2,417,045 | 118,321 | 194,414 | — | 2,729,780 | |||||||||||||||||||||||||||
| Construction products | — | 332,940 | — | — | 332,940 | |||||||||||||||||||||||||||
| Ground stabilization solutions | — | 256,148 | — | — | 256,148 | |||||||||||||||||||||||||||
| Other | 186,315 | 14,337 | 44,237 | 44,691 | 289,580 | |||||||||||||||||||||||||||
| Net sales to external customers | 6,704,305 | 721,746 | 1,328,791 | 44,691 | 8,799,533 | |||||||||||||||||||||||||||
| Intersegment net sales, eliminated in consolidation | 93,522 | 22,802 | 2,353 | (118,677) | — | |||||||||||||||||||||||||||
| Net sales | $ | 6,797,827 | $ | 744,548 | $ | 1,331,144 | $ | (73,986) | $ | 8,799,533 | ||||||||||||||||||||||
The Company allocates net sales to external customers based on the location of the customer. The following table presents net sales by geographic area of the Company's customers:
| Year Ended August 31, | ||||||||||||||||||||
| (in thousands) | 2025 | 2024 | 2023 | |||||||||||||||||
| Geographic area: | ||||||||||||||||||||
| United States | $ | 6,216,096 | $ | 6,465,388 | $ | 6,894,990 | ||||||||||||||
| Poland | 617,623 | 583,320 | 941,806 | |||||||||||||||||
| Other | 964,761 | 877,264 | 962,737 | |||||||||||||||||
| Net sales | $ | 7,798,480 | $ | 7,925,972 | $ | 8,799,533 | ||||||||||||||
The following table presents long-lived assets, net of accumulated depreciation and amortization, by geographic area:
| August 31, | ||||||||||||||||||||
| (in thousands) | 2025 | 2024 | 2023 | |||||||||||||||||
| Geographic area: | ||||||||||||||||||||
| United States | $ | 2,650,327 | $ | 2,499,949 | $ | 2,343,606 | ||||||||||||||
| Poland | 256,248 | 236,326 | 209,966 | |||||||||||||||||
| Other | 37,780 | 43,026 | 39,704 | |||||||||||||||||
| Total long-lived assets, net | $ | 2,944,355 | $ | 2,779,301 | $ | 2,593,276 | ||||||||||||||
About Segments Disclosures
Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.
Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.