Tenaris reported third-quarter 2026 sales of $3.1 billion, up 4% year over year and 5% sequentially, with EBITDA of $756 million and a margin of 24%, according to the company's earnings call transcript published by The Motley Fool on November 5, 2026. Management attributed the sequential margin recovery to a favorable product mix and efficient industrial performance, despite higher raw material, energy and logistics costs. Average selling prices in the tubes segment, excluding services performed on third-party pipes, rose 4% year over year and 2% sequentially.
The company reported net cash of $3.8 billion at the end of the quarter. Steel input costs remain the key variable for the company's margins. Chief Financial Officer Carlos Gómez Álzaga said that raw material cost increases reach Tenaris's P&L with a lag, as they move through inventory under the FIFO accounting method.
He said scrap and ferroalloy prices have stabilized but that FIFO effects will push costs higher in the fourth quarter, at a level similar to the third quarter. Scrap and ferroalloy costs are expected to level out in the first half of 2027. Hot-rolled coil (HRC) is the slowest input to flow through the P&L.
According to Gómez Álzaga, residual effects from HRC and energy in Europe will continue, and current CRU price levels are expected to affect results around the second quarter of 2027. In the United States, Guillermo Moreno, President of U.S. operations, said OCTG prices rose around 27% from the start of the year through October. Pipe Logix, the reference price index for the market, increased 8% to 9% in the third quarter and a further 6% in October.
Moreno said these increases will be reflected in revenues in the fourth quarter of 2026 and the first quarter of 2027. He cited four factors supporting prices: stronger customer activity, rising steel and logistics costs, OCTG inventories below standard levels, and new anti-dumping margins set by the U.S. Department of Commerce on main imports.
He added that rising HRC costs in the U.S. also support the outlook. Management expects prices to remain firm in the short term, with some upside, while cautioning that low Henry Hub gas prices represent a short-term downside risk for gas-related activity. On trade policy, management estimated U.S. tariff costs at $140 million to $150 million per quarter, reflecting higher volumes in the U.S.
Because of FIFO accounting, the full impact is expected to appear in the first half of 2027 as inventory is sold. For the fourth quarter, Tenaris guided to revenue growth of close to 10% sequentially, mainly from higher volumes, and an EBITDA margin of around 25%. Chief Executive Officer Gabriel Podskubka said first-quarter 2027 revenues are expected to be higher, citing offshore and Middle East backlog with long lead times.
Asked about 2027 margins, he agreed with an analyst's view that EBITDA margins are unlikely to fall below 25%, while stressing that many variables remain. In the Middle East, shipments are only partially recovering. Deliveries to Qatar and Iraq remain below historical levels, while Saudi Arabia and the United Arab Emirates have been resilient.
In Europe, management cited the EU safeguard measures reducing imports from China and other countries as supportive for pricing, while energy costs remain a concern. The company also received unconditional EU clearance for its acquisition of Artrom, which management said would roughly double its market share in European mechanical and industrial pipe. Management expects 2027 capital expenditure of around $600 million.
Source: Motley Fool transcript of Tenaris (TS) Q3 2026 earnings call, November 5, 2026 (fool.com).
Source: fool.com