(Reuters) - United States Steel Corp’s (X.N) shares fell as much as 26.5 percent on Wednesday, a day after the company reported a surprise first-quarter loss.
The company’s stock slumped to a three-month low of $22.88 and was the biggest percentage loser on the New York Stock Exchange. It was the second-most actively traded on the exchange, with nearly 50 million shares changing hands by 11:00 a.m. ET.
The steelmaker late on Tuesday also reported lower-than-expected revenue for the first quarter ended March 31.
The company said the results were hurt by “operating challenges” at its flat-rolled facilities that prevented it from benefiting fully from improved market conditions.
Cowen and Co analyst Novid Rassouli said in a note that the company’s flat-rolled shipments were impacted by factors including higher raw material costs and increased planned outage costs.
US Steel said on a post-earnings conference call on Wednesday that its profit for the year will be hurt by its efforts to accelerate “asset revitalization”, as it invests in its steel mills to improve profitability.
“We now expect our investment in asset revitalization in 2017 to be approximately $300 million higher than it was in 2016,” Chief Executive Mario Longhi said on the call.
As a result the company will be taking more downtime at its facilities, limiting its steel production volumes.
U.S. Steel on Tuesday also reported seasonally lower results from its mining operations.
Reporting by Rachit Vats in Bengaluru; Editing by Maju Samuel