Derivatives and Other Financial Instruments (Tables)
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6 Months Ended |
Jun. 30, 2026 |
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| Fair Value Disclosures [Abstract] |
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| Schedule of Detail for Level 1, 2 and 3 Derivatives |
The following tables present the detail for Level 1, 2, and 3 derivatives (see additional Level 3 information in further tables below):
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June 30, 2026 |
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December 31, 2025 |
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Assets |
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Liabilities |
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Assets |
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Liabilities |
|
Level 1 and 2 derivative instruments |
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$ |
75 |
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$ |
150 |
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$ |
15 |
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$ |
246 |
|
Level 1 derivative instruments (undesignated) |
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17 |
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2 |
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48 |
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1 |
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Level 3 derivative instruments |
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16 |
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1,222 |
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20 |
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1,354 |
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Total |
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$ |
108 |
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$ |
1,374 |
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$ |
83 |
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$ |
1,601 |
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Less: Current |
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83 |
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|
494 |
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|
49 |
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|
467 |
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Noncurrent |
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$ |
25 |
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$ |
880 |
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$ |
34 |
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$ |
1,134 |
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2026 |
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2025 |
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Second quarter ended June 30, |
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Unrealized gain (loss) recognized in Other comprehensive income (loss) |
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Realized loss reclassified from Accumulated other comprehensive loss to earnings |
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Unrealized loss recognized in Other comprehensive income (loss) |
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Realized loss reclassified from Accumulated other comprehensive loss to earnings |
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Level 1 and 2 derivative instruments |
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$ |
41 |
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$ |
(45 |
) |
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$ |
(46 |
) |
|
$ |
(2 |
) |
Level 3 derivative instruments |
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|
(99 |
) |
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|
(145 |
) |
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|
(82 |
) |
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|
(78 |
) |
Total |
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$ |
(58 |
) |
|
$ |
(190 |
) |
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$ |
(128 |
) |
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$ |
(80 |
) |
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| Schedule of Outstanding Quantities of Derivative Instruments |
The following table presents the outstanding quantities of derivative instruments classified as Level 1 or Level 2:
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Classification |
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June 30, 2026 |
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June 30, 2025 |
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Aluminum (in kmt) |
Commodity buy forwards |
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299 |
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160 |
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Aluminum (in kmt) |
Commodity sell forwards |
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538 |
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575 |
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Alumina (in kmt) |
Commodity sell forwards |
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68 |
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— |
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Foreign currency (in millions of euro) |
Foreign exchange buy forwards |
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464 |
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176 |
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Foreign currency (in millions of euro) |
Foreign exchange sell forwards |
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4 |
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10 |
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Foreign currency (in millions of euro) (undesignated) |
Foreign exchange buy forwards |
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633 |
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821 |
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Foreign currency (in millions of euro) (undesignated) |
Foreign exchange sell forwards |
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— |
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32 |
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Foreign currency (in millions of Norwegian krone) |
Foreign exchange buy forwards |
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193 |
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8 |
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Foreign currency (in millions of Brazilian real) |
Foreign exchange buy forwards |
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18 |
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107 |
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Foreign currency (in millions of Australian dollar) |
Foreign exchange buy forwards |
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1,154 |
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821 |
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Foreign currency (in millions of Saudi riyal) (undesignated) |
Foreign exchange swap |
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273 |
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— |
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Natural gas (in millions of megawatt hours) |
Commodity buy forwards |
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4 |
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6 |
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Electricity (in millions of megawatt hours) |
Commodity buy forwards |
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5 |
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6 |
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| Schedule of Quantitative Information for Level 3 Derivative Contracts |
The following table presents quantitative information related to the significant unobservable inputs described above for Level 3 derivative instruments (megawatt hours in MWh; megawatts in MW):
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June 30, 2026 |
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Unobservable Input |
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Unobservable Input Range |
Asset Derivatives |
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Financial contract (undesignated) |
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$ |
16 |
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Interrelationship of forward energy price and the contract price, and the |
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Electricity
(per MWh) |
2026: $22.24
2028: $42.20 |
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estimated MW of renewable energy produced (per month) |
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Electricity |
2026: 31 MW
2028: 84 MW |
Total Asset Derivatives |
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$ |
16 |
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Liability Derivatives |
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Financial contract (undesignated) |
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$ |
22 |
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Interrelationship of forward energy price, LME forward price and the |
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Electricity
(per MWh) |
2026: $45.27
2026: $27.57 |
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Consumer Price Index |
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LME (per mt) |
2026: $3,076
2026: $3,078 |
Power contract |
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99 |
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MWh of energy needed to produce the forecasted mt of aluminum |
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LME (per mt) |
2026: $3,076
2027: $3,049 |
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Electricity |
Rate of 4 million MWh per year |
Power contracts |
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1,101 |
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MWh of energy needed to produce the forecasted mt of aluminum |
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LME (per mt) |
2026: $3,076
2029: $3,000
2036: $3,040 |
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Midwest premium
(per pound) |
2026: $1.1998
2029: $1.1300
2036: $1.1300 |
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Electricity |
Rate of 18 million MWh per year |
Power contract |
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— |
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MWh of energy needed to produce the forecasted mt of aluminum |
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LME (per mt) |
2026: $3,076
2026: $3,083 |
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Electricity |
Rate of 2 million MWh per year |
Power contract (undesignated)(1) |
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— |
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Estimated spread between the 30-year debt yield of Alcoa and the counterparty |
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Credit spread |
0.98%: 30-year debt yield spread
6.62%: Alcoa (estimated)
5.64%: counterparty |
Total Liability Derivatives |
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$ |
1,222 |
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(1)In the second quarter of 2026, the Company entered into an agreement to terminate the existing power contract (undesignated) in December 2026 (previous expiration was October 2028).
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| Schedule of Fair Values of Level 3 Derivative Instruments Recorded as Assets and Liabilities |
The fair values of Level 3 derivative instruments recorded in the accompanying Consolidated Balance Sheet were as follows:
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Asset Derivatives |
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June 30, 2026 |
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December 31, 2025 |
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Derivatives not designated as hedging instruments: |
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Current—financial contract |
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$ |
11 |
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$ |
15 |
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Noncurrent—financial contract |
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5 |
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5 |
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Total derivatives not designated as hedging instruments |
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$ |
16 |
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$ |
20 |
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Total Asset Derivatives |
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$ |
16 |
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$ |
20 |
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Liability Derivatives |
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Derivatives designated as hedging instruments: |
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Current—power contracts |
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$ |
376 |
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$ |
353 |
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Noncurrent—power contracts |
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824 |
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1,001 |
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Total derivatives designated as hedging instruments |
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$ |
1,200 |
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$ |
1,354 |
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Derivatives not designated as hedging instruments: |
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Current—financial contract |
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$ |
22 |
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$ |
— |
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Total derivatives not designated as hedging instruments |
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$ |
22 |
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|
$ |
— |
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Total Liability Derivatives |
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$ |
1,222 |
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$ |
1,354 |
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| Schedule of Reconciliation of Activity for Derivative Contracts |
The following tables present a reconciliation of activity for Level 3 derivative instruments:
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Assets |
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Second quarter ended June 30, 2026 |
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Financial contracts |
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April 1, 2026 |
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$ |
40 |
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Total gains or losses included in: |
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Other expenses, net (unrealized/realized) |
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(29 |
) |
Settlements and other |
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5 |
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June 30, 2026 |
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$ |
16 |
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Change in unrealized gains or losses included in earnings
for derivative instruments held at June 30, 2026: |
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Other expenses, net |
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$ |
(29 |
) |
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Liabilities |
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Second quarter ended June 30, 2026 |
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Power contracts |
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Financial contracts |
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Embedded credit derivative |
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April 1, 2026 |
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$ |
1,246 |
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$ |
— |
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$ |
2 |
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Total gains or losses included in: |
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Sales (realized) |
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(145 |
) |
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— |
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— |
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Other expenses (income), net (unrealized/realized) |
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— |
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23 |
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(2 |
) |
Other comprehensive loss (unrealized) |
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99 |
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— |
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— |
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Settlements and other |
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— |
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(1 |
) |
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— |
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June 30, 2026 |
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$ |
1,200 |
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$ |
22 |
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$ |
— |
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Change in unrealized gains or losses included in earnings
for derivative instruments held at June 30, 2026: |
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Other expenses (income), net |
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$ |
— |
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$ |
23 |
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$ |
(2 |
) |
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Assets |
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Six months ended June 30, 2026 |
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Financial contracts |
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January 1, 2026 |
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$ |
20 |
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Total gains or losses included in: |
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Other expenses, net (unrealized/realized) |
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(18 |
) |
Settlements and other |
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14 |
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June 30, 2026 |
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$ |
16 |
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Change in unrealized gains or losses included in earnings
for derivative instruments held at June 30, 2026: |
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Other expenses, net |
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$ |
(18 |
) |
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Liabilities |
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Six months ended June 30, 2026 |
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Power contracts |
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Financial contracts |
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Embedded credit derivative |
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January 1, 2026 |
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$ |
1,354 |
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|
$ |
— |
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$ |
— |
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Total gains or losses included in: |
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Sales (realized) |
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(261 |
) |
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— |
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— |
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Other expenses, net (unrealized/realized) |
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— |
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23 |
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— |
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Other comprehensive loss (unrealized) |
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107 |
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— |
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— |
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Settlements and other |
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— |
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(1 |
) |
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— |
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June 30, 2026 |
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$ |
1,200 |
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$ |
22 |
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|
$ |
— |
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Change in unrealized gains or losses included in earnings
for derivative instruments held at June 30, 2026: |
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Other expenses, net |
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$ |
— |
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$ |
23 |
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$ |
— |
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| Schedule of Carrying Values and Fair Values of Other Financial Instruments |
The carrying values and fair values of Alcoa Corporation’s other financial instruments were as follows:
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June 30, 2026 |
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December 31, 2025 |
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Carrying value |
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Fair value |
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Carrying value |
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Fair value |
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Cash and cash equivalents |
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$ |
1,352 |
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$ |
1,352 |
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$ |
1,597 |
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$ |
1,597 |
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Restricted cash |
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|
142 |
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|
142 |
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|
95 |
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|
95 |
|
Noncurrent marketable securities |
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1,360 |
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|
1,360 |
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|
1,397 |
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|
1,397 |
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Short-term borrowings |
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— |
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— |
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9 |
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9 |
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Long-term debt due within one year |
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1 |
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1 |
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1 |
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|
1 |
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Long-term debt, less amount due within one year |
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2,224 |
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2,284 |
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|
2,438 |
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|
2,545 |
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