Management's Discussion and Analysis of Financial Condition and Results of Operations is designed to provide a reader of our financial statements with a narrative from the perspective of management on our financial condition, results of operations, liquidity and other factors that may affect our future results. We believe it is important to read our Management's Discussion and Analysis of Financial Condition and Results of Operations in conjunction with our Annual Report on Form 10-K for the year ended December 31, 2021, as well as other publicly available information.

Cliffs is the largest flat-rolled steel producer in North America. Founded in 1847 as a mine operator, we are also the largest manufacturer of iron ore pellets in North America. We are vertically integrated from mined raw materials, direct reduced iron and ferrous scrap to primary steelmaking and downstream finishing, stamping, tooling and tubing. We are the largest supplier of steel to the automotive industry in North America and serve a diverse range of other markets due to our comprehensive offering of flat-rolled steel products. Headquartered in Cleveland, Ohio, we employ approximately 27,000 people across our operations in the United States and Canada.

While steel market conditions have been volatile over the first six months of 2022, fundamentals remain healthier than historical levels. The price for domestic HRC, the most significant index in driving our revenues and profitability, averaged $1,262 per net ton for the first six months of 2022, 6% lower than the same period last year but well above the prior ten-year average of $712 per net ton. After climbing to $1,492 per net ton in April 2022, HRC prices have since receded to a one-year low below $1,000 per net ton. The large decline in spot price was driven by service center destocking, interest rate hikes driving caution on new business, declining metallics prices and scheduled summer manufacturing outages. Continued automotive supply chain difficulties have also limited the demand for steel from automotive manufacturers. The largest market for our steel products is the automotive industry in North America, which makes light vehicle production a key driver of demand. In the first six months of 2022, North American light vehicle production was approximately 7.1 million units, the highest first-half production volume since the first half of 2019. However, automotive production continues to be adversely affected by the global semiconductor shortage, as well as other material shortages and supply chain disruptions. This has caused several outages amongst light vehicle manufacturers. The long-term outlook for the automotive industry remains positive as pent-up demand is strong due to ongoing production and supply chain issues. As the largest supplier of automotive-grade steel in the U.S., we expect to benefit from the increased production in coming years. During the first six months of 2022, light vehicle sales in the U.S. saw a seasonally adjusted annualized rate of 13.8 million units sold, with 2.9 million passenger cars and 10.9 million light trucks sold, representing an 18% decrease over the first six months of 2021 due primarily to decreased availability. Continued production issues have kept inventory near all-time lows, with only 1.15 million units of gross stock at the end of the first six months of 2022. 26

The ongoing conflict between Russia and Ukraine has disrupted raw material sourcing for our minimill competitors and increased their steelmaking input costs. Approximately two-thirds of all U.S. imported pig iron, an important feedstock for flat-rolled steel producing minimills, is sourced from Russia and Ukraine. Early during the second quarter of 2022, imported pig iron prices peaked at $1,045 per metric ton, the highest level since Fastmarkets AMM began assessing the pig iron market in September 2017. Imported pig iron prices declined to $875 per metric ton by the end of the second quarter of 2022 and were $515 per metric ton in the most recently available reported data, which is above the historical average of $440 per metric ton from September 2017 to December 2021. Higher than historical imported pig iron costs should continue to support a higher HRC price. Unlike other flat-rolled producers, we are not reliant on imported pig iron as we produce it in-house at our blast furnaces, using our own iron ore and HBI as our primary raw materials. The price for busheling scrap, a necessary input for flat-rolled steel production in EAFs in the U.S., has remained significantly higher than the historical ten-year average of $380 per long ton. The Fastmarkets AMM Cleveland busheling price peaked at $795 per long ton in April 2022 before declining to $670 per long ton at the end of the second quarter. As a replacement to imported pig iron, we expect the busheling scrap price will remain elevated relative to historical levels as the availability of imported pig iron from Russia and Ukraine remains disrupted. We expect the supply of busheling scrap to remain tight due to decreasing prime scrap generation from original equipment manufacturers and the growth of EAF capacity in the U.S., along with a push for expanded scrap use globally. As we are fully integrated and have primarily a blast furnace footprint, the rising prices for busheling scrap in the U.S. bolster our competitive advantage, as we source the majority of our iron feedstock from our stable-cost mining and pelletizing operations in Minnesota and Michigan. The elevated price of busheling scrap should also enhance the benefit of sourcing more scrap internally following the FPT Acquisition and provide greater cost savings potential for HBI used internally. The price of iron ore reached $162 per metric ton during the second quarter of 2022, which has been another important factor in steel prices remaining above historical averages. The Platts 62% price averaged $140 per metric ton in the first six months of 2022, which is 43% higher than the historical 10-year average. While higher iron ore prices play a role in increased steel prices, we also directly benefit from higher iron ore prices for the portion of iron ore pellets we sell to third parties.

As the largest flat-rolled steel producer in North America, we benefit from having the size and scale necessary in a competitive, capital intensive business. Our sizeable operating footprint provides us with the operational leverage, flexibility and cost performance to achieve competitive margins throughout the business cycle. We also have a unique vertically integrated profile from mined raw materials, direct reduced iron, and ferrous scrap to primary steelmaking and downstream finishing, stamping, tooling and tubing. This positioning gives us both lower and more predictable costs throughout the supply chain and more control over both our manufacturing inputs and our end product destination. One of our main competitive strengths is our ability to source our primary feedstock domestically and internally. This model reduces our exposure to volatile pricing and unreliable global sourcing. The current Russia-Ukraine conflict has displayed the importance of our U.S.-centric footprint, as our minimill competitors rely on imported pig iron to produce flat-rolled steel. The best example is our legacy business of producing iron ore pellets, which is our primary steelmaking raw material input. By controlling our iron ore pellet supply, our primary steelmaking raw material feedstock can be secured at a stable and predictable cost and not be subject to as many factors outside of our control. The FPT Acquisition has given us a competitive advantage in sourcing prime scrap, as we have started leveraging our long-standing flat-rolled automotive and other customer relationships into recycling partnerships to further grow our prime scrap presence. In the short period of time since the FPT Acquisition was completed, we have already seen success in our strategy by increasing our prime scrap presence. FPT has 22 facilities located primarily in the Midwest near our steel facilities, which gives us an increased advantage in logistics. The strategic importance of these assets is now even further elevated as a result of the Russia-Ukraine conflict. We are also the largest supplier of automotive-grade steel in the U.S. Compared to other steel end markets, automotive steel is generally higher quality and more operationally and technologically intensive to produce. As such, it often generates higher through-the-cycle margins, making it a desirable end market for the steel industry. Given the strong demand and market environment in 2021, we were able to significantly improve our fixed price contracts, which should continue to benefit us throughout 2022. Demand for our automotive-grade steel is expected to increase in the second half of 2022 from pent-up automotive demand as a result of supply chain issues. With our continued 27

technological innovation, as well as leading delivery performance, we expect to remain the leader in supplying this industry.

We are the only producers of both GOES and NOES in the U.S. The recently passed Infrastructure and Jobs Act of 2021 in the U.S. provides funding to be used for the modernization of the electrical grid and the infrastructure needed to allow for increased electric vehicle adoption, both of which require electrical steels. As a result, with increased demand for both transformers and motors for electric vehicles, we expect to benefit from this position in what is currently a rapidly growing market. We believe we offer the most comprehensive flat-rolled steel product selection in the industry, along with several complementary products and services. A sampling of our offering includes advanced high-strength steel, hot-dipped galvanized, aluminized, galvalume, electrogalvanized, galvanneal, HRC, cold-rolled coil, plate, tinplate, GOES, NOES, stainless steels, tool and die, stamped components, rail, slab and cast ingot. Across the quality spectrum and the supply chain, our customers can frequently find the solutions they need from our product selection. We are the first and the only producer of HBI in the Great Lakes region. Construction of our Toledo direct reduction plant was completed in the fourth quarter of 2020 and reached full run-rate nameplate annual capacity of 1.9 million metric tons during the middle of 2021. From this modern plant, we produce a high-quality, low-cost and low-carbon intensive HBI product that can be used in our blast furnaces and as a productivity enhancer, or in our BOFs and EAFs as a premium scrap alternative. We use HBI to stretch our hot metal production, lowering carbon intensity and reliance on coke. As a result of our internal usage of HBI, coupled with our ongoing evaluation of coke use strategies, we idled our coke facility at Middletown Works during the third quarter of 2021 and permanently closed our Mountain State Carbon coke plant in the first quarter of 2022. With increasing tightness in the scrap and metallics markets combined with our own internal needs, we expect our Toledo direct reduction plant to support healthy margins for us going forward.

We offer a full suite of flat steel products encompassing all steps of the steel manufacturing process. We have an industry-leading market share in the automotive sector, where our portfolio of high-end products delivers a broad range of differentiated solutions for this highly sought after customer base. As a result of our exposure to these high-end markets, we have the highest fixed-price contractual volumes in our industry. Approximately 45% of our volumes are sold under these contracts. These contracts reduce volatility and allow for more predictable through-the-cycle margins. The pricing in our fixed-price contracts has dramatically improved in 2022 compared to 2021. We expect to be able to maintain and increase contract values as fundamentals remain strong and the HRC price remains above historical averages. We are also proponents of the "value over volume" approach in terms of steel supply. We take our leadership role in the industry very seriously and intend to manage our steel output in a responsible manner. In the first quarter of 2022, we announced the indefinite idle of the Indiana Harbor #4 blast furnace. Going forward, we will continue to use our operational flexibility to align with our "value over volume" approach in terms of steel supply.

Take Advantage of our U.S.-Centric, Internally Sourced Supply Chain

The conflict between Russia and Ukraine has displayed the unique advantage of our vertically integrated business model. Two-thirds of U.S. imports of pig iron, a critical raw material for flat-rolled minimills, are sourced from Russia and Ukraine. This supply remains largely disrupted, driving volatility in input costs and reducing availability for our competitors' ferrous inputs. We, on the other hand, produce our pig iron in-house in the U.S., supported by internally sourced iron ore and HBI and supplemented with internally sourced scrap. While competitors are forced to scramble for materials, we are able to take advantage of our vertically integrated footprint. We began construction of our HBI plant in 2017, in part because of the uncertainty of the industry sourcing metallics from Russia and Ukraine. Russia had previously invaded the Crimea peninsula in 2014, and we felt it necessary to on-shore more metallics capacity to the U.S. HBI, which is a lower-carbon alternative to imported pig iron, has now become a critical component of our decarbonization strategy. 28

Optimize Our Fully-Integrated Steelmaking Footprint

We are a fully-integrated steel enterprise with the size and scale to achieve margins above industry averages for flat-rolled steel. Our focus remains on both maintaining and enhancing our cost advantage while also lowering carbon emissions. The combination of our ferrous raw materials, including iron ore, scrap and HBI, allows us to do so relative to peers who must rely on more unpredictable and unreliable raw material sourcing strategies. With our acquisition of FPT, we have ample access to scrap along with internally sourced HBI. The use of higher amounts of these raw materials in our blast furnaces ultimately boosts liquid steel output, reduces coke needs and lowers carbon emissions from our operations. As a result of the successful operational improvements, we announced the indefinite idle of the Indiana Harbor #4 blast furnace in the first quarter of 2022. The indefinite idle reduced our operational blast furnaces from 8 to 7.

Expand our Ferrous Scrap Recycling Presence

Throughout our entire footprint, we consume a very significant amount of scrap in our EAFs and BOFs, more than half of which can now be obtained through internal sources. Prime scrap is a byproduct of industrial manufacturing. As manufacturing in the U.S. has moved offshore and yields have improved, prime scrap supply has been shrinking for the last 50 years. As the U.S. steel industry brings new flat-rolled EAF capacity online over the next five years, and the global metallics market remains disrupted as a result of the Russia-Ukraine conflict, securing additional access to prime scrap will continue to be an important strategic initiative. Our expansion in this area began with the FPT Acquisition and has continued to grow by pairing FPT's processing capabilities with our long-standing customer relationships. As the largest supplier of flat-rolled steel in North America, we are the largest source of the steel that generates prime scrap in manufacturing facilities. Based on this, we have grown our prime scrap presence by leveraging our long-standing flat-rolled automotive and other customer relationships and expanding them into recycling partnerships. The FPT Acquisition allows us to optimize productivity at our existing EAFs and BOFs, as we have no current plans to add additional steelmaking capacity.

Advance our Participation in the Green Economy

We are seeking to expand our customer base with the rapidly growing and desirable electric vehicle market. At this time, we believe the North American automotive industry is approaching a structural inflection point, with the adoption of electrical motors in passenger vehicles. As this market grows, it will require more advanced steel applications to meet the needs of electric vehicle producers and consumers. With our unique technical capabilities and leadership in the automotive industry, we believe we are positioned better than any other North American steelmaker to supply the steel and parts necessary to fill these needs. We also have the right products to meet the growing demand for renewable energy as well as for the modernization of the U.S. electrical grid. We offer plate products that can be used in windmills, which we estimate contain 130 tons of steel per megawatt of electricity. In addition, panels for solar power are heavy consumers of galvanized steel, where we are a leading producer. We estimate solar panels consume 40 tons of steel per megawatt of electricity. We are currently the sole producer of electrical steel in the U.S., which can facilitate the modernization of the U.S. electrical grid. Along with charging networks, electrical steels are also needed in the motors of electric vehicles.

Our commitment to operating our business in a more environmentally responsible manner remains constant. One of the most important issues impacting our industry, our stakeholders and our planet is climate change. In early 2021, we announced our commitment to reduce GHG emissions 25% from 2017 levels by 2030. This goal represents combined Scope 1 (direct emissions) and Scope 2 (indirect emissions from purchased electricity or other forms of energy) GHG emission reductions across all of our operations. On a per ton basis, we reduced our blast furnace and BOF Scope 1 and Scope 2 GHG intensity from 1.82 per ton in 2020 to 1.67 per ton in 2021. Prior to setting this goal with our newly acquired steel assets, we exceeded our previous GHG reduction target at our legacy facilities six years ahead of our 2025 goal. In 2019, we reduced our combined Scope 1 and Scope 2 GHG emissions by 42% on a mass basis from 2005 baseline levels. Our goal is to further reduce those emissions in coming years. 29

Our future GHG emissions reductions are expected to be driven by the use of direct reduced iron in blast furnaces, the stretching of hot metal with additional scrap, driving more productivity out of fewer blast furnaces, natural gas technologies, including natural gas injection, carbon capture, clean energy and energy efficiency projects.

Given the cyclicality of our business, it is important to us to be in the financial position to easily withstand any negative demand or pricing pressure we may encounter. With strong business conditions and the expectation to generate healthy free cash flow throughout 2022 and beyond, we have the ability to reduce substantial amounts of debt, return capital to shareholders through our share repurchase program and make investments to both improve and grow our business. We anticipate that a healthy market environment and significantly improved fixed price contracts will provide us ample opportunities to reduce our debt with our own free cash flow generation in the coming years. During the first six months of 2022, we reduced the outstanding principal of our long-term debt by $638 million. Recent Developments Financing Transactions On April 20, 2022, we redeemed all $607 million aggregate principal amount outstanding of the 9.875% 2025 Senior Secured Notes. The total payment made to holders of the notes, including the redemption premium, was $677 million. The notes were redeemed with available liquidity. The cash interest associated with these notes was approximately $60 million per year. Additionally, during the second quarter of 2022, we repurchased $307 million aggregate principal amount of our outstanding senior notes of various series with available liquidity. Results of Operations Overview

Our total revenues, net income, diluted EPS and Adjusted EBITDA for the three and six months ended June 30, 2022 and 2021 were as follows:

[[Image Removed: clf-20220630_g2.jpg]] [[Image Removed: clf-20220630_g3.jpg]]

[[Image Removed: clf-20220630_g4.jpg]] [[Image Removed: clf-20220630_g5.jpg]] See "- Results of Operations - Adjusted EBITDA" below for a reconciliation of our Net income to Adjusted EBITDA. 30

During the three and six months ended June 30, 2022, our consolidated Revenues increased by $1,292 million and $3,198 million, respectively, compared to the prior-year periods. Both the three and six months ended June 30, 2022, were positively impacted by the incremental revenue associated with the FPT Acquisition, which occurred on November 18, 2021. The increase for the three months ended June 30, 2022, was also impacted by the increase in the average steel product selling price of $369 per net ton, partially offset by a decrease of 564 thousand net tons of steel shipments from our Steelmaking segment. The increase for the six months ended June 30, 2022, was also impacted by the increase in the average steel product selling price of $449 per net ton, partially offset by a decrease of 1,071 thousand net tons of steel shipments from our Steelmaking segment.

The following represents our consolidated Revenues by product line for the three months ended:

[[Image Removed: clf-20220630_g6.jpg]][[Image Removed: clf-20220630_g7.jpg]]

The following represents our consolidated Revenues by product line for the six

[[Image Removed: clf-20220630_g8.jpg]][[Image Removed: clf-20220630_g9.jpg]]

The increase in Revenues from our Other product line for the three and six months ended June 30, 2022, as compared to the prior-year periods, is primarily related to the inclusion of results for the FPT Acquisition in 2022.

The following table represents our consolidated Revenues and percentage of revenues attributable to each of the markets we supply:

(In Millions) Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 Revenue % Revenue % Revenue % Revenue % Automotive $ 1,768 28 % $ 1,226 24 % $ 3,497 29 % $ 2,629 29 % Infrastructure and manufacturing 1,629 26 % 1,323 26 % 3,186 26 % 2,307 25 % Distributors and converters 1,863 29 % 1,964 39 % 3,716 30 % 3,256 36 % Steel producers 1,077 17 % 532 11 % 1,893 15 % 902 10 % Total revenues $ 6,337 $ 5,045 $ 12,292 $ 9,094 The increase in Revenues from the steel producers market for the three and six months ended June 30, 2022, as compared to the prior-year periods, is primarily related to the inclusion of results for the FPT Acquisition in 2022.

During the three and six months ended June 30, 2022, Cost of goods sold increased by $1,508 million and $2,453 million, respectively, as compared to the prior-year periods. Both the three and six months ended June 30, 2022, were impacted by the incremental Cost of goods sold associated with the FPT Acquisition, which occurred on November 18, 2021. The increases for both the three and six months ended June 30, 2022, as compared to the prior-year periods, were also impacted by higher raw materials and utility costs, including natural gas, coal, coke, alloys and scrap, coupled with increased investment in maintenance, excess and idle costs and labor costs.

Selling, general and administrative expenses

During the three and six months ended June 30, 2022, Selling, general and administrative expenses increased by $2 million and $16 million, respectively, as compared to the prior-year periods.

During the three and six months ended June 30, 2022, Miscellaneous - net increased by $9 million and $39 million, respectively, as compared to the prior-year periods. The increase in miscellaneous expense for the six months ended June 30, 2022, was primarily due to the $29 million asset impairment charge associated with the permanent closure of Mountain State Carbon.

During the three and six months ended June 30, 2022, Interest expense, net decreased by $21 million and $36 million, respectively, as compared to the prior-year periods. The decrease was primarily due to debt restructuring activities during 2021 and 2022, which reduced interest expense on our senior notes.

Gain (loss) on extinguishment of debt

The loss on extinguishment of debt of $66 million for the three months ended June 30, 2022 resulted from the redemption in April 2022 of all $607 million aggregate principal amount of our outstanding 9.875% 2025 Senior Secured Notes, partially offset by the net gain on extinguishment for the repurchase of $307 million aggregate principal amount of our outstanding senior notes of various series. The loss on extinguishment of debt of $80 million for the six months ended June 30, 2022 was also impacted by the redemption of all $294 million aggregate principal amount of our outstanding 1.500% 2025 Convertible Senior Notes in January 2022. 32

The loss on extinguishment of debt of $22 million for the three months ended June 30, 2021 resulted from the redemption of all of the $396 million aggregate principal amount outstanding of our 5.750% 2025 Senior Notes and the repurchase of $25 million aggregate principal amount of our outstanding 9.875% 2025 Senior Secured Notes. The loss on extinguishment of debt of $88 million for the six months ended June 30, 2021 was also impacted by the redemptions in the first quarter of 2021 of $322 million aggregate principal amount of 9.875% 2025 Senior Secured Notes and $535 million in aggregate principal amount of our outstanding senior notes of various series.

Refer to NOTE 8 - DEBT AND CREDIT FACILITIES for further details.

Our effective tax rate is impacted by permanent items, primarily state income tax expense and depletion. It also is affected by discrete items that may occur in any given period but are not consistent from period to period. The following represents a summary of our tax provision and corresponding effective rates: (In Millions) Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 Income tax expense $ (157) $ (216) $ (394) $ (225) Effective tax rate 21 % 21 % 22 % 21 % Our 2022 estimated annual effective tax rate before discrete items at June 30, 2022 is 22%. This estimated annual effective tax rate exceeds the U.S. statutory rate of 21%, as state income tax expense exceeds the percentage depletion in excess of cost depletion. The 2021 estimated annual effective tax rate before discrete items at June 30, 2021 was 21%. The increase in the estimated annual effective tax rate before discrete items is driven by the change in income and a decrease to the percentage depletion in excess of cost depletion.

We evaluate performance on an operating segment basis, as well as a consolidated basis, based on Adjusted EBITDA, which is a non-GAAP measure. This measure is used by management, investors, lenders and other external users of our financial statements to assess our operating performance and to compare operating performance to other companies in the steel industry. In addition, management believes Adjusted EBITDA is a useful measure to assess the earnings power of the business without the impact of capital structure and can be used to assess our ability to service debt and fund future capital expenditures in the business. 33

The following table provides a reconciliation of our Net income to Adjusted EBITDA: (In Millions) Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 Net income $ 601 $ 795 $ 1,415 $ 852 Less: Interest expense, net (64) (85) (141) (177) Income tax expense (157) (216) (394) (225) Depreciation, depletion and amortization (250) (208) (551) (425) Total EBITDA $ 1,072 $ 1,304 $ 2,501 $ 1,679 Less: EBITDA of noncontrolling interests1 $ 13 $ 21 $ 35 $ 43 Asset impairment - - (29) - Loss on extinguishment of debt (66) (22) (80) (88) Severance costs (6) (1) (7) (12) Acquisition-related costs excluding severance costs - - (1) (2) Acquisition-related loss on equity method investment - (18) - (18) Amortization of inventory step-up - (37) - (118) Impact of discontinued operations 1 1 2 1 Total Adjusted EBITDA $ 1,130 $

1 EBITDA of noncontrolling interests includes the following: Net income attributable to noncontrolling interests

$ 5 $ 15 $ 18 $ 31 Depreciation, depletion and amortization 8 6 17 12 EBITDA of noncontrolling interests $ 13 $

The following table provides a summary of our Adjusted EBITDA by segment:

(In Millions) Three Months Ended Six Months Ended June 30, June 30, 2022 2021 2022 2021 Adjusted EBITDA: Steelmaking $ 1,108 $ 1,360 $ 2,531 $ 1,862 Other Businesses 20 8 49 19 Eliminations1 2 (8) 1 (8) Total Adjusted EBITDA $ 1,130 $ 1,360 $ 2,581 $ 1,873

1 In 2022, we began allocating Corporate SG&A to our operating segments. Prior periods have been adjusted to reflect this change. The Eliminations line now only includes sales between segments.

Adjusted EBITDA from our Steelmaking segment for the three and six months ended June 30, 2022 decreased by $252 million and increased by $669 million, respectively, as compared to the prior-year periods. The changes were primarily attributable to lower gross margin of $225 million and a higher gross margin of $722 million for the three and six months ended June 30, 2022, respectively, as compared to the prior-year periods. Our Steelmaking Adjusted EBITDA included Selling, general and administrative expenses of $100 million and $214 million for the three and six months ended June 30, 2022, respectively, and $96 million and $195 million for the three and six months ended June 30, 2021, respectively. 34

The following is a summary of our Steelmaking segment operating results for the three months ended June 30, 2022 and 2021:

Three Months Ended June 30, 2022 2021 % Change Steel shipments (in thousands of net tons) 3,641 4,205 (13) %

Average selling price per net ton of steel products $ 1,487 $ 1,118

33 % Revenues (in millions) $ 6,176 $ 4,922 25 % Cost of goods sold (in millions) $ (5,209) $ (3,730) 40 % Gross margin (in millions) $ 967 $ 1,192 (19) % Gross margin percentage 16 % 24 % Adjusted EBITDA (in millions) $ 1,108 $ 1,360 (19) %

Gross margin decreased by $225 million, or 19%, during the three months ended June 30, 2022, as compared to the prior-year period, primarily due to:

•An increase in selling prices (approximately $1.4 billion impact) driven by favorable renewals of annual sales contracts, higher index steel prices and spot prices; •This increase was partially offset by lower sales volumes (approximately $200 million impact), predominantly driven by lower shipments to the distributors and converters end market due to high inventory levels; and •Increased costs of production (approximately $1.4 billion impact) driven by higher raw materials and utility costs, including natural gas, coal, coke, alloys and scrap, coupled with increased investment in maintenance, excess and idle costs and labor costs.

The following is a summary of our Steelmaking segment operating results for the six months ended June 30, 2022 and 2021:

Six Months Ended June 30, 2022 2021 % Change Steel shipments (in thousands of net tons) 7,278 8,349 (13) %

Average selling price per net ton of steel products $ 1,466 $ 1,017

44 % Revenues (in millions) $ 11,970 $ 8,841 35 % Cost of goods sold (in millions) $ (9,781) $ (7,374) 33 % Gross margin (in millions) $ 2,189 $ 1,467 49 % Gross margin percentage 18 % 17 % Adjusted EBITDA (in millions) $ 2,531 $ 1,862 36 %

Gross margin increased by $722 million, or 49%, during the six months ended June 30, 2022, as compared to the prior-year period, primarily due to:

•An increase in selling prices (approximately $3.4 billion impact) driven by favorable renewals of annual sales contracts, higher index steel prices and spot prices; •This increase was partially offset by lower sales volumes (approximately $500 million impact), predominantly driven by lower shipments to the distributors and converters end market due to high inventory levels; and 35

•Increased costs of production (approximately $2.3 billion impact) driven by higher raw materials and utility costs, including natural gas, coal, coke, alloys and scrap, coupled with increased investment in maintenance, excess and idle costs and labor costs.

Liquidity, Cash Flows and Capital Resources

Our primary sources of liquidity are Cash and cash equivalents and cash generated from our operations, availability under the ABL Facility and other financing activities. Our capital allocation decision-making process is focused on preserving healthy liquidity levels while maintaining the strength of our balance sheet and creating financial flexibility to manage through the inherent cyclical demand for our products and volatility in commodity prices. We are focused on maximizing the cash generation of our operations, reducing debt, and aligning capital investments with our strategic priorities and the requirements of our business plan, including regulatory and permission-to-operate related projects. The current strong market environment has provided us opportunities to reduce our debt with our own free cash flow generation. We also continue to look at the composition of our debt, as we are interested in both extending our average maturity length and increasing our ratio of unsecured debt to secured debt, which can be accomplished with cash provided by operating activities. During 2022, we took action in alignment with these priorities. First, in the first quarter of 2022, we redeemed all $294 million in aggregate principal amount outstanding of our 1.500% 2025 Convertible Senior Notes and all $66 million aggregate principal amount outstanding of the IRBs due 2024 to 2028. Second, in April 2022, we redeemed all $607 million remaining aggregate principal amount outstanding of our 9.875% 2025 Senior Secured Notes. Most recently, we repurchased $307 million in aggregate principal amount of our outstanding senior notes of various series at an average price of 92% of par. Additionally, we have been able to return capital to shareholders through our share repurchase program. During 2022, we repurchased 8.5 million common shares at a cost of $176 million in the aggregate.

Based on our outlook for the next 12 months, which is subject to continued changing demand from customers and volatility in domestic steel prices, we expect to have ample liquidity through cash generated from operations and availability under our ABL Facility sufficient to meet the needs of our operations, service and repay our debt obligations and return capital to shareholders.

The following discussion summarizes the significant items impacting our cash flows during the six months ended June 30, 2022 and 2021 as well as expected impacts to our future cash flows over the next 12 months. Refer to the Statements of Unaudited Condensed Consolidated Cash Flows for additional information.

Net cash provided by operating activities was $1,398 million and $132 million for the six months ended June 30, 2022 and 2021, respectively. The period-over-period improvement was driven by improved operating results, along with favorable changes in working capital period-over-period. Favorable changes in working capital included an increase in payables, a decrease in receivables and lower pension contributions as a result of improvements to our pension plans' funded status.

Net cash used by investing activities was $467 million and $242 million for the six months ended June 30, 2022 and 2021, respectively. We had capital expenditures of $468 million and $298 million for the six months ended June 30, 2022 and 2021, respectively, primarily relating to sustaining capital spend. Sustaining capital spend includes infrastructure, mobile equipment, fixed equipment, product quality, reliability, environment, health and safety.

We anticipate total cash used for capital expenditures during the next 12 months to be between $800 and $900 million.

Net cash used by financing activities was $932 million for the six months ended June 30, 2022, compared to net cash provided by financing activities of $71 million for the six months ended June 30, 2021. Cash outflows from financing activities for the six months ended June 30, 2022 included $1,319 million for repayments of debt and $176 million for the repurchase of common shares. In the first half of 2022, we used available liquidity to redeem all $607 million remaining aggregate principal amount outstanding of our 9.875% 2025 Senior Secured Notes, all $294 million aggregate principal amount outstanding of our 1.500% 2025 Convertible Senior Notes and all $66 million aggregate principal amount outstanding of our IRBs due 2024 to 2028. We also repurchased $307 million in aggregate principal 36

amount of our outstanding senior notes of various series. Cash inflows for the six months ended June 30, 2022 included net borrowings of $636 million under our ABL Facility. Net cash provided by financing activities for the six months ended June 30, 2021 included the issuances of $500 million aggregate principal amount of 4.625% 2029 Senior Notes, $500 million aggregate principal amount of 4.875% 2031 Senior Notes and 20 million common shares for proceeds of $322 million, along with net borrowings of $190 million under credit facilities. We used available liquidity to redeem all $396 million aggregate principal amount of our 5.75% 2025 Senior Notes. We used the net proceeds from the issuance of the 20 million common shares, and cash on hand, to redeem $322 million in aggregate principal amount of our 9.875% 2025 Senior Secured Notes. We used the net proceeds from the issuances of the 4.625% 2029 Senior Notes and 4.875% 2031 Senior Notes to redeem all of the outstanding 4.875% 2024 Senior Secured Notes, 6.375% 2025 Senior Notes, 7.625% 2021 AK Senior Notes, 7.500% 2023 AK Senior Notes and 6.375% 2025 AK Senior Notes, and pay fees and expenses in connection with such redemptions, and reduce borrowings under our ABL Facility. We anticipate future uses of cash during the next 12 months to include repayment of our ABL Facility balance, as well as opportunistic transactions, including other debt repayments. Capital Resources

The following represents a summary of key liquidity measures:

(In Millions) June 30, 2022 Cash and cash equivalents $ 47 Available borrowing base on ABL Facility1 $ 4,500 Borrowings (2,245) Letter of credit obligations (178) Borrowing capacity available $ 2,077 1 As of June 30, 2022, the ABL Facility had a maximum borrowing base of $4.5 billion. The available borrowing base is determined by applying customary advance rates to eligible accounts receivable, inventory and certain mobile equipment. Our primary sources of funding are cash and cash equivalents, which totaled $47 million as of June 30, 2022, cash generated by our business, availability under the ABL Facility and other financing activities. The combination of cash and availability under the ABL Facility gives us $2.1 billion in liquidity entering the third quarter of 2022, which is expected to be adequate to fund operations, letter of credit obligations, capital expenditures and other cash commitments for at least the next 12 months.

As of June 30, 2022, we were in compliance with the ABL Facility liquidity requirements and, therefore, the springing financial covenant requiring a minimum fixed charge coverage ratio of 1.0 to 1.0 was not applicable.

In the normal course of business, we are a party to certain arrangements that are not reflected on our Statements of Unaudited Condensed Consolidated Financial Position. These arrangements include minimum "take or pay" purchase commitments, such as minimum electric power demand charges, minimum coal, coke, diesel and natural gas purchase commitments, minimum railroad transportation commitments and minimum port facility usage commitments; and financial instruments with off-balance sheet risk, such as bank letters of credit and bank guarantees.

Information about our Guarantors and the Issuer of our Guaranteed Securities

The accompanying summarized financial information has been prepared and presented pursuant to SEC Regulation S-X, Rule 3-10, "Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered," and Rule 13-01 "Financial Disclosures about Guarantors and Issuers of Guaranteed Securities and Affiliates Whose Securities Collateralized a Registrant's Securities." Certain of our subsidiaries (the "Guarantor subsidiaries") have fully and unconditionally, and jointly and severally, guaranteed the obligations under (a) the 5.875% 2027 Senior Notes, the 7.000% 2027 Senior Notes, the 4.625% 2029 Senior Notes and the 4.875% 2031 Senior Notes issued by Cleveland-Cliffs Inc. on a senior unsecured basis and (b) the 6.750% 2026 Senior Secured 37

Notes issued by Cleveland-Cliffs Inc. on a senior secured basis. See NOTE 8 - DEBT AND CREDIT FACILITIES for further information.

The following presents the summarized financial information on a combined basis for Cleveland-Cliffs Inc. (parent company and issuer of the guaranteed obligations) and the Guarantor subsidiaries, collectively referred to as the obligated group. Transactions between the obligated group have been eliminated. Information for the non-Guarantor subsidiaries was excluded from the combined summarized financial information of the obligated group. Each Guarantor subsidiary is consolidated by Cleveland-Cliffs Inc. as of June 30, 2022. Refer to Exhibit 22 , incorporated herein by reference, for the detailed list of entities included within the obligated group as of June 30, 2022. The guarantee of a Guarantor subsidiary with respect to Cliffs' 6.750% 2026 Senior Secured Notes, the 5.875% 2027 Senior Notes, the 7.000% 2027 Senior Notes, the 4.625% 2029 Senior Notes and the 4.875% 2031 Senior Notes will be automatically and unconditionally released and discharged, and such Guarantor subsidiary's obligations under the guarantee and the related indentures (the "Indentures") will be automatically and unconditionally released and discharged, upon the occurrence of any of the following, along with the delivery to the trustee of an officer's certificate and an opinion of counsel, each stating that all conditions precedent provided for in the applicable Indenture relating to the release and discharge of such Guarantor subsidiary's guarantee have been complied with: (a) any sale, exchange, transfer or disposition of such Guarantor subsidiary (by merger, consolidation, or the sale of) or the capital stock of such Guarantor subsidiary after which the applicable Guarantor subsidiary is no longer a subsidiary of the Company or the sale of all or substantially all of such Guarantor subsidiary's assets (other than by lease), whether or not such Guarantor subsidiary is the surviving entity in such transaction, to a person which is not the Company or a subsidiary of the Company; provided that (i) such sale, exchange, transfer or disposition is made in compliance with the applicable Indenture, including the covenants regarding consolidation, merger and sale of assets and, as applicable, dispositions of assets that constitute notes collateral, and (ii) all the obligations of such Guarantor subsidiary under all debt of the Company or its subsidiaries terminate upon consummation of such transaction;

(b) designation of any Guarantor subsidiary as an "excluded subsidiary" (as defined in the Indentures); or

(c) defeasance or satisfaction and discharge of the Indentures.

Each entity in the summarized combined financial information follows the same accounting policies as described in the consolidated financial statements. The accompanying summarized combined financial information does not reflect investments of the obligated group in non-Guarantor subsidiaries. The financial information of the obligated group is presented on a combined basis; intercompany balances and transactions within the obligated group have been eliminated. The obligated group's amounts due from, amounts due to, and transactions with, non-Guarantor subsidiaries and related parties have been presented in separate line items.

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