Gerdau S.A. (GGB): Marketing Mix Analysis [Dec-2025 Updated]

You're digging into how Gerdau S.A. is actually making money in the current market, and honestly, looking at their Marketing Mix-the four P's-is the clearest way to map their strategy right now. As someone who's spent two decades in this game, I can tell you the real story isn't just in the books; it's in how they sell their long and special steel products globally, especially with an estimated revenue near R$70 billion for the 2025 fiscal year. We'll break down their B2B sales focus, their heavy emphasis on ESG in promotion, and how commodity prices dictate their pricing structure, giving you a precise, actionable view of their market positioning. Stick with me; this breakdown simplifies the complexity.

Gerdau S.A. (GGB) - Marketing Mix: Product

The product offering from Gerdau S.A. centers on steel produced through both primary and recycled routes, segmented by product form and end-use specification.

Long steel products form a core part of the business, primarily serving the construction sector. These include essential items like rebar and wire rod. For instance, Gerdau S.A. was noted as a major player in the long steel industry. The company's operations support infrastructure, with one mill supplying more than 7,000 individual products with distinctive product codes.

Special steel represents a focus on higher-margin, engineered solutions tailored for demanding industries. Gerdau S.A. provides these engineered products for the automotive, commercial vehicle, agricultural, construction, and energy markets. Specific examples of these specialized offerings include AccuCaliber™ Gun Barrel Steels and Camshaft Blanks. Reflecting strong demand in this area, downstream product sales in the North American segment grew by 47% year-over-year, reaching a record 76,000 tonnes in the third quarter of 2025.

Flat steel products constitute a smaller segment, often serving industrial use. The production process at facilities like the Cartersville plant involves firing the Electric Arc Furnace (EAF) approximately 25-30 times a day to produce these flat products. However, the Brazilian market faced competitive pressure, with imported long and flat steel products increasing by 28.8% in the first half of 2025.

A defining characteristic of Gerdau S.A.'s product positioning is its major role as a scrap metal recycler, which frames its steel as a circular economy product. Each year, Gerdau S.A. transforms more than 14 million tons of recycled scrap into new steel. This commitment extends to resource management, with the company reusing almost 97% of its industrial process water. Furthermore, globally, more than 84% of Gerdau's co-products are reused in other production chains.

The drive toward higher-margin, value-added steel products is evident in capital allocation. In the second quarter of 2025, of the R$ 1.6 billion invested, 54% was allocated to expansion projects and technological upgrades, supporting this product evolution.

Here's a look at some operational and product-related metrics as of late 2025:

The product mix is supported by significant financial scale; Gerdau S.A.'s revenue for the twelve months ending September 30, 2025, was $12.198B.

• Long steel products: Rebar and wire rod for construction.
• Special steel products: Engineered alloys for automotive and energy sectors.
• Flat steel products: Used for industrial applications.
• Recycled steel: Over 14 million tons of scrap processed annually.

Finance: review the Q3 2025 segment contribution breakdown against the 65% North America EBITDA share to assess product margin trends by Friday.

Gerdau S.A. (GGB) - Marketing Mix: Place

Gerdau S.A.'s Place strategy centers on its extensive, geographically diversified operational footprint across the Americas, ensuring proximity to key industrial and construction markets.

The global footprint includes operations throughout the Americas, specifically in Brazil, the U.S., and Canada. As of late 2025, Gerdau S.A. was operating 11 plants across the U.S. and Canada. The North American segment has become the cornerstone of the 2025 strategy, contributing 65% of the company's consolidated adjusted Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) in the third quarter of 2025. The Brazil Business Segment's operations include mills in several states, such as Minas Gerais, Rio Grande do Sul, and São Paulo.

Here's a look at the regional operational breakdown for Q3 2025:

The company maintains a vertically integrated distribution network. In North America, this network comprises metals recycling locations, steel mills, and downstream facilities. For example, the Cartersville, Georgia, mill stores roughly 2,000 tons of finished product onsite in a 150-acre warehouse. The largest unit, the Ouro Branco mill in Brazil, has an annual installed capacity of 3.6 million tonnes of crude steel. The Cartersville facility itself produces over 7,000 individual products.

The strategic location of mini-mills near key urban and industrial markets is a core element. In North America, demand drivers include solar and renewable energy project development, plus data centers. The company funneled BRL1.6 billion in capital expenditures into North America in 2025 to expand flat steel capacity. In contrast, investments in Brazil, such as the Itabiritos iron ore project and the Ouro Branco flat steel expansion, are focused on enhancing vertical integration to offset structural cost disadvantages.

Gerdau S.A. utilizes a direct-to-customer Business-to-Business (B2B) sales model, particularly for large industrial and construction projects. In the North America Business Segment, products are generally sold to steel service centers, steel fabricators, or directly to original equipment manufacturers (OEMs). The environment for this B2B sales approach is rapidly evolving; research suggests that 80% of B2B sales interactions are expected to occur via digital channels by 2025. This necessitates a strong digital engagement capability to support the direct sales force.

• North American operations benefited from U.S. Section 232 tariffs, which sit at 50% for many steel imports.
• In Q2 2025, North American operations contributed 61% of consolidated EBITDA, rising to 65% in Q3 2025.
• Steel shipments in North America showed 10% growth compared to the previous year in Q3 2025.
• The company announced dividends of approximately R$555 million for Gerdau S.A. in Q3 2025.

Gerdau S.A. (GGB) - Marketing Mix: Promotion

Strong emphasis on corporate sustainability and ESG reporting to investors.

• CDP Climate Change module score for the 2023 cycle: A-.
• Percentage of senior executive long-term bonus conditioned on meeting ESG targets: 20%.
• Commitment to reduce greenhouse gas emissions by: 2031.
• Investment in clean energy initiatives: R$1.5 billion.
• Percentage of steel produced from recycled materials: over 70%.
• Forestry base in Minas Gerais, Brazil: over 254,000 hectares.
• Hectares set aside for biodiversity conservation: 91,000 hectares.
• Planned expansion of the forestry base over the next five years: 20%.
• Greenhouse gas emissions in Q2 2025: lowest in company history.

B2B relationship marketing through direct sales teams and industry events.

While specific Gerdau S.A. B2B event attendance is not detailed, the focus on industry engagement is implied by the sector's nature and the company's operational scale.

Digital platforms for customer interaction and order management.

• Percentage of sales via digital channels (2021 data): 17%.
• Percentage of customers using at least one digital channel (2021 data): 88%.
• Gerdau Mais platform status: Phase 2.
• Reduction in manual data entry errors from onboarding digitalization: 90%.

Investor Relations focus, highlighting operational efficiency and capital discipline.

The promotion of financial discipline is evident in the reporting of key performance indicators from the third quarter of 2025 (3Q25).

The 2025 investment plan estimate was R$6.0 billion.

Gerdau S.A. (GGB) - Marketing Mix: Price

The pricing for Gerdau S.A. (GGB) products is fundamentally tied to the volatile nature of global steel commodity prices and the specific demand dynamics within its key operating regions. You see this clearly when comparing the performance between its North American and Brazilian segments.

The company's overall financial scale reflects this pricing environment; Gerdau S.A. reported revenue in the last twelve months ending September 30, 2025, of R$69.71 billion, which is very near the R$70 billion mark you mentioned. This TTM revenue represented a 7.37% year-over-year growth.

Gerdau S.A. employs a cost-plus approach, but the structure is heavily influenced by raw material inputs, particularly scrap metal, and energy expenses. The company anticipates favorable operating conditions where the steel spread expands due to rising finished steel prices alongside steady scrap costs. However, the cost base is not uniform across geographies; for instance, natural gas prices in Brazil are noted as being up to five times U.S. levels, which directly impacts the cost structure and, subsequently, pricing flexibility in that market. To mitigate this, Gerdau S.A. is investing in a scrap recycling center at its specialty steel plant in Pindamonhangaba.

Competitive pricing is a tale of two markets. In North America, trade policies like the U.S. Section 232 tariffs, which levy 50% duties on many steel imports, have shielded domestic producers, allowing Gerdau S.A. to capture higher margins and maintain stable pricing. In the third quarter of 2025, the North America Division accounted for 65% of consolidated EBITDA. Conversely, in Brazil, pricing power is limited, leading to margin compression. The import penetration rate in Brazil reached a critical 26.0% in the second quarter of 2025, putting direct pressure on local realized prices.

The long-term pricing strategy must absorb significant capital requirements. The guidance for capital expenditure (CapEx) for the 2025 fiscal year was set at R$6.0 billion. This level of investment, which includes projects like the Miguel Burnier mining platform and renewable energy initiatives, is essential for maintaining cost competitiveness and expanding capacity, which ultimately underpins future pricing power.

Here is a snapshot of the regional pricing and cost environment as of late 2025:

The company's pricing realization is also segmented by product value:

• Finished steel prices are rising, supporting margin expansion.
• Downstream product sales in North America rose 47% year-over-year in Q3 2025.
• Order backlog in North America is around 70 days, above the historical average of 60 days.

Finance: draft 13-week cash view by Friday.