U.S. Steel Corp reported its second consecutive quarterly loss on Tuesday and said it expected all of its business sectors to operate in the red in the third quarter.

The company, which has been operating at less than half capacity since the economic downturn last year stunted steel demand, said customer orders had increased, but the outlook for overall demand and economic recovery was uncertain.

Its shares were down 3.5 percent to $39.84 in early afternoon trading on the New York Stock Exchange.

While the second-quarter loss was smaller than Wall Street expected, analyst Charles Bradford of Affiliated Research Group noted the results included several one-time gains, such as $34 million from the recovery of federal excise taxes paid on coal export sales from 1990 to 1992.

Bradford said the results were dreadful.

They must be having big problems, to do that badly, he said. Everyone else should be close to break-even or making a little money in the third quarter, but these guys expect lower prices and could have a loss bigger than the second.

Michelle Applebaum, an independent steel industry analyst in Chicago, said she was reluctant to grade the results, because the company discussed a gain on emission allowances without quantifying it.

What we know is that the actual result most probably will be worse than what the Street is calling the 'adjusted' result, she wrote in a note.

The net loss in the second quarter was $392 million, or $2.92 per share, compared with a year-earlier profit of $668 million, or $5.65 per share, the Pittsburgh-based steelmaker said.

Excluding one-time items, the loss per share was $3.28. The analysts' average forecast was a loss of $3.45, according to Reuters Estimates.

Revenue dropped by almost 75 percent to $2.13 billion. Analysts were expecting $2.36 billion.

In April, U.S. Steel's first-quarter loss of $439 million, or $3.78 per share, was much bigger than analysts had expected. At that time, the company said it expected an operating loss in the second quarter.

Our order book and operating rates remained at very low levels, spot market prices declined, and we continued to incur carrying costs for our idled facilities, said Chief Executive John Surma.

Looking ahead, Surma said that although U.S. Steel anticipated an increase in operating rates, we expect each of our segments to report an operating loss in the third quarter due to continued low operating rates, idled facility carrying costs, and lower average realized prices.

U.S. Steel's three segments are flat-rolled steel, tubular steel and U.S. Steel Europe.

There are some signs that the destocking cycle has ended in the North American and Central European steel markets as increased customer orders across almost all industry segments have resulted in an extension of lead times, Surma said.

U.S. Steel, which has been operating recently at less than 50 percent capacity, has begun to reopen idled facilities, in line with customer demand, and has implemented price increases in its flat-rolled steel and European operations.

Despite these signs of improvement, the outlook for overall demand remains uncertain, and the timing and magnitude of sustained economic recovery remain difficult to forecast, Surma said in a statement.

(Reporting by Steve James, editing by John Wallace, Lisa Von Ahn, Tim Dobbyn)