Freeport-McMoRan Inc.: Q2 FY2026 earnings call

What management said about Q2 FY2026, from the documents filed with the SEC on 23 July 2026: press release. Guidance figures: 3 raised, 6 lowered, 4 new, 8 kept. The quarter’s numbers.

Read the filing

Key takeaways

• Net income and adjusted earnings reported: Net income attributable to common stock was $984 million, $0.68 per share, against $772 million a year earlier. Adjusted net income was $1.1 billion, $0.74 per share, after $96 million of after-tax charges. Source
• Sales above April estimate on timing: Copper sales ran above the April estimate, mainly on shipment timing and improved operating performance, while molybdenum and gold moved on separate timing factors. Source
• Ramp-up on schedule, planned rates met: PTFI began initial ramp-up of Production Blocks 2 and 3 at the end of March and reached the operating rates planned for the second quarter. Source
• PTFI sales well below prior year: PTFI copper sales were 153 million pounds, against 443 million a year earlier. Gold sales were 118 thousand ounces, against 518 thousand, reflecting lower operating rates during the ramp-up. Source
• Realized prices higher than last year: Realized prices were $6.17 per pound for copper, $4,520 per ounce for gold and $28.75 per pound for molybdenum, against $4.54, $3,291 and $21.10 a year earlier. Source
• Copper unit costs below April estimate: Consolidated unit net cash costs were $1.97 per pound of copper, against $1.13 a year earlier. The result was below the April estimate on molybdenum credits and copper volumes. Source
• Operating cash flow included insurance: Operating cash flow was $2.0 billion, net of $0.6 billion of working capital and other uses, and included $0.7 billion of pre-tax insurance proceeds collected by PTFI. Source

“We made steady progress with our Grasberg ramp-up and our Americas operations delivered excellent performance, which resulted in year-over-year improvements to bottom-line results, demonstrating the strength of our diversified portfolio.”

Kathleen Quirk, President and Chief Executive Officer

Guidance

What changed from last quarter

• Guidance raised: Molybdenum sales expected for 2026 raised to 93 million pounds from 90 million pounds. Source
• Guidance lowered: Copper unit net cash cost for 2026 lowered to $1.90 per pound from $1.95. Source
• Guidance lowered: Operating cash flow for 2026 lowered to $8.3 billion from $8.7 billion, with changed gold and molybdenum price assumptions for the second half. Source
• Guidance lowered: South America copper sales for 2026 lowered to about 1.0 billion pounds from about 1.05 billion pounds. Source
• Guidance lowered: South America unit net cash cost for 2026 lowered to $2.56 per pound from $2.60, and the U.S. estimate also moved down. Source
• Guidance raised: Molybdenum mines unit net cash cost for 2026 raised to $17.91 per pound from $17.80. Source
• Guidance lowered: PTFI expected unit net cash credit for 2026 reduced to $1.22 per pound from $1.30. Source
• New guidance: Third-quarter 2026 sales volumes and copper unit cost were given for the first time. Source
• New guidance: Noncontrolling interest net income for 2026 estimated at $2.0 billion, not given in the prior release. Source
• New guidance: Consolidated effective tax rate for 2026 estimated at about 30%, not given in the prior release. Source
• Guidance raised: Bagdad project capital cost estimate increased by about 30% above the 2023 estimate of $3.5 billion. Source
• New: Cerro Verde stake raised from 55.08% to 55.66% after an open-market purchase of 2.0 million shares for $107 million. Source
• New: FCX replaced its revolving credit facility with a new $3.0 billion facility maturing May 2031; Cerro Verde replaced its $350 million facility on similar terms. Source
• New: PTFI submitted its application to extend its IUPK in June 2026, after the February memorandum of understanding with the Indonesia government. Source

Quarter results and drivers

• Net income and adjusted earnings reported: Net income attributable to common stock was $984 million, $0.68 per share, against $772 million a year earlier. Adjusted net income was $1.1 billion, $0.74 per share, after $96 million of after-tax charges. Source
• Sales above April estimate on timing: Copper sales ran above the April estimate, mainly on shipment timing and improved operating performance, while molybdenum and gold moved on separate timing factors. Source
• Copper sales below prior-year quarter: Copper sales were below the prior-year quarter, as expected, because PTFI operating rates were lower during the Grasberg Block Cave ramp-up. Source

Grasberg Block Cave ramp-up

• Ramp-up on schedule, planned rates met: PTFI began initial ramp-up of Production Blocks 2 and 3 at the end of March and reached the operating rates planned for the second quarter. Source
• Material handling upgrades on schedule: Upgrades to the material handling system at the Grasberg Block Cave haulage level are on schedule. Work on the future restart of Production Block 1S continues. Source
• PTFI sales well below prior year: PTFI copper sales were 153 million pounds, against 443 million a year earlier. Gold sales were 118 thousand ounces, against 518 thousand, reflecting lower operating rates during the ramp-up. Source
• Idle costs excluded from unit costs: Idle facility and restoration costs were $284 million in the quarter, or $1.86 per pound of copper. These costs are excluded from consolidated net cash costs; the first-half total was $690 million. Source

“As we look forward, we remain focused on restoring full operations at Grasberg safely and sustainably and continuing to build momentum on initiatives across our global footprint to grow margins, cash flow and earnings.”

Kathleen Quirk, President and Chief Executive Officer

U.S. and South America operations

• U.S. copper sales and costs: U.S. copper sales were 312 million pounds, up from 308 million a year earlier. Unit costs for the U.S. mines are discussed under unit costs. Source
• South America sales lower on leach: South America copper sales fell on lower leach production and on lower-grade stockpile ore from mine sequencing. Unit net cash costs were $2.48 per pound, close to last year. Source
• Leaching initiatives add copper: Leaching and technology initiatives added 47 million pounds of copper in the quarter and 101 million pounds in the first half, across the U.S. and South America. Source
• Morenci additive testing continues: A large-scale test of an internally developed additive at Morenci is under way. Two more additives are to be field-tested, and heat applied to stockpiles could further lift recoveries. Source

Prices, sales mix and provisional pricing

• Realized prices higher than last year: Realized prices were $6.17 per pound for copper, $4,520 per ounce for gold and $28.75 per pound for molybdenum, against $4.54, $3,291 and $21.10 a year earlier. Source
• Gold sales below April estimate: Gold sales were below the April estimate, mainly on the timing of refined gold shipments in Indonesia, and well below the prior-year quarter. Source
• Molybdenum sales above estimate: Molybdenum sales were above the April estimate and the prior-year quarter, mainly as inventory came down. Source
• Provisional pricing added to revenue: Adjustments to prior-period provisionally priced sales added $98 million to revenue, or $35 million to net income, which is $0.02 per share. Source
• Copper sold mostly as cathode and rod: Over the first six months, mined copper was sold 38% as cathode, 35% as rod and 27% in concentrate. Source

Unit costs, margins and tax

• Copper unit costs below April estimate: Consolidated unit net cash costs were $1.97 per pound of copper, against $1.13 a year earlier. The result was below the April estimate on molybdenum credits and copper volumes. Source
• U.S. unit costs down year over year: U.S. unit net cash costs were $2.94 per pound, down from $3.04, mainly on higher by-product credits, partly offset by supplies, diesel fuel and other consumables. Source
• Molybdenum mine costs rose: Molybdenum mine unit net cash costs were $19.20 per pound, up from $14.20, on lower volumes and higher supplies, energy and labor costs. Source
• Noncontrolling share and tax rate: Net income attributable to noncontrolling interests was $407 million, 21% of pre-tax income, against $775 million a year earlier. The consolidated effective tax rate for the quarter was 28%. Source

Capital spending and growth projects

• Capital spending of $1.1 billion: Capital expenditures were $1.1 billion in the quarter, $0.7 billion of it for major mining projects. First-half capital expenditures were $2.1 billion, including $1.3 billion for major mining projects. Source
• Major mining split by project type: Major mining projects include planned work in the Grasberg district and a leaching project at El Abra, and separately discretionary growth projects. Source
• Bagdad expansion sized at copper and molybdenum: The Bagdad study indicates new concentrators that would add copper and molybdenum output; construction would take three to four years, with economics supported at about $4.00 per pound incentive price. Source
• Safford/Lone Star studies continue: Pre-feasibility studies continue in the Safford/Lone Star district to define a potential expansion, following positive drilling in recent years. Source
• El Abra project economics under review: The potential El Abra mill expansion could add over 700 million pounds of copper a year. An environmental impact study was submitted to Chile in March 2026. Source
• Kucing Liar spending and full-rate output: PTFI has spent about $1.4 billion on Kucing Liar development, with about $4 billion more estimated through 2033. Full-rate output would be about 750 million pounds of copper a year. Source

Cash, debt and shareholder returns

• Operating cash flow included insurance: Operating cash flow was $2.0 billion, net of $0.6 billion of working capital and other uses, and included $0.7 billion of pre-tax insurance proceeds collected by PTFI. Source
• Net debt and cash at quarter-end: Consolidated debt was $9.4 billion and cash $4.1 billion at June 30. Net debt was $2.1 billion, excluding $3.2 billion of PTFI downstream processing debt. Source
• Share repurchases in second quarter: The company bought 1.7 million shares for $110 million at $64.34 average. By July 22, 55.4 million shares had been bought for $2.2 billion under the $5.0 billion program. Source
• Quarterly dividend declared, payable August: The board declared $0.15 per share, $0.075 base and $0.075 variable, under a policy allowing up to 50% of available cash flow for stockholder returns within a net debt target of $3.0 to $4.0 billion. Source
• 2027 senior note maturities: PTFI has $0.7 billion of senior note maturities in April 2027, and FCX has $0.6 billion due in the second half of 2027. Source

Coming up, as management said on 23 July 2026

• Bagdad investment decision in second half: A potential investment decision on Bagdad is planned for the second half of 2026; timing will also depend on copper market conditions and other factors. Source
• Safford/Lone Star studies due in 2026: Pre-feasibility studies for the Safford/Lone Star district are expected to be completed during 2026. Source
• El Abra permitting before any decision: The decision to proceed with the El Abra project and its timing will reflect required permitting, market conditions and other factors. Source
• Indonesia licence process to complete: FCX and PTFI are working with the Indonesia government to complete the formal licence process for the IUPK extension. Source

Figures management reported

Risks management discussed

• Operational: Output and sales at PTFI may vary more from each other until its downstream smelting and refining reach normal operating rates. Source
• Financial: Idle facility costs are non-inventoriable and kept out of unit net cash costs, but they are charged to reported results during the ramp-up. Source
• Regulatory: The IUPK extension beyond 2041 depends on completing a formal licence process with the Indonesia government. Source
• External: Volumes and unit costs depend on energy costs, other consumables, and weather, which can move the 2026 cost path. Source
• Financial: Interest expense rose in the 2026 periods because of historical withholding-tax charges on PTFI senior notes. Source
• External: Provisionally priced sales are settled against later LME prices, so each $0.05 per pound move changes 2026 revenue by about $9 million. Source
• Operational: Lower leach production and lower-grade stockpile ore from mine sequencing reduced South America copper sales volumes. Source

Earlier plans management reported on

• Ahead: Second-quarter copper sales came in above the estimate given in April, on shipment timing and operating performance. Source
• Ahead: Consolidated unit net cash costs for the quarter were below the April estimate. Source
• On track: Management describes the Grasberg Block Cave ramp-up as progressing on schedule. Source
• Met: The first-quarter release expected receipt of the settlement proceeds in the second quarter; the second-quarter release reports $0.7 billion collected.

Other quarters

• Q1 FY2026 earnings call
• Q4 FY2025 earnings call
• Q3 FY2025 results
• Q2 FY2025 results

Summarised with AI from the documents the company filed with the SEC. Every point is checked against the filing before it is shown: management’s own words word for word, figures against the line or table row they come from. A point that fails the check is left out. Source opens the filing at that line.