Freeport-McMoRan Inc. (FCX) Earnings & Analysis

Latest quarter

Freeport-McMoRan reported Q2 FY2026 revenue of $7.0 billion, down −7.29% from $7.6 billion in Q2 FY2025. On the basis used for consensus comparisons, the company reported revenue of $7.0 billion against the consensus estimate of $6.5 billion, an 8.57% difference.

The company reported adjusted EPS, as the consensus counts it, of $0.74, compared with the consensus estimate of $0.62, a 19.4% difference. Freeport-McMoRan reported diluted EPS of $0.68 for Q2 FY2026, compared with $0.53 a year earlier, an increase of 28.3%.

The company reported a gross margin of 31.1%, compared with 34.7% in Q2 FY2025, and an operating margin of 28.5%, compared with 32.1% a year earlier. Freeport-McMoRan reported free cash flow of $944.0 million, compared with $934.0 million in Q2 FY2025, an increase of 1.07%.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

Chief Executive Officer Kathleen Quirk said second-quarter copper sales and unit cash costs were better than the company’s forecast. She said Grasberg’s ramp-up, together with a favorable metal-price backdrop, generated margins, cash flow and earnings during the quarter.

Quirk said U.S. customers continued to report copper demand and order books associated with AI data centers and related energy infrastructure, while auto-sector demand improved and private construction remained weaker. She said the company expects additional copper supply will be required as demand grows.

In the U.S., Quirk said the company was increasing mining and processing rates and expects copper production to grow in coming quarters. She said the company was field-testing additives and heated leach solutions as part of its leach initiative. Quirk also said Freeport-McMoRan was nearing an investment decision on a major Baghdad mine expansion and was advancing regulatory work for an El Abra expansion in Chile.

On Grasberg, Quirk said Block Cave production rates rose during the quarter and that material-handling-system upgrades were progressing on schedule. She said the company targeted district operating rates approximating 65.0% of full capacity in the second half of 2026, 80.0% by mid-2027 and approaching full capacity by the end of 2027.

When analysts asked about Baghdad, Quirk said the company was finalizing capital-cost estimates with vendors, contractors and construction-labor organizations. She said preliminary indications placed capital in the $4.5 billion range and cited commodity and labor escalation, scope revisions and additional engineering. Quirk said the company could complete the project within a three- to four-year time frame.

When asked about the Indonesian operating-rights extension, Quirk said Freeport-McMoRan had filed its formal application in June under the memorandum of understanding terms agreed in February. She said the regulatory process had no prescribed time frame and that the company was working to complete it during the year.

Chief Financial Officer Maree Robertson said average 2026 unit net cash cost was estimated at $1.90 per pound, slightly below the April estimate of $1.95 per pound, as higher by-product credits more than offset other unit-cost increases. Robertson said 2027 capital expenditures were estimated at $4.8 billion, reflecting upgraded mining equipment and revised cost estimates.

Guidance

Freeport-McMoRan’s current 2026 average unit net cash-cost estimate is $1.90 per pound, compared with its April estimate of $1.95 per pound. The company now expects second-half copper sales to be over 20% higher than first-half sales and gold sales to be more than 65% higher, compared with its prior outlook for copper volumes approximately 30% higher and gold volumes approximately 50% higher.

For 2027, Freeport-McMoRan estimates capital expenditures of $4.8 billion, compared with its prior estimate of $4.5 billion. The company expects discretionary projects to require $1.9 billion in 2027.