Freeport-McMoRan Inc. (NYSE:FCX) shares are trading lower on Thursday after it reported first-quarter fiscal 2026 results.
Earnings Snapshot
Revenue came in at $6.23 billion, beating the consensus of $5.81 billion.
Adjusted EPS of 57 cents beat the consensus of 46 cents.
Net income attributable to common stock totaled $881 million, or 61 cents per share, in the quarter.
Production And Sales Volumes
- Copper production totaled 662 million pounds, with sales volume of 657 million.
- Gold production was 97,000 ounces, with sales volume of 121,000 ounces.
- Molybdenum production totaled 22 million pounds, while sales totaled 24 million pounds.
Other Key Metrics
During the first quarter, average realized prices stood at $5.78 per pound for copper, $4,889 per ounce for gold, and $25.21 per pound for molybdenum.
Unit net cash costs for copper averaged $1.91 per pound, down from $2.07 a year earlier.
Capital expenditures reached $1.0 billion in the quarter, including $600 million for major mining projects.
As of March 31, Freeport-McMoRan held $3.7 billion in cash and equivalents and total debt of $9.4 billion.
Outlook
For 2026, the company now expects sales of roughly 3.1 billion pounds of copper, 0.65 million ounces of gold, and 90 million pounds of molybdenum. These estimates assume a ramp-up of the Grasberg Block Cave underground mine.
FCX is targeting an annual production of around 300 million pounds of copper from leaching and technology innovation initiatives in 2026.
For the second quarter, Freeport sees sales of 690 million pounds of copper, 140 thousand ounces of gold, and 22 million pounds of molybdenum.
The outlook reflects the revised Grasberg ramp-up schedule, which is the key change versus prior estimates.
For 2026, capital expenditure guidance remains broadly unchanged at about $4.3 billion in 2026 and $4.5 billion in 2027.
Conference Call Takeaways
During the quarter, Freeport returned $300 million to shareholders, maintained a solid balance sheet, and continued allocating capital toward strategic growth initiatives.
In Indonesia, the Grasberg ramp-up timeline has been revised due to material handling bottlenecks, with full production now anticipated by mid-2027.
Management now projects a return to only 65% capacity by the second half of 2026, down from the previously estimated 85%. Due to these bottlenecks, the company cut its full-year 2026 copper sales forecast to 3.1 billion pounds (from 3.4 billion) and gold sales to 650,000 ounces (from 800,000).
A new Memorandum of Understanding with the Indonesian government extends operating rights, strengthening the long-term outlook for the asset base.
As the Grasberg ramp-up progresses, the company expects second-half volumes to be about 30% higher for copper and roughly 50% higher for gold versus the first half.
The company also flagged renewed cost pressure following the Iran conflict, particularly from diesel price volatility used in haul trucks and power operations in Indonesia.
The rise in diesel prices in March alone implies an estimated $500 million annualized cost headwind.
Consequently, Freeport-McMoRan projects net unit costs rise to about $1.95 per pound of copper, versus the prior $1.75, mainly due to lower Grasberg volumes for the year.
FCX Price Action: Freeport-McMoRan shares were down 12.07% at $61.87 at the time of publication on Thursday, according to Benzinga Pro data.
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