Newmont, the world’s largest gold producer, delivered second-quarter adjusted earnings that exceeded street estimates as a strong rise in bullion prices outweighed lower metal output, the company said.
For the quarter, Newmont reported adjusted earnings of $2.10 per share for the period ended June 30, surpassing analysts’ average forecast of $1.99 compiled by LSEG. The company attributed the earnings beat primarily to higher realized gold prices rather than increased volumes.
Gold averaged $4,506.41 per ounce in the second quarter, roughly 37% higher than the same period a year earlier. Newmont’s own quarterly average realized price for gold was $4,414 per ounce, up from $3,320 per ounce a year earlier.
Despite the stronger pricing environment, quarterly gold production declined to 1.29 million ounces from 1.48 million ounces a year earlier. The drop in output reflected a number of site-specific factors: Cadia experienced reduced output related to seismic events, while Ahafo South, Penasquito and Yanacocha saw lower grades as part of planned mine sequencing.
Operations at Cadia had returned to normal levels by mid-June, the company said, and management expects third-quarter production to be broadly in line with Q2 volumes.
Looking ahead, Newmont warned that unit costs are likely to rise in the third quarter, with higher sustaining capital spending identified as the main driver. The company also noted that rising oil prices could further affect costs and reiterated that its cost base remains sensitive to royalties that are tied to gold prices. Newmont expects to invest $1.4 billion of development capital in 2026.
On the Red Chris project in British Columbia, Newmont said earlier this month that any expansion would be contingent on fitting within the company’s capital allocation framework and delivering accretive value. CEO Natascha Viljoen said Newmont has obtained all critical approvals and is engaged with the British Columbia government on mining investment terms. She clarified that the C$500 million in support the company received from the province is not a pre-requisite for making a decision on the Red Chris mine.
Market forces that have influenced gold prices in recent months were reflected in the company’s results. The metal has rallied on safe-haven demand and hopes for cuts to U.S. interest rates, although a stronger U.S. dollar and episodes of oil-driven inflation concerns tied to the Iran conflict have at times limited further gains.
Newmont’s results underline the degree to which the miner’s financial performance remains linked to commodity price movements as well as site-level production variability. The company reported the currency reference $1 = 1.4081 Canadian dollars in its release.
Bottom line: Elevated gold prices delivered an earnings beat for Newmont in Q2 even as production fell year-on-year. Management expects Q3 volumes to be broadly comparable to Q2 but warns of higher unit costs driven by sustaining capital and potential oil-price pressure, while continuing discussions and approvals related to the Red Chris expansion.