Freeport-McMoRan's profit beats expectations on the back of higher copper and gold price
On Wednesday, Freeport-McMoRan exceeded Wall Street expectations for its second-quarter profits as higher copper prices and gold prices offset lower production.
In pre-market trading, the company's shares climbed 1.6% to $40.54.
The results are in stark contrast to the threat by U.S. president Donald Trump to impose a tariff of 50% on imports of copper, starting August 1.
Freeport, the United States' largest producer, could see its annual profits increase by up to $1.6 billion, as it has more options for expansion than competitors.
After the announcement, COMEX prices rose by approximately 25% over global benchmarks. This increased the spread between the domestic and international markets.
Freeport, which provides about 70% of U.S. refined copper, expects to sell around 1.3 billion pounds in 2025 from its domestic mines.
The company stated that the tariffs announced and in place in the United States have had no material impact on its second quarter, but warned about a 5% cost increase for U.S. purchases from suppliers who pass on tariff-related costs.
The average realized quarterly price of copper was $4.54 a pound. This is up 1.3% compared to a year ago. Meanwhile, the average realized price of gold was $3.291 an ounce. This represents a 43% increase.
The second-quarter copper output fell by around 7%, to 963 millions recoverable pounds from the year before.
According to data compiled and analyzed by LSEG, the company reported a profit adjusted of 54 cents for the three-month period ended June 30. This compares with an average analyst estimate of 45 cents. (Reporting from Tanay in Bengaluru, editing by Sriraj Kalluvila.)
(source: Reuters)
