Newmont Q3 Earnings Call Highlights

Key Points

• Strong cash generation: Newmont produced $1.9 billion in third-quarter free cash flow and $7.3 billion through the first nine months of 2026. The company returned about $1.9 billion to shareholders and improved its full-year all-in sustaining cost outlook to approximately $1,520 per ounce.
• Production growth ahead: Newmont expects fourth-quarter gold production to reach 1.4 million ounces, its strongest quarter of 2026, while 2027 production is projected to rise by a low- to mid-single-digit percentage. Higher costs, lower Peñasquito silver output and inflation remain key headwinds.
• Red Chris expansion advances: Newmont expects a funding decision on the Red Chris Block Cave project early next year, with construction potentially ramping up in 2027 and commercial production targeted for 2033. The project could produce about 3 million ounces of gold and 850,000 tons of copper during its initial development phase.

Newmont NYSE: NEM reported a stable third quarter marked by strong free cash flow, improved full-year cost expectations and continued progress on its development pipeline, including plans for a potential major block-cave expansion at Red Chris in British Columbia.

President and Chief Executive Officer Natascha Viljoen said the company produced approximately 1.3 million ounces of gold, 23,000 tons of copper and 11 million ounces of silver during the quarter. Gold production was broadly consistent with the second quarter, while higher silver output and realized prices, disciplined cost management and operational execution supported the company’s financial results.

Newmont generated $2.8 billion of cash flow from operations after working capital and $1.9 billion of free cash flow in the quarter. Adjusted net income was $2.20 per share, which Viljoen described as a third-quarter record. Through the first nine months of 2026, the company generated $7.3 billion of free cash flow, approximately equal to the amount it generated during all of 2025, according to Chief Financial Officer Brian Tabolt.

Capital Returns and Cost Outlook

Newmont returned about $1.9 billion to shareholders since its prior earnings call through dividends and share repurchases. The company has repurchased more than 115 million shares since its repurchase program began in February 2024, reducing its outstanding share count by approximately 10%.

During the third quarter, Newmont declared a quarterly dividend of $0.26 per share and spent $525 million on sustaining capital and $354 million on development capital. The company repurchased approximately $1.6 billion of shares since the prior call, including more than $450 million in October, leaving about $2.8 billion under its current $6 billion repurchase authorization.

Tabolt said Newmont ended the quarter with net cash of $3.2 billion, above the upper end of its stated net-cash target range of $1 billion plus or minus $2 billion. That balance did not yet reflect the anticipated $1.95 billion payment associated with the amended Nevada Gold Mines joint venture agreement, which the company expects to close in the fourth quarter.

The company reported gold all-in sustaining costs of $1,454 per ounce on a by-product basis for the third quarter. Newmont improved its full-year all-in sustaining cost outlook to approximately $1,520 per ounce, about 10% below the guidance issued at the beginning of the year.

Fourth-quarter all-in sustaining costs are expected to rise to about $1,900 per ounce, reflecting the timing of sustaining capital expenditures, lower co-product credits as silver production at Peñasquito declines, and inflationary pressures including fuel costs. Newmont said every $10-per-barrel movement in oil prices has an estimated direct fuel impact of approximately $60 million and an additional approximate $50 million effect on consumables and inputs such as chemicals, explosives and grinding media.

Fourth-Quarter Production and 2027 Growth

Newmont expects fourth-quarter gold production of 1.4 million ounces, which would make it the company’s strongest quarter of 2026. Expected contributors include access to higher-grade stopes at Tanami, the start of mining at the Vein Zone open pit at Cerro Negro, the ramp-up of Ahafo North and higher-grade ore at Lihir after its September maintenance shutdown.

Management said it is monitoring potential water impacts at Lihir from El Niño conditions expected to strengthen through November and December. Viljoen said the operation had not yet been affected, but Newmont is preparing mitigation measures that could include prioritizing water supplies for local communities, stockpiling ore, blending feed and potentially bringing forward maintenance work if necessary.

For 2027, Newmont expects total portfolio production to increase by a low- to mid-single-digit percentage from 2026. Management cited higher-grade mining areas at Lihir and Boddington, additional production from Tanami’s second expansion, the Vein Zone open pit at Cerro Negro, potential low-cost ounces at Yanacocha and contributions from non-managed assets.

However, Tabolt said unit costs are expected to trend higher in 2027 due to macroeconomic headwinds and reduced co-product credits. Silver production at Peñasquito is expected to be roughly 30% lower than 2026 levels because of planned mine sequencing. The company also expects general labor-cost escalation to exceed its 2026 assumption of approximately 3%, although Viljoen said Newmont’s labor turnover remains under control and it is not seeing broad labor shortages across its business.

Red Chris Study Supports Potential 2027 Construction Ramp-Up

Newmont is finalizing the feasibility study for the Red Chris Block Cave project and expects a full funding decision early next year, subject to board approval. Construction is anticipated to ramp up in 2027, with commercial production targeted for 2033.

The initial development phase is expected to operate for about 13 years and produce approximately 3 million ounces of gold and 850,000 tons of copper on a 100% basis. After ramp-up, Newmont expects annual production of 275,000 to 325,000 ounces of gold and 65,000 to 85,000 tons of copper.

Development capital is currently estimated at $4.2 billion to $4.8 billion, or C$5.6 billion to C$6.4 billion, on a 100% basis, including the anticipated benefit of Canadian government funding. Viljoen said the feasibility study incorporated more than 60% engineering completion, updated geotechnical understanding, revised mine design and improved materials-handling and processing plans.

The revised project plan would increase processing capacity to 15 million tons per year from 9 million tons per year in the earlier study. Viljoen said the initial macro block represents less than 20% of Red Chris’ potential mine life, while about 40% of planned investment in surface and underground infrastructure is expected to support future expansions.

Management said Red Chris must meet Newmont’s capital-allocation standards as a standalone investment, including strategic fit, durable production, free-cash-flow potential and a double-digit internal rate of return that exceeds the applicable country-specific discount rate.

Project Pipeline and Nevada Gold Mines Agreement

At Tanami, Newmont completed construction of a 1.5-kilometer shaft for the second expansion and expects full mechanical completion by the end of 2026. Commercial production is now expected by the end of the second quarter of 2027, earlier than previously anticipated, with ramp-up continuing through year-end.

At Cadia, the PC2-3 project remains on track for completion by year-end after the final drawbell was fired in September. The company also said regulatory approvals and requirements related to an April seismic event at PC1-2 had been achieved, allowing cave-establishment activities to continue. Viljoen said the event is not expected to affect Cadia reserve assumptions.

Newmont’s water-treatment plants at Yanacocha are approaching mechanical completion, with commissioning underway. Spending on those facilities is expected to decline as the projects approach completion in 2027, freeing roughly $200 million of cash flow in 2027 and approximately $400 million annually beginning in 2028 compared with 2026 spending levels.

The company also expects to close an amended Nevada Gold Mines joint-venture agreement in the fourth quarter. Under the agreement, Fourmile, Fiberline and Mike properties would be contributed to the venture. Viljoen said the revised arrangement also creates an opportunity for the partners to work more closely to optimize the Nevada district.

About Newmont (NYSE:NEM)

Newmont Corporation NYSE: NEM is a global mining company primarily engaged in the exploration, development, and production of gold. The company also produces copper, silver, zinc, and lead as byproducts of its mining operations. Its activities span the full mining life cycle, including resource discovery, project development, mine operations, processing, reclamation, and closure.

Founded in 1921, Newmont has grown into one of the world's largest gold producers. The company operates and develops mines across several regions, including North America, South America, Australia, Africa, and Papua New Guinea.

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