Barrick earnings jump 50% as $1.95bn Newmont deal clears IPO path

Barrick Mining Corporation reported a 50% increase in second-quarter net earnings as sharply higher gold and copper prices outweighed rising mining costs and broadly flat gold production. The New York Stock Exchange and Toronto Stock Exchange-listed miner, which trades under $B and $ABX respectively, generated $5.29 billion of revenue, $1.22 billion of net earnings and $1.70 billion of operating cash flow during the quarter ended June 30. Barrick also reached a $1.95 billion agreement with Newmont Corporation that will bring previously excluded Nevada properties into Nevada Gold Mines and remove a significant obstacle to Barrick’s planned North American gold initial public offering. The company repurchased $1.21 billion of shares during the quarter and declared a $0.175 dividend, lifting total shareholder returns by 242% from a year earlier. The central tension is that stronger commodity prices are generating significantly higher earnings, but unit costs and growth capital are also rising, leaving attributable free cash flow below the prior-year level despite the headline profit increase.

Barrick produced 796,000 attributable ounces of gold, exceeding its quarterly guidance range of 730,000 to 770,000 ounces and increasing 11% sequentially. Production was essentially unchanged from 797,000 ounces a year earlier, while copper output declined 5% year over year to 56,000 tonnes. The improvement from the first quarter was driven by the faster-than-expected restart of Loulo-Gounkoto, recovery at Pueblo Viejo following planned maintenance and record underground tonnes at Cortez as Goldrush continued ramping up.

Higher gold and copper prices lifted Barrick earnings even as mining costs continued to rise

Barrick’s second-quarter revenue increased 44% from $3.68 billion to $5.29 billion even though gold production was virtually unchanged from the corresponding 2025 period. The main driver was pricing. Barrick realized an average gold price of $4,417 per ounce, 34% above the $3,295 recorded a year earlier, while its realized copper price increased 41% to $6.15 per pound.

The higher prices produced a substantial increase in profitability. Net earnings reached $1.22 billion, or $0.73 per diluted share, compared with $811 million, or $0.47 per share, a year earlier. Adjusted net earnings increased 70% to $1.36 billion, while adjusted earnings per share rose 74% to $0.82. Attributable adjusted EBITDA climbed 51% to $2.55 billion and represented 60% of attributable revenue.

The result demonstrates Barrick’s operating leverage to precious-metal prices. When gold prices rise faster than production costs, a substantial portion of the increase can flow through to earnings because the company’s existing mines do not need an equivalent increase in production volume to benefit.

Costs are nevertheless moving higher. Gold cost of sales increased 20% to $1,993 per ounce, while total cash costs rose 15% to $1,426 and all-in sustaining costs increased 11% to $1,866 per ounce. Barrick attributed the pressure to lower grades at Carlin, Cortez and North Mara, higher fuel expenses and increased royalties linked to stronger gold prices.

Copper showed a similar pattern. C1 cash costs increased 37% to $2.47 per pound and copper all-in sustaining costs rose 36% to $3.95 per pound. Higher copper prices kept the operations profitable, but the increase illustrates how royalty structures, fuel costs and mine sequencing can absorb part of the commodity-price benefit.

Barrick retained its 2026 gold production guidance of 2.90 million to 3.25 million ounces and copper guidance of 190,000 to 220,000 tonnes. Gold all-in sustaining costs are expected to range between $1,760 and $1,950 per ounce, while copper AISC is forecast at $3.45 to $3.75 per pound.

Those cost forecasts are based on assumptions of $4,500 gold, $5.50 copper and West Texas Intermediate oil at $70 per barrel. Barrick estimates that every $10-per-barrel change in oil prices would affect gold costs by approximately $12 per ounce and copper costs by about $0.04 per pound.

The current commodity environment therefore provides considerable margin protection, but Barrick’s earnings sensitivity works in both directions. If metal prices weaken while fuel, labour and royalty expenses remain elevated, the gap between realized prices and production costs could contract quickly.

Newmont’s $1.95 billion agreement removes a major obstacle to Barrick’s North American IPO

Barrick and Newmont reached an agreement that fundamentally changes the structure of their Nevada Gold Mines joint venture. Barrick will contribute its Fourmile project, while Newmont will contribute the Mike and Fiberline developments that had previously remained outside the partnership. Newmont will make a $1.95 billion cash payment to Barrick to reflect the value of the properties being contributed.

Nevada Gold Mines is 61.5% owned and operated by Barrick, with Newmont holding the remaining 38.5%. The joint venture includes the Carlin, Cortez, Turquoise Ridge, Phoenix and Long Canyon operations and is already one of the world’s largest concentrations of gold assets.

Adding Fourmile, Mike and Fiberline is expected to create a Nevada complex containing close to 100 million ounces of gold resources, according to Barrick. The agreement also modernizes governance arrangements and resolves outstanding disputes between the partners.

The most immediate strategic consequence is Newmont’s consent to Barrick’s proposed initial public offering of its North American gold assets. Newmont had previously raised concerns about how an IPO could interact with joint-venture protections and the performance of Nevada Gold Mines. The new agreement removes that dispute and gives Barrick a clearer route to complete the planned transaction before the end of 2026.

Barrick intends to place a minority interest in a newly formed North American gold company while retaining a controlling stake. The planned entity is expected to include Barrick’s interests and operatorship in Nevada Gold Mines, Pueblo Viejo, Fourmile and other North American exploration properties, along with the assets contributed by Newmont. Mark Hill is expected to become chief executive of the new company.

The structure could allow investors to value Barrick’s lower-jurisdiction-risk North American gold assets separately from its wider global portfolio. A separately listed vehicle could command a different valuation from a diversified mining company exposed to operations and development projects across Africa, Latin America, Asia and the Middle East.

Barrick would retain substantial economic exposure because only a minority interest is expected to be offered. The eventual valuation, proceeds and ownership structure will depend on market conditions, regulatory approvals and the size of the IPO.

Fourmile is particularly important to the long-term value proposition. Barrick describes it as having the potential to become a standalone Tier One gold asset, which under the company’s definition means potential annual production of at least 500,000 ounces over a minimum 10-year life with costs expected in the lower half of the industry curve. That designation remains a development objective rather than an operating result.

Barrick awarded the Bullion Hill decline contract during the quarter and expects underground decline development to begin during the third quarter. Twenty drill rigs are operating at Fourmile as the company works toward a prefeasibility study targeted for 2028.

Barrick’s $1.2 billion buyback highlights the trade-off between shareholder returns and growth spending

Barrick generated $1.70 billion of operating cash flow during the second quarter, 28% more than a year earlier. On an attributable basis, operating cash flow increased 20% to $1.12 billion. Attributable free cash flow, however, declined 33% to only $141 million.

The divergence reflects a substantial increase in capital investment. Total attributable capital expenditure reached $978 million, up 36% year over year, while project capital expenditure increased 49%. Consolidated capital expenditure was $1.19 billion.

Barrick is simultaneously funding several large growth projects. The Lumwana Super Pit expansion in Zambia remains scheduled for first copper production by the end of the first quarter of 2028. Construction has progressed on the mill, primary crusher and conveyor infrastructure, with most major long-lead equipment already delivered to site.

At Pueblo Viejo in the Dominican Republic, the company continues work on the Naranjo tailings-storage development, water-management infrastructure and processing improvements. More than 570 families have been resettled as part of the expansion program.

Barrick nevertheless reduced its 2026 attributable capital expenditure forecast to between $3.8 billion and $4.2 billion from $4 billion to $4.45 billion. The reduction primarily reflects lower expected spending at the Reko Diq copper-gold project.

Against that investment program, Barrick spent $1.209 billion repurchasing its own shares during the second quarter under a $3 billion authorization. Combined with dividends, shareholder returns reached approximately $1.50 billion, an increase of 242% from the prior-year quarter.

The buyback therefore substantially exceeded the $141 million of attributable free cash flow generated during the quarter. That does not mean the distribution was financed solely through borrowing. Barrick entered the quarter with a strong balance sheet and ended June with $5.93 billion of cash against $4.68 billion of debt, leaving approximately $1.25 billion of net cash.

The balance sheet gives management flexibility to return capital during periods when quarterly free cash flow is temporarily reduced by project spending. The strategy becomes less sustainable if capital expenditures remain elevated while commodity prices or operating cash flow weaken.

Barrick’s dividend framework targets annualized distributions equal to approximately 50% of attributable free cash flow through a fixed quarterly dividend and a potential year-end performance top-up. Buybacks are separate and remain discretionary.

The $1.95 billion payment expected from Newmont provides another source of liquidity and could materially strengthen Barrick’s financial position once received. How management allocates that cash between development projects, additional repurchases and balance-sheet reserves will be an important indicator of capital discipline.

Barrick enters the second half with higher metal prices, improving sequential production and a clearer path toward its North American restructuring. The earnings performance is strong, but the more important long-term test is whether Fourmile, Lumwana and other projects convert today’s elevated capital expenditure into larger, lower-cost production without requiring the company to sacrifice its balance-sheet strength.

Key takeaways from Barrick’s second-quarter results and Newmont agreement

• Barrick Mining Corporation generated $5.29 billion of second-quarter revenue, representing 44% growth from the prior-year period.
• Net earnings increased 50% to $1.22 billion, while adjusted earnings per share rose 74% to $0.82 as stronger gold and copper prices supported margins.
• Gold production reached 796,000 attributable ounces, essentially unchanged year over year but 11% above the first quarter and ahead of quarterly guidance.
• Barrick realized $4,417 per ounce of gold, up 34%, while realized copper pricing increased 41% to $6.15 per pound.
• Gold all-in sustaining costs increased 11% to $1,866 per ounce, showing that higher royalties, fuel expenses and lower grades absorbed part of the commodity-price benefit.
• Barrick and Newmont agreed to contribute Fourmile, Mike and Fiberline to Nevada Gold Mines, with Newmont paying Barrick $1.95 billion and consenting to the planned North American IPO.
• Barrick expects the North American gold company to be listed by the end of 2026, subject to market conditions and regulatory approvals.
• Attributable free cash flow declined 33% to $141 million as project investment increased, despite operating cash flow rising 28% to $1.70 billion.
• Barrick repurchased $1.21 billion of shares and declared a $0.175 quarterly dividend, taking quarterly shareholder returns to approximately $1.50 billion.
• The outlook for $B depends on maintaining production and cost guidance while converting Fourmile, Lumwana and other capital-intensive growth projects into durable future cash flow.