FCX's Unit Net Cash Costs Fall in Q2: Can It Sustain the Momentum?

Core Insights - Freeport-McMoRan Inc. (FCX) achieved a significant reduction in its average unit net cash cost per pound of copper to $1.13 in Q2 2025, down from $1.73 a year earlier, driven by operational efficiencies, higher gold credits, and increased copper sales volumes [1][6] - The company anticipates an increase in unit net cash costs to $1.59 per pound in Q3 2025, influenced by lower expected sales volumes and potential tariff impacts, which could raise costs by approximately 5% [2][6] Financial Performance - FCX's profit margins improved in Q2 2025 due to lower costs, with a notable increase in copper sales volumes contributing to this performance [1][6] - The Zacks Consensus Estimate projects FCX's earnings to rise by 18.2% in 2025 and 33% in 2026, with EPS estimates trending higher over the past 60 days [7] Industry Comparison - Southern Copper Corporation (SCCO) reported a decrease in its operating cash cost per pound of copper to $0.63, a 17% decline from the previous year [3] - BHP Group Limited (BHP) also experienced lower unit costs across its copper operations, with expected unit costs for Escondida ranging from $1.20 to $1.50 per pound for fiscal 2026 [4] Stock Performance - FCX shares have increased by 9.6% year to date, outperforming the Zacks Mining - Non Ferrous industry's rise of 3.2% [5] - The company is currently trading at a forward 12-month earnings multiple of 19.76, slightly above the industry average of 19.49 [8]