Financial Data and Key Metrics Changes - Freeport-McMoRan reported quarterly EBITDA of $3.2 billion and operating cash flows of $2.2 billion, with net unit cash production costs at $1.13 per pound, significantly improved from previous guidance and last year's second quarter [10][11][12] - The average copper realization price was over $4.5 per pound, approximately $0.20 per pound above international benchmark pricing [11] - The company expects copper sales in the second half of the year to be nearly 10% higher than the first half volumes [11][46] Business Line Data and Key Metrics Changes - Sales of copper and gold exceeded forecasts, with a net credit for operating costs at Grasberg of $0.99 per pound [10][37] - The startup of the new copper smelter in Indonesia was a significant milestone, with production of first cathodes expected by the end of the month [12][29] - The leach initiative is projected to achieve a run rate of £300 million by the end of the year, targeting £800 million per annum [15][34] Market Data and Key Metrics Changes - Copper prices averaged $4.32 on the London Metals Exchange and $4.72 on the U.S. COMEX exchange during the quarter [18] - The U.S. copper premium has tripled from second quarter levels, providing an approximate $1.7 billion annual financial benefit on U.S. sales [24][25] - Global copper demand continues to benefit from trends in electrification, AI technology, and decarbonization, with China and India being major growth markets [20][21] Company Strategy and Development Direction - Freeport-McMoRan is committed to its long-term strategy focused on copper production, with significant organic growth opportunities in the U.S. and a strong position in Indonesia and South America [6][9] - The company is advancing three major project opportunities in the Americas and is focused on innovation and technology to enhance productivity and cost performance [17][43] - The company aims to boost domestic copper supplies and is actively working on legislative recognition of copper as a critical mineral [27][35] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued strong financial performance, driven by high copper demand and successful operational initiatives [11][12] - The impact of tariffs on costs is being closely monitored, with an estimated potential 5% impact on operating costs [71] - The company is optimistic about the future, with expectations for increased production and lower costs in the coming years [32][46] Other Important Information - The company repurchased 1.5 million shares during the second quarter, with a total of 2.9 million shares repurchased in the first half of the year [14] - Freeport-McMoRan has a solid balance sheet with investment-grade ratings and no significant debt maturities until 2027 [53] Q&A Session Summary Question: Changes in mine plan and modeling updates - Management updates quarterly forecasts and has recalibrated the Grasberg ore grade model due to observed differentials in recovery rates [60][61] Question: Impact of tariffs on cost outlook - Tariffs are being monitored closely, with a potential 5% impact on costs, but the company is focused on driving efficiencies and cost reductions [71][73] Question: Discussions with the U.S. administration regarding financing or incentives - The company has engaged with U.S. government representatives to discuss its role as a major copper producer and potential incentives for domestic production [80][81] Question: Potential tariff exemptions for refined copper - No known exemptions for refined copper are currently anticipated, and the company is awaiting further details on tariff implementation [84] Question: Internal cost to operate the new smelter in Indonesia - The operating cost of the new smelter is estimated at approximately $0.27 per pound, with additional revenues expected from processing [88] Question: Thoughts on building a smelter in the U.S. - The company is studying the potential for expanding the Miami smelter but emphasizes the near-term opportunity lies in the leach initiative [95][98]