Freeport-McMoRan Inc. FCX used its second-quarter 2026 earnings call to emphasize steady progress at Grasberg, improving U.S. operating performance and a widening pipeline of brownfield copper projects.

The quarter also showed how favorable metals pricing and better-than-expected execution can offset lower year-over-year production while the company rebuilds Indonesian output.

FCX Keeps Grasberg Ramp on Schedule

President and chief executive officer Kathleen Quirk said the Grasberg Block Cave ramp remained aligned with the company’s April plan. Production rates doubled during the quarter, rising from an April average of 34,000 metric tons per day to 69,000 in June.

Quirk said overall Grasberg district rates should approximate 65% of full capacity in the second half of 2026, reach 80% by mid-2027 and approach full capacity by year-end 2027.

Mark Johnson, president and chief operating officer of Freeport-McMoRan Indonesia, added that material-handling upgrades and drainage work are progressing, while preparations continue for a 2027 restart of Production Block 1 South.

Freeport Builds a Larger U.S. Copper Base

Quirk said Morenci’s second-quarter mining rate was 30% above its five-year average, supported by better equipment reliability, maintenance execution and workforce stability.

Senior vice president Cory Stevens said higher-capacity haul trucks, centralized operating support and additional technology should help sustain those gains. Management expects stronger mining rates to translate into higher copper production over time.

The leach program remains another central growth lever. Freeport is targeting a 300-million-pound annual run rate by year-end 2026 and continues to frame 800 million pounds annually as the longer-term opportunity.

FCX Weighs Higher Bagdad Capital Costs

Quirk said preliminary capital for the Bagdad expansion is now around $4.5 billion, roughly 30% above the 2023 estimate, reflecting labor and commodity inflation, scope changes and added engineering.

Despite the increase, management said the project remains supported at an incentive copper price of about $4 per pound. The expansion would add 200 million to 250 million pounds of annual copper production and could be completed in three to four years.

During the Q&A, a BofA Securities analyst pressed management on the economics. Quirk said automation, operating-model changes and throughput optimization are helping offset the higher capital requirement, with a board decision still targeted for the second half of 2026.

Freeport Maintains Volume and Cost Outlook

Executive vice president and chief financial officer Maree Robertson said 2026 sales expectations remain broadly consistent with April estimates. Second-half copper sales are projected to exceed first-half levels by more than 20%, while gold sales are expected to rise more than 65%.

The company expects 2026 unit net cash costs of about $1.9 per pound, slightly better than the prior $1.95 estimate, as stronger by-product credits offset higher energy and input costs.

FCX reported adjusted earnings of $0.74 per share versus the Zacks Consensus Estimate of $0.62. Revenues of $7.03 billion also exceeded the $6.47 billion consensus.    

Freeport-McMoRan Inc. Price, Consensus and EPS Surprise

Freeport-McMoRan Inc. price-consensus-eps-surprise-chart | Freeport-McMoRan Inc. Quote

FCX Q&A Sharpens Key Execution Risks

A Goldman Sachs analyst asked whether Grasberg’s strong June exit rate created upside to second-half guidance. Quirk said planned maintenance and chute-gallery upgrades should keep output near the existing range rather than produce a near-term step-up.

A Barclays analyst questioned the shift of copper sales from the third quarter into the fourth. Quirk said production plans were largely unchanged, but inventory-building and refined-copper timing at the new Indonesian smelter altered the sales schedule.

A UBS analyst also challenged the prior goal of reducing U.S. costs to $2.5 per pound in 2027. Quirk said the target remains valid, but current energy, sulfur and acid markets make it unattainable in 2027.

Freeport’s Near-Term Focus

Management’s tone remained confident on execution but disciplined on timing. Grasberg restoration, leach scaling and U.S. operating improvements are the immediate priorities.

At the same time, Freeport is advancing Bagdad, El Abra and Safford/Lone Star without committing to overlapping large-project schedules before studies, permits and capital reviews are complete.

Zacks Signals Point to a Mixed Setup

FCX currently carries a Zacks Rank #3 (Hold). Its Growth Score of B, Momentum Score of A and VGM Score of A indicate favorable growth and trading characteristics, while the Value Score of C is more neutral.

The Style Scores are most powerful when paired with a Zacks Rank #1 (Strong Buy) or Zacks Rank 2 (Buy). The current Hold rating supports a balanced stance, and it can change as analysts revise estimates following the reported results.

You can see the complete list of today’s Zacks #1 Rank stocks here.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

Freeport-McMoRan Inc. (FCX) : Free Stock Analysis Report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research