Southern Copper Reports 71.6% Profit Surge as Metal Prices Offset Rising Operating Costs
The $152 billion mining giant saw Q2 net income jump to $1.67 billion despite operating expenses climbing 13.8%, buoyed by dramatic gains in copper, silver, and molybdenum prices.
Strong Earnings Despite Cost Pressures
Southern Copper Corporation reported net income attributable to the company of $1,670.0 million for the second quarter of 2026, representing a 71.6% increase compared to the same period in 2025, according to its 10-Q filing submitted July 31, 2026. The earnings surge came despite operating costs and expenses rising 13.8% during the quarter, as metal price gains significantly outpaced cost increases.
Net sales for the quarter totaled $4,289.0 million, up 40.6% year-over-year, "primarily driven by higher prices for copper (LME, +39.8%; COMEX, +30.5%), molybdenum (+43.1%), silver (+118.6%), and zinc (+30.8%)," the filing stated. These price increases occurred "despite a decrease in sales volumes of copper (-1.5%), molybdenum (-13.1%), silver (-8.7%) and zinc (-8.8%)."
Metal Price Performance Drives Revenue
Copper, which represented 72.7% of the company's revenue in Q2 2026, saw London Metal Exchange prices surge from $4.32 to $6.04 per pound during the quarter, while COMEX prices rose from $4.72 to $6.16 per pound (10-Q filing, 2026-07-31).
By-products contributed significantly to the revenue picture. Silver prices averaged $73.49 per ounce in Q2 2026, compared to $33.62 in the same period of 2025, representing a 118.6% increase. Molybdenum, accounting for 11.1% of sales and described as "our most significant by-product during the period," saw prices average $29.44 per pound versus $20.57 the prior year, a 43.1% gain.
Production Declines Across Key Operations
Copper mine production in the second quarter stood at 508.5 million pounds, reflecting a 3.5% decrease compared to Q2 2025. The filing attributed this decline "mainly to lower production at Toquepala (-14.7%; which was due to a decrease in ore grades and mineral milled) and Cuajone (-7.8%; due to lower ore grades)." Higher production at Buenavista (+2.9%) and La Caridad (+3.9%) partially offset these declines.
Molybdenum production decreased 11.0% in the quarter, driven by lower production across all operations. Silver mine production fell 3.8%, while zinc production dropped 14.5%, primarily due to lower output at the Buenavista zinc concentrator (-18.6%).
For full-year 2026, the company expects copper production to reach 917,000 tonnes, which is 0.6% above the planned target of 911,400 tonnes. Molybdenum production is projected at 27,900 tonnes, representing a 7% increase compared to initial plans.
Capital Deployment Accelerates
Southern Copper spent $864.7 million on capital investments in the first six months of 2026, representing 26.6% of net income and a 56.2% increase compared to the same period in 2025 (10-Q filing, 2026-07-31).
The company's business model focuses on "value creation through copper production, cost control, production enhancement and maintaining a prudent capital structure to remain profitable," according to the filing. Management noted that "market forces outside of our control largely determine the sale prices for our products," explaining the emphasis on cost management.
MarginX data shows the company has a cash dividend of $1.10 per share scheduled for August 11, 2026, with Q3 2026 results expected October 26, 2026.
This article was generated by MarginX from the 10-Q filing on 2026-07-31. It is not investment advice.