Barrick Misses Q2 Profit Estimate as Costs Rise and Newmont Deal Clears IPO Path

Barrick Mining reported second-quarter adjusted earnings below Wall Street expectations even as higher gold prices drove sharp year-over-year growth in revenue and profit. Rising fuel, royalty and operating costs absorbed part of the benefit from stronger bullion prices, while a separate $1.95 billion agreement with Newmont cleared an important obstacle to Barrick’s planned North American gold IPO.

Adjusted earnings were 82 cents a share for the three months ended June 30, below the 88 cents expected by analysts surveyed by LSEG. Net earnings attributable to shareholders rose 50% from a year earlier to $1.22 billion, adjusted net earnings increased 70% to $1.36 billion, and revenue climbed 44% to $5.29 billion.

Barrick’s U.S. listed shares fell nearly 6% in premarket trading after the results and the Newmont announcement. The decline came despite a quarter in which Barrick exceeded its own gold-production guidance and kept its full-year production and cost outlook unchanged.

Gold production reached 796,000 ounces, up 11% from the first quarter and nearly unchanged from the 797,000 ounces produced a year earlier. Barrick had guided to second-quarter production of 730,000 to 770,000 ounces, so output finished above the top of the expected range. The sequential improvement reflected a faster restart at Loulo-Gounkoto, a quicker recovery at Pueblo Viejo after planned maintenance and record underground tonnes at Cortez as Goldrush continued to ramp up.

The stronger production did not prevent unit costs from climbing. Gold cost of sales rose 20% year over year to $1,993 an ounce, total cash costs increased 15% to $1,426 an ounce, and all-in sustaining costs rose 11% to $1,866 an ounce. Barrick attributed the increase to lower grades at Carlin, Cortez and North Mara, higher fuel expenses across its operations and royalties that increased alongside the gold price.

Barrick’s realized gold price averaged $4,417 an ounce, 34% above the $3,295 realized in the second quarter of 2025. That increase was large enough to produce substantial year-over-year earnings growth despite cost inflation, but it was not enough to prevent adjusted profit from missing analysts’ expectations.

The comparison with the first quarter was less favorable. Barrick had earned adjusted profit of 98 cents a share in the first three months of the year, when its realized gold price averaged $4,823 an ounce. Second-quarter adjusted earnings fell to 82 cents as the realized price declined 8% sequentially and all-in sustaining costs increased 9%.

Cash generation also weakened from the previous quarter. Operating cash flow was $1.70 billion, up 28% from a year earlier but down from $2.55 billion in the first quarter. Attributable free cash flow fell to $141 million from $1.21 billion in the first quarter and $212 million a year earlier as Barrick increased spending on development projects including Fourmile and the Lumwana expansion.

Costs are rising, but Barrick has kept its 2026 operating outlook intact

Barrick has not indicated that the higher cost base is forcing a change to its operating plan. The company maintained full-year gold production guidance of 2.90 million to 3.25 million ounces and left its cost forecast unchanged, including expected all-in sustaining costs of $1,760 to $1,950 an ounce. The second quarter’s $1,866 figure was therefore still inside the company’s full-year range, even though it was substantially above the level reported a year earlier.

Energy prices remain one of the variables that could affect the second half. Barrick’s cost assumptions are based on West Texas Intermediate crude at $70 a barrel, and the company estimates that every $10-a-barrel change in oil alters direct diesel-related costs across its gold operations by about $12 an ounce. If oil remains materially above the level built into Barrick’s budget, fuel could continue to pressure unit costs.

At the same time, Barrick lowered expected attributable capital expenditure for 2026 to $3.8 billion to $4.2 billion from a previous range of $4.0 billion to $4.45 billion, primarily because of lower planned spending at the Reko Diq copper and gold project. The copper business showed a similar mix of favorable pricing and higher costs: production was 56,000 tonnes, down 5% from a year earlier, while the realized copper price rose 41% to $6.15 a pound and copper all-in sustaining costs increased 36% to $3.95 a pound.

Taken together, the quarterly results show a company benefiting strongly from higher metals prices while absorbing more expensive mining conditions and continuing to fund major development projects. The earnings miss was relatively small in isolation, but the quarter also came with a more consequential strategic development: Barrick and Newmont resolved their disputes over Nevada Gold Mines and established a path for Barrick to proceed with the proposed listing of its North American gold business.

The Newmont settlement clears the way for the North American IPO

Under the newly announced terms, Newmont will pay Barrick $1.95 billion in cash within 30 days. Barrick will contribute its Fourmile project to Nevada Gold Mines earlier than previously contemplated, while Newmont will contribute the Mike and Fiberline projects. Barrick said the additions would help create a Nevada gold complex containing nearly 100 million ounces of gold.

Fourmile, Mike and Fiberline had been left outside Nevada Gold Mines when Barrick and Newmont created the joint venture in 2019. At the time, the companies combined most of their Nevada operations but excluded those projects while their commercial potential was still being evaluated.

Nevada Gold Mines is 61.5% owned and operated by Barrick, with Newmont holding the remaining 38.5%. The joint venture combines mines and processing facilities across northern Nevada, including the Carlin, Cortez and Turquoise Ridge districts, and Barrick describes it as the world’s largest integrated gold-producing complex.

The ownership and governance relationship had become increasingly important after Barrick announced plans to create a separately traded North American gold company. In February, Newmont said any transaction involving the joint ventures would have to respect transfer restrictions and other protections in the existing agreements. It also criticized Nevada Gold Mines’ operating performance, saying the venture had experienced deterioration in performance and asset value over the previous six years.

Barrick maintained that it could proceed with the IPO while complying with its contractual obligations, but the companies continued negotiating over Nevada Gold Mines, the proposed listing and the timing of Fourmile’s eventual contribution. The new settlement removes that dispute from the immediate IPO process: Newmont has explicitly consented to the listing, both sides have agreed on the treatment of the three previously excluded Nevada projects, and Barrick says all outstanding Nevada Gold Mines disputes have been resolved.

Barrick still expects to complete the IPO by the end of 2026, subject to market conditions, regulatory approvals and other customary requirements. The planned company is expected to include Barrick’s interest in and operatorship of Nevada Gold Mines, its stake in Pueblo Viejo in the Dominican Republic, Fourmile, other North American exploration properties and the projects contributed by Newmont.

Fourmile is central to the growth case behind the proposed company. The deposit sits next to Nevada Gold Mines and had been wholly owned by Barrick before the latest settlement. Barrick has described it as potentially capable of becoming a standalone Tier One gold asset and one of the most important gold discoveries of this century, although parts of its longer-term potential remain conceptual and depend on further drilling and economic studies.

Development accelerated during the second quarter. Barrick awarded the Bullion Hill decline contract to Barminco, secured key infrastructure contracts and expects underground decline development to begin during the third quarter. Twenty drilling rigs were operating at the site as the company works toward a prefeasibility study targeted for 2028.

Barrick’s earlier plan had already contemplated contributing Fourmile to Nevada Gold Mines at fair market value once certain criteria were met. The settlement accelerates that process and resolves how Newmont will be compensated within the joint-venture structure. Newmont’s contribution of Mike and Fiberline also puts two projects excluded from the original 2019 venture into the same operating framework.

Barrick said in April that the North American company would contain four Tier One assets: Carlin, Cortez and Turquoise Ridge within Nevada Gold Mines, plus Pueblo Viejo. Those assets produced about 2 million attributable ounces of gold in 2025. Barrick intends to sell only a minority stake to public investors and retain a significant controlling interest.

The company has been planning a primary listing in New York with a secondary listing in Toronto. Mark Hill, currently Barrick’s president and chief executive, is expected to become chief executive of the North American company when the separation takes place. The structure is therefore not an outright sale of Barrick’s North American operations, but an attempt to create a separately valued public company while preserving most of the economic exposure for Barrick shareholders.

That strategy addresses a longstanding valuation issue for diversified miners. Barrick’s portfolio combines mature North American gold mines, large development projects, copper assets and operations across regions with very different political and operating risks. A separately traded North American company would give investors a way to value a more geographically concentrated gold business independently from the rest of Barrick. Whether that produces a higher valuation will depend on the IPO terms, the percentage sold, operating performance and the price at which the shares are offered, none of which has been finalized publicly.

Buybacks and the Newmont payment add another capital-allocation dimension

Barrick also continued returning capital to shareholders while development spending rose. The company spent $1.21 billion repurchasing its own shares during the second quarter under the $3 billion buyback authorization announced in May. Together with its quarterly dividend, Barrick said shareholder returns reached about $1.50 billion during the period, up 242% from a year earlier.

Barrick declared another quarterly dividend of 17.5 cents a share, payable September 15 to shareholders of record on August 31. Its dividend framework targets an annualized payout equal to 50% of attributable free cash flow through a combination of a fixed base dividend and a potential year-end performance component.

The balance sheet gives management room to juggle shareholder returns, development spending and the proposed reorganization. Barrick ended June with $5.93 billion in cash and equivalents against $4.68 billion of debt, leaving the company in a net cash position. The $1.95 billion payment from Newmont would add another substantial source of liquidity once received, although Barrick did not commit in its second-quarter release to a specific use for those proceeds.

Investors are therefore weighing two distinct elements from the quarter. Higher gold prices are producing much stronger revenue and earnings than a year ago, but rising mining costs and lower grades are limiting some of the benefit. At the same time, the settlement with Newmont removes a dispute that had complicated Barrick’s effort to separate and independently value its North American assets.

The next major milestone is the IPO itself rather than whether Newmont will consent to it. Barrick is still targeting completion by the end of 2026, and the remaining questions center on the listing terms, valuation, regulatory process and the size of the minority stake ultimately sold to public investors.

Sources

Barrick Mining, Q2 2026 Results Presentation: production, costs, earnings, guidance, Newmont agreement, IPO structure and buybacks.