Newmont Corporation (NYSE: NEM), the world’s largest gold producer, delivered a blockbuster second quarter, handily beating analysts’ estimates and further boosting its appeal as a value play even as the stock rallies.
Strong Financials and Gold Tailwinds
Newmont reported adjusted earnings per share of $1.43 for the quarter ended June 30, surpassing the consensus estimate of $1.18 by nearly 21% Exchange Rates. Revenue surged 20.8% to $5.32 billion, up from roughly $4.40 billion year-over-year the deep dive. The average realized gold price rose to approximately $3,320.58 per ounce, nearly 41.5% higher than $2,347 a year ago.
Cash generation was exceptional: operating cash flow hit $2.38 billion, and free cash flow reached a record $1.71 billion, nearly triple the $594 million a year before the deep dive. Net cash climbed to $6.19 billion, while gross debt was cut to $7.13 billion, an 18% reduction year-over-year, the deep dive.
Macro analyst Tavi Costa of Crescat Capital highlighted Newmont's earnings strength as part of a broader trend in undervalued precious metals equities. Costa noted in a recent post on X, pointing to improving margins and balance sheets across the sector.
Gold production declined 8% to 1.48 million ounces, reflecting divestitures following Newmont’s $17 billion takeover of Newcrest and lower output at Lihir and Cadia. All-in sustaining costs (AISC) edged down 2% to $1,593/oz, despite modest cost increases planned for H2 as capital-intensive projects ramp up.
Newmont launched a $3 billion share buyback program, using a portion of its record cash flow to return capital to shareholders.
J.P. Morgan analyst Al Harvey noted that the buyback program “would lend support to Newmont's earnings per share,” highlighting investor confidence in capital returns.
Shares rose nearly 7%, hitting a three-year high, on strong investor sentiment around the results and gold market strength. Despite the rally, Newmont still trades at just about 13× trailing earnings, maintaining its reputation as an undervalued gold miner.
Global spot gold traded around $3,360.68/oz by July 25, slightly down from intraday highs amid trade optimism, though a softer U.S. dollar helped limit losses.
Silver markets are also red hot: spot silver recently climbed to $39.40/oz, its highest level since September 2011, up roughly 36% YTD, outpacing gold's roughly 31% gain. Strong industrial demand in photovoltaics, AI, and defense continues to drive a structural deficit in silver supply.
Newmont’s Q2 performance highlights its ability to capitalize on a robust gold price environment while maintaining disciplined cost control, improving its balance sheet, and deploying capital in a shareholder-friendly manner. With rare metals markets trending upward, including silver nearing multi‑decade highs, Newmont's operational strength and valuation leverage may appeal to value-oriented investors even as the stock price climbs.