Newmont Corporation (ASX:NEM) delivered record third-quarter adjusted net income of US$2.3 billion and US$1.9 billion in free cash flow, despite lower gold output and higher unit costs. The gold major also moved Red Chris closer to a potential US$4.2 billion to US$4.8 billion development decision in early 2027.
- Record Q3 adjusted net income of US$2.3 billion
- US$1.9 billion quarterly free cash flow and US$8.8 billion cash balance
- 2026 gold production guidance maintained at 5.26 million ounces
- Gold by-product AISC guidance improved to US$1,520 per ounce
- Red Chris investment decision expected in early 2027
- US$1.95 billion payment to Barrick remains due in Q4
Newmont Corporation (NYSE:NEM, ASX:NEM, PNGX:NEM) has managed the unusual mining trick of producing fewer gold ounces while making substantially more money. Third-quarter net income attributable to shareholders rose to US$2.5 billion from US$1.8 billion a year earlier, while adjusted net income reached a record US$2.3 billion, or US$2.20 a diluted share. The result was powered by much stronger metal prices, with the average realised gold price reaching US$4,317 an ounce and silver US$50.50 an ounce.
Higher Metal Prices Offset Lower Gold Output
Attributable gold production was 1.3 million ounces, broadly stable against the previous quarter but down from 1.4 million ounces in the third quarter of 2025. Consolidated gold production fell to 1.216 million ounces from 1.317 million, while gold sales declined to 1.211 million ounces. Cadia’s recovery from its seismic disruption helped the quarter, but lower grades, mine sequencing and throughput issues weighed on several operations, including Peñasquito, Red Chris and Yanacocha.
The pricing environment did the heavy lifting. Quarterly sales increased 15% to US$6.4 billion, including a 12% increase in gold revenue and an 88% increase in silver revenue. Adjusted EBITDA rose 19% year on year to US$4.0 billion, while nine-month operating cash flow reached US$9.5 billion, up 41%. The comparison is not entirely clean because Ahafo North became a commercial operation late last year and Newmont completed its non-core asset divestment program in 2025.
Cost Guidance Improves Despite a More Expensive Quarter
Newmont’s gold by-product costs applicable to sales were US$832 an ounce and all-in sustaining costs were US$1,454 an ounce in the quarter. The company improved its full-year 2026 guidance to US$925 for costs applicable to sales and US$1,520 for AISC, while leaving production guidance at 5.26 million attributable gold ounces and capital guidance unchanged.
That improvement sits alongside a less comfortable operational detail: quarterly gold by-product AISC was higher than the year-earlier US$1,303 an ounce, while the company expects fourth-quarter unit costs to rise as sustaining capital spending peaks and Peñasquito’s silver output falls to roughly half its third-quarter level. Newmont also flagged El Niño-related water risks at Lihir and said every US$10 move in the Brent oil price could affect costs by approximately US$50 million through indirect inputs.
Cash Returns Continue Before Major Payments
Newmont generated US$1.9 billion of free cash flow in the quarter and returned US$1.9 billion to shareholders through buybacks and dividends since its previous earnings call. It repurchased US$1.6 billion of shares during that period, leaving US$2.8 billion under its current US$6 billion authorisation. More than 115 million shares have been repurchased since February 2024, reducing the share count by approximately 10%.
The balance sheet ended September with US$8.8 billion of cash, US$12.8 billion of total liquidity and a net cash position of US$3.2 billion. That headline strength will be tested in the fourth quarter by the planned US$1.95 billion cash payment to Barrick under the amended Nevada Gold Mines agreement, which was the subject of the Nevada Gold Mines agreement earlier this year. The board also declared a quarterly dividend of US$0.26 per share, payable in December.
Red Chris Moves Towards a US$4.8 Billion Decision
The most consequential development beyond the quarter’s earnings is Red Chris. Newmont said the feasibility study for the British Columbia gold-copper project is nearing completion, with a full-funds investment decision expected in early 2027, subject to board and joint venture approval. The proposed first phase is estimated to require US$4.2 billion to US$4.8 billion in real terms on a 100% basis, net of an anticipated C$500 million contribution from the Canadian government.
The initial project is expected to produce 3.0 million ounces of gold and more than 850,000 tonnes of copper over a 13-year cave life, with commercial production targeted for 2033. Those figures remain feasibility-stage expectations rather than approved production commitments. The government contribution terms have not been finalised, and Newmont has not yet made the investment decision.
Near-Term Growth Comes With Execution Risk
Newmont expects attributable gold production to grow by a low-to-mid single-digit percentage in 2027, helped by higher-grade ore at Lihir and Boddington and the expected start-up of Tanami Expansion 2. Tanami’s shaft construction is complete and commercial production is now expected in the first half of 2027, slightly ahead of schedule.
The tension in the numbers is clear. High metal prices are producing exceptional cash flows, but lower grades, inflation, royalties, weather, geotechnical events and project spending are all pushing in the opposite direction. The next material tests are the Barrick payment, the final Red Chris feasibility study and whether Tanami can add ounces without allowing the rising cost base to reclaim the advantage.
Bottom Line?
Newmont’s cash generation is carrying both shareholder returns and a heavier growth pipeline, but the early-2027 Red Chris decision will put that capital discipline to a more demanding test.
Questions in the middle?
- Will the US$1.95 billion Barrick payment materially change the pace of buybacks or development spending?
- Can Tanami Expansion 2 deliver its earlier first-half 2027 production target without further cost escalation?
- Will the final Red Chris feasibility study preserve the current capital range and the anticipated Canadian government contribution?