Earnings Recap — Q2 FY2026
CY Q3 2026 · Reported July 22, 2026 · Beat 6 of last 7 quarters
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Southern Copper's record results underscore the strength of copper demand, partly driven by AI infrastructure buildout, as evidenced by a 40% surge in LME copper prices. The company's expansion projects, particularly Tia Maria and El Pilar, will add meaningful copper supply in the late 2020s, supporting the long-term copper needs of data centers and power grids. Management's confidence in continued demand and their aggressive capital program signal a positive outlook for copper-intensive AI infrastructure.
Southern Copper delivered record Q2 results with sales of $4.3 billion, up 41% YoY, driven by a 40% surge in LME copper prices to $6.04/lb and strong by-product prices (silver +118%, molybdenum +43%). Copper production fell 3.5% YoY to 230,662 tons due to lower grades at Peruvian mines, but Mexican operations grew 3.2%. Adjusted EBITDA hit a record $2,856 million (67% margin), and net income rose 72% to $1,670 million. The company issued $1.25 billion in 10-year notes at 5.35% to fund Tia Maria, which reached 42% completion, and announced a quarterly dividend of $1.10 cash plus 0.012 stock dividend.
Management raised 2026 copper production guidance to 917,000 tons (from 910,000 tons initially), citing improved Mexican output and better-than-expected grades. Molybdenum guidance was raised to 27,900 tons (7% above plan). They expect a slight copper market deficit for 2026 and see inventories at ~15 days of demand. Tia Maria remains on track for start-up in second half 2027, with 42% completion and $1.1B committed; El Pilar will begin early site works in September 2026, with construction in Q1 2027 and production in H2 2029. Management expressed optimism about Peru's incoming administration under President-elect Keiko Fujimori, expecting a more stable political environment and potential support for mining projects, including Los Chancas. They reiterated a long-term goal of 1.6 million tons of copper by 2033-2034.
“Southern Copper delivered another exceptional quarter, registering record-breaking results in sales, adjusted EBITDA and net income.”
on Quarterly performance
“For now, we don't expect a delay in the project. That's what we're reporting. But if there is a perception that the project will delay a little bit, we will certainly report that to the market.”
on Tia Maria timeline
“As you know, our goal is to be over 1.6 million tons of copper by 2033, 2034. And that's what we are heading towards with organic growth in projects pretty much fully owned by the company.”
on Long-term production target
Can you talk about how grades have progressed at Toquepala and Cuajone, and what that means for second half production and full-year expectations?
We raised our 2026 copper production guidance to 917,000 tons. Lower grades at Cuajone reduced output by about 35,000 tons, partially offset by Mexican improvements. We expect better volumes in H2 as in-process material is converted to sales.
On Tia Maria, has the desalination plant equipment been ordered, and is there risk of delay? Also, is El Pilar fully permitted including water license?
For El Pilar, the water license has been renewed, so we're ready to start early works in September. For Tia Maria, we are placing purchase orders for major equipment including the desal plant, and we do not expect a delay currently.
What are your views on the political environment in Peru with the new government, and what are the main risks for Tia Maria and Los Chancas? Also, what is your production outlook for 2027?
We are encouraged by the incoming administration's focus on fighting illegal mining and improving security. Tia Maria's social environment is positive; risks are typical construction risks. For 2027, copper production should be similar to 2026, with Tia Maria contributing later in the year, and we expect over 1 million tons by 2029.