#Record Net Income Reaches $1.67 Billion
Southern Copper Corporation (NYSE: SCCO) reported record net income of $1.67 billion for the second quarter of 2026, up 71.6% from $973.4 million a year earlier, as higher prices for copper and its main by-products drove quarterly sales to a new record.
Net sales reached $4.29 billion, a 40.6% increase over the second quarter of 2025. Southern Copper is based in Phoenix, Arizona, is 88.9% owned by Mexico's Grupo Mexico, and operates mines and metallurgical facilities in Mexico and Peru.
#Higher Metal Prices Drive Record Quarterly Sales
The average London Metal Exchange copper price rose 39.8% from a year earlier, while the COMEX copper price gained 30.5%. Copper is Southern Copper's main product and accounts for the largest share of its revenue.
By-product prices also climbed. The silver price rose 118.6% year over year, molybdenum increased 43.1% and zinc gained 30.8%, according to price data in the company's results.
The price gains were partially offset by a 1.5% decline in copper sales volumes and lower volumes for the company's main by-products. Net income margin widened to 38.9% from 31.9% a year earlier.
Adjusted EBITDA, a non-GAAP measure, reached a record $2.86 billion, up 59.5% from $1.79 billion, with the margin rising to 66.6% from 58.7%. Earnings per share rose to $2.01 from $1.17.
Cash flow from operating activities was $3.68 billion in the first half of 2026, up 116.9% from a year earlier.
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#Copper Output Falls on Lower Peruvian Ore Grades
Mined copper production fell 3.5% from the prior quarter to 230,662 tonnes. A 12.0% drop at the company's Peruvian mines outweighed a 3.2% increase at its Mexican operations.
For the first half of 2026, copper production declined 3.8% to 461,206 tonnes, which the company attributed to lower ore grades at its Peruvian operations.
Mined by-product output also declined against the second quarter of 2025. Silver production fell 3.8%, zinc dropped 14.5% and molybdenum decreased 11.0%.
Operating cash cost per pound of copper, net of by-product revenue credits, fell to $0.05 in the quarter from $0.63 a year earlier, a 93% reduction the company linked to higher by-product credits.
"We expect all equipment to be fully assembled next year, and initial production to begin in the second half of 2027," German Larrea, Chairman of the Board, said in the earnings release, referring to the Tía María project in Peru.
#Southern Copper Advances $1.25 Billion Tía María Financing
Southern Copper completed a $1.25 billion offering of 10-year senior unsecured notes due in 2036 on June 24. The notes carry a 5.35% interest rate. The proceeds are earmarked for the company's Peruvian branch to develop the Tía María copper project.
Tía María, in Arequipa, is designed to produce 120,000 tonnes of copper cathode a year using SX-EW technology. The company said the project had reached 42% completion as of June 30, with production expected to begin in the second half of 2027.
The board declared a quarterly cash dividend of $1.10 per share alongside a stock dividend, payable on August 27 to shareholders of record on August 11. The company estimated the combined value at $3.23 per share.
Capital investments totaled $422.8 million in the quarter, up 79.4% from a year earlier.
#Outlook and Risks
Larrea said Southern Copper remains committed to advancing its Peruvian projects Tía María, Los Chancas and Michiquillay, which the company said represent a combined investment of about $10.3 billion. He said the company was encouraged by initial statements from Peru's president-elect ahead of an executive power transition.
The outlook depends on metal prices, which the company notes can fluctuate significantly, as well as permitting timelines and execution across its Peruvian and Mexican pipeline. At Los Chancas, the company said the presence of illegal miners within the project area continues to hinder progress.