This ranking evaluates how Fortune 500 companies are deploying AI, and how technology leaders value those investments relative to industry peers.

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With a combined revenue of $21 trillion and $2.1 trillion in profits, the 2026 Fortune 500 is the definitive list of America's largest companies.

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Almost $20 trillion in revenue—and a record-breaking $1.87 trillion in profits. Introducing the 2025 Fortune 500, the definitive list of the biggest companies in America.

Industries included in the sector are mining, oil and gas exploration and services, pipelines, refining, and utilities.

Fortune Sector Leaders: Energy

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Fortune collaborated with the Diligent Institute to rank the most innovative boards of directors among S&P 500.

Modern Board 2023-Freeport-McMoRan

The Phoenix-based mining company supplies about 9% of the world’s mined copper and is led by CEO and board chair Richard Adkerson. FCX has <a href="https://www.fcx.com/about/board-of-directors">12 members</a> on its board, including David Abney, former CEO of UPS; Lydia Kennard, CEO of KDG Construction Consulting; and John Stephens, former AT&amp;T CFO. In February, the company appointed its president, Kathleen Quirk, to the board. FCX has grappled with an ongoing <a href="https://www.reuters.com/markets/commodities/copper-miner-freeport-mcmoran-beats-profit-estimates-2023-04-21/">labor shortage</a> in the copper mining industry in recent months. Its metals are critical to support decarbonization efforts and the green energy transition. In its 2022<a href="https://www.fcx.com/sustainability"> sustainability report</a>—its 22nd to date—the company outlined its ESG performance, covering human rights, responsible supply-chain practices, and ethics, among other matters. There are five women members on its 12-person board.

Fortune Modern Board 25

The Fortune 500, in its 69th year in 2023, ranks the biggest U.S. companies by revenue.

Industrials came out on top this year, with 22 companies featured on the list.

100 Fastest-Growing Companies

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F500-2021-215-Freeport-McMoRan

The mining company is based out of the Freeport-McMoRan Center in Phoenix and mines for minerals including gold and copper.

This year's Fortune 500 marks the 66th running of the list.

F500-2020-221-Freeport-McMoRan

The Phoenix-based mining company extracts copper, gold, and molybdenum from sites in North and South America and Indonesia. It closed one of its New Mexico mines in April when workers contracted the coronavirus; the company has since announced furloughs and cuts to executive compensation.

This year's Fortune 500 marks the 65th running of the list.

This year's Fortune 500 marks the 64th running of the list.

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Wal-Mart stayed on top as its sales crept closer to half-a-trillion dollars. Apple moved into the top five. And UnitedHealth Group continued its steady climb. 

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Phoenix-based Freeport-McMoRan was founded more than 100 years ago in Freeport, Texas, as a sulfur-mining company. The company merged in 1981 with McMoRan Oil and Gas as a fossil fuel and mining conglomerate under the Freeport-McMoRan name. In more recent years, the company has focused its business on metals mining, specifically with a goal of becoming the world leader in copper, which is growing in demand because of its use in renewable energy, electric vehicles, data centers, and more. With a global mining footprint throughout the Americas—from Arizona to Chile—and in Indonesia, Freeport also mines heavily in gold and molybdenum, which is used in steel and other alloys.

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Freeport-McMoRan (FCX): Company Profile, Stock Price, News, Rankings

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Freeport-McMoRan

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I would now like to turn the conference over to Mr.

David Joint, Vice President, Investor Relations. Please go ahead, sir.

Thank you, Regina, and good morning, everyone. Welcome to the Freeport McMoran conference call. Earlier this morning, FCX reported first quarter twenty twenty five operating and financial results. A copy of today's release with supplemental schedules and slides are available on our website, fcx.com. Today's conference call is being broadcast live on the Internet.

Anyone may listen to the conference call by accessing our website homepage and clicking on the webcast link. In addition to analysts and investors, the financial press has been invited to listen to today's call. A replay of the webcast will be available on our website later today. Before we begin our comments, we'd like to remind everyone that today's press release and certain of our comments on the call include non GAAP measures and forward looking statements, and actual results may differ materially. Please refer to the cautionary language in our press release and slides and to the risk factors described in our SEC filings, all of which are available on our website.

Also on the call with me today are Richard Actresson, Chairman of the Board of FCX Kathleen Quirk, President and Chief Executive Officer Marie Robertson, Executive Vice President and Chief Financial Officer and other senior members of our management team. Richard will make some opening remarks, Kathleen and Marie will review our slide materials, and then we'll open up the call for

Thank you, David, and thank you all for joining us. Kathleen and our team will review the details of the quarter and our outlook. Team Freeport is executing well in a complex environment. Over the years, we've got a lot of experience in doing just that, facing problems with resilience and relentlessness and successfully executing our plans. Government policy and tariffs are dominating financial markets.

At Freeport, we are focused on the basics to drive long term value. Our strategy has been clear for many years, centered on being a global leader in copper. We have built our business with large scale copper producing assets and a long term pipeline of organic growth projects supported by strong balance sheet and a clearly articulated financial policy. This strategy places Freeport in a strong position with where the world is heading. Copper is an essential metal for the future and Freeport is foremost in copper.

We also have significant financial exposure to gold and the world class molybdenum business. Kathleen and our senior management team are engaged in important initiatives to support this strategy. As you will see, we're making significant positive progress. Our team is driving efficiencies and reducing cost, while setting up the next generation of copper development projects, which will have attractive returns for shareholders by delivering more copper to a world with increasing requirements. Our Freeport team's accomplishments in Indonesia are striking in the upstream mining at the Grasberg District and with our massively expanded downstream processing and refining.

The smelter is progressing ahead of our earlier targets. We are honored that Indonesia's President, but Pravov inaugurated our Pressure Metals refinery in March. ETF '5 celebrated its fifty eighth anniversary in Indonesia this month. My first trip in Indonesia was thirty five years ago. I am delighted with our current positive relationship with the government under President Pribola's leadership.

We are well positioned in working together to secure long term operating rights for this incredible asset. It's the world's second largest copper mine and one of the world's largest gold mines. All of this would generate large values for all stakeholders for decades to come. Kathleen?

Thank you, Richard. And I'm going to start on Slide three with our first quarter highlights, where production of copper and gold were in line with our expectations going into the year, incorporating planned maintenance activities at Grasberg. We exceeded expectations on copper sales. And as as we flagged in our March 31 update, our gold shipments were impacted by timing. Unit costs were similar to what we guided to in January for the quarter and a bit better than our late March update, and we generated $1,900,000,000 in EBITDA with expectations that margins and cash flows will benefit from improved results in the balance of the year.

Importantly, our annual sales guidance is on track, and we expect operating and financial performance to improve significantly in the balance of the year. To put this in context, compared with the first quarter levels, our quarterly copper sales volumes are expected to average about 20% more in the balance of the year. Gold sales are expected to average nearly four times the first quarter rates and unit net cash costs are expected to be 30% lower on average in the remaining quarters. This will drive strong performance and free cash flow in the balance of 2025 and continuing over the next several years. Other notable highlights in the quarter include solid progress on the smelter with repairs tracking ahead of plan, continued momentum on our low cost leach innovation projects in The U.

S, the premium we are receiving on our US copper sales, which we'll talk more about, favorable gold pricing and the advancement of optionality in our organic growth portfolio. We're well positioned for the future as a leader in the global copper industry, and we remain focused on operational excellence and our innovative and exciting growth pipeline to drive our future results. We took advantage of recent market volatility as you see and year to date have repurchased 2,300,000.0 shares in the open market for approximately $80,000,000 On the next slide, slide four, we are summarizing our priorities for 2025. We covered these on our January call, and these areas are defining our everyday pursuit of value creation. The first one is executing our plans safely and efficiently.

That remains a top priority. Team Freeport has a history of strong execution, delivering on our plan volumes, cost targets, and capital projects safely and efficiently while seeking opportunities to capture upside values. Given inflationary pressures in recent years, we're particularly focused on aggressive cost management and driving our costs lower, particularly in The US. A second key focus area is scaling the leach opportunity. We've talked a lot about that in recent years.

Achievement of our targets will significantly enhance margins and profitability. We continue to target a 40% increase in our run rate to achieve £300,000,000 per annum by the end of the year and on our path to £800,000,000 per annum in the future. Third is the PTFI smelter. The team has expedited the repair process and set us up for start up by the May. That's about one month sooner than the earlier schedule.

Our startup has been derisked, and success here will be beneficial as we work to extend our operating rights long term in Indonesia. We see innovation as a major value driver for our business. We're pursuing aggressively new tools to enable better productivity and cost performance, and we're continuing to build optionality in our growth portfolio for the next generation of copper producing assets. We have key milestones identified at three major projects that we're pursuing in The Americas. Turning to the copper markets, we've got some commentary on slide five.

The market fundamentals remain positive, and that's underpinned by copper's increasing use in the global economy to drive electrification. Copper prices during the quarter traded between $3.94 per pound and $4.53 per pound on the London Metals Exchange and reached a new high of $5.22 per pound on the US COMEX Exchange in March. US tariff policy has heavily influenced sentiment on the global economy in recent weeks, but the facts are that copper demand remains strong globally and benefits from the secular trends and major new investments in power infrastructure, technology, decarbonization, and transportation. The US remains strong, supported by rising demand for electrical power, and we are seeing improving demand trends in China, which has been particularly strong year to date, and also green shoots in Europe. The fundamentals of the copper markets are among the most compelling of any commodity.

While macro sentiment impacts short term pricing, we recognize that market analysts expect a tight market in 2025 and are projecting demand growth to outpace available supplies as we go forward. Freeport is in a great position to increase volumes in the coming years to meet rising demand. We'll talk about on Slide six, the U. S. Copper pricing and the premiums currently priced in to The US copper market.

We present information on regional premiums and The ongoing US investigation on copper for considering a potential tariff. In late February, the Trump administration issued an executive order identifying copper as a critical material and instructing the secretary of commerce to conduct an investigation into the copper market and the impact of imports on national security. The US currently imports approximately half of its copper requirements. The domestic supplies in The US, the rest of them are majority produced by Freeport. The investigation, is expected to be completed by November and potentially sooner, will also cover recommendations to provide incentives to increase domestic production and policies to strengthen The US copper supply chain, including permitting reforms.

While copper is currently exempt from the new tariffs, the outcome of this investigation may lead to tariffs on imported copper, and markets have begun to price in a potential tariff as you can see from the growing US premium. For background, the reference price for Freeport's international operations utilize the London Metals Exchange. And in The U. S, which comprises about one third of our copper sales, our sales contracts are based on the COMEX exchange prices pricing. Historically, the pricing on the two exchanges have been similar.

But in recent months, The US pricing has reflected market expectations for a tariff on US imports, and this premium has widened over time and is currently approximately 13% above LME. This equates to about 57¢ per pound as of yesterday, and that premium currently implies an approximate $800,000,000 bottom line annual financial benefit on Freeport's US copper sales. For reference, the tariff on steel and aluminum is 25% compared to the current market premium of 13% for copper. As Freeport has not taken a position on whether or not copper tariffs should be imposed, but we have highlighted in our public comment submission some of the items for consideration, including the potential broader impact of tariffs on the economy, inflation, and where US domestic copper production is currently placed on the global cost curve. We also highlighted in our comments the importance of Freeport to US copper supply, the critical role we play in supplying 70% of The US domestically sourced refined copper, and the opportunity we have at Freeport for US brownfield growth in copper supplies.

highlight Freeport as America's copper champion, and we appreciate the administration's recognition of copper as a critical mineral and the actions by the US government to provide permitting reforms and incentives to boost domestic production. Freeport is an iconic American copper producer and is by far the largest contributor to The US copper market with an established and successful franchise dating back to the late eighteen hundreds. We employ a large workforce of thirty thirty nine thousand, people, including contractors, mostly in rural commune communities in The US, and have earned the trust of the communities where we operate in the Southwestern United States and with our US copper customers, some of whom have placed trust in us to source all of their copper requirements. Our operations in The United States are fully integrated with mines and smelting and refining facilities and innovative leach processes that efficiently produce refined cathode. Freeport is well positioned to grow in The U.

S. As you'll see from our pipeline. We've got sizable resource position and brownfield expansion opportunities. Turning to our global operations for the first quarter on Slide eight, we'll provide some operating highlights by geographic region. Starting with The U.

S, we continue to make progress on enhancing efficiencies and improving costs and margins. Our operating teams are benefiting from data analytics to identify the highest value opportunity for efficiency gains and to assist in decision making to eliminate efficiency losses. On the cost front, improved retention of our of our workforce has allowed us to rebuild skills within our workforce with lower reliance on more expensive contractors. As an example, contractor hours at Morenci, our largest mine in The US, are down about 20% over the last few quarters. As we look forward, we expect production in The US to increase in 2025 compared to 2024 and also to increase further in 2026 and 2027.

Absent changes in commodity based input costs, we're targeting unit costs to trend lower each year over this three year period. Our autonomous haul truck conversion at Baghdad is going very well. That is going to allow us to test the potential for this application for potential use at other locations in The US. At Baghdad, we've already converted 12 of 33 autonomous trucks. We have them in service now, and we expect to have the balance in service over the next several months.

We are confident in further scaling in our innovative leach program. We've got several projects underway using existing technologies to achieve our targeted 40% increase in run rate to £300,000,000 per annum of low cost copper by year end 2025. We're also integrating new technology and automation to optimize performance in our basic mining functions and believe there is significant potential for value creation through meaningful cost reduction, which would enhance margins and expand reserves from known mineralization, which is currently economically limited under our current reserve pricing. We can do this through further using and integrating new technology into our basic operations. We're also continuing to follow and pursue the potential for US legislation to recognize copper as a critical mineral and bring eligibility consistent with other critical minerals for a potential tax credit of 10% of our operating costs in The US.

Turning to South America, the team at our Cerro Verde operation posted another solid quarter with improved mill rates, better recoveries, and higher molybdenum volumes that helped us mitigate the impact of lower ore grades. Our unit net cash costs in the quarter were $0.20 per pound lower than the comparable quarter last year. At Alabra in Chile, we are positive about testing an initiative to add heat to our leach process, which has promised to provide incremental near term production. And we continue to advance a major project at El Abra in partnership with Codelco, which would capitalize on a large resource we have defined and bring substantial scale and operating efficiencies to this high class mine. In Indonesia, as we've already discussed, our operating rates in the quarter were impacted by maintenance on one of our SAG mills that resulted in a 25% reduction in mill rates during the quarter.

The maintenance work was timed to coincide with our work to extend our export permit, which was received in mid March. As we look forward, we expect strong production from Grasberg in the balance of the year with 2025 annual sales of 1,600,000,000 pounds of copper and 1,600,000 ounces of gold at a net cash credit of $0.47 per pound, meaning our our gold revenues will more than offset all of our production costs. The team has made outstanding progress in completing the smelter repairs, and as I mentioned, we're a bit ahead of schedule. The precious metals refinery, as Richard referenced, was inaugurated by the president of Indonesia in March and is ramping up to full capacity. The successful completion of these projects position us to advance approval for extension of our operating rights in the second half of this year.

Turning to our growth, which we're really excited about. As we look forward, we see a world that will require additional copper supplies to support energy infrastructure, new technologies, and more advanced societies. And Freeport is really well positioned, with an extensive copper resource position and a broad range of projects in various stages of development. These initiatives, as you can see from this chart on slide nine, total 2,500,000,000 pounds of copper per annum, and those can be developed from Freeport's known resources in jurisdictions where we have established history and experience. Our projects in Indonesia also have the benefit of high gold content that go along with the copper, so they really are supercharged from a from an economic standpoint.

Because all of these projects are brownfield in nature, we benefit from leveraging existing infrastructure, experienced workforces, and relationships with key stakeholders to move more quickly with less risk than a greenfield project. In The US, these projects include the incremental leach volumes of £600,000,000 per annum. As I mentioned, we're already hit the initial target of 200 and are going to £800,000,000 pounds per annum over the next three to five years. The Baghdad expansion, which we're we're we're currently evaluating, and potential expansion to double the production in the Safford Lone Star District, which is a an enormous district with enormous amounts of of copper that we're excited about the future on. In South America, we and our partner, Codelco, are planning a major expansion at Alabra through the addition of a new concentrator, which would provide 750,000,000 pounds of incremental copper per annum.

We're in the process of completing a permit application, and we expect to file the application by the end of this year. In Indonesia, after successfully developing several world class underground ore bodies. We're now progressing development of the Cuchin Liard development, and we expect to commence production here by the, end of this decade by 2030. We're also conducting additional exploration below our existing deep end MLZ ore body, and we expect that an extension of our operating rights beyond 2041 will set up for additional long term development options in this highly attractive district. Our objective is to move quickly to define the opportunities and value potential and allocate capital on a risk reward basis to provide profitable growth options for the future.

There are additional details on these projects on Slide 25 in the reference materials. As usual, we will continue to be disciplined in our approach, targeting opportunities that enhance long term value. Several of these projects are in advanced stages, particularly the Leach initiative where we can have near term impacts. We're providing near term low cost of incremental pounds, and then we've also have medium term opportunities and longer term optionality in our portfolio. I'd now like to ask Marie Robertson to review our financial outlook, and then we'll take your questions.

Thanks, Kathleen. Just moving to slide 10, we show our three year outlook for sales volumes of copper, gold, and molybdenum. Our guidance for the three year period is consistent with our previous estimates. And for 2025, the US represents 33% of our consolidated copper sales. South America, around 27%, and Indonesia, approximately 40%.

And as Kathleen mentioned earlier, continued success in our leaching initiative would provide upside to these estimates. On slide 22 of the reference materials, we provide quarterly forecast, which shows sales in the balance of the year substantially higher than first quarter levels. Our current estimate for unit net unit costs for the full year 2025 using $3,000 for gold and $20 for moly is approximately a dollar 50 per pound, lower than our previous guidance of a dollar 60 per pound. Unit costs in the balance of the year reflect improved operating rates compared with the first quarter. The details of the costs by region are presented on Slide 21 in the reference materials.

Moving to slide 11, putting together our projected volumes and cost estimates, we show modeled results for EBITDA and cash flow at various copper prices ranging from $4 per pound to $5 per pound. These model results using the average of 2026 and 2027 with current volume and cost estimates and holding gold flat at $3,000 per ounce and the lignum flat at $20 per pound. Annual EBITDA would range from over $11,000,000,000 per annum at $4 copper to over $15,000,000,000 per annum at $5 copper, with operating cash flows ranging from $8,000,000,000 per year at $4 to over $11,000,000,000 at $5 copper. These estimates assume no premium on our US copper asset, copper sales. If we apply the current premium of 13%, our EBITDA and operating cash flows would increase by approximately $800,000,000 per annum.

We show sensitivities to various commodities on the right. You will note we are highly leveraged to copper prices with each 10¢ per pound change equating to approximately $425,000,000 in annual EBITDA. We will also benefit from improving gold prices with each hundred dollar per ounce change in price approximating a hundred and $50,000,000 in annual EBITDA. With our long life reserves and large scale production, we are well positioned to generate substantial cash flow to fund future organic growth and cash returns under our performance based payout framework. Slide 12 shows our current forecast for capital expenditures in 2025 and 2026.

Again, expenditures are similar to our previous guidance, expected to approximate $4,400,000,000 in 2025 and 2026. The discretionary projects approximated a billion dollars in 2024 and are expected to approximate 1.6 to 1 point 7 billion dollars per year in 2025 and 2026, with roughly 50% related to the Kuching Liard development and the LNG project at Grasberg. The balance includes acceleration of tailings and other infrastructure to support the Baghdad expansion, the Atlantic Copper Circular Project, which is expected to be completed in the first half of twenty twenty six, and allocated capitalized interest. The discretionary cap category reflects the capital investments we're making in new value enhancing projects that under our financial policy are funded with the 50% of available cash that is not distributed. These projects, which are detailed on slide 30 in the reference materials, will benefit our results in the future, and we'll continue to be disciplined in allocating capital to projects that enhance our position and generate attractive returns.

This is consistent with our track record of efficient capital allocation and value driven approach. On slide 13, we reiterate the financial policy priorities centered on a strong balance sheet, cash returns to shareholders, and investments in value enhancing growth projects. Our balance sheet is solid with investment grade ratings, solid credit metrics, and flexibility within our debt targets to execute on our projects. We do not have any significant debt maturities until 2027. In addition to paying our first quarter base and variable dividend, we have repurchased $80,000,000 of SCF's common stock in the open market year to date.

In total, we have distributed $5,000,000,000 to shareholders through dividends and share purchases since adopting our financial policy of returning 50% of excess cash flow in 2021. And we have an attractive future long term portfolio, as we've previously discussed, that will enable us to continue to build long term value for shareholders with the remaining 50. We actively monitor current market conditions and carefully manage the timing of our projects to ensure our financial flexibility remains strong. Our global team is focused on driving value in our business, committed to strong execution of our plans, providing cash to invest in profitable growth, and return cash to shareholders. And just on slide 14, in concluding today's presentation, Freeport's large scale, our proven producing assets, actionable low risk growth, leadership in the global copper industry, significant exposure to a rising gold price, and an advantageous US footprint all provide a strong foundation for the future.

Thanks for your attention. I'll now hand it back to Kathleen, and we'll take your questions.

Thank you, Marie. We're ready for questions.

Ladies and gentlemen, we will now begin the question and answer session. If your question has been answered or you wish to remove yourself from the queue, please press star one again. If you are using a speakerphone, please pick up your handset before pressing the numbers. We ask that you limit your questions to one. And the first question comes from Carlos De Alba with Morgan Stanley.

Yes. Good morning, everyone. Thank you very much. Kathleen, I wanted to check with you what is the expected cost reduction or efficiency gains in terms of volumes that you would expect for the Baghdad autonomous haulage system when it is fully in place and running at capacity? A range would be quite useful just to get a sense of the potential lift in results.

Thank you, Carlos. We're really excited about what the autonomous haulage will allow us to do at Baghdad. This was one of the sites that we had struggled with over the pandemic period in keeping staffing levels. And and with high rates of turnover there in this very remote location, it it it affected our cost structure and our efficiencies. And so what we see here is with this project done, it'll reduce the amount of of people we need to hire for an expansion, and it'll leverage, you know, leverage us to be able to get consistent and safe results without, you know, without having to hire hire people.

So the project itself has an attractive rate of return on on its on its face. The the the the capital cost that that we're incurring for that for that project, and we've got some details on in the back reference materials. But the the capital cost itself is for to convert these whole trucks is in the $80,000,000 range, and the project itself will will produce a a good rate of return and and allow us, again, leverage to to to expand that operation in the future. So it's it's strategic for us. It's also very strategic from the perspective of allowing us potentially to adopt this at other sites within within The US, and it could have, you know, meaningful impacts for us.

In in general, Carlos, in terms of the the the targets for our cash costs in The US, we have a target to get to within the 2027 time frame to get to an average cost of in the $2.50 range. We're currently around $3, and we've got projects underway now that will allow us to bring our costs in The US down. And so we're targeting over the next couple of years to get to, on average, $2.50 per pound, and we're not gonna stop there. So a big focus of ours in The U. S.

Is on bringing down that unit cost to look more like it does in South America even though we've got lower grades in The U. S.

And your next question comes from the line of Liam Fitzpatrick with Deutsche Bank. Your line is open.

Good morning, Kathleen. My question is on Indonesia and the new smelter and how that links into the concentrate export permit. Are you aiming to proactively extend the allowance to export concentrate beyond the midyear point? Or could we again see a situation where there are delays to shipments in Q3? And then linked to that, can you give any sort of color or guidance on how long you expect the new smelter to take to ramp up towards full capacity?

Okay. Thank you, Liam. I'm going to let Corey talk about the smelter ramp up, Corey Stephens, and he's over there right now. But in terms of the first question on our on our sales forecast, we have enough quota within the approved level that we got in March to meet our our sales targets for this year. We're assuming that we export through the September timeframe of the license.

And then in the fourth quarter, we would be using our existing smelters, not just the new smelter at Mannar, but also in the established smelter we have at PT Smelting. So we within our our guidance that we show, that's within within our permit limits. If we need to get for some reason, if we produce more, we need to get more flexibility, we'll go and and speak with the government about it. But at this point in time, we have sufficient room under our permit to to meet our our our sales targets for this year. The the the work we're doing on the start up is is comprehensive.

We we're fortunate that Freeport as an organization has a lot of experience with smelters. Of course, we have a smelter in in Huelva, Spain that we've operated for some time. We have a smelter here in The US as well, and then we have in partnership with Mitsubishi the the smelter in in Indonesia. So we're calling on resources, internal resources, external resources to plan an efficient start up. And, and and, Corey, if you wanna add, you know, just some color on on our start up plans and and and how how this how this will play out.

Smelters are complex, and we we understand that, and that's why we've done so much preplanning. They're complex to to start up, and we recognize that. But but, Corey, why don't you to cover how we're how we're planning to, sequence the start up?

Yeah. So the the mechanical repairs are essentially complete in pre commissioning and commissioning activities in the area where the fire was are well underway. In the remainder of the facility, the the teams have been refining their operating practices and going through drills, and we've been basically operating those facilities, those other unit operations, in preparation to combine everything with the main smelter coming online. So both furnaces are hot. The boilers are ready.

You know, the the teams have been practicing. We've got maintenance teams and and a number of support from operations and and contractors with experience. So so in the in the May time frame, we're gonna start the the process up, and we'll essentially ramp up to 100% capacity over a six month period and plan to run 2026 at 100% capacity throughout.

your next question comes from the line of Katja Jantzik with BMO Capital Markets. Your line is open.

Hi, Katja. Thank you for taking my question. Maybe on the potential Baghdad expansion. If I'm not mistaking, the feasibility study was completed in 2023. So is the $3,500,000,000 CapEx still attainable in this environment, especially with tariffs and other inflationary pressures?

We are reviewing that now, and and and we do that with all of our projects to keep them fresh. And so we're going through a a process to review rereview all the economics associated with the project, capital, and operating costs. And and so that that will be part of the decision making that we that we make, you know, we we to the end of this year. We're we're want to get the the autonomous trucks in place because that will allow us to to manage the the workforce that we have now. And as I said before, not not have to rely on a big hiring program and and less experienced people.

So, that's a important part of it. We're also doing some work, some some infrastructure work. We've we've boosted housing. We're doing infrastructure work on our tailings facilities to put us in a position so that when we do make the decision, we can do it in a in a in a in a derisked fashion, in a more fast track fashion. But we wanna make sure that the economics are are robust.

These are this is an option for us. It is with the reserves are there, and this will allow us to bring forward those values and bring forward reserves. But, but we it's not something we have to do, and we can assess the right timing. We wanna we wanna bring it to market at a time when we can do it efficiently and and generate the return. So that'll be that'll be part of our analysis, Katya, as we go through the balance of this year and to your point to better understand the tariffs as well.

And your next question comes from the line of Timna Tanners with Wolfe Research. Your line is open.

Hey, good morning. I wanted to ask a bigger picture question, if I could. In light of the different levels of support being provided to the copper industry from the U. S. Government.

Are there any measures that you can take to accelerate some of these efforts? Do you think about adding smelting? The world is oversupplied clearly, but not in The U. S. Any update on the 45 x benefits?

Just just like to hear about what incremental you might be able to do given the new initiatives that we hear about from the Trump administration. Thanks again.

Thanks, Tinna. Actually, Freeport is in a terrific position to expand its US production. We already had several things underway. As we talked about, we're fully integrated. So we're we're producing concentrate, and those go to our our smelter in Arizona.

We also a big part of what we do in The US, as you know, is is is leach production where we don't need a smelter, and we can produce leach pounds very efficiently, we were already on that path to increase our our our leach production capacity and, again, produce refined copper. We've got innovation around leaching concentrate. We've got a we've got a facility which we're expanding in in The US to to to leach concentrates. Again, that avoids the big capital intensity of a smelter. And then potentially, you know, longer run can look at potentially expanding the Miami smelter to to produce more cathode.

There even is a potential you know, one of the one of the areas that The US is interested in is there's a lot of scrap produced in the in The US that ends up getting exported. We're going to look into can Freeport use existing infrastructure and low low capital intensity projects to potentially process scrap material in The US. So of all the the the things out there that you hear about, Freeport really is in a good position, because our projects are brownfield in nature. We have infrastructure. We have the workforce in the area.

We have community support. And so, you know, I feel in in many ways that Freeport is the poster child when it comes to what The US is trying to achieve in in in bringing back, expanding copper production in The US. Now we recognize that, The US has, some real positives in its regulatory framework, but the resources, as as as you're aware, are generally lower grade, or more mature and generally lower grade than some of the operations internationally. So that's where these incentives come in to really support not only the the base production in The US, but, incentivize, new new new investments and new production. And and that's why we're interested in the 45 x potential credits where the executive order already says that copper is a critical mineral, but we need to have legislation to modify the the treasury regulations to to to allow for copper to be listed under 45 x of the IRA to be eligible for the 10% production credit.

That would be very, very helpful. But as you know, with tax policy, there's lots of pluses and minuses and give and takes going on. And so we'll just have to keep advocating for the benefits to The US national security of having copper produced domestically, and that's something that we'll continue to work on. But, Timna, we have great opportunities in The US. This Lone Star District has a a huge resource.

We have visions that the Lone Star Safford District could be another Morenci with both bleach production and concentrate production in the future. Of course, we talked about Baghdad. We talked about our leach initiative. So we're in we're in a really good position to help The US and its objectives to to bring more copper production into into The US.

Okay. Thanks for the overview. We'll look forward to updates from you and from the administration. Thanks again.

And your next question comes from the line of Daniel Major with UBS. Your line is open.

Hi, thanks for taking my questions. Can I ask a question on the change in the cost guidance for North America? I noticed site production delivery costs have increased somewhat, albeit not that much. But note in Note six in the presentation, it said that this excludes the impact of additional tariff costs. Can you give us a sense of what those impacts are?

I think you mentioned a 5% increase in cost of purchased inputs. How much of your cost base does that account for? And what's the upside to this number if you're unable to mitigate some of those impacts?

Thank you for the question. We did disclose in our earnings release, when these tariffs came out, we began talking with our suppliers. The direct impacts that we have, and and where we're the vendor of record are are material, and we are working to diversify our supply chains to to mitigate those impacts. The bigger impact as we're working with our suppliers is potentially the the cost that they that they incur on the various components that they purchase. And as you can imagine, it gets complicated because it's just not one supply chain.

They have you know, when they're fabricating something, they have multiple supply chains that are involved. And so they're going through an analysis themselves to understand what the potential impacts are and what they can do to potentially diversify their their sources to to mitigate these impacts. The when we look at our overall costs in The US, about 40% of those costs are related to to to labor and and and and services that that wouldn't be subject to tariffs. So it's it's it's the balance. The the other piece that we applied the the estimate of of 5% to.

Of that, when you look at the components of the of the of the potential 5% impact, the biggest driver is the 45% Chinese tariff. And while the dollar amount, as we've if we've as we've talked with our vendors, the dollar amount of of Chinese purchased components in their supply chain is not significant. The magnitude of a 45% is what what adds up quickly. And so if that's reduced and if we can mitigate that, this this tariff impact will be reduced significantly potential impact will be reduced significantly. I'm confident that working with our suppliers, we can find ways to to mitigate these impacts.

We wanted to set up a system, to really understand the various components so that when we get a, attempt from a vendor to pass through something that we can confirm and verify and that we can work collaboratively with them to source products that that do not have high tariffs with them. So I feel confident that we can we can mitigate this. We all would love to see more certainty and and these issues get resolved because it it it does impact these these these conversations and trade flows, etcetera. But I do feel confident that we can find ways to mitigate these potential impacts.

Okay. Thanks. Sorry, just a quick follow-up on the same subject. What proportion of the cost base is exposed to energy, particularly oil? Obviously, we're seeing some benefit there.

We haven't we have not we basically used the same oil price assumption in our in our guidance that we used at the start of the year. And you are right to say that there is there is benefit. We we purchased about a hundred million gallons of of of diesel in The US. And right now, the price is probably $0.20 a gallon or so less than what we assumed in our original forecast going into the quarter.

Electricity is another component and we have seen some pressures in that area. We have seen some slight pickup in in electricity. But just in in the oil component, that is that that that and when I I'm talking about the hundred million gallons, that's that's specific to North America.

next question comes from the line of Chris Lofamena with Jefferies. Your line is open.

Hi, thanks operator. Hi, Kathleen, Richard and Marie. Hope you're doing well.

to ask on the buyback. So you've been running a net debt level that's well below your targeted net debt threshold. And you're kind of entering this period now where free cash flow should materially improve. I mean, you have this COMEX premium, you have high gold prices, you're going to have rising volumes, price in The US coming down. Mean, everything's kind of heading in the right direction and cash flow should get very strong.

And your share price has been kind of a victim of the macro and it's been, you know, it's been relatively weak, recovering a little bit now, but still at a low level. And back when your stock was in the 50s and free cash flow was zero, it made sense to not be maybe not be really accelerating the pace of the buybacks. But I would think, where we are today and where you're heading, the, the attractiveness of repurposing your shares, it really almost can't be beat. And especially when you consider, you know, if the focus is on kind of pivot to growth, you can shrink your share count, you can grow your volumes on a per share basis in an accretive way, and you can use free cash flow to do that and maintain a very strong balance sheet, which is a pretty compelling combination of factors. So just really wondering how you think about, potentially ramping up the buyback if market conditions continue to be as they are.

I mean, back in the thirties, do you just buy back more aggressively now? Or do you want to save money for the capital projects you have in the pipeline? Thank you.

Thank you for that, Chris. And and and we're balancing all those things, but we agree with what you with everything you just said. And particularly as we go through the balance of this year, we've got in the first quarter, we had this this maintenance and and and some some some timing in the numbers. But as we go through the balance of the year, our cash flow should improve. You you highlighted the the potential premium.

Freeport-McMoRan (FCX) Q1 2025 Earnings Call Transcript

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