Executive Summary / Key Takeaways

• Strategic Portfolio Refinement: Newmont has successfully completed a multi-year transformation, divesting six non-core assets and integrating the Newcrest acquisition, resulting in a focused portfolio of 11 managed Tier 1 operations and three key projects poised for long-term value creation.
• Robust Financial Performance & Capital Returns: The company delivered a record-setting Q2 2025 with $1.7 billion in free cash flow, driven by strong production and favorable gold prices. This financial strength supports a disciplined capital allocation strategy, including significant debt reduction and a doubled share repurchase authorization of $6 billion.
• Technological Edge & Operational Optimization: Newmont leverages advanced technologies like AI-driven analytics, autonomous haul trucks, and injection leaching to enhance resource recovery, improve productivity, and reduce waste, providing a quantifiable competitive advantage in its pursuit of a Tier 1 cost structure.
• Clear 2025 Guidance & Long-Term Vision: Newmont is firmly on track to meet its 2025 guidance of 5.6 million gold ounces at $1,620/ounce AISC, with a long-term vision of averaging 6 million gold ounces and 150,000 tonnes of copper annually over the next decade, prioritizing margin expansion over volume.
• Navigating Industry Headwinds: While benefiting from strong gold prices and robust demand, Newmont is actively addressing challenges such as inflationary pressures, operational incidents, and ongoing environmental and legal complexities, demonstrating a commitment to safety and responsible mining.

The Gold Standard Reimagined: Newmont's Strategic Evolution

Newmont Corporation, founded in 1916, has long been a foundational pillar of the global mining industry, initially focusing on gold exploration and acquisition. Over its extensive history, the company strategically expanded its global footprint across numerous countries, diversifying its portfolio to include copper, silver, lead, and zinc. This global presence has been a deliberate strategy to balance operational risks and capitalize on diverse geological endowments. Today, Newmont stands as the world's leading gold company, uniquely positioned within the S&P 500 and Fortune 500, and consistently recognized for its ESG performance.

A pivotal moment in Newmont's journey was the "transformational" acquisition of Newcrest in November 2023. This strategic move aimed to solidify Newmont's position as a world-class company with an outstanding portfolio of assets capable of generating value for decades. The integration of these new assets, particularly Cadia and Lihir, presented specific operational and capital challenges, necessitating significant investments in infrastructure and process optimization. Following this, Newmont embarked on a comprehensive portfolio optimization program in February 2024, divesting six non-core assets and a development project. This rationalization, largely completed by Q2 2025, was a resounding success, generating over $3 billion in after-tax cash proceeds and removing approximately $1.8 billion in closure liabilities. This strategic pivot has sharpened Newmont's focus on a core set of 11 managed Tier 1 assets and three key projects in execution.

Technological Leadership: A Differentiated Moat

Newmont's competitive edge is significantly bolstered by its commitment to technological innovation, which is deeply embedded in its operational strategy. The company actively deploys and develops advanced mining technologies to enhance efficiency, safety, and resource recovery. For instance, Newmont utilizes AI-driven mining analytics to achieve approximately 15% higher resource recovery rates, translating directly into superior margins and faster innovation cycles. This quantifiable benefit allows Newmont to optimize its mine plans and extraction processes more effectively than competitors relying on traditional methods.

Furthermore, the adoption of autonomous haul trucks at operations like Boddington has yielded a 10% uplift in productivity, demonstrating a tangible advantage in operational efficiency. The company's patented injection leaching technology at Yanacocha is crucial for recovering ounces from leach pads, showcasing its ability to extract value from complex ore bodies. Newmont also employs digital twin technology for mine planning, providing 20% greater predictive accuracy in resource estimation and contributing to a 15% reduction in waste. These technological differentiators are not merely incremental improvements; they are fundamental to Newmont's ability to achieve a "Tier 1 cost structure" for its Tier 1 assets, contributing to higher average selling prices (ASPs), lower operating costs, and ultimately, better margins. The strategic intent behind this R&D is to continuously improve productivity and cost discipline, ensuring long-term profitability and competitive advantage.

Competitive Positioning in a Dynamic Market

Newmont operates within a highly competitive global gold and copper mining landscape. Its primary direct competitors include Barrick Gold (GOLD), Agnico Eagle Mines (AEM), Kinross Gold (KGC), and Gold Fields (GFI). While Barrick often boasts a larger scale with 20% higher production volumes in shared North American markets, Newmont's technological offerings, such as its AI-driven analytics, provide a distinct advantage in efficiency, leading to up to 15% lower operating costs per ounce in specific applications. However, Barrick's scale can exert pressure on pricing in joint markets.

Agnico Eagle, a strong competitor in North America, demonstrates 10-15% higher gold recovery rates through advanced processing. Newmont counters this with its broader metal diversification, offering a 20% lower risk profile in volatile markets, though this can lead to 5% higher operating costs due to multi-metal extraction complexities. Newmont's market positioning as a "responsible miner" through ESG certifications also appeals to institutional investors, differentiating it from peers. While Kinross Gold may have a lower-cost structure in some regions, Newmont's digital twin technology offers 20% greater predictive accuracy in resource estimation, leading to 15% less waste. Gold Fields, with its cost-focused African operations, presents a challenge with 5-10% lower operating costs per unit, but Newmont's autonomous haul trucks offer 15% higher productivity.

Overall, Newmont maintains an estimated 10-15% aggregate market share in primary gold production, with an 8-10% annual growth trajectory, outpacing the industry average of 5-7%. Its strengths lie in technological innovation, a diversified portfolio, and strong ESG practices. However, it faces vulnerabilities in cost efficiency and debt management compared to some peers, leading to slightly lower operating margins and return on invested capital. The company's strategic response is to leverage its technological edge to drive long-term market share gains and improve financial metrics.

Financial Performance and Operational Momentum

Newmont's recent financial performance underscores the positive impact of its strategic transformation. For the six months ended June 30, 2025, the company reported Sales of $10,327 million, a significant increase from $8,425 million in the prior year period. This growth was primarily driven by higher average realized gold prices, which reached $3,320 per ounce in Q2 2025, up from $2,347 in Q2 2024. Net income from continuing operations attributable to Newmont stockholders surged to $3,952 million for the six months ended June 30, 2025, compared to $1,004 million in the same period of 2024. This substantial increase was largely due to higher sales, a net gain on completed divestments, and favorable changes in the fair value of investments.

Operationally, Newmont produced 1.5 million attributable gold ounces and 36,000 tonnes of copper in Q2 2025, keeping it firmly on track for its full-year guidance. The company achieved an all-time record quarterly free cash flow of $1.7 billion in Q2 2025, with over 90% generated by its core managed operations. For the six months ended June 30, 2025, Net cash provided by operating activities reached $4,415 million, a substantial increase from $2,170 million in the prior year. This robust cash flow generation is a direct reflection of improved operational stability and a supportive commodity price environment.

Unit costs, while still a focus area for optimization, are aligning with expectations. Gold all-in sustaining costs (AISC) for Q2 2025 were $1,593 per ounce on a co-product basis. Notably, on a by-product basis, gold AISC for Q2 2025 was $1,375 per ounce, and for the core managed portfolio, it was $1,276 per ounce, highlighting the significant contribution of co-products to overall margin performance.

Strategic Initiatives and Outlook

Newmont's strategic initiatives are designed to unlock the full potential of its refined portfolio. The company's 2025 guidance projects gold production from its core Tier 1 portfolio to be around 5.6 million ounces, with an all-in sustaining cost of $1,620 per ounce. Sustaining capital is expected to be $1.8 billion and remain at this level for the next couple of years, primarily due to critical investments in Cadia's tailings remediation and storage capacity. Development capital spend is disciplined, held at $1.3 billion for 2025, focused on high-return projects.

Key operational advancements include:

• Ahafo North: Progressing as planned, with first gold pour expected in the coming months and commercial production by Q4 2025. This new mine is expected to contribute around 750,000 ounces per year from 2026.
• Tanami Expansion 2: The 1.5-kilometer shaft is on track for commissioning in H1 2027, with commercial production by H2 2027, projected to reduce operating costs and increase gold production by around 35% beginning in 2028.
• Cadia Panel Caves: The transition to Panel Cave 2-3 is underway, with grades expected to be lower until fully ramped up by H2 2026. These panel caves are projected to deliver over 5 million ounces of gold and 1 million tonnes of copper, ensuring Cadia's operation until mid-century.
• Peñasquito: Gold production exceeded expectations in H1 2025 but is expected to shift towards a higher proportion of silver, lead, and zinc in Q4 2025 due to planned mine sequencing.
• Lihir: Efforts to improve asset reliability and mine sequencing are expected to result in a 30% lift in production in 2028 and beyond, following a period of lower throughput in 2025.

Newmont's long-term outlook is robust, with expectations to produce roughly 6 million ounces of gold and 150,000 tonnes of copper on average each year over the next decade. This vision is underpinned by a reserve base of 134 million ounces of gold and 170 million ounces of gold resources, providing over 40 years of high-confidence inventory. The company's focus is firmly on expanding margins and generating strong returns on invested capital, rather than solely chasing volume.

Liquidity and Capital Returns

Newmont's financial strength is a cornerstone of its investment thesis. The company ended Q2 2025 with a substantial $6.2 billion in consolidated cash, well above its target of $3 billion. Its outstanding principal debt balance stood at $7.4 billion, comfortably below its target of $8 billion. The company actively reduced debt by $372 million since the last earnings call and $1 billion since the start of 2025.

Shareholder returns remain a key priority. Newmont declared a fixed common Q2 dividend of $0.25 per share, maintaining predictability. The company has repurchased $1.5 billion in shares in 2025, bringing total repurchases since February 2024 to $2.8 billion. Demonstrating strong confidence in its future, the Board approved an additional $3 billion share repurchase program, doubling the total authorization to $6 billion. The timing of these repurchases is closely correlated with free cash flow generation and divestment proceeds.

Risks and Challenges

Despite its strong position, Newmont faces inherent risks. Safety remains paramount, tragically underscored by the recent fall of ground incident at Red Chris, which led to a rescue effort and suspension of operations. The company is diligently investigating this and other past fatalities, reinforcing its "Always Safe" program.

Geopolitical and macroeconomic pressures, including inflationary conditions and potential tariff impacts, continue to influence costs, particularly for contracted labor. Environmental liabilities, such as those at Yanacocha and the Cadia tailings facilities, require significant ongoing investment and carry inherent uncertainties regarding ultimate costs and compliance timelines. Legal proceedings, including class action lawsuits alleging misleading statements and ongoing tax disputes, present potential financial and reputational risks. While Newmont's global diversification helps mitigate foreign currency exchange rate impacts on revenue, fluctuations can still affect costs.

Conclusion

Newmont Corporation has successfully navigated a period of profound transformation, emerging as a more focused and financially robust leader in the global gold and copper mining sector. By strategically divesting non-core assets and diligently integrating key acquisitions, the company has refined its portfolio to 11 managed Tier 1 operations and three high-return projects. This strategic clarity, coupled with a strong balance sheet and a commitment to shareholder returns, underpins its compelling investment thesis.

The company's technological prowess, from AI-driven analytics to autonomous haul trucks, provides a quantifiable competitive advantage, driving operational efficiencies and margin expansion. While challenges such as safety incidents and inflationary pressures persist, Newmont's proactive management and disciplined capital allocation, including significant debt reduction and a substantial share repurchase program, position it for sustained value creation. With a clear path to achieving its 2025 guidance and a long-term vision focused on profitable growth, Newmont is poised to deliver consistent performance and expand its industry-leading margins for decades to come.