FREEPORT-MCMORAN INC

Previous wording

We continue to progress organic copper growth projects in the U.S. and South America. Across our U.S. and South America operations, we are incorporating new applications, technologies and data analytics into our leaching processes. We are targeting annual production of approximately 300 million pounds of copper from these initiatives in 2026 and believe there is potential for further significant increases in recoverable metal in future years. Additionally, in March 2026, an environmental impact study was submitted to Chile regulatory authorities for a potential major expansion at our El Abra mine in Chile. Refer to “Operations – United States” and “Operations – South America” for further discussion.

Current wording

At our U.S. and South America operations, we are advancing testing of innovative technologies to target significant increases in incremental production from leaching initiatives. We are targeting reaching an annual run rate of 300 million pounds of copper from these initiatives by the end of 2026 and believe there is potential for further significant increases in recoverable metal in future years. We are finalizing cost estimates for an opportunity to more than double the concentrator capacity of the Bagdad operation in northwest Arizona and have advanced technical and economic studies in preparation for a potential investment decision during the second half of 2026. Additionally, we are advancing our evaluation of a potential major expansion at our El Abra mine in Chile. Refer to “Operations – United States” and “Operations – South America” for further discussion.

Previous wording

At March 31, 2026, we had consolidated debt of $9.4 billion and consolidated cash and cash equivalents of $3.7 billion. Net debt totaled $2.4 billion, excluding $3.2 billion of debt for PTFI’s smelter and precious metals refinery (PMR) (collectively, PTFI’s downstream processing facilities). Refer to “Net Debt” for a reconciliation of consolidated debt and consolidated cash and cash equivalents to net debt.

Current wording

At June 30, 2026, we had consolidated debt of $9.4 billion and consolidated cash and cash equivalents of $4.1 billion. Net debt totaled $2.1 billion, excluding $3.2 billion of debt for PTFI’s downstream processing facilities. Refer to “Net Debt” for a reconciliation of consolidated debt and consolidated cash and cash equivalents to net debt.

Previous wording

During first-quarter 2026, we acquired 1.7 million shares of our common stock for a total cost of $93 million ($54.25 average cost per share). At April 30, 2026, we have acquired a total of 53.7 million shares ($39.01 average cost per share) and have $2.9 billion available under our $5.0 billion share repurchase program.

Current wording

During the first six months of 2026, we acquired 3.4 million shares of our common stock for a total cost of $203 million ($59.30 average cost per share). As of July 31, 2026, we have acquired a total of 55.4 million shares ($39.80 average cost per share) and have $2.8 billion available under our $5.0 billion share repurchase program.

Previous wording

Our financial results vary as a result of fluctuations in metals market prices primarily for copper, gold and, to a lesser extent, molybdenum, as well as other factors. World market prices for these commodities have fluctuated historically and are affected by numerous factors beyond our control. Refer to “Markets” below, and “Risk Factors” in Part I, Item 1A. of our 2025 Form 10-K and Part II, Item 1A. herein for further discussion. Because we cannot control the prices of our products, the key measures that management focuses on in operating our business are sales volumes, unit net cash costs, operating cash flows and capital expenditures. References to previous estimates refer to guidance provided in our 2025 Form 10-K.

Current wording

Our financial results vary as a result of fluctuations in metals market prices primarily for copper, gold and, to a lesser extent, molybdenum, as well as other factors. World market prices for these commodities have fluctuated historically and are affected by numerous factors beyond our control. Refer to “Markets” below, and “Risk Factors” in Part I, Item 1A. of our 2025 Form 10-K and Part II, Item 1A. herein for further discussion. Because we cannot control the prices of our products, the key measures that management focuses on in operating our business are sales volumes, unit net cash costs, operating cash flows and capital expenditures.

Previous wording

a. Includes 60 million pounds produced by our U.S. copper mines and Cerro Verde mine, and 30 million pounds produced by our primary molybdenum mines.

Current wording

a. Includes 60 million pounds produced by our U.S. copper mines and Cerro Verde mine, and 33 million pounds produced by our primary molybdenum mines.

Previous wording

Projected sales volumes are dependent on operational performance; the ramp-up of the Grasberg Block Cave underground mine at PTFI; weather-related conditions; timing of shipments and other factors detailed in the “Cautionary Statement” below.

Current wording

Projected sales volumes are dependent on operational performance; the phased ramp-up of the Grasberg Block Cave underground mine at PTFI; weather-related conditions; timing of shipments and other factors detailed in the “Cautionary Statement” below.

Previous wording

Based on achievement of current sales volume and cost estimates and assuming average prices of $4,500 per ounce of gold and $25.00 per pound of molybdenum for the remainder of 2026, consolidated unit net cash costs (net of by-product credits and excluding idle facility and restoration costs associated with the Mud Rush Incident at PTFI) for our copper mines are expected to average $1.95 per pound of copper for the year 2026 (including $2.24 per pound of copper in second-quarter 2026). The impact of price changes on consolidated unit net cash costs for the remainder of 2026 would approximate $0.02 per pound of copper for each $100 per ounce change in the average price of gold and $0.03 per pound of copper for each $2 per pound change in the average price of molybdenum.

Current wording

Based on achievement of current sales volume and cost estimates and assuming average prices of $4,000 per ounce of gold and $30.00 per pound of molybdenum for the second half of 2026, consolidated unit net cash costs (net of by-product credits and excluding idle facility and restoration costs) for our copper mines are expected to average $1.90 per pound of copper for the year 2026 (including $2.00 per pound of copper in third-quarter 2026). The impact of price changes on consolidated unit net cash costs for the second half of 2026 would approximate $0.02 per pound of copper for each $100 per ounce change in the average price of gold and $0.03 per pound of copper for each $2 per pound change in the average price of molybdenum.

Previous wording

Following the Mud Rush Incident and until PTFI’s operations return to normal capacity, a portion of PTFI's production and delivery costs will be recognized as idle facility costs, which are non-inventoriable. Idle facility and restoration costs are expected to total $1.3 billion for the year 2026 (including $0.3 billion in second-quarter 2026). Refer to “Operations – Indonesia” for further discussion.

Current wording

During the phased ramp-up period of the Grasberg Block Cave underground mine and until PTFI’s operations return to normal capacity, a portion of PTFI's production and delivery costs will be recognized as idle facility costs, which are non-inventoriable. Idle facility and restoration costs are expected to approximate $1.2 billion for the year 2026 (including $0.3 billion in third-quarter 2026). Refer to “Operations – Indonesia” for further discussion.

Previous wording

Projected unit net cash costs for the year 2026 are dependent on operational performance; the ramp-up of the Grasberg Block Cave underground mine at PTFI; impacts related to the conflict in the Middle East, including changes in energy costs and other consumables; weather-related conditions; timing of shipments and other factors detailed in the “Cautionary Statement” below.

Current wording

Projected unit net cash costs for the year 2026 are dependent on operational performance; the phased ramp-up of the Grasberg Block Cave underground mine at PTFI; impacts related to the conflict in the Middle East, including changes in energy costs and other consumables; weather-related conditions; timing of shipments and other factors detailed in the “Cautionary Statement” below.

Previous wording

Our consolidated operating cash flows vary with sales volumes; prices realized from copper, gold and molybdenum sales; production costs; income taxes; other working capital changes; and other factors, such as the ramp-up of the Grasberg Block Cave underground mine at PTFI and impacts related to the conflict in the Middle East, including changes in energy costs and other consumables.

Current wording

Our consolidated operating cash flows vary with sales volumes; prices realized from copper, gold and molybdenum sales; production costs; income taxes; other working capital changes; and other factors, such as the phased ramp-up of the Grasberg Block Cave underground mine at PTFI and impacts related to the conflict in the Middle East, including changes in energy costs and other consumables.

Previous wording

Consolidated operating cash flows are expected to approximate $8.7 billion for the year 2026, including $0.2 billion of working capital and other sources, based on current sales volume and cost estimates, and assuming average prices of $6.00 per pound of copper, $4,500 per ounce of gold and $25.00 per pound of molybdenum for the remainder of 2026. Estimated consolidated operating cash flows for the year 2026 also reflect a projected income tax provision of $2.6 billion (refer to “Consolidated Results – Income Taxes” for further discussion of our projected income tax rate for the year 2026). The impact of price changes on consolidated operating cash flows for the remainder of 2026 would approximate $220 million for each $0.10 per pound change in the average price of copper, $50 million for each $100 per ounce change in the average price of gold and $90 million for each $2 per pound change in the average price of molybdenum.

Current wording

Consolidated operating cash flows are expected to approximate $8.3 billion for the year 2026, net of $0.3 billion of working capital and other uses, based on current sales volume and cost estimates, and assuming average prices of $6.00 per pound of copper, $4,000 per ounce of gold and $30.00 per pound of molybdenum for the second half of 2026. Estimated consolidated operating cash flows for the year 2026 include a projected income tax provision of $2.6 billion (refer to “Consolidated Results – Income Taxes” for further discussion of our projected income tax rate for the year 2026). The impact of price changes on consolidated operating cash flows for the second half of 2026 would approximate $150 million for each $0.10 per pound change in the average price of copper, $40 million for each $100 per ounce change in the average price of gold and $45 million for each $2 per pound change in the average price of molybdenum.

Previous wording

a. Includes $1.4 billion for planned projects, primarily associated with underground mine development and supporting mill and power capital costs in the Grasberg minerals district, and $1.6 billion for discretionary growth projects, primarily in the Grasberg minerals district for the continued development of Kucing Liar and at the Bagdad mine for tailings infrastructure.

Current wording

a. Includes $1.4 billion for planned projects, primarily associated with underground mine development and supporting mill and power capital costs in the Grasberg minerals district and a leaching project at El Abra, and $1.6 billion for discretionary growth projects, primarily in the Grasberg minerals district for the continued development of Kucing Liar and at Bagdad for tailings infrastructure.

Previous wording

Copper sales from our South America and Indonesia operations are generally based on quoted LME monthly average copper settlement prices. During first-quarter 2026, LME copper settlement prices averaged $5.83 per pound (ranging from a low of $5.36 per pound to a high of $6.28 per pound) and closed at $5.52 per pound on March 31, 2026. The LME copper settlement price was $5.90 per pound on April 30, 2026.

Current wording

Copper sales from our South America and Indonesia operations are generally based on quoted LME monthly average copper settlement prices. During second-quarter 2026, LME copper settlement prices averaged $6.05 per pound (ranging from a low of $5.51 per pound to a high of $6.39 per pound) and closed at $6.05 per pound on June 30, 2026. The LME copper settlement price was $6.28 per pound on July 31, 2026, and on August 6, 2026, the LME copper settlement price closed at an all-time high of $6.56 per pound.

Previous wording

Copper sales from our U.S. copper mines are generally based on prevailing COMEX monthly average copper settlement prices. During first-quarter 2026, COMEX copper settlement prices averaged $5.79 per pound (ranging from a low of $5.34 per pound to a high of $6.18 per pound) and closed at $5.59 per pound on March 31, 2026. The COMEX copper settlement price was $5.93 per pound on April 30, 2026.

Current wording

Copper sales from our U.S. copper mines are generally based on prevailing COMEX monthly average copper settlement prices. During second-quarter 2026, COMEX copper settlement prices averaged $6.16 per pound (ranging from a low of $5.54 per pound to a high of $6.65 per pound) and closed at $6.19 per pound on June 30, 2026. The COMEX copper settlement price was $6.44 per pound on July 31, 2026, and on August 5, 2026, the COMEX copper settlement price closed at an all-time high of $6.70 per pound.

Previous wording

We believe fundamentals for copper are favorable with growing demand supported by copper’s critical role in electrification initiatives, continued urbanization in developing countries, data centers and AI growth and growing connectivity globally.

Current wording

We believe long-term fundamentals for copper are favorable with growing demand supported by copper’s critical role in electrification initiatives, continued urbanization in developing countries, data center and AI growth and growing connectivity globally.

Previous wording

This graph presents London Bullion Market Association (London) PM gold prices from January 2016 through March 2026. The prospect of additional U.S. interest rate reductions, geopolitical tensions, trade uncertainty and strong demand from central banks around the world continued to influence gold prices in first-quarter 2026. In January 2026, the London PM gold price closed at an all-time high of $5,405 per ounce before declining as macro conditions tightened, driven by a stronger U.S. dollar, higher treasury yields and rising energy costs stemming from the conflict in the Middle East.

Current wording

This graph presents London Bullion Market Association (London) PM gold prices from January 2016 through June 2026. During second-quarter 2026, gold prices retreated from all-time highs reached at the beginning of 2026, as macroeconomic conditions tightened, driven by a stronger U.S. dollar, higher U.S. treasury yields and rising energy costs stemming from the conflict in the Middle East.

Previous wording

During first-quarter 2026, London PM gold prices averaged $4,873 per ounce (ranging from a low of $4,353 per ounce to a high of $5,405 per ounce) and closed at $4,608 per ounce on March 31, 2026. The London PM gold price closed at $4,611 per ounce on April 30, 2026.

Current wording

During second-quarter 2026, London PM gold prices averaged $4,506 per ounce (ranging from a low of $4,002 per ounce to a high of $4,871 per ounce) and closed at $4,026 per ounce on June 30, 2026. The London PM gold price closed at $4,027 per ounce on July 31, 2026.

Previous wording

During first-quarter 2026, the weekly average prices for molybdenum averaged $25.50 per pound (ranging from a low of $22.42 per pound to a high of $28.11 per pound) and closed at $26.60 per pound on March 31, 2026. The Platts Metals Daily Molybdenum Dealer Oxide weekly average price closed at $27.85 per pound on April 30, 2026.

Current wording

During second-quarter 2026, the weekly average prices for molybdenum averaged $29.40 per pound (ranging from a low of $26.67 per pound to a high of $31.29 per pound) and closed at $31.29 per pound on June 30, 2026. The Platts Metals Daily Molybdenum Dealer Oxide weekly average price closed at $32.61 per pound on July 31, 2026.

Previous wording

b. Includes favorable adjustments to prior period provisionally priced concentrate and cathode copper sales totaling $34 million ($12 million to net income attributable to common stock or $0.01 per share) in first-quarter 2026 and $70 million ($24 million to net income attributable to common stock or $0.02 per share) in first-quarter 2025. Refer to Note 5 for further discussion.

Current wording

b. Includes favorable (unfavorable) adjustments to prior period provisionally priced concentrate and cathode copper sales totaling $98 million ($35 million to net income attributable to common stock or $0.02 per share) in second-quarter 2026, $(35) million ($(10) million to net income attributable to common stock or $(0.01) per share) in second-quarter 2025, $58 million ($24 million to net income attributable to common stock or $0.02 per share) for the first six months of 2026 and $63 million ($21 million to net income attributable to common stock or $0.01 per share) for the first six months of 2025. Refer to Note 5 for further discussion.

Previous wording

c. We defer recognizing profits on intercompany sales until final sales to third parties occur. Changes in these deferrals attributable to variability in intercompany volumes resulted in net additions to operating income totaling $70 million ($23 million to net income attributable to common stock or $0.02 per share) in first-quarter 2026 and $114 million ($34 million to net income attributable to common stock or $0.02 per share) in first-quarter 2025.

Current wording

c. We defer recognizing profits on intercompany sales until final sales to third parties occur. Changes in these deferrals attributable to variability in intercompany volumes resulted in net (reductions) additions to operating income totaling $(18) million ($(6) million to net income attributable to common stock or less than $0.01 per share) in second-quarter 2026, $34 million ($9 million to net income attributable to common stock or $0.01 per share) in second-quarter 2025, $52 million ($17 million to net income attributable to common stock or $0.01 per share) for the first six months of 2026 and $148 million ($44 million to net income attributable to common stock or $0.03 per share) for the first six months of 2025.

Previous wording

Consolidated revenues totaled $6.2 billion in first-quarter 2026 and $5.7 billion in first-quarter 2025. Our revenues primarily include the sale of copper cathode, copper rod and copper concentrate, as well as gold and molybdenum in various forms. Refer to Note 8 for a summary of product revenues.

Current wording

Consolidated revenues totaled $7.0 billion in second-quarter 2026, $7.6 billion in second-quarter 2025 and $13.3 billion for both the first six months of 2026 and 2025. Our revenues primarily include the sale of copper cathode, copper rod and copper concentrate, as well as gold and molybdenum products in various forms. Refer to Note 8 for a summary of product revenues.

Previous wording

Sales Volumes. Consolidated copper and gold sales volumes decreased in first-quarter 2026, compared to first-quarter 2025, primarily reflecting lower operating rates at PTFI following the Mud Rush Incident. As a fully integrated producer of refined copper and gold in Indonesia, there may be variability in the timing between production and sales of refined copper and gold. Refer to “Operations” for further discussion of sales volumes at our mining operations.

Current wording

Sales Volumes. Consolidated copper and gold sales volumes decreased in the 2026 periods, compared to the 2025 periods, primarily reflecting lower operating rates at PTFI during the phased ramp-up of the Grasberg Block Cave underground mine. Refer to “Operations” for further discussion of sales volumes at our mining operations.

Previous wording

Realized Prices. Our consolidated revenues can vary significantly as a result of fluctuations in the market prices of copper, gold and molybdenum. Our average realized prices in first-quarter 2026, compared with first-quarter 2025, were 30% higher for copper, 59% higher for gold and 16% higher for molybdenum.

Current wording

Realized Prices. Our consolidated revenues can vary significantly as a result of fluctuations in the market prices of copper, gold and molybdenum. Our average realized prices in second-quarter 2026, compared with second-quarter 2025, were 36% higher for copper, 37% higher for gold and 36% higher for molybdenum. Average realized prices for the first six months of 2026, compared with the first six months of 2025, were 35% higher for copper, 44% higher for gold and 26% higher for molybdenum.

Previous wording

Average realized copper prices include net (unfavorable) favorable adjustments to current period provisionally priced copper sales totaling $(55) million in first-quarter 2026 and $46 million in first-quarter 2025. As discussed in Note 5, certain sales contracts for copper and gold provide final pricing in a specified future month (generally one to four months from the shipment date). We record revenues and invoice customers at the time of shipment based on then-current LME prices for copper or London PM prices for gold, which results in an embedded derivative on provisionally priced sales that is adjusted to fair value through earnings each period, using the period-end forward prices, until final pricing on the date of settlement. To the extent final prices are higher or lower than what was recorded on a provisional basis, an increase or decrease to revenues is recorded each reporting period until the date of final pricing. Accordingly, in times of rising copper and gold prices, our revenues benefit from adjustments to the final pricing of provisionally priced sales pursuant to contracts entered into in prior periods; in times of falling copper and gold prices, the opposite occurs.

Current wording

Average realized copper prices include net favorable adjustments to current period provisionally priced copper sales totaling $40 million in second-quarter 2026, $69 million in second-quarter 2025, $59 million for the first six months of 2026 and $87 million for the first six months of 2025. As discussed in Note 5, certain sales contracts for copper and gold provide final pricing in a specified future month (generally one to four months from the shipment date). We record revenues and invoice customers at the time of shipment based on then-current LME prices for copper or London PM prices for gold, which results in an embedded derivative on provisionally priced sales that is adjusted to fair value through earnings each period, using the period-end forward prices, until final pricing on the date of settlement. To the extent final prices are higher or lower than what was recorded on a provisional basis, an increase or decrease to revenues is recorded each reporting period until the date of final pricing. Accordingly, in times of rising copper and gold prices, our revenues benefit from adjustments to the final pricing of provisionally priced sales pursuant to contracts entered into in prior periods; in times of falling copper and gold prices, the opposite occurs.

Previous wording

Prior Period Provisionally Priced Copper Sales. Net favorable adjustments to prior periods’ provisionally priced copper sales (i.e., provisionally priced sales at December 31, 2025 and 2024) recorded in consolidated revenues totaled $34 million in first-quarter 2026 and $70 million in first-quarter 2025. Refer to Notes 5 and 8 for a summary of total adjustments to prior period and current period provisionally priced copper sales.

Current wording

2025 and 2024) recorded in consolidated revenues totaled $98 million in second-quarter 2026, $(35) million in second-quarter 2025, $58 million for the first six months of 2026 and $63 million for the first six months of 2025. Refer to Notes 5 and 8 for a summary of total adjustments to prior period and current period provisionally priced copper sales.

Previous wording

At March 31, 2026, we had provisionally priced copper sales totaling 136 million pounds (net of intercompany sales and noncontrolling interests) recorded at an average price of $5.58 per pound, subject to final LME copper settlement prices over the next several months. We estimate that each $0.05 change in the price realized from the March 31, 2026, recorded provisional price would have an approximate $12 million effect on 2026 revenues ($4 million to 2026 net income attributable to common stock). The LME copper settlement price closed at $5.90 per pound on April 30, 2026.

Current wording

At June 30, 2026, we had provisionally priced copper sales totaling 202 million pounds (99 million pounds net of intercompany sales and noncontrolling interests) recorded at an average price of $6.07 per pound, subject to final LME copper settlement prices over the next several months. We estimate that each $0.05 change in the price realized from the June 30, 2026, recorded provisional price would have an approximate $9 million effect on 2026 revenues ($3 million to 2026 net income attributable to common stock). The LME copper settlement price closed at $6.28 per pound on July 31, 2026.

Previous wording

Sales of Purchased Copper. We purchase copper cathode primarily for processing by our U.S. Rod & Refining operations. The volumes of copper purchases vary depending on cathode production from our operations and totaled 10 million pounds in first-quarter 2026 and 66 million pounds in first-quarter 2025. Revenues associated with the sale of purchased copper vary with the volume of copper purchases and changes in copper prices. During first-quarter 2026, we were able to meet customer demand for copper rod primarily using copper cathode produced by our U.S. and South America mining operations, resulting in a decrease in purchased copper volumes.

Current wording

Sales of Purchased Copper. We purchase copper cathode primarily for processing by our U.S. Rod & Refining operations. The volumes of copper purchases vary depending on cathode production from our operations and totaled 37 million pounds in second-quarter 2026, 35 million pounds in second-quarter 2025, 47 million pounds for the first six months of 2026 and 101 million pounds for the first six months of 2025. Revenues associated with the sale of purchased copper vary with the volume of copper purchases and changes in copper prices.

Previous wording

Treatment Charges. Revenues from our copper concentrate sales are recorded net of treatment charges, which will vary with market conditions, sales volumes and the price of copper. Treatment charges totaled $2 million in first-quarter 2026, compared to $28 million in first-quarter 2025, primarily reflecting lower treatment charge rates as a result of favorable market conditions and the lack of copper concentrate sales volumes in Indonesia now that PTFI is a fully integrated producer of refined copper and gold.

Current wording

Treatment Charges. Revenues from our copper concentrate sales are recorded net of treatment charges, which will vary with market conditions, sales volumes and the price of copper. Treatment charges totaled $8 million in second-quarter 2026, $16 million in second-quarter 2025, $10 million for the first six months of 2026 and $43 million for the first six months of 2025. The 2026 periods primarily reflect lower treatment charge rates as a result of favorable market conditions and the lack of copper concentrate sales volumes in Indonesia as PTFI is now a fully integrated producer of refined copper, gold and silver.

Previous wording

Export Duties and Royalties. Prior to the expiration of its export license in September 2025, PTFI was assessed export duties on copper concentrate sales at a rate of 7.5%. PTFI incurred export duties totaling $55 million in first-quarter 2025. Refer to Note 11 of the 2025 Form 10-K for further discussion.

Current wording

Export Duties. Prior to the expiration of its export license in September 2025, PTFI was assessed export duties on copper concentrate sales at a rate of 7.5%. PTFI incurred export duties totaling $146 million in second-quarter 2025 and $202 million for the first six months of 2025. Refer to Note 11 of our 2025 Form 10-K for further discussion.

Previous wording

PTFI pays royalties on all copper and gold sales, the amount of which varies with sales volumes and metal prices. Royalties totaled $53 million in first-quarter 2026 and $68 million in first-quarter 2025.

Current wording

Royalties. PTFI pays royalties on all copper and gold sales, the amount of which varies with sales volumes and metal prices. Royalties totaled $60 million in second-quarter 2026, $135 million in second-quarter 2025, $113 million for the first six months of 2026 and $203 million for the first six months of 2025.

Previous wording

Following the Mud Rush Incident and until PTFI’s operations return to normal capacity, a portion of PTFI's production and delivery costs will be recognized as idle facility costs, which are non-inventoriable. First-quarter 2026 included $406 million of idle facility and restoration costs associated with the Mud Rush Incident, and first-quarter 2025 included charges totaling $73 million associated with a planned maintenance turnaround at the Miami smelter.

Current wording

Consolidated production and delivery costs totaled $4.3 billion in both second-quarter 2026 and 2025, $8.4 billion for the first six months of 2026 and $8.0 billion for the first six months of 2025. The 2026 periods, compared with the 2025 periods, primarily reflect higher costs of copper purchases at Atlantic Copper and higher costs for supplies, diesel fuel and other consumables at our mining operations, partly offset by the impact of reduced operating rates at PTFI following the September 2025 external mud rush incident. The first six months of 2025 also included charges totaling $73 million associated with a planned maintenance turnaround at the Miami smelter.

Previous wording

Mining Unit Site Production and Delivery Costs Per Pound. Site production and delivery costs for our copper mining operations primarily include labor, energy and other commodity-based inputs, such as sulfuric acid, steel, reagents, liners, tires and explosives. Consolidated unit site production and delivery costs (before net noncash and other costs) for our copper mines averaged $3.29 per pound of copper in first-quarter 2026 and $2.59 per pound of copper in first-quarter 2025. First-quarter 2026 consolidated unit site production and delivery costs exclude $0.62 per pound of copper for idle facility and restoration costs associated with the Mud Rush Incident. Refer to “Operations” for further discussion of unit net cash costs associated with our operating divisions, and to “Product Revenues and Production Costs” for reconciliations of per pound costs by operating division to production and delivery costs applicable to sales reported in our consolidated statements of income.

Current wording

Mining Unit Site Production and Delivery Costs Per Pound. Site production and delivery costs for our copper mining operations primarily include labor, energy and other commodity-based inputs, such as sulfuric acid, steel, reagents, liners, tires and explosives. Consolidated unit site production and delivery costs (before net noncash and other costs) for our copper mines averaged $3.28 per pound of copper in second-quarter 2026 and for the first six months of 2026, compared to $2.71 per pound of copper in second-quarter 2025 and $2.65 per pound of copper for the first six months of 2025.

Previous wording

Following the Mud Rush Incident and until PTFI’s operations return to normal capacity, a portion of PTFI’s production and delivery costs will be recognized as idle facility costs, which are non-inventoriable. Idle facility and restoration costs, which were excluded from PTFI's unit net cash credits, totaled $406 million ($4.93 per pound of copper) in first-quarter 2026.

Current wording

During the phased ramp-up period of the Grasberg Block Cave underground mine and until PTFI’s operations return to normal capacity, a portion of PTFI's production and delivery costs will be recognized as idle facility costs, which are non-inventoriable. Idle facility and restoration costs totaled $284 million ($0.40 per pound of copper) in second-quarter 2026 and $690 million ($0.50 per pound of copper) for the first six months of 2026, which were excluded from consolidated net cash costs.

Previous wording

Depreciation will vary under the unit-of-production (UOP) method as a result of changes in sales volumes and the related UOP rates at our mining operations. Consolidated depreciation, depletion and amortization (DD&A) totaled $514 million in first-quarter 2026 (which included $93 million of non-inventoriable idle facility costs associated with the Mud Rush Incident) and $466 million in first-quarter 2025. The increase in first-quarter 2026 DD&A, compared to first-quarter 2025, primarily reflects higher depreciation associated with placing assets into service at our U.S. copper mines and at PTFI in 2025, partly offset by lower UOP depreciation as a result of lower operating rates at PTFI.

Current wording

Depreciation will vary under the unit-of-production (UOP) method as a result of changes in sales volumes and the related UOP rates at our mining operations. Consolidated depreciation, depletion and amortization (DD&A) totaled $523 million in second-quarter 2026, $668 million in second-quarter 2025, $1.0 billion for the first six months of 2026 and $1.1 billion for the first six months of 2025. The decrease in DD&A in the 2026 periods, compared to the 2025 periods, primarily reflects lower UOP depreciation as a result of lower operating rates at PTFI, partly offset by higher depreciation associated with placing assets into service at our U.S. copper mines and at PTFI in 2025.

Previous wording

Based on current sales volume estimates, consolidated DD&A is estimated to approximate $2.3 billion for the year 2026, including $0.3 billion for idle facility costs associated with the Mud Rush Incident.

Current wording

Based on current sales volume estimates, consolidated DD&A is estimated to approximate $2.3 billion for the year 2026, including $0.3 billion recognized as idle facility costs associated with the September 2025 external mud rush incident. Refer to Note 7 for further discussion of idle facility costs.

Previous wording

Environmental obligation costs reflect net revisions to our long-term environmental obligations, which vary from period to period because of changes to environmental laws and regulations, the settlement of environmental matters and/or circumstances affecting our operations that could result in significant changes in our estimates. Shutdown costs include care-and-maintenance costs and any litigation, remediation or related expenditures associated with closed facilities or operations.

Current wording

Environmental obligations reflect net revisions to our long-term environmental obligations, which vary from period to period because of changes to environmental laws and regulations, the settlement of environmental matters and/or circumstances affecting our operations that could result in significant changes in our estimates. Shutdown costs include care-and-maintenance costs and any litigation, remediation or related expenditures associated with closed facilities or operations.

Previous wording

Net charges for environmental obligations and shutdown costs totaled $17 million in first-quarter 2026 and $10 million in first-quarter 2025.

Current wording

Net charges for environmental obligations and shutdown costs totaled $13 million in second-quarter 2026, $27 million in second-quarter 2025, $30 million for the first six months of 2026 and $37 million for the first six months of 2025.

Previous wording

PTFI Mud Rush Incident Insurance Settlement

Current wording

Gain on PTFI Mud Rush Incident Insurance Settlement

Previous wording

In first-quarter 2026, PTFI recognized a gain of $0.7 billion for an insurance settlement associated with the Mud Rush Incident under its property and business interruption policies. PTFI collected this settlement in April 2026.

Current wording

In first-quarter 2026, PTFI recognized a gain of $0.7 billion ($0.2 billion after taxes and noncontrolling interests) for an insurance settlement associated with the September 2025 external mud rush incident under its property and business interruption policies. PTFI collected the proceeds from this settlement in April 2026.

Previous wording

Other income, net, which totaled $11 million in first-quarter 2026 and $58 million in first-quarter 2025, primarily includes amounts associated with interest income, currency exchange gains and losses, and mark-to-market impacts of trust assets used to satisfy financial assurance obligations for our New Mexico mining operations. Lower other income, net, in first-quarter 2026, compared to first-quarter 2025, primarily reflects currency exchange losses, partly offset by a gain of $22 million recognized in first-quarter 2026 for interest to be collected by Cerro Verde associated with the closure of its 2020 income tax audit.

Current wording

Other income, net, primarily includes amounts associated with interest income, currency exchange gains and losses, and mark-to-market impacts associated with investments and trust assets used to satisfy financial assurance obligations for our New Mexico mining operations.