Freeport-mcmoran Inc.

Copper • Basic Materials • Phoenix, AZ, United States • FCX (NYQ)

602 366 8100 333 North Central Avenue, Phoenix, AZ 85004-2189, United States

Quarter: Q4 2025 Reported: November 18, 2025 Sentiment: Negative

Freeport-McMoRan Inc. engages in the mining of mineral properties in North America, South America, and Indonesia. It primarily explores for copper, gold, molybdenum, silver, and other metals. The company's assets include the Grasberg minerals district in Indonesia; Morenci, Bagdad, Safford, Sierrita, and Miami in Arizona; Chino and Tyrone in New Mexico; and Henderson and Climax in Colorado, North America, as well as Cerro Verde in Peru and El Abra in Chile. The company was formerly known as Freeport-McMoRan Copper & Gold Inc. and changed its name to Freeport-McMoRan Inc. in July 2014. The company was incorporated in 1987 and is headquartered in Phoenix, Arizona.

Analysis Summary

Freeport-McMoRan Inc. (FCX) issued a comprehensive update on the Grasberg minerals district following an unprecedented mud rush incident on September 8, 2025, at the Grasberg Block Cave (GBC) underground mine. The incident involved approximately 800,000 metric tons of wet material, tragically resulting in the deaths of seven team members. Mining operations at GBC were immediately suspended to prioritize recovery and investigation. The company confirmed that operations at the unaffected Big Gossan and Deep Mill Level Zone underground mines restarted in late October 2025. However, the phased restart and ramp-up of the GBC underground mine is not anticipated until the second quarter of 2026, indicating a prolonged recovery period for this key asset.

Financially, the incident has already impacted Q3 2025 results and is expected to have a significant negative impact on Q4 2025 and full-year 2026 operating and financial results. FCX is undertaking extensive remediation, including mud removal, implementation of enhanced operating procedures, updated cave management plans, and repair/replacement of damaged infrastructure. Damage assessments are ongoing, with the potential for significant asset write-offs if unexpected conditions are identified. While PTFI does not believe the incident indicates a broader impairment of its long-lived mining assets, this is contingent on reserve life, metal prices, and expected resumption of operations.

The company has recorded charges and anticipates additional future costs, liabilities, fines, and penalties. While insurance recovery is being sought, its scope, timing, and potential disputes are uncertain, and future insurance renewals may face higher premiums or reduced coverage. Operationally, Indonesian smelting facilities have limited availability and are on stand-by, leading to higher variability between production and sales. Force majeure declarations on certain PTFI contracts may impact commercial relationships. The company faces risks including delays in restart, unexpected operational challenges, significant asset impairments, and adverse indirect effects such as negative publicity, increased regulatory scrutiny, and reduced stakeholder confidence, all of which could adversely affect cash flows, access to capital, and development projects.

Key Highlights

• Grasberg Block Cave (GBC) underground mine experienced a fatal mud rush incident on September 8, 2025, resulting in seven deaths.
• GBC operations are suspended, with a phased restart and ramp-up anticipated to begin in second-quarter 2026.
• Unaffected Big Gossan and Deep Mill Level Zone underground mines restarted operations in late October 2025.
• The incident is expected to have a significant negative impact on Q4 2025 and 2026 operating and financial results.
• Extensive remediation efforts, including mud removal and enhanced operating procedures, are underway.
• Smelting operations are on stand-by, and force majeure has been declared for certain PTFI contracts.
• Potential for significant asset write-offs and uncertainty regarding insurance recoveries and future premiums.

Financial Metrics

eps

Not specified in this update

YoY: Expected to be significantly impacted negatively

revenue

Not specified in this update N/A

YoY: Expected to be significantly impacted negatively

guidance

net income

Not specified in this update N/A

YoY: Expected to be significantly impacted negatively

Stock Performance (90 Days)

Data through May 18, 2026

Positive Signals

• Restart of unaffected Big Gossan and Deep Mill Level Zone underground mines in late October 2025.
• Anticipated phased restart of the GBC underground mine in Q2 2026, indicating a clear recovery timeline.
• Commitment to implement enhanced operating procedures and risk management processes.
• Intent to seek recovery of damages under property and business interruption insurance policies.
• Management's belief that the incident does not indicate a broader impairment of PTFI's long-lived mining assets, based on reserve life and favorable market outlook for metal prices.

Risks & Concerns

— Potential for delays in mud removal and remediation activities, impacting the GBC restart timeline.
— Risk of significant asset impairments if damage assessments identify unexpected conditions beyond repair.
— Uncertainty regarding the scope, timing, and potential disputes of insurance recoveries, and potential for higher future premiums or reduced coverage.
— Future costs, liabilities, fines, and penalties related to the incident potentially exceeding current expectations.
— Adverse indirect effects including negative publicity, damage to reputation, increased regulatory scrutiny, and reduced confidence from stakeholders.