Newmont reports earnings miss amid rising gold mining costs

Yahoo Finance Video
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Yahoo Finance Live anchors discuss earnings and the stock performance for Newmont Goldcorp.

Video Transcript

JULIE HYMAN: Let's move on to the next stock we're watching, which is Newmont Mining. Investors seeing the shine come off of gold miner Newmont, so to speak, after the company reported an earnings missed and raised its cost forecasts and cited lower gold production and inflation. Of course, gold itself classically has been an inflation hedge. But that-- even though gold has-- I don't know. Gold has not performed. We've talked about this before-- not performed as you might think it would in this environment.

But if you look at what's going on with that cost I mentioned, last quarter, the all-in sustaining cost to produce gold for Newmont was $1,199 an ounce. That is higher than had been estimated by analysts. So even though for some of these commodities, even if they're benefiting when the price goes up, it costs them more to produce it also.

BRIAN SOZZI: Yeah, really two lines on this quarter probably summarizes this quarter from Newmont, and maybe what is likely in a third quarter. Average price for gold down slightly year-over-year and sequentially. And adjusted operating profits for the business down sequentially and year-over-year. So it's telling you that the company still has not gotten its cost in line with, really, what has been a disappointing-- to your point, disappointing move in gold.

BRAD SMITH: I thought we were going to see more companies actually pulling in AMC and trying to have some positioning in gold. AMC took a very interesting route. And we were trying--

BRIAN SOZZI: I mean, Bed Bath and Beyond could team up with Newmont.

BRAD SMITH: Bed Bath Beyond gold division. Yeah.

BRIAN SOZZI: I agree.

BRAD SMITH: Why not? But, yeah, I mean, gold and the broader commodities right now, if you were to look at how companies are going to try and keep other assets on their balance sheet and if they would lean into a commodity like a gold, that could be an interesting play. I don't think AMC should go further into that, though, at this point in time. That's my--

BRIAN SOZZI: Or Bed Bath and Beyond.

BRAD SMITH: Or Bed Bath and Beyond.

JULIE HYMAN: Yeah, I don't-- it's been a strange trade in gold this year for sure. But, again, it's problematic if it costs them more to produce this stuff. All right--