Shares of Barrick Mining plunged 8.6% to CA$55.73 Monday morning after the miner reported second-quarter results that disappointed on the only line investors truly care about: profit. Adjusted earnings per share of $0.82 missed the analyst consensus of $0.94, while revenue of $5.29 billion fell short of the $5.67 billion expected. The paradox — record-beating output paired with an earnings miss — exposes a widening gap between what Barrick can pull from the ground and what it keeps.
More Gold Came Out, but Costs Swallowed the Upside
Gold production rose 11% sequentially to 796,000 ounces, beating guidance of 730,000–770,000 ounces. Yet that extra output couldn't offset spiraling expenses. Gold cost of sales hit $1,993 per ounce, up from $1,654 a year ago, driven by lower grades at key Nevada mines, higher fuel costs, and bigger royalty payments tied to elevated gold prices. In simple terms, Barrick is spending more to produce each ounce even as bullion retreats from its January highs — a margin squeeze that could persist.
Mali's Tax Saga Still Haunts the Bottom Line
Retrospective tax penalties in Mali weighed directly on the quarter's results. This follows a bruising multiyear standoff: Mali's ruling junta and Barrick reached a deal in late 2025 to resolve a dispute over the country's new mining code, which increases the state's share of mining revenue. But the financial residue — back taxes, fines, and legal costs — is still flowing through earnings, making Mali an ongoing drag on reported profitability.
A $1.95 Billion Newmont Deal Brings Both Clarity and Controversy
Barrick will fold its Fourmile project into Nevada Gold Mines while Newmont contributes additional assets, with Newmont paying Barrick a $1.95 billion cash top-up within 30 days and consenting to Barrick's planned North American gold IPO.
Barrick expects to complete that IPO by year-end. But some shareholders worry the spin-off of Nevada and other crown-jewel assets could dilute their holdings, adding uncertainty atop today's earnings miss.
Buybacks Are Huge, but They Can't Paper Over Margins Forever
Barrick declared a $0.175 quarterly dividend and repurchased $1.209 billion of shares, lifting Q2 shareholder returns to $1.50 billion — up 242% year-over-year. That's aggressive capital return, but it is funded by cash flow that shrank on a per-ounce basis. Production and cost guidance remain unchanged, while capex guidance was trimmed to $3.8–$4.2 billion. If costs keep climbing faster than gold prices, today's sell-off may be an early warning, not an overreaction.