$SCCO · SOUTHERN COPPER CORP/
Southern Copper filed its Q3 2026 10-Q, reporting net sales of $4.697B (+39.1% YoY) and net income attributable to SCC of $1.802B ($2.15 EPS), up 62.7% from $1.108B ($1.32 EPS) a year ago. The surge was driven almost entirely by higher metals prices — copper LME +44.4%, silver +58.7%, molybdenum +35.5%, zinc +35.9% — while copper volumes slipped 0.4% and silver volumes fell 12.2%. Operating cash cost net of by-product revenues improved sharply to $0.09/lb from $0.42/lb.
- Q3 net sales hit $4.697B, up 39.1% YoY driven by copper LME prices +44.4% and silver +58.7%
- Q3 EPS of $2.15 vs $1.32 a year ago; net income attributable to SCC reached $1.802B, up 62.7%
- Copper sales volumes fell 0.4% and silver volumes dropped 12.2% despite the price tailwinds
- Operating cash cost net of by-product revenues fell to $0.09/lb from $0.42/lb, reflecting strong by-product credits
- Nine-month capex rose to $1.381B from $902.7M; long-term debt increased to $7.996B from $6.751B at year-end 2025
Shares fell 7.43% to $177.50 in the regular session despite the 62.7% net income jump. The decline suggests the market is focused on copper volume weakness (-0.4%) and silver volume declines (-12.2%), raising concerns that price-driven earnings are unsustainable if commodity prices retreat.
A 62.7% net income surge paired with a 7.4% stock drop signals the market is pricing in peak commodity prices and punishing volume weakness — a classic cyclical warning for copper miners.
Southern Copper's results mirror the broader copper mining sector where price tailwinds from supply constraints and electrification demand are masking volume stagnation. The operating cash cost of $0.09/lb net of by-products is among the lowest in the industry, but volume declines raise questions about production capacity.
Commodity price risk is acute: a 44.4% LME copper price increase drove nearly all revenue growth while volumes declined. Any copper price reversal would disproportionately hit earnings. Foreign currency exposure in Peruvian soles and Mexican pesos adds further margin risk as costs are denominated in local currencies while revenues are USD-based.