FREEPORT-MCMORAN INC (FCX) FY 2024 MD&A

Items 7. and 7A.  Management’s Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures About Market Risk.

In Management’s Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures About Market Risk (MD&A), “we,” “us” and “our” refer to Freeport-McMoRan Inc. and its consolidated subsidiaries. The results of operations reported and summarized below include forward-looking statements that are not guarantees of future performance and are not necessarily indicative of future operating results (refer to “Cautionary Statement” below for further discussion). References to “Notes” are Notes included in our Notes to Consolidated Financial Statements. Throughout MD&A, all references to income or losses per share are on a diluted basis.

This section of our Form 10-K discusses the results of operations for the years 2024 and 2023 and comparisons between these years. Discussion of the results of operations for the year 2022 and comparisons between the years 2023 and 2022 are not included in this Form 10-K and can be found in Items 7. and 7A. “Management’s Discussion and Analysis of Financial Condition and Results of Operations and Quantitative and Qualitative Disclosures About Market Risk” contained in Part II of our Annual Report on Form 10-K for the fiscal year ended December 31, 2023.

OVERVIEW

We are a leading international metals company with the objective of being foremost in copper. Headquartered in Phoenix, Arizona, we operate large, long-lived, geographically diverse assets with significant proven and probable mineral reserves of copper, gold and molybdenum. We are one of the world’s largest publicly traded copper producers. Our portfolio of assets includes the Grasberg minerals district in Indonesia, one of the world’s largest copper and gold deposits; and significant operations in North America and South America, including the large-scale Morenci minerals district in Arizona and the Cerro Verde operation in Peru.

Our results for 2024 reflect solid execution of our operating plans and we are committed to enhancing productivity, managing costs and capital and advancing opportunities for long-term profitable growth and value creation. We believe the actions we have taken in recent years to strengthen our balance sheet and maintain flexible organic growth options will allow us to continue to execute our business plans, and reliably and responsibly generate cash flows to pursue value-enhancing organic growth options and return cash to shareholders.

We believe that we have a high-quality portfolio of long-lived copper assets positioned to generate long-term value, and we remain focused on executing our operating and investment plans. Our underground mining operations at the Grasberg minerals district in Indonesia continue to perform well, with copper production increasing in each of the past three years. During 2024, construction of PT Freeport Indonesia’s (PT-FI) new smelter and precious metals refinery (PMR) (collectively, PT-FI’s new downstream processing facilities) in Eastern Java, Indonesia were completed and as part of start-up activities, PT-FI commenced gold production from the PMR in December 2024. In October 2024, during start-up activities of the new smelter, a fire occurred requiring a temporary suspension of smelting operations to complete repairs. PT-FI expects repairs to be completed by mid-2025 and ramp-up to full capacity to be achieved by year-end 2025.

We are progressing initiatives across our North America and South America operations by incorporating new applications, technologies and data analytics to our leaching processes. Incremental copper production from these initiatives totaled 214 million pounds in 2024, compared with a total of 144 million pounds in 2023. We have projects underway to apply recent operational enhancements to our leaching processes on a larger scale and are testing new innovative technology applications that we believe have the potential for significant increases in recoverable metal from leach stockpiles beyond the current run rate.

We believe we benefit from significant copper reserves and resources with embedded growth options, an experienced team and exposure to markets with a favorable fundamental outlook.

Net income attributable to common stock totaled $1.9 billion in 2024 and $1.8 billion in 2023. Our results in 2024, compared to 2023, primarily reflect higher average realized copper and gold prices and higher gold sales volumes, partly offset by higher operating costs and higher income attributable to noncontrolling interests primarily related to higher operating income at PT-FI. Refer to “Consolidated Results” for discussion of items impacting our consolidated results for the two years ended December 31, 2024.

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At December 31, 2024, we had consolidated debt of $8.9 billion and consolidated cash and cash equivalents of $3.9 billion, $4.7 billion including current restricted cash and cash equivalents associated with a portion of PT-FI’s export proceeds required to be temporarily deposited in Indonesia banks. Net debt totaled $1.06 billion, excluding $3.2 billion of debt for PT-FI’s new downstream processing facilities. Refer to “Net Debt” for reconciliations of consolidated debt, consolidated cash and cash equivalents and current restricted cash associated with PT-FI's export proceeds to net debt.

At December 31, 2024, we had $3.0 billion of availability under our revolving credit facility, and PT-FI and Cerro Verde had $1.5 billion and $350 million, respectively, of availability under their revolving credit facilities. In November 2024, we repaid $0.7 billion in scheduled senior note maturities using cash on hand and have no further senior note maturities until 2027. Refer to Note 6 and “Capital Resources and Liquidity” for further discussion of our debt.

We have significant mineral reserves, mineral resources and future development opportunities within our portfolio of mining assets. At December 31, 2024, our estimated consolidated recoverable proven and probable mineral reserves totaled 97.0 billion pounds of copper, 23.0 million ounces of gold and 3.16 billion pounds of molybdenum. Refer to Note 15 and “Critical Accounting Estimates – Mineral Reserves” for further discussion.

During 2024, production from our mines totaled 4.2 billion pounds of copper, 1.9 million ounces of gold and 80 million pounds of molybdenum. Following is the allocation of our consolidated copper, gold and molybdenum production in 2024 by geographic location:

a.Our North America copper mines produced 38% of consolidated molybdenum production, and our Henderson and Climax molybdenum mines produced 37%.

Copper production from three of our mines (the Morenci mine in North America, the Cerro Verde mine in Peru and the Grasberg minerals district in Indonesia) together totaled 77% of our consolidated copper production in 2024.

OUTLOOK

Our financial results vary as a result of fluctuations in 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,” and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, 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. The forward-looking statements in the below section and elsewhere in this annual report on Form 10-K are based on current market conditions, speak only as of the filing date of this annual report on Form 10-K, are based on several assumptions and are subject to significant risks and uncertainties. Refer to “Cautionary Statement” below.

Consolidated Sales Volumes

Following are our projected consolidated sales volumes for 2025 and actual consolidated sales volumes for 2024:

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a.Includes 53 million pounds from our North America and South America copper mines and 35 million pounds from our Molybdenum mines.

Projected sales volumes are dependent on operational performance; Indonesia regulatory approval to export copper concentrate until repairs and full ramp-up of PT-FI’s new smelter are complete; weather-related conditions; timing of shipments and other factors. For further discussion of other important factors that could cause results to differ materially from projections, refer to Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024.

Consolidated Unit Net Cash Costs

Consolidated unit net cash costs (net of by-product credits) for our copper mines are expected to average $1.60 per pound of copper for the year 2025, based on achievement of current sales volume estimates (including estimates for copper concentrate exports from Indonesia) and cost estimates and assuming average prices of $2,700 per ounce of gold and $20.00 per pound of molybdenum for the year 2025.

Quarterly unit net cash costs vary with fluctuations in sales volumes, including the ratio of copper and gold sales within a period, and realized prices, primarily for gold and molybdenum. The impact of price changes on consolidated unit net cash costs for the year 2025 would approximate $0.04 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.

Consolidated Operating Cash Flows

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. Our consolidated operating cash flows are estimated to approximate $6.2 billion for the year 2025, based on current sales volume and cost estimates, and assuming average prices of $4.00 per pound of copper, $2,700 per ounce of gold and $20.00 per pound of molybdenum for the year 2025. Estimated consolidated operating cash flows in 2025 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). The impact of price changes on operating cash flows for the year 2025 would approximate $375 million for each $0.10 per pound change in the average price of copper, $140 million for each $100 per ounce change in the average price of gold and $135 million for each $2 per pound change in the average price of molybdenum.

Consolidated Capital Expenditures

Following is a summary of expected capital expenditures for the year 2025 (in billions):

a.Includes $1.1 billion for planned projects, primarily associated with underground mine development, supporting mill and power capital costs and a portion of spending on a new gas-fired combined cycle facility in the Grasberg minerals district, and expansion projects in North America, and $1.7 billion for discretionary growth projects, primarily in the Grasberg minerals district for the development of Kucing Liar and at the Bagdad mine for tailings infrastructure.

b.Excludes capitalized interest, commissioning and owner’s costs. Capital expenditures for PT-FI’s new downstream processing facilities are expected to be funded with PT-FI’s cash flows from operations and availability under PT-FI’s revolving credit facility.

We closely monitor market conditions and will adjust our operating plans, including capital expenditures, to protect our liquidity and preserve our asset values, as necessary.

MARKETS

Prices for copper, gold and molybdenum are affected by numerous factors beyond our control and can fluctuate significantly (for further discussion refer to “Risk Factors” contained in Part I, Item 1A. of our annual report on Form 10-K for the year ended December 31, 2024). The following graphs present the London Metal Exchange (LME) copper settlement prices, the London Bullion Market Association (London) PM gold prices, and the Platts Metals Daily Molybdenum Dealer Oxide weekly average prices since January 2015.

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This graph presents LME copper settlement prices and the combined reported stocks of copper at the LME, Commodity Exchange Inc. (COMEX) and the Shanghai Futures Exchange from January 2015 through December 2024. Copper sales from our South America and Indonesia operations are generally based on quoted LME monthly average copper settlement prices. For the year 2024, the LME copper settlement prices averaged $4.15 per pound (ranging from a low of $3.67 per pound to a high of $4.92 per pound) and closed at $3.95 per pound on December 31, 2024. The LME copper settlement prices averaged $4.07 per pound in January 2025, and closed at $4.25 per pound on February 13, 2025.

Copper sales from our North America copper mines are generally based on prevailing COMEX monthly average copper settlement prices. For the year 2024, COMEX copper settlement prices averaged $4.22 per pound (ranging from a low of $3.69 per pound to a high of $5.12 per pound) and closed at $3.99 per pound on December 31, 2024. COMEX copper settlement prices averaged $4.25 per pound in January 2025, and closed at $4.77 per pound on February 13, 2025.

We believe fundamentals for copper are favorable with growing demand supported by copper’s critical role in the global transition to renewable power, electric vehicles and other carbon-reduction initiatives, continued urbanization in developing countries, data centers and artificial intelligence developments and growing connectivity globally.

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This graph presents London PM gold prices from January 2015 through December 2024. For the year 2024, London PM gold prices averaged $2,386 per ounce (ranging from a low of $1,985 per ounce to a high of $2,778 per ounce) and closed at $2,609 per ounce on December 31, 2024. Interest rate reductions, geopolitical tensions and strong demand from central banks positively impacted gold prices during 2024. The London PM gold prices averaged $2,710 in January 2025, and closed at $2,915 per ounce on February 13, 2025.

This graph presents the Platts Metals Daily Molybdenum Dealer Oxide weekly average prices from January 2015 through December 2024. For the year 2024, the weekly average prices for molybdenum averaged $21.30 per pound (ranging from a low of $19.34 per pound to a high of $23.52 per pound) and was $21.08 per pound on December 31, 2024. Overall global demand for molybdenum is driven by energy, power generation, aerospace,

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defense and construction sectors. We believe fundamentals for molybdenum are positive with favorable demand drivers and limited supply. The Platts Metals Daily Molybdenum Dealer Oxide weekly average price for January 2025 was $20.82 per pound and was $20.70 per pound on February 13, 2025.

CRITICAL ACCOUNTING ESTIMATES

MD&A is based on our consolidated financial statements, which have been prepared in conformity with generally accepted accounting principles (GAAP) in the U.S. The preparation of these statements requires that we make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses. We base these estimates on historical experience and on assumptions that we consider reasonable under the circumstances; however, reported results could differ from those based on the current estimates under different assumptions or conditions. The areas requiring the use of management’s estimates are also discussed in Note 1 under the subheading “Use of Estimates.” Management has reviewed the following discussion of its development and selection of critical accounting estimates with the Audit Committee of our Board of Directors (Board).

Income Taxes

Refer to Note 9, and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for further discussion of our consolidated income taxes.

In preparing our consolidated financial statements, we estimate the actual amount of income taxes currently payable or receivable as well as deferred income tax assets and liabilities attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred income tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which these temporary differences are expected to be recovered or settled. The effect on deferred income tax assets and liabilities of a change in tax rates or laws is recognized in income in the period in which such changes are enacted.

Income taxes represent a critical accounting estimate as our operations are in multiple tax jurisdictions where uncertainties arise in the application of complex tax regulations and our income tax returns are subject to examination by tax authorities in those jurisdictions who may challenge any tax position on these returns. Some of these tax regimes are defined by contractual agreements with the local government, while others are defined by general tax laws and regulations. We and our subsidiaries are subject to reviews of our income tax filings and other tax payments, and disputes can arise with the taxing authorities over the interpretation of our contracts or laws. Uncertainty in a tax position may arise because tax laws are subject to interpretation. We use significant judgment to (1) determine whether, based on the technical merits, a tax position is more likely than not to be sustained upon examination by taxing authorities and (2) measure the amount of tax benefit that qualifies for recognition.

A valuation allowance is provided for those deferred income tax assets for which available information, including positive and negative evidence, suggests that the related benefits will not be realized. In determining the amount of the valuation allowance, we consider carryback opportunities, future reversals of existing taxable temporary differences, prudent and feasible tax planning strategies in each jurisdiction, as well as future taxable income exclusive of reversing temporary differences. If we determine that we will not realize all or a portion of our deferred income tax assets, we will increase our valuation allowance. Conversely, if we determine that we will ultimately be able to realize all or a portion of the related benefits for which a valuation allowance has been provided, all or a portion of the related valuation allowance will be reduced. Refer to Note 9 for further discussion of our valuation allowances.

On January 1, 2023, the provisions of the U.S. Inflation Reduction Act of 2022 (the Act) became applicable to us. The Act includes, among other provisions, a new Corporate Alternative Minimum Tax (CAMT) of 15% on the adjusted financial statement income (AFSI) of corporations with average annual AFSI exceeding $1.0 billion over a three-year period.

In September 2024, the Internal Revenue Service (IRS) issued proposed regulations that provide guidance on the application of the CAMT, which are not final and subject to change. Based on the proposed guidance released by the IRS, we determined that the provisions of the Act did not impact our financial results for the years 2024 or 2023.

In December 2021, the Organisation for Economic Cooperation and Development (OECD) published a framework for Pillar Two of the Global Anti-Base Erosion Rules, which was designed to coordinate participating jurisdictions in updating the international tax system to ensure that large multinational companies pay a minimum level of income

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tax. Recommendations from the OECD regarding a global minimum income tax and other changes are being considered and/or implemented in jurisdictions where we operate. At current metals market prices, we do not expect enactment of the recommended framework in jurisdictions where we operate to materially impact our financial results.

We have uncertain tax positions related to income tax assessments in Peru and Indonesia, including penalties and interest, which have not been recorded at December 31, 2024. Final taxes paid may be dependent upon many factors, including negotiations with taxing authorities. In certain jurisdictions, we pay a portion of the disputed amount before formally appealing an assessment. Such payment is recorded as a receivable if we believe the amount is collectible. Refer to Note 10 for further discussion.

Environmental Obligations

Refer to Notes 1 and 10, and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for further discussion of environmental obligations, including a summary of changes in our estimated environmental obligations for the three years ended December 31, 2024.

Our current and historical operating activities are subject to various national, state and local environmental laws and regulations that govern emissions of air pollutants; discharges of water pollutants; generation, handling, storage, treatment, transportation and disposal of hazardous substances, hazardous wastes and other toxic materials; and remediation, restoration and reclamation of environmental contamination, and compliance with these laws and regulations requires significant expenditures. Environmental expenditures are charged to expense or capitalized, depending upon their future economic benefits. The guidance provided by U.S. GAAP requires that liabilities for contingencies be recorded when it is probable that obligations have been incurred, and the cost can be reasonably estimated. At December 31, 2024, environmental obligations recorded in our consolidated balance sheet totaled $2.0 billion, which reflect obligations for environmental liabilities attributed to the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 or analogous state programs and for estimated future costs associated with environmental matters.

Accounting for environmental obligations represents a critical accounting estimate because (i) changes to environmental laws and regulations and/or circumstances affecting our operations could result in significant changes to our estimates, which could have a significant impact on our results of operations, (ii) we will not incur most of these costs for a number of years, requiring us to make estimates over a long period, (iii) calculating the discounted cash flows for certain of our environmental obligations requires management to estimate the amounts and timing of projected cash flows and make long-term assumptions about inflation rates and (iv) changes in estimates used in determining our environmental obligations could have a significant impact on our results of operations.

We perform a comprehensive annual review of our environmental obligations and also review changes in facts and circumstances associated with these obligations at least quarterly. Judgments and estimates are based upon currently available facts, existing technology, presently enacted laws and regulations, remediation experience, whether we are a potentially responsible party (PRP), the ability of other PRPs to pay their allocated portions and take into consideration reasonably possible outcomes. Our cost estimates can change substantially as additional information becomes available regarding the nature or extent of site contamination, updated cost assumptions (including increases and decreases to cost estimates), changes in the anticipated scope and timing of remediation activities, the settlement of environmental matters, required remediation methods and actions by or against governmental agencies or private parties.

Asset Retirement Obligations

Refer to Notes 1 and 10, and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for further discussion of reclamation and closure costs, including a summary of changes in our asset retirement obligations (AROs) for the three years ended December 31, 2024.

We record the fair value of our estimated AROs associated with tangible long-lived assets in the period incurred. Fair value is measured as the present value of cash flow estimates after considering inflation and a market risk premium. Our cost estimates are reflected on a third-party cost basis and comply with our legal obligation to retire tangible long-lived assets in the period incurred. These cost estimates may differ from financial assurance cost estimates for reclamation activities because of a variety of factors, including obtaining updated cost estimates for reclamation activities, the timing of reclamation activities, changes in scope and the exclusion of certain costs not

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considered reclamation and closure costs. At December 31, 2024, AROs recorded in our consolidated balance sheet totaled $3.7 billion.

Generally, ARO activities are specified by regulations or in permits issued by the relevant governing authority, and management’s judgment is required to estimate the extent and timing of expenditures. Accounting for AROs represents a critical accounting estimate because (i) we will not incur most of these costs for a number of years, requiring us to make estimates over a long period, (ii) reclamation and closure laws and regulations could change in the future, we may commit to taking additional closure actions and/or circumstances affecting our operations could change, (iii) the methods used or required to plug and abandon non-producing oil and gas wellbores, remove platforms, tanks, production equipment and flow lines, and restore the wellsite could change, (iv) calculating the fair value of our AROs requires management to estimate projected cash flows, make long-term assumptions about inflation rates, determine our credit-adjusted, risk-free interest rates and determine market risk premiums that are appropriate for our operations and (v) given the magnitude of our estimated reclamation, mine closure and wellsite abandonment and restoration costs, changes in any or all of these estimates could have a significant impact on our results of operations.

Mineral Reserves

Refer to Note 15, and Items 1. and 2. “Business and Properties” and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for further information regarding, and risks associated with, our estimated recoverable proven and probable mineral reserves.

Recoverable proven and probable mineral reserves were determined from the application of relevant modifying factors to geological data, in order to establish an operational, economically viable mine plan, and have been prepared in accordance with the disclosure requirements of Subpart 1300 of U.S. Securities and Exchange Commission Regulation S-K. The determination of mineral reserves represents a critical accounting estimate because it involves numerous uncertainties with respect to the ultimate geology of the ore bodies, including quantities, grades and recoveries. Estimating the quantity and grade of mineral reserves requires us to determine the size, shape and depth of our ore bodies by analyzing geological data, such as samplings of drill holes, tunnels and other underground workings. In addition to the geology of our mines, assumptions are required to determine the economic feasibility of mining these reserves, including estimates of future commodity prices, the mining methods we use and the related costs incurred to develop and mine our mineral reserves. Our estimates of recoverable proven and probable mineral reserves are prepared by and are the responsibility of our employees. These estimates are reviewed and verified regularly by independent experts in mining, geology and reserve determination.

Our estimated recoverable proven and probable mineral reserves at December 31, 2024, were determined using metal price assumptions of $3.25 per pound of copper, $1,600 per ounce of gold and $12.00 per pound of molybdenum. The following table summarizes changes in our estimated consolidated recoverable proven and probable mineral reserves during 2024:

a.Includes estimated recoverable metals contained in stockpiles. See below for additional discussion of recoverable copper in stockpiles.

b.Revisions are primarily the result of higher cost assumptions and updated geologic models.

c.May not foot because of rounding.

As discussed in Note 1, we depreciate our life-of-mine mining and milling assets and values assigned to proven and probable mineral reserves using the unit-of-production (UOP) method based on our estimated recoverable proven and probable mineral reserves. Because the economic assumptions used to estimate mineral reserves may change from period to period and additional geological data is generated during the course of operations, estimates of mineral reserves may change, which could have a significant impact on our results of operations, including changes to prospective depreciation rates and impairments of long-lived asset carrying values. Based on projected copper sales volumes, if estimated copper reserves at our mines were 10% higher at December 31, 2024, we estimate that our annual depreciation, depletion and amortization (DD&A) expense for 2025 would decrease by approximately

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$110 million (approximately $43 million to net income attributable to common stock), and a 10% decrease in copper reserves would increase DD&A expense by approximately $137 million (approximately $53 million to net income attributable to common stock). We perform annual assessments of our existing assets in connection with the review of mine operating and development plans. If it is determined that assigned asset lives do not reflect the expected remaining period of benefit, any change could affect prospective DD&A rates.

As discussed below, we review and evaluate our long-lived assets for impairment when events or changes in circumstances indicate that the related carrying amount of such assets may not be recoverable, and changes to our estimates of recoverable proven and probable mineral reserves could have an impact on our assessment of asset recoverability.

Recoverable Copper in Stockpiles

Refer to Note 1 for further discussion of our accounting policy for recoverable copper in mill and leach stockpiles, including adjustments to stockpile inventory volumes and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for risks associated with implementation of new technologies associated with the recovery of copper in leach stockpiles.

We record, as inventory, applicable costs for copper contained in mill and leach stockpiles that are expected to be processed in the future based on proven processing technologies. Mill and leach stockpiles are evaluated periodically to ensure that they are stated at the lower of weighted-average cost or net realizable value.

Accounting for recoverable copper from mill and leach stockpiles represents a critical accounting estimate because (i) it is impracticable to determine copper contained in mill and leach stockpiles by physical count, thus requiring management to employ reasonable estimation methods and (ii) recoveries from leach stockpiles can vary significantly.

At December 31, 2024, estimated consolidated recoverable copper was 1.4 billion pounds in leach stockpiles (with a carrying value of $2.2 billion) and 0.3 billion pounds in mill stockpiles (with a carrying value of $0.4 billion).

Impairment of Long-Lived Mining Assets

Refer to Note 1, and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for further information regarding, and risks associated with, impairment of long-lived mining assets.

We assess the carrying values of our long-lived mining assets when events or changes in circumstances indicate that the related carrying amounts of such assets may not be recoverable. In evaluating our long-lived mining assets for recoverability, we use estimates of pre-tax undiscounted future cash flows of our mines.

Estimates of future cash flows are derived from current business plans, which are developed using near-term metal price forecasts reflective of the current price environment and management’s projections for long-term average metal prices. In addition to near- and long-term metal price assumptions, other key assumptions include estimates of commodity-based and other input costs; proven and probable mineral reserves estimates, including the timing and cost to develop and produce the mineral reserves; value beyond proven and probable mineral reserve estimates; and the use of appropriate discount rates in the measurement of fair value. We believe our estimates and models used to determine fair value are similar to what a market participant would use. As quoted market prices are unavailable for our individual mining operations, fair value is determined through the use of after-tax discounted estimated future cash flows.

During the two-year period ended December 31, 2024, no material impairments of our long-lived mining assets were recorded.

In addition to decreases in future metal price assumptions, other events that could result in future impairment of our long-lived mining assets include, but are not limited to, decreases in estimated recoverable proven and probable mineral reserves and any event that might otherwise have a material adverse effect on mine site production levels or costs.

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CONSOLIDATED RESULTS

a.Refer to Note 14 for a summary of revenues and operating income by operating division.

b.Includes favorable adjustments to prior period provisionally priced concentrate and cathode copper sales totaling $28 million ($9 million to net income attributable to common stock or $0.01 per share) in 2024 and $183 million ($62 million to net income attributable to common stock or $0.04 per share) in 2023 (refer to Note 12).

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 (reductions) to operating income totaling $21 million ($(3) million to net income attributable to common stock or less than $0.01 per share) in 2024 and $64 million ($37 million to net income attributable to common stock or $0.03 per share) in 2023.

d.Includes net charges totaling $257 million ($0.18 per share), primarily associated with adjustments to PT-FI’s ARO, oil and gas charges for impairments and abandonment obligations, metals inventory adjustments, net adjustments to environmental obligations and related litigation reserves and nonrecurring labor-related charges at Cerro Verde, partly offset by net credits associated with historical tax matters at PT-FI and a reduction in accruals for uncertain U.S. tax positions.

e.Includes net charges totaling $373 million ($0.26 per share), primarily associated with net adjustments to environmental obligations and related litigation reserves, contested tax rulings issued by the Peru Supreme Court, impairment of oil and gas properties and an accrual for an administrative fine in Indonesia, partly offset by adjustments to PT-FI’s ARO.

f.Working capital and other uses totaled $29 million in 2024 and $880 million in 2023.

g.Includes $0.7 billion at December 31, 2024, and $1.1 billion at December 31, 2023, associated with a portion of PT-FI’s export proceeds required to be temporarily deposited in Indonesia banks for 90 days in accordance with Indonesia regulations (refer to Notes 10 and 12).

a.Reflects per pound weighted-average production and delivery costs and unit net cash costs (net of by-product credits) for all copper mines, before net noncash and other costs. For reconciliations of the per pound unit net cash costs by operating division to production and delivery costs applicable to sales reported in our consolidated financial statements, refer to “Product Revenues and Production Costs.”

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Revenues

Consolidated revenues totaled $25.5 billion in 2024 and $22.9 billion in 2023. Our revenues primarily include the sale of copper concentrate, copper cathode, copper rod, gold in concentrate and anode slimes, and molybdenum. Following is a summary of changes in our consolidated revenues from 2023 to 2024 (in millions):

Sales Volumes. Copper sales volumes in 2024 were slightly lower than 2023, primarily reflecting lower ore grades and operating rates in North America, partly offset by higher ore grades and operating rates in Indonesia. Gold sales volumes were higher in 2024, compared to 2023, primarily reflecting the timing of shipments at PT-FI. Refer to “Operations” for further discussion of sales volumes at our mining operations.

Realized Prices. Our consolidated revenues can vary significantly as a result of fluctuations in the market prices of copper, gold and molybdenum. In 2024, our average realized prices, compared with 2023, were 9% higher for copper, 23% higher for gold and 12% lower for molybdenum.

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 or London PM prices, which results in an embedded derivative on provisionally priced sales that are 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.

Consolidated revenues include net favorable (unfavorable) adjustments to current year provisionally priced copper sales (i.e., provisionally priced sales during the years 2024 and 2023) totaling $89 million for 2024 and $(86) million for 2023. See below for discussion of adjustments related to prior year provisionally priced copper sales.

Prior Year Provisionally Priced Copper Sales. Net favorable adjustments to prior years’ provisionally priced copper sales (i.e., provisionally priced copper sales at December 31, 2023 and 2022) recorded in consolidated revenues totaled $28 million in 2024 and $183 million in 2023. Refer to “Disclosures About Market Risks – Commodity Price Risk” for further discussion of our provisionally priced copper sales, and to Note 12 for a summary of total adjustments to prior period and current period provisionally priced copper sales.

Atlantic Copper Revenues. Higher Atlantic Copper revenues of $3.0 billion in 2024, compared with $2.8 billion in 2023, primarily reflects higher copper prices.

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Sales of Purchased Copper. We purchase copper cathode primarily for processing by our Rod & Refining operations. The volumes of copper purchases vary depending on cathode production from our operations and totaled 158 million pounds in 2024 and 103 million pounds in 2023. Revenues associated with the sale of purchased copper vary with the volume of copper purchases and changes in copper prices.

Treatment Charges. Revenues from our concentrate sales are recorded net of treatment charges (i.e., fees paid to smelters that are generally negotiated annually), which will vary with the sales volumes and the price of copper. The decrease in treatment charges in 2024, compared to 2023, primarily reflects lower copper concentrate sales volumes in South America.

Export Duties and Royalties. Export duties and royalties are primarily associated with PT-FI sales. Effective March 29, 2023, PT-FI’s export duties of 2.5% were eliminated upon verification that construction progress of its new smelter exceeded 50%, but were reinstated at a rate of 7.5% in July 2023 under a revised regulation. PT-FI incurred export duties totaling $457 million in 2024 and $324 million in 2023. Royalties will vary with the volume of metal sold and the prices of copper and gold. Refer to Note 11 for discussion of PT-FI’s export duties and royalties.

Production and Delivery Costs

Consolidated production and delivery costs totaled $15.6 billion in 2024, compared with $13.6 billion in 2023. Higher production and delivery costs in 2024 primarily reflect increased costs at PT-FI associated with higher operating rates and sales volumes, and for adjustments to its ARO (refer to Note 10 for discussion of Indonesia reclamation and closure programs). Production and delivery costs also includes oil and gas charges totaling $217 million in 2024 and $70 million in 2023, mostly for impairments and assumed abandonment obligations from bankruptcies of other companies (refer to Note 10) and nonrecurring labor-related charges totaling $97 million in 2024 associated with Cerro Verde’s new collective labor agreements (CLA). Refer to Note 14 for details of production and delivery costs by operating segment.

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 $2.49 per pound of copper in 2024 and $2.36 per pound in 2023. Refer to “Operations – Unit Net Cash Costs” 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 financial statements.

Our copper mining operations require significant amounts of energy, principally diesel, electricity, coal and natural gas, most of which is obtained from third parties under long-term contracts. Our take-or-pay contractual obligations for electricity totaled approximately $0.2 billion at December 31, 2024. We do not have take-or-pay contractual obligations for other energy commodities. Energy represented 16% of our copper mine site operating costs in 2024, including purchases of approximately 270 million gallons of diesel fuel; approximately 8,550 gigawatt hours of electricity at our North America and South America copper mining operations (we generate all of our power at our Indonesia mining operation); approximately 750 thousand metric tons of coal for our coal power plant in Indonesia; and approximately 2 million MMBtu (million British thermal units) of natural gas at certain of our North America mines. Based on current cost estimates, energy will approximate 16% of our copper mine site operating costs for the year 2025.

Depreciation, Depletion and Amortization

Depreciation will vary under the UOP method as a result of changes in sales volumes and the related UOP rates at our mining operations. Consolidated DD&A totaled $2.2 billion in 2024 and $2.1 billion in 2023. Our consolidated DD&A is estimated to approximate $2.5 billion for the year 2025, based on current sales volume estimates. The increase in 2025, compared to 2024, primarily reflects expected completion of commissioning activities for PT-FI’s new downstream processing facilities.

Environmental Obligations and Shutdown Costs

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 (refer to “Critical Accounting Estimates – Environmental Obligations” for further discussion). Shutdown costs include care-and-maintenance costs and any litigation, remediation or related expenditures associated with closed facilities or operations.

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Net charges for environmental obligations and shutdown costs totaled $127 million in 2024, including $82 million in net adjustments to environmental obligations. Net charges totaled $319 million in 2023, including $195 million in net adjustments to environmental obligations and $65 million associated with an adjustment to the proposed settlement of talc-related litigation. Refer to Note 10 for further discussion of environmental obligations and litigation matters.

Interest Expense, Net

Consolidated interest costs (before capitalization) totaled $710 million in 2024 and $782 million in 2023. The year 2023 included $74 million of interest charges associated with Cerro Verde’s contested tax rulings issued by the Peru Supreme Court.

Capitalized interest totaled $391 million in 2024 and $267 million in 2023. The increase in capitalized interest in 2024, compared with 2023, resulted from construction and development projects in process, primarily related to PT-FI’s new downstream processing facilities. Refer to “Operations” and “Capital Resources and Liquidity – Investing Activities” for further discussion of current development projects.

Other Income, Net

Other income, net, which totaled $362 million in 2024 and $286 million in 2023, 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. The year 2024 also includes a credit of $26 million associated with the reduction in the accrual to indemnify PT Mineral Industri Indonesia (MIND ID) from potential losses arising from historical tax disputes, and the year 2023 also includes a $69 million charge associated with Cerro Verde’s contested tax rulings issued by the Peru Supreme Court.

Income Taxes

Refer to Note 9, and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for further discussion of income taxes.

Following is a summary of the approximate amounts used in the calculation of our consolidated income tax provision for the years ended December 31 (in millions, except percentages):

a.Represents income before income taxes, equity in affiliated companies’ net earnings and noncontrolling interests.

b.In addition to our North America mining operations, which had operating income of $0.8 billion in 2024 and $1.0 billion in 2023 (refer to Note 14), the U.S. jurisdiction reflects non-operating sites and corporate-level expenses, which include interest expense associated with our senior notes and general and administrative expenses. The U.S. jurisdiction also includes net revisions to environmental obligation estimates and charges associated with oil and gas abandonment obligations and impairments.

c.Includes net credits associated with the closure of our 2017 and 2018 U.S. federal income tax exams.

d.Includes a valuation allowance release on prior year unbenefited net operating losses.

e.Reflects net charges associated with contested tax rulings issued by the Peru Supreme Court.

f.Reflects net credits associated with closure of PT-FI’s 2021 corporate income tax audit and resolution of a framework for Indonesia disputed tax matters.

Assuming achievement of current sales volume and cost estimates and average prices of $4.00 per pound for copper, $2,700 per ounce for gold and $20.00 per pound for molybdenum, we estimate our consolidated effective tax rate for the year 2025 would approximate 40%. Changes in projected sales volumes and average prices during 2025 would incur tax impacts at estimated effective rates of 39% for Peru, 36% for Indonesia and 0% for the U.S., which excludes any impacts from the Act.

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Net Income Attributable to Noncontrolling Interests

Refer to Note 2 for ownership in our subsidiaries.

Net income attributable to noncontrolling interests, which is primarily associated with PT-FI, Cerro Verde and El Abra, totaled $2.5 billion in 2024 and $1.9 billion in 2023. In September 2024, we increased our ownership interest in Cerro Verde to 55.08% from 53.56%. Refer to Note 14 for net income attributable to noncontrolling interests for each of our business segments.

Based on achievement of current sales volume and cost estimates and assuming average prices of $4.00 per pound of copper, $2,700 per ounce of gold and $20.00 per pound of molybdenum for the year 2025, we estimate that net income attributable to noncontrolling interests will approximate $2.3 billion for the year 2025. The impact of price changes on net income attributable to noncontrolling interests for the year 2025 would approximate $0.2 billion for each $0.25 per pound change in the average price of copper for the year 2025. The actual amount will depend on many factors, including relative performance of each business segment, commodity prices, costs and other factors.

OPERATIONS

Responsible Production

Refer to Items 1. and 2. “Business and Properties” and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for discussion of our involvement with the International Council on Mining & Metals and environmental (including climate) and social-related risks.

We demonstrate our responsible production performance through the Copper Mark, a comprehensive assurance framework developed specifically for the copper industry, and recently extended to other metals including molybdenum. To achieve the Copper Mark, each site is required to complete an independent external assurance process to assess conformance with various environmental, social and governance criteria. Awarded sites must be revalidated every three years. We have achieved, and are committed to maintaining, the Copper Mark and/or Molybdenum Mark, as applicable, at all of our operating sites globally.

Technology and Leaching Innovation Initiatives

We are progressing initiatives across our North America and South America operations by incorporating new applications, technologies and data analytics to our leaching processes. In late 2023, we achieved our initial incremental annual run rate target of approximately 200 million pounds of copper. Incremental copper production from these initiatives totaled 214 million pounds in 2024, compared with a total of 144 million pounds in 2023. We have projects underway to apply recent operational enhancements to our leaching processes on a larger scale and are testing new innovative technology applications that we believe have the potential for significant increases in recoverable metal from leach stockpiles beyond the current run rate. Continued success with these initiatives could contribute to favorable adjustments in recoverable copper in certain leach stockpiles and positively impact average unit net cash costs.

In addition to technology-driven leaching initiatives, we are pursuing opportunities to leverage new technologies and analytic tools in automation and operating practices with a goal of improving operating efficiencies, and reducing costs and capital intensity of our current operations and future development projects. We believe these technology and leaching initiatives are particularly important to our North America operations, which have lower ore grades.

Feasibility and Optimization Studies

We are engaged in various studies associated with potential future expansion projects primarily at our mining operations. The costs for these studies are charged to production and delivery costs as incurred and totaled $155 million in 2024 and $185 million in 2023. We estimate the costs of these studies will approximate $240 million for the year 2025, subject to market conditions and other factors.

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North America

We manage seven copper operations in North America – Morenci, Bagdad, Safford (including Lone Star), Sierrita and Miami in Arizona, and Chino and Tyrone in New Mexico. We also operate a copper smelter in Miami, Arizona. All of the North America operations are wholly owned, except for Morenci. We record our 72% undivided joint venture interest in Morenci using the proportionate consolidation method.

The North America copper operations include open-pit mining, sulfide-ore concentrating, leaching and solution extraction/electrowinning (SX/EW) facilities. A majority of the copper produced at our North America copper operations is cast into copper rod by our Rod & Refining segment. The remainder of our North America copper production is sold as copper cathode or copper concentrate, a portion of which is shipped to Atlantic Copper (our wholly owned smelter and refinery in Spain). Molybdenum concentrate, gold and silver are also produced by certain of our North America copper operations.

Development Activities. Refer to Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for further discussion of risks associated with development projects.

We have substantial reserves and future opportunities in the U.S., primarily associated with existing mining operations.

We have a potential expansion project to more than double the concentrator capacity of the Bagdad operation in northwest Arizona. Bagdad’s reserve life currently exceeds 80 years and supports an expanded operation. In late 2023, we completed technical and economic studies, which indicate the opportunity to construct new concentrating facilities to increase copper production by 200 to 250 million pounds per year at estimated incremental project capital costs of approximately $3.5 billion. Expanded operations would provide improved efficiency and reduce unit net cash costs through economies of scale. Project economics indicate that the expansion would require an incentive copper price in the range of $3.50 to $4.00 per pound and approximately three to four years to complete. The decision of whether to proceed and timing of the potential expansion will take into account overall copper market conditions, availability of labor and other factors, including deployment of our autonomous haul truck fleet conversion expected by year-end 2025 and expanding housing alternatives to support long-range plans. In parallel, we are enhancing local infrastructure and advancing activities for expanded tailings infrastructure projects required under long-range plans in order to advance the potential construction timeline.

We have commenced pre-feasibility studies in the Lone Star district of Safford to define a potential significant expansion opportunity. Positive drilling conducted in recent years indicates a large, mineralized district with opportunities to pursue a further expansion project. We expect to complete these studies in 2026. The decision of whether to proceed and timing of the potential expansion will take into account results of technical and economic studies, overall copper market conditions and other factors.

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Operating Data. Following is summary operating data for the North America copper mines for the years ended December 31:

a.Refer to “Consolidated Results” for our consolidated molybdenum sales volumes, which include sales of molybdenum produced at the North America copper mines.

Our consolidated copper production and sales volumes from the North America copper mines in 2024 were below 2023 volumes, primarily reflecting lower ore grades and operating rates, partly offset by leach recovery initiatives.

North America copper sales are estimated to approximate 1.4 billion pounds in 2025. Refer to “Outlook” for projected molybdenum sales volumes.

Unit Net Cash Costs. We believe unit net cash costs per pound of copper is a measure that provides investors with information about the cash-generating capacity of our mining operations expressed on a basis relating to the primary metal product for our respective operations. We use this measure for the same purpose and for monitoring operating performance by our mining operations. This information differs from measures of performance determined in accordance with U.S. GAAP and should not be considered in isolation or as a substitute for measures of performance determined in accordance with U.S. GAAP. This measure is presented by other metals mining companies, although our measure may not be comparable to similarly titled measures reported by other companies.

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Gross Profit per Pound of Copper and Molybdenum

The following table summarizes unit net cash costs and gross profit per pound at our North America copper mines for the two years ended December 31, 2024. Refer to “Product Revenues and Production Costs” for an explanation of the “by-product” and “co-product” methods and a reconciliation of unit net cash costs per pound to production and delivery costs applicable to sales reported in our consolidated financial statements.

a.Reflects sales of molybdenum produced by certain of the North America copper mines to our molybdenum sales company at market-based pricing.

b.Includes charges totaling $0.05 per pound of copper in 2024 and $0.08 per pound of copper in 2023 for feasibility and optimization studies. Also, includes charges totaling $0.05 per pound of copper in 2024 and $0.01 per pound of copper in 2023 for metals inventory adjustments.

Our North America copper mines have varying cost structures because of differences in ore grades and characteristics, processing costs, by-product credits and other factors. Average unit net cash costs (net of by-product credits) for the North America copper mines of $3.11 per pound of copper in 2024 were higher than average unit net cash costs of $2.63 per pound of copper in 2023, primarily reflecting lower copper volumes and higher mining and labor costs.

Because certain assets are depreciated on a straight-line basis, North America’s average unit depreciation rate may vary with asset additions and the level of copper production and sales.

Revenue adjustments primarily result from changes in prices on provisionally priced copper sales recognized in prior periods. Refer to “Consolidated Results – Revenues” for further discussion of adjustments to prior period provisionally priced copper sales.

Average unit net cash costs (net of by-product credits) for the North America copper mines are expected to approximate $3.00 per pound of copper for the year 2025, based on achievement of current sales volume and cost estimates and assuming an average price of $20.00 per pound of molybdenum. North America’s average unit net cash costs for the year 2025 would change by approximately $0.05 per pound for each $2 per pound change in the average price of molybdenum.

South America

We manage two copper operations in South America – Cerro Verde in Peru (in which we own a 55.08% interest) and El Abra in Chile (in which we own a 51% interest), which are consolidated in our financial statements.

In September 2024, we purchased 5.3 million shares of Cerro Verde common stock for $210 million, increasing our ownership interest in Cerro Verde to 55.08% from 53.56%.

South America operations includes open-pit mining, sulfide-ore concentrating, leaching and SX/EW facilities. Production from our South America operations is sold as copper concentrate or cathode under long-term contracts.

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Our South America operations also sell a portion of their copper concentrate production to Atlantic Copper. In addition to copper, the Cerro Verde mine produces molybdenum concentrate and silver.

Development Activities. Refer to Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for further discussion of risks associated with development projects.

At the El Abra operations in Chile, we have completed substantial drilling and evaluations to define a large sulfide resource that would support a potential major mill project similar to the large-scale concentrator at Cerro Verde. We are preparing data for a potential submission of an environmental impact statement by year-end 2025, subject to ongoing stakeholder engagement and economic evaluations. Preliminary estimates, which remain under review, indicate that the project economics would be supported using an incentive copper price of less than $4.00 per pound. The decision of whether to proceed and timing of the potential project will take into account overall copper market conditions, required permitting and other factors.

Operating Data. Following is summary consolidated operating data for our South America operations for the years ended December 31.

a.Refer to “Consolidated Results” for our consolidated molybdenum sales volumes, which include sales of molybdenum produced at Cerro Verde.

Our consolidated copper production and sales volumes from our South America operations in 2024 were slightly lower than 2023 volumes, primarily reflecting lower operating rates, offset by higher ore grades.

South America copper sales volumes are expected to approximate 1.1 billion in 2025 as a result of slightly lower expected ore grades. Refer to “Outlook” for projected molybdenum sales volumes.

Unit Net Cash Costs. We believe unit net cash costs per pound of copper is a measure that provides investors with information about the cash-generating capacity of our mining operations expressed on a basis relating to the primary metal product for our respective operations. We use this measure for the same purpose and for monitoring operating performance by our mining operations. This information differs from measures of performance determined in accordance with U.S. GAAP and should not be considered in isolation or as a substitute for measures of performance determined in accordance with U.S. GAAP. This measure is presented by other metals mining companies, although our measure may not be comparable to similarly titled measures reported by other companies.

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Gross Profit per Pound of Copper

The following table summarizes unit net cash costs and gross profit per pound of copper at our South America operations for the two years ended December 31, 2024. Unit net cash costs per pound of copper are reflected under the by-product and co-product methods as the South America operations also had sales of molybdenum and silver. Refer to “Product Revenues and Production Costs” for an explanation of the “by-product” and “co-product” methods and a reconciliation of unit net cash costs per pound to production and delivery costs applicable to sales reported in our consolidated financial statements.

a.Includes $0.05 per pound of copper in 2024 and $0.04 per pound of copper in 2023 for feasibility and optimization studies.

Our South America operations have varying cost structures because of differences in ore grades and characteristics, processing costs, by-product credits and other factors. Average unit net cash costs (net of by-product credits) for South America operations of $2.46 per pound of copper in 2024 were higher than average unit net cash costs of $2.38 per pound in 2023, primarily reflecting charges totaling $97 million ($0.08 per pound of copper) associated with nonrecurring labor-related charges at Cerro Verde associated with new multi-year CLAs with its two unions and lower by-product credits.

Revenues from Cerro Verde’s copper concentrate sales are recorded net of treatment charges, which will vary with Cerro Verde’s sales volumes and the price of copper.

Because certain assets are depreciated on a straight-line basis, South America’s unit depreciation rate may vary with asset additions and the level of copper production and sales.

Revenue adjustments primarily result from changes in prices on provisionally priced copper sales recognized in prior periods. Refer to “Consolidated Results – Revenues” for further discussion of adjustments to prior period provisionally priced copper sales.

Average unit net cash costs (net of by-product credits) for South America operations are expected to approximate $2.50 per pound of copper for the year 2025, based on achievement of current sales volume and cost estimates and assuming an average price of $20.00 per pound of molybdenum.

Indonesia

PT-FI operates one of the world’s largest copper and gold mines at the Grasberg minerals district in Central Papua, Indonesia. PT-FI produces copper concentrate that contains significant quantities of gold and silver. We have a 48.76% ownership interest in PT-FI and manage its operations. PT-FI's results are consolidated in our financial statements. Once the full ramp-up of the new downstream processing facilities is achieved, PT-FI will be a fully integrated producer of refined copper and gold.

Concentrate Exports. Current regulations in Indonesia prohibit exports of copper concentrate as of January 1, 2025. Pursuant to the terms of its special mining business license (IUPK) regarding force majeure events, PT-FI has requested approval from the Indonesia government to permit the export of copper concentrate in 2025 until the

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required repairs of its new smelter following the October 2024 fire incident (see below for further discussion) and full ramp-up are complete. Based on discussions with the Indonesia government, PT-FI expects to re-commence exports of copper concentrate during first-quarter 2025, and pursuant to current regulations, would be required to pay a 7.5% export duty on copper concentrate exports during 2025.

Refer to Notes 10 and 11 for further discussion of Indonesia regulatory matters, including its IUPK, export proceeds and export duties.

Long-Term Mining Rights. Pursuant to regulations issued during 2024, PT-FI is eligible to apply for an extension of its mining rights beyond 2041, provided certain conditions are met, including ownership of integrated downstream facilities that have entered the operational stage; domestic ownership of at least 51% and agreement with a state-owned enterprise for an additional 10% ownership; and commitments for additional exploration and increases in refining capacity, each as approved by the Ministry of Energy and Mineral Resources. Application for extension may be submitted at any time up to one year prior to the expiration of PT-FI’s IUPK. PT-FI expects to apply for an extension during 2025, pending agreement with MIND ID on a purchase and sale agreement for the transfer in 2041 of an additional 10% interest in PT-FI.

An extension would enable continuity of large-scale operations for the benefit of all stakeholders and provide growth options through additional resource development opportunities in the highly attractive Grasberg minerals district.

Operating and Development Activities. Refer to Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for further discussion of risks associated with development projects.

Over a multi-year investment period, PT-FI has successfully commissioned three large-scale underground mines in the Grasberg minerals district (Grasberg Block Cave, Deep Mill Level Zone (DMLZ) and Big Gossan). Milling rates for ore from these underground mines averaged 208,400 metric tons of ore per day in 2024 and 198,300 metric tons of ore per day in 2023. In December 2024, PT-FI completed construction of a new copper cleaner circuit, a mill recovery project to enhance recoveries and optimize concentrate production, with commissioning underway.

Kucing Liar. Long-term mine development activities are ongoing for PT-FI’s Kucing Liar deposit in the Grasberg minerals district. Kucing Liar is expected to produce over 7 billion pounds of copper and 6 million ounces of gold between 2029 and the end of 2041, and an extension of PT-FI’s operating rights beyond 2041 would extend the life of the project. Development activities commenced in 2022 and are expected to continue over an approximate 10-year timeframe. Capital investments for Kucing Liar are estimated to total $4 billion over the next seven to eight years (averaging approximately $0.5 billion per annum). Approximately $0.6 billion has been incurred through December 31, 2024. At full operating rates, annual production from Kucing Liar is expected to approximate 560 million pounds of copper and 520 thousand ounces of gold, providing PT-FI with sustained long-term, large-scale and low-cost production. Kucing Liar will benefit from substantial shared infrastructure and PT-FI’s experience and long-term success in block-cave mining.

Natural Gas Facilities. PT-FI plans to transition its existing energy source from coal to natural gas, which would meaningfully reduce PT-FI’s Scope 1 greenhouse gas emissions at the Grasberg minerals district. The majority of PT-FI’s planned investments in a new gas-fired combined cycle facility are expected to be incurred over the next three years, at a cost of approximately $1 billion, which represents an incremental cost of $0.4 billion compared to previously planned investments to refurbish the existing coal units. Once complete, PT-FI’s dual-fuel power plant and the new gas-fired combined cycle facility will be fueled by natural gas, supplied by a floating liquefied natural gas storage and regassification unit.

Downstream Processing Facilities.

New Smelter. Construction of the new greenfield smelter in Eastern Java, Indonesia was completed during 2024. In October 2024, during start-up activities, a fire occurred that required a temporary suspension of smelting operations to complete repairs. Procurement of long-lead items is advanced and repairs are scheduled to be completed by mid-2025, and PT-FI expects ramp-up to full capacity to be achieved by year-end 2025. PT-FI expects restoration, repair and replacement costs to approximate $100 million, which are expected to be mostly offset through recovery under construction insurance programs.

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PMR. As part of start-up activities, PT-FI commenced gold production at its new PMR in December 2024. The facility has capacity to refine all precious metals from PT-FI’s new smelter as well as from PT Smelting, PT-FI’s 66%-owned smelter and refinery in Gresik, Indonesia.

Refer to “Smelting and Refining” and Note 2 for further discussion of PT Smelting.

Operating Data. Following is summary consolidated operating data for Indonesia operations for the years ended December 31.

Higher consolidated copper and gold sales volumes in 2024, compared with 2023, primarily reflected higher mining and milling rates, higher copper ore grades and the timing of shipments.

PT-FI’s consolidated copper production volumes for 2024 exceeded sales volumes, reflecting an increase in concentrate inventory held at PT-FI’s new downstream processing facilities expected to be sold as refined metal in the second half of 2025. PT-FI’s consolidated copper and gold production volumes for 2023 exceeded sales volumes, reflecting the deferral of sales recognition related to the PT Smelting tolling arrangement (as discussed below and in Note 2).

Consolidated sales volumes from PT-FI are expected to approximate 1.55 billion pounds of copper and 1.6 million ounces of gold in 2025. PT-FI’s projected sales volumes in 2025 reflect reduced operating rates associated with two major maintenance projects in its concentrating facilities. Projected sales volumes are dependent on operational performance; Indonesia regulatory approval to export copper concentrate until repairs and full ramp-up of PT-FI’s new smelter are complete; weather-related conditions; and other factors detailed in the “Cautionary Statement” below.

Unit Net Cash (Credits) Costs. We believe unit net cash (credits) costs per pound of copper is a measure that provides investors with information about the cash-generating capacity of our mining operations expressed on a basis relating to the primary metal product for our respective operations. We use this measure for the same purpose and for monitoring operating performance by our mining operations. This information differs from measures of performance determined in accordance with U.S. GAAP and should not be considered in isolation or as a substitute for measures of performance determined in accordance with U.S. GAAP. This measure is presented by other metals mining companies, although our measure may not be comparable to similarly titled measures reported by other companies.

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Gross Profit per Pound of Copper and per Ounce of Gold

The following table summarizes the unit net cash (credits) costs and gross profit per pound of copper and per ounce of gold at our Indonesia mining operations for the two years ended December 31, 2024. Refer to “Product Revenues and Production Costs” for an explanation of “by-product” and “co-product” methods and a reconciliation of unit net cash costs per pound to production and delivery costs applicable to sales reported in our consolidated financial statements.

a.Includes charges of $0.09 per pound of copper associated with ARO adjustments, $0.08 per pound of copper for operational readiness and start-up costs associated with PT-FI’s new downstream processing facilities, $0.02 per pound of copper for amounts capitalized in prior years associated with construction of PT-FI’s new downstream processing facilities and $0.02 per pound of copper for feasibility and optimization studies.

b.Includes credits of $0.07 per pound of copper associated with ARO adjustments, and charges of $0.04 per pound of copper associated with an administrative fine and $0.02 per pound of copper for feasibility and optimization studies.

A significant portion of PT-FI’s costs are fixed and unit costs vary depending on volumes and other factors. PT-FI’s unit net cash credits (including gold, silver and other by-product credits) of $0.28 per pound of copper in 2024 was favorable compared to the unit net cash costs (net of gold, silver and other by-product credits) of $0.10 per pound of copper in 2023, primarily reflecting higher gold credits and higher copper volumes.

Treatment charges vary with the volume of metals sold and the price of copper, and royalties vary with the volume of metals sold and the prices of copper and gold. PT-FI royalties totaled $433 million in 2024 and $338 million in 2023.

Export duties totaled $457 million in 2024 and $324 million in 2023. Refer to Note 11 for further discussion of PT-FI’s export duties.

Because certain assets are depreciated on a straight-line basis, PT-FI’s unit depreciation rate may vary with asset additions and the level of copper volumes and changes in copper and gold inventory.

Revenue adjustments primarily result from changes in prices on provisionally priced copper sales recognized in prior periods. Refer to “Consolidated Results – Revenues” for further discussion of adjustments to prior period provisionally priced copper sales.

As discussed in Note 2, beginning in 2023, PT-FI’s commercial arrangement with PT Smelting changed from a copper concentrate sales agreement to a tolling arrangement and there are no further sales from PT-FI to PT Smelting. PT Smelting’s intercompany profit for 2023 represents the change in the deferral of PT-FI’s profit on prior sales to PT Smelting.

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Average unit net cash credits (including gold, silver and other by-product credits) for PT-FI are expected to approximate $0.27 per pound of copper for the year 2025, based on achievement of current sales volumes (including estimates for copper concentrate exports) and cost estimates and assuming an average price of $2,700 per ounce of gold. PT-FI’s average unit net cash costs for the year 2025 would change by approximately $0.09 per pound of copper for each $100 per ounce change in the average price of gold.

PT-FI’s projected sales volumes and unit net cash costs for the year 2025 are dependent on operational performance; Indonesia regulatory approval to export copper concentrate until repairs and full ramp-up of PT-FI’s new smelter are complete; weather-related conditions; timing of shipments; and other factors. Refer to “Cautionary Statement” below, and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for further discussion of factors that could cause results to differ materially from projections.

Molybdenum Mines

We operate two wholly owned primary molybdenum operations in Colorado – the Climax open-pit mine and the Henderson underground mine. The Climax and Henderson mines produce high-purity, chemical-grade molybdenum concentrate, which is typically further processed into value-added molybdenum chemical products. The majority of the molybdenum concentrate produced at the Climax and Henderson mines, as well as from our North America copper mines and South America operations, is processed at our conversion facilities.

Operating and Development Activities. Production from the Molybdenum mines totaled 30 million pounds of molybdenum in both 2024 and 2023. Refer to “Consolidated Results” for our consolidated molybdenum operating data, which includes sales of molybdenum produced at our primary molybdenum operations and from our North America copper mines and South America operations. Refer to “Outlook” for projected consolidated molybdenum sales volumes and to “Markets” for a discussion of molybdenum prices.

Unit Net Cash Costs per Pound of Molybdenum. We believe unit net cash costs per pound of molybdenum is a measure that provides investors with information about the cash-generating capacity of our mining operations expressed on a basis relating to the primary metal product for our respective operations. We use this measure for the same purpose and for monitoring operating performance by our mining operations. This information differs from measures of performance determined in accordance with U.S. GAAP and should not be considered in isolation or as a substitute for measures of performance determined in accordance with U.S. GAAP. This measure is presented by other metals mining companies, although our measure may not be comparable to similarly titled measures reported by other companies.

Average unit net cash costs for our Molybdenum mines of $17.89 per pound of molybdenum in 2024 were higher than $15.13 per pound of molybdenum in 2023, primarily reflecting contract labor transition costs. Average unit net cash costs for the Molybdenum mines are expected to approximate $15.20 per pound of molybdenum for the year 2025, based on achievement of current sales volumes and cost estimates. Refer to “Product Revenues and Production Costs” for a reconciliation of unit net cash costs per pound to production and delivery costs applicable to sales reported in our consolidated financial statements.

Smelting and Refining

Through our downstream integration, we are able to assure placement of a significant portion of our copper concentrate production. PT-FI wholly owns and operates its new downstream facilities in Eastern Java, Indonesia, and has a 66% ownership interest in PT Smelting (39.5% prior to June 30, 2024), which is operated by Mitsubishi Materials Corporation (refer to Note 2 for further discussion of PT Smelting). We wholly own and operate the Miami smelter in Arizona, the El Paso refinery in Texas, and Atlantic Copper smelter and refinery in Huelva, Spain.

During 2024, PT-FI completed construction of its new downstream processing facilities. In October 2024, during start-up activities of the new smelter, a fire occurred requiring a temporary suspension of smelting operations to complete repairs (for further discussion refer to “Operations – Indonesia – Downstream Processing Facilities”). The new smelter will smelt and refine copper concentrate from PT-FI and the PMR, which commenced gold production as part of start-up activities in December 2024, will process anode slimes from the new smelter and PT Smelting. Once its new downstream processing facilities are operational, PT-FI’s operations will be fully integrated and treatment charges reflecting the cost of smelting and refining operations will be recorded in production and delivery costs. PT-FI recorded charges for operational readiness and startup costs associated with the new downstream processing facilities totaling $133 million in 2024. We estimate that operational readiness and startup costs associated with the new downstream processing facilities will approximate $120 million for the year 2025.

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The Miami smelter has been operating for over 100 years and has been upgraded numerous times during that period to implement new technologies, improve production and comply with air quality requirements. Major maintenance turnarounds are anticipated to occur approximately every three to four years for the Miami smelter. We performed a major maintenance turnaround for the Miami smelter during 2021 and the next major maintenance turnaround is scheduled for mid-year 2025, for which we expect to incur maintenance charges and idle facility costs of approximately $85 million.

Atlantic Copper smelts and refines copper concentrate and markets refined copper and precious metals in slimes. During the year 2024, Atlantic Copper’s copper concentrate purchases included 30% from our copper mining operations and 70% from third parties. Atlantic Copper’s treatment charges, which consist of a base rate per pound of copper and per ounce of gold, are generally fixed and represent a cost to our mining operations and income to Atlantic Copper (i.e., higher treatment charges benefit our Atlantic Copper operations). Our North America copper mines are less significantly affected by changes in treatment charges because these operations are largely integrated with our Miami smelter and El Paso refinery.

We defer recognizing profits on sales from our mining operations to Atlantic Copper until final sales to third parties occur. Changes in these deferrals attributable to variability in intercompany volumes resulted in net additions (reductions) to operating income totaling $21 million ($(3) million to net income attributable to common stock) in 2024 and $64 million ($37 million to net income attributable to common stock) in 2023. Our net deferred profits on our inventories at Atlantic Copper to be recognized in future periods’ operating income totaled $181 million ($60 million to net income attributable to common stock) at December 31, 2024. Quarterly variations in ore grades, the timing of intercompany shipments and changes in product prices will result in variability in our net deferred profits and quarterly earnings.

In May 2024, the U.S. Environmental Protection Agency (EPA) amended its rule establishing standards for hazardous air pollutant emissions from primary copper smelters. This final rule will impact our Miami, Arizona smelter operations, which process a significant portion of the copper concentrate produced by our North America copper mines. We are evaluating processes and equipment modifications and the costs involved, which could be significant in connection with the revised rule requirements. Our appeal of EPA’s final rule to the Court of Appeals for the District of Columbia Circuit is suspended, pending resolution of several petitions for reconsideration to EPA filed by us and other parties. Refer to “Governmental Regulations – Environmental Matters” in Items 1 and 2. “Business and Properties” and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for additional information on new and revised environmental regulatory requirements that may result in substantial increased costs for our business.

CAPITAL RESOURCES AND LIQUIDITY

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. See “Consolidated Results,” and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for further discussion of our energy requirements and related costs.

We remain focused on managing costs efficiently and continue to advance several important value-enhancing initiatives. We believe the actions we have taken in recent years to build a solid balance sheet, successfully expand low-cost operations and maintain flexible organic growth options while maintaining sufficient liquidity, will allow us to continue to execute our business plans in a prudent manner during periods of economic uncertainty while preserving substantial future asset values. We closely monitor market conditions and will adjust our operating plans to protect liquidity and preserve our asset values, if necessary. We expect to maintain a strong balance sheet and liquidity position as we focus on building long-term value in our business, executing our operating plans safely, responsibly and efficiently, and prudently managing costs and capital expenditures.

Based on current sales volume, cost and metal price estimates and planned capital expenditures discussed in “Outlook,” our available cash and cash equivalents plus our projected consolidated operating cash flows of $6.2 billion for the year 2025 exceed our expected consolidated capital expenditures of $5.0 billion. We have cash on hand and the financial flexibility to fund capital expenditures and our other cash requirements for the next twelve months, including noncontrolling interest distributions, income tax payments, current common stock dividends (base and variable) and any share or debt repurchases. Planned capital expenditures for major mining projects over the next few years are primarily associated with underground mine development in the Grasberg minerals district and

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potential expansion projects in North America. At December 31, 2024, we had $3.9 billion of consolidated cash and cash equivalents ($4.7 billion including $0.7 billion of current restricted cash associated with a portion of PT-FI’s export proceeds required to be temporarily deposited in Indonesia banks), and FCX, PT-FI and Cerro Verde have $3.0 billion, $1.5 billion and $350 million, respectively, available under their revolving credit facilities.

Financial Policy. Our financial policy is aligned with our strategic objectives of maintaining a solid balance sheet, providing cash returns to shareholders and advancing opportunities for future growth. The policy includes a base dividend and a performance-based payout framework, whereby up to 50% of available cash flows generated after planned capital spending and distributions to noncontrolling interest would be allocated to shareholder returns and the balance to debt reduction and investments in value enhancing growth projects, subject to us maintaining our net debt at a level not to exceed the net debt target of $3.0 billion to $4.0 billion (excluding debt for PT-FI’s new downstream processing facilities). Our Board reviews the structure of the performance-based payout framework at least annually.

At December 31, 2024, our net debt, excluding $3.2 billion of debt for PT-FI’s new downstream processing facilities, totaled $1.06 billion. Refer to “Net Debt” for further discussion.

On December 18, 2024, our Board declared cash dividends totaling $0.15 per share on our common stock (including a $0.075 per share quarterly base cash dividend and a $0.075 per share quarterly variable, performance-based cash dividend), which was paid on February 3, 2025, to shareholders of record as of January 15, 2025. The declaration and payment of dividends (base or variable) are at the discretion of our Board and will depend on our financial results, cash requirements, global economic conditions and other factors deemed relevant by our Board.

During 2024 we acquired 1.2 million shares of our common stock for a total cost of $59 million ($50.48 average cost per share) bringing total purchases under our $5.0 billion share repurchase program to 49.0 million shares for a cost of $1.9 billion ($38.64 average cost per share). The timing and amount of share repurchases are at the discretion of management and will depend on a variety of factors. The share repurchase program may be modified, increased, suspended or terminated at any time at the Board’s discretion.

Refer to Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, and “Cautionary Statement” below for further discussion.

Cash

Following is a summary of the U.S. and international components of consolidated cash and cash equivalents available to the parent company, net of noncontrolling interests’ share and withholding taxes, at December 31, 2024 (in billions):

a.Excludes $0.7 billion of current restricted cash associated with a portion of PT-FI's export proceeds required to be temporarily deposited in Indonesia banks for 90 days in accordance with a regulation issued by the Indonesia government (refer to Note 10).

Cash held at our international operations is generally used to support our foreign operations’ capital expenditures, operating expenses, debt repayments, working capital or other cash needs. Management believes that sufficient liquidity is available in the U.S. from cash balances and availability from our revolving credit facility. We have not elected to permanently reinvest earnings from our foreign subsidiaries, and we have recorded deferred tax liabilities for foreign earnings that are available to be repatriated to the U.S. From time to time, our foreign subsidiaries distribute earnings to the U.S. through dividends that are subject to applicable withholding taxes and noncontrolling interests’ share. See Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for further discussion of our holding company structure and the potential impact of changes in tax laws.

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Debt

At December 31, 2024, consolidated debt totaled $8.9 billion, with a weighted-average interest rate of 5.2%. Refer to “Interest Rate Risk” for further discussion of our fixed- and variable-rate debt.

In November 2024, we repaid $0.7 billion in scheduled senior note maturities using cash on hand and our next senior note maturities are in 2027. Our total debt has an average remaining duration of approximately 10 years.

At December 31, 2024, we had no borrowings and $7 million in letters of credit issued under our $3.0 billion revolving credit facility, PT-FI had $250 million in borrowings outstanding under its $1.75 billion revolving credit facility and Cerro Verde had no borrowings under its $350 million revolving credit facility. Refer to Note 6 for further discussion.

Operating Activities

We generated consolidated operating cash flows of $7.2 billion in 2024 and $5.3 billion in 2023. Higher operating cash flows in 2024, compared with 2023, primarily reflect higher average realized copper and gold prices and higher gold sales volumes, as well as working capital changes related to the timing of approval of PT-FI’s permitted copper concentrate export quota for 2024 and routine timing related impacts associated with payments to suppliers.

Investing Activities

Capital Expenditures. Capital expenditures, including capitalized interest, totaled $4.8 billion in 2024 and 2023, including amounts for major mining projects ($2.1 billion in 2024 and $1.8 billion in 2023) primarily associated with the underground development activities in the Grasberg minerals district, and for PT-FI’s new downstream processing facilities ($1.2 billion in 2024 and $1.7 billion in 2023).

Refer to “Outlook” for further discussion of projected capital expenditures for 2025.

Acquisition of Additional Ownership Interest in Cerro Verde. In September 2024, we purchased 5.3 million shares of Cerro Verde common stock for a total cost of $210 million, increasing our ownership interest in Cerro Verde to 55.08% from 53.56%.

Loans to PT Smelting for Expansion. PT-FI made loans to PT Smelting totaling $28 million in 2024 and $129 million in 2023 to fund PT Smelting’s expansion project. Refer to Note 2 for further discussion.

Financing Activities

Debt Transactions. Net repayments of debt totaled $0.5 billion in 2024, including the repayment of our 4.55% Senior Notes that matured in November 2024 totaling $730 million, partly offset by $250 million in borrowings under the PT-FI revolving credit facility that were used to fund capital expenditures for PT-FI’s new downstream processing facilities.

Net repayments of debt totaled $1.2 billion in 2023, including the repayment of our 3.875% Senior Notes that matured in March 2023 totaling $996 million and open-market purchases of senior notes totaling $221 million.

Cash Dividends on Common Stock. We paid cash dividends on our common stock totaling $0.9 billion in 2024 and in 2023. The declaration and payment of dividends (base or variable) is at the discretion of our Board and will depend on our financial results, cash requirements, global economic conditions and other factors deemed relevant by our Board. Refer to Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, and “Cautionary Statement” below.

Cash Dividends and Distributions Paid to Noncontrolling Interests. Cash dividends and distributions paid to noncontrolling interests at our international operations totaled $1.8 billion (including $1.4 billion paid to PT-FI’s noncontrolling shareholders) in 2024 and $0.6 billion (including $0.3 billion paid to PT-FI’s noncontrolling shareholders) in 2023. Cash dividends and distributions to noncontrolling interests vary based on the operating results and cash requirements of our consolidated subsidiaries.

Treasury Stock Purchases. In 2024, we acquired 1.2 million shares of our common stock for a total cost of $59 million ($50.48 average cost per share) under the share repurchase program. There were no shares acquired under the program in 2023. As of February 14, 2025, $3.1 billion remains available under the share repurchase program. Refer to Note 8 for further discussion.

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Contributions from Noncontrolling Interests. We received equity contributions totaling $50.0 million in 2023 from MIND ID for its share of capital spending on the underground mine development projects in the Grasberg minerals district.

CONTINGENCIES

Environmental Obligations and AROs

Refer to Note 10 and “Critical Accounting Estimates,” and Items 1. and 2. “Business and Properties” and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for further information about contingencies associated with environmental matters and AROs.

For 2025, we expect to incur approximately $0.6 billion of aggregate environmental capital expenditures and other environmental costs and $0.2 billion in aggregate ARO expenditures.

Leases

Refer to Note 11, and Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for information about lease commitments.

Litigation and Other Contingencies

Refer to Note 10, and Item 1A. “Risk Factors” and Item 3. “Legal Proceedings” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for further discussion of contingencies associated with legal proceedings and other matters, including tax and Indonesia regulatory matters.

DISCLOSURES ABOUT MARKET RISKS

Commodity Price Risk

Our 2024 consolidated revenues from our copper mining operations include the sale of copper concentrate, copper cathode, copper rod, gold, silver, molybdenum and other metals, the sale of molybdenum in various forms by our molybdenum operations, and the sale of copper cathode, copper anode and gold in anode and slimes by Atlantic Copper. Our financial results will vary with fluctuations in the market prices of the commodities we produce, primarily copper and gold, and to a lesser extent molybdenum. For projected sensitivities of our operating cash flow to changes in commodity prices, refer to “Outlook.” World market prices for these commodities have fluctuated historically and are affected by numerous factors beyond our control. Refer to Item 1A. “Risk Factors” contained in Part I of our annual report on Form 10-K for the year ended December 31, 2024, for further discussion of financial risks associated with fluctuations in the market prices of the commodities we sell.

During 2024, our mined copper was sold 45% in concentrate, 34% as cathode and 21% as rod. All of our copper concentrate and some cathode sales contracts provide final copper pricing in a specified future month (generally one to four months from the shipment date) based primarily on quoted LME monthly average copper settlement prices. We receive market prices based on prices in the specified future period, which results in price fluctuations recorded through revenues until the date of settlement. We record revenues and invoice customers at the time of shipment based on then-current LME prices, which results in an embedded derivative on our provisionally priced concentrate and cathode 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 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 prices, the opposite occurs.

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Following are the favorable impacts of net adjustments to the prior years’ provisionally priced copper sales for the years ended December 31 (in millions, except per share amounts):

At December 31, 2024, we had provisionally priced copper sales at our copper mining operations totaling 133 million pounds of copper (net of intercompany sales and noncontrolling interests) recorded at an average price of $3.96 per pound, subject to final pricing over the next several months. We estimate that each $0.05 change in the price realized from the December 31, 2024, provisional price recorded would have an approximate $12 million effect on 2025 revenues ($4 million to net income attributable to common stock). The LME copper settlement price closed at $4.25 per pound on February 13, 2025.

Foreign Currency Exchange Risk

The functional currency for most of our operations is the U.S. dollar. Substantially all of our revenues and a significant portion of our costs are denominated in U.S. dollars; however, some costs and certain asset and liability accounts are denominated in local currencies, including the Indonesia rupiah, Peruvian sol, Chilean peso and euro. We recognized foreign currency translation gains on balances denominated in foreign currencies totaling $17 million in 2024 and $20 million in 2023. Generally, our operating results are positively affected when the U.S. dollar strengthens in relation to those foreign currencies and are adversely affected when the U.S. dollar weakens in relation to those foreign currencies.

Following is a summary of estimated annual payments and the impact of changes in foreign currency rates on our annual operating costs:

a.Reflects the estimated impact on annual operating costs assuming a 10% increase or decrease in the exchange rate reported at December 31, 2024.

b.Based on exchange rates at December 31, 2024.

Interest Rate Risk

At December 31, 2024, we had total future debt maturities based on principal amounts of $9.0 billion, of which 97% was fixed-rate debt. The table below presents average interest rates for our scheduled maturities of principal for our outstanding debt and the related fair values at December 31, 2024 (in millions, except percentages):

NEW ACCOUNTING STANDARDS

Refer to Note 1 for discussion of recently issued accounting standards and their projected impact on our future financial statements and disclosures.

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NET DEBT

We believe that net debt provides investors with information related to the performance-based payout framework in our financial policy, which requires us to maintain our net debt at a level not to exceed the net debt target of $3 billion to $4 billion, excluding debt for PT-FI’s new downstream processing facilities. We define net debt as consolidated debt less (i) consolidated cash and cash equivalents and (ii) current restricted cash associated with PT-FI’s export proceeds. This information differs from consolidated debt determined in accordance with U.S. GAAP and should not be considered in isolation or as a substitute for consolidated debt determined in accordance with U.S. GAAP. Our net debt, which may not be comparable to similarly titled measures reported by other companies, follows (in millions):

a.In accordance with a regulation issued by the Indonesia government, 30% of PT-FI’s export proceeds are being temporarily deposited into Indonesia banks for a period of 90 days before withdrawal and are presented as current restricted cash and cash equivalents in our consolidated balance sheet. As the 90-day holding period is the only restriction on the cash, we have included such amount in the calculation of net debt.

b.Represents PT-FI’s senior notes and $250 million of borrowings under PT-FI’s revolving credit facility.

PRODUCT REVENUES AND PRODUCTION COSTS

Mining Product Revenues and Unit Net Cash Costs (Credits)

We believe unit net cash costs (credits) per pound of copper and molybdenum are measures intended to provide investors with information about the cash-generating capacity of our mining operations expressed on a basis relating to the primary metal product for the respective operations. We use this measure for the same purpose and for monitoring operating performance by our mining operations. This information differs from measures of performance determined in accordance with U.S. GAAP and should not be considered in isolation or as a substitute for measures of performance determined in accordance with U.S. GAAP. These measures are presented by other metals mining companies, although our measures may not be comparable to similarly titled measures reported by other companies.

We present gross profit per pound of copper in the following tables using both a “by-product” method and a “co-product” method. We use the by-product method in our presentation of gross profit per pound of copper because (i) the majority of our revenues are copper revenues, (ii) we mine ore, which contains copper, gold, molybdenum and other metals, (iii) it is not possible to specifically assign all of our costs to revenues from the copper, gold, molybdenum and other metals we produce, and (iv) it is the method used by our management and Board to monitor our operations and to compare mining operations in certain industry publications. In the co-product method presentations, shared costs are allocated to the different products based on their relative revenue values, which will vary to the extent our metals sales volumes and realized prices change.

We show revenue adjustments for prior period open sales as separate line items. Because these adjustments do not result from current period sales, these amounts have been reflected separately from revenues on current period sales. Noncash and other costs, net which are removed from site production and delivery costs in the calculation of unit net cash costs, consist of items such as ARO accretion and other adjustments, inventory write-offs and adjustments, stock-based compensation costs, long-lived asset impairments, idle facility costs, feasibility and optimization study costs, operational readiness and startup costs, restructuring and/or unusual charges. As discussed above, gold, molybdenum and other metal revenues at copper mines are reflected as credits against site production and delivery costs in the by-product method. The following schedules are presentations under both the by-product and co-product methods together with reconciliations to amounts reported in our consolidated financial statements.

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North America Copper Mines Product Revenues, Production Costs and Unit Net Cash Costs

a.Reflects sales of molybdenum produced by certain of the North America copper mines to our molybdenum sales company at market-based pricing.

b.Includes gold and silver product revenues and production costs.

c.Includes charges totaling $62 million ($0.05 per pound of copper) for feasibility and optimization studies and $60 million ($0.05 per pound of copper) for metals inventory adjustments.

d.Represents the combined total for our other mining operations as presented in Note 14.

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North America Copper Mines Product Revenues, Production Costs and Unit Net Cash Costs

a.Reflects sales of molybdenum produced by certain of the North America copper mines to our molybdenum sales company at market-based pricing.

b.Includes gold and silver product revenues and production costs.

c.Includes charges totaling $107 million ($0.08 per pound of copper) for feasibility and optimization studies and $11 million ($0.01 per pound of copper) for metals inventory adjustments.

d.Represents the combined total for our other mining operations as presented in Note 14.

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South America Operations Product Revenues, Production Costs and Unit Net Cash Costs

a.Includes silver sales of 3.6 million ounces ($29.35 per ounce average realized price) and sales of molybdenum produced by Cerro Verde to our molybdenum sales company at market-based pricing.

b.Includes $97 million ($0.08 per pound of copper) associated with nonrecurring labor-related charges at Cerro Verde related to the new CLAs with its unions.

c.Includes charges totaling $57 million ($0.05 per pound of copper) for feasibility and optimization studies.

d.Represents the combined total for our other mining operations as presented in Note 14.

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South America Operations Product Revenues, Production Costs and Unit Net Cash Costs

a.Includes silver sales of 4.1 million ounces ($23.57 per ounce average realized price) and sales of molybdenum produced by Cerro Verde to our molybdenum sales company at market-based pricing.

b.Includes charges totaling $44 million ($0.04 per pound of copper) for feasibility and optimization studies.

c.Represents the combined total for our other mining operations as presented in Note 14.

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Indonesia Operations Product Revenues, Production Costs and Unit Net Cash (Credits) Costs

a.Includes silver sales of 6.9 million ounces ($28.52 per ounce average realized price).

b.Includes charges totaling (i) $144 million ($0.09 per pound of copper) associated with ARO adjustments, (ii) $133 million ($0.08 per pound of copper) for operational readiness and startup costs associated with the new downstream processing facilities, (iii) $34 million ($0.02 per pound of copper) related to amounts capitalized in prior years associated with the construction of the new downstream processing facilities, and (iv) $28 million ($0.02 per pound of copper) for feasibility and optimization studies.

c.Represents tolling costs paid to PT Smelting.

d.Represents the combined total for our other mining operations as presented in Note 14.

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Indonesia Operations Product Revenues, Production Costs and Unit Net Cash Costs

a.Includes silver sales of 6.0 million ounces ($23.37 per ounce average realized price).

b.Includes credits of $112 million ($0.07 per pound of copper) associated with ARO adjustments, and charges of $55 million ($0.04 per pound of copper) associated with an administrative fine and $27 million ($0.02 per pound of copper) for feasibility and optimization studies.

c.Represents tolling costs paid to PT Smelting.

d.Represents the combined total for our other mining operations as presented in Note 14.

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Molybdenum Mines Product Revenues, Production Costs and Unit Net Cash Costs