Analysts had high hopes for the industry, with gold among the best-performing commodities this year, surging more than 30% on the outlook for lower interest rates and geopolitical turmoil. But Newmont’s results revealed that big gold producers are still wrestling with inflationary pressures, especially regarding labor costs, that have lasted longer than expected.
“There’s a potential read-through here, assuming Newmont’s takeaways are accurate, that this is a risk factor for the industry,” said Josh Wolfson, a mining analyst with Royal Bank of Canada.
Newmont earned 80 cents a share, well short of the average estimate of 89 cents among analysts surveyed by Bloomberg. Revenue of $4.61 billion also trailed estimates, as did its gross profit margin, which slipped below 50%.
The company said it spent more to dig up the precious metal at its mines in Australia, Canada, Peru and Papua New Guinea than in the…
