Agnico Eagle Mines Limited (AEM) Q3 2026 earnings review
Agnico Eagle profits rise on gold prices, but costs climb
Agnico Eagle earned higher profits thanks to strong gold prices, even as mine output shrank and unit costs climbed. Revenue rose 17% from a year ago to $3.58 billion on a $4,264 gold price, while gold production fell 6% after a July rock slide temporarily closed the Barnat pit in Quebec. That shutdown and rising expenses for royalties, fuel and supplies pushed cash costs up 19% to $1,133 per ounce.
| Revenue | $3,584M +17.1% from a year ago |
|---|---|
| Profit per share, excluding one-offs | $2.62 +21.3% from a year ago |
| Total cash costs per ounce | $1,133 +19.0% from a year ago |
| Full-year cost outlook | Upper end of $1,020–$1,120 cash cost range |
⚖️ Verdict: ⚪ Neutral
The standing story is unchanged because an early restart at the Barnat pit balanced out rising cost pressures across the mines. Workers reopened the pit on September 27, slightly ahead of the fourth-quarter target, which protects the floor of this year's production plan. The caution: Agnico Eagle now expects full-year unit costs and mine depreciation near the top of its forecast ranges as 6% supplies inflation and new Canadian tariffs take hold, and by our math the plan points to fourth-quarter cash costs near $1,207 per ounce.
The question now is whether Agnico Eagle can hold its 2027 and 2028 production flat before its five major construction projects begin adding gold at the end of the decade. Either higher grades at Detour Lake and the new East Goldie underground mine offset the lost Barnat ounces, or total output drops for two years while capital spending stays near $2.7 billion a year. February's multi-year production plan will settle it.
🐂 Bull Case
Barnat Pit Reopened Ahead of Schedule
Canadian Malartic in Quebec is Agnico Eagle's second-largest gold complex. On July 1, a rock slide on the north wall of its Barnat open pit forced a shutdown. Management originally expected to finish repairs in the third quarter and restart mining in the fourth.
The gold miner beat that timetable: "Remediation work was completed in the third quarter of 2026, with mining activities resuming on September 27, 2026." In addition, "Commercial production was achieved at East Goldie in August 2026," which is the new underground deposit at the same complex.
While the pit was closed, the mill processed lower-grade stockpiles, so third-quarter output at the site fell 29.1% from a year ago to 111,202 ounces. The early restart matters because it limits the risk of further 2026 volume losses, though the redesigned pit still trims up to 150,000 ounces a year in 2027 and 2028.
What to watch: fourth-quarter gold grade and daily mill volume at Canadian Malartic. A rebound from 0.82 grams per tonne toward last year's 1.05 grams would confirm normal pit access.
High Gold Prices Lifted Profit Margin
Agnico Eagle does not sell its gold forward, so its revenue tracks market prices directly. In the third quarter, the average realized gold price rose 22.7% from a year ago to $4,264 per ounce, lifting revenue 17.1% to $3.58 billion despite lower production.
That price gain outpaced mine inflation and expanded operating profit margin by 3.2 percentage points from a year ago to 55.5%, by our math. Production costs — the direct expense of mining and milling ore — fell 0.3 percentage points of revenue to 27.1%, while mine depreciation and amortization dropped 1.3 percentage points to 12.8%.
Net income climbed 28.2% to $1.35 billion, and profit per share excluding one-offs rose 21.3% to $2.62. Because the company keeps full exposure to gold prices, higher bullion prices flow straight into earnings even when unit costs per ounce rise.
What to watch: fourth-quarter realized gold price against total cash costs per ounce. If gold holds above $4,200, operating profit margins will stay near record levels despite year-end fuel charges.
Cash Returns Top Target While Cash Grows
Agnico Eagle targets returning about 40% of its annual free cash flow to shareholders through dividends and share buybacks. In the third quarter, the Canadian miner repurchased 1.3 million shares for $250.0 million and paid $204.9 million in dividends.
Over the first nine months of 2026, buybacks of $799.7 million and dividends of $614.9 million reached 48.5% of free cash flow by our math, beating the 40% goal. Even after those payouts and $902.8 million of third-quarter capital spending, cash minus long-term debt rose to $3.42 billion, and the company expanded its bank credit line to $3.0 billion in October.
What to watch: fourth-quarter share repurchases under the $2.0 billion buyback plan. Continued buying near $250 million a quarter would keep full-year shareholder returns well above the 40% target.
Positives this quarter didn't test
Two long-term drivers from prior quarters received no new operational metrics in the third-quarter report.
- Finland hub expansion: after buying Rupert Resources and Aurion Resources in June to consolidate Northern Finland, the company spent more on regional drilling there, but the first study on the Ikkari deposit is not due until late 2027.
- Mill productivity records: higher ore grades lifted Detour Lake output 3.7%, but daily mill volume there fell to 65,130 tonnes from 79,902 a year ago, offering no new portfolio-wide processing records this quarter.
🐻 Bear Case
Diesel, Tariffs and Royalties Push Costs Up
Agnico Eagle kept its full-year cost ranges unchanged on paper, but it now expects both total cash costs and all-in sustaining costs (AISC, a measure of total mine-level cash and sustaining capital cost per ounce) to land "near the upper end of the guidance range".
Third-quarter total cash costs rose 19.0% from a year ago to $1,133 per ounce, "primarily due to higher royalty expenses, which increased in line with stronger gold prices across all operations, combined with higher diesel prices". Supplies represent 30% of operating costs and are "beginning to face inflationary pressures of approximately 6%", while "Canadian retaliatory tariffs will increase operating costs by approximately $5 per ounce".
- Canadian Malartic cash costs: $1,508 per ounce, up 57.2% from a year ago on lower volume
- Macassa cash costs: $1,189 per ounce, up 80.4% as ore grade fell nearly in half
- Meadowbank cash costs: $1,177 per ounce, up 27.2% on lower grade and higher mining costs
- Fourth-quarter Nunavut fuel shipment: expected to add about $21 million to production costs
This cuts against the company's low-cost reputation because cost pressures are broadening beyond royalties. Worse, the balance sheet shows no remaining diesel fuel hedges at September 30, down from 16.0 million gallons hedged at year-end, leaving the miner exposed to fuel swings.
What to watch: fourth-quarter total cash costs per ounce against the $1,207 level implied by the top of the full-year outlook at 3.3 million ounces. A reading above $1,207 would mean full-year costs missed the original range.
Output Falls While Project Bills Climb
Agnico Eagle is spending heavily on five major projects to lift annual gold production above 4 million ounces in the early 2030s, including the newly approved Hope Bay mine in Nunavut. However, near-term production is shrinking while the construction bill rises.
Third-quarter gold production fell 6.1% from a year ago to 814,012 ounces, and full-year output remains stuck at the bottom of the 3.3 to 3.5 million ounce plan. Meanwhile, capital additions to property, plant and mine development jumped 44.1% from a year ago to $902.8 million, or 25.2% of revenue by our math, pushing free cash flow down 28.4% to $852.2 million.
What to watch: the 2027 and 2028 production outlook in February's annual update. It will show whether other mines can offset the loss of up to 150,000 ounces a year at Canadian Malartic before new projects start up.
Gold Price Pullback Trimmed Quarterly Revenue
Because Agnico Eagle does not hedge its gold sales, a falling gold price hits revenue immediately. The company's average realized gold price dropped 4.9% from the second quarter to $4,264 per ounce, marking a second straight quarterly decline from the first quarter's $4,861 peak.
Combined with the 4.9% quarterly drop in gold production from the Barnat pit closure, third-quarter revenue fell 5.8% from the second quarter to $3.58 billion, and profit per share excluding one-offs slid 14.7% from $3.07 to $2.62. With capital spending now running near $900 million a quarter, any deeper pullback in gold prices would quickly squeeze free cash flow.
What to watch: fourth-quarter realized gold price relative to the $4,500 budget assumption used for Nunavut royalty payments. A further price drop would reduce cash flow while capital commitments stay fixed.
Risks this quarter didn't answer
Three standing operational and permitting concerns received no update in the third-quarter report.
- Workplace safety reset: following fatal accidents in late 2025 and spring 2026, the report gave no new safety statistics or audit findings.
- Labor availability across concurrent builds: management did not update staffing levels or contractor rates across its five simultaneous construction projects.
- San Nicolas copper-gold project in Mexico: the report included no update on the supplementary permits needed to approve construction.
💲 Other KPIs
Cash and cash equivalents minus long-term debt rose by $148.9 million from the second quarter and is up 28.0% since the end of 2025. Total cash reached $3.61 billion against just $197.1 million of long-term debt, giving the miner a large cushion to fund its construction pipeline.
Output at Agnico Eagle's largest mine rose 3.7% from a year ago, slowing from 23.2% growth in the second quarter. Higher ore grade of 1.05 grams per tonne, up from 0.82 grams a year ago, offset a drop in daily mill volume, keeping unit cash costs low at $872 per ounce.
Spending on drilling and project evaluation rose 29.4% from a year ago, up from 18.1% growth in the second quarter. The increase went to newly acquired regional targets in Northern Finland and Canadian sites, including the first 6,500-metre drill programme at Hope Bay's Boston deposit.
🔮 Guidance
Unchanged. The company still expects full-year output to finish at the low end of the range because of the third-quarter Barnat pit shutdown. By our math, hitting the 3.30 million ounce floor leaves 805,063 ounces for the fourth quarter, down 4.2% from a year ago, while the 3.40 million middle of the range would require 905,063 ounces, up 7.7%.
Unchanged on the range, but Agnico Eagle now expects costs to finish near the $1,120 top end, up from $979 in 2025. After averaging $1,092 per ounce over the first nine months, hitting $1,120 at 3.3 million ounces implies fourth-quarter cash costs of about $1,207 per ounce by our math, driven by royalties, 6% supplies inflation, $5 per ounce in tariffs, and a $21 million Nunavut fuel charge.
Unchanged on the range, but now steered toward the $1,550 upper end, compared with $1,339 in 2025. The upward shift reflects the same fuel, consumables and royalty pressures hitting cash costs, spread across fewer ounces at Canadian Malartic. The third-quarter report did not print the quarterly AISC figure.
Unchanged from the July update, which raised the site's forecast from $1,187 after the Barnat wall slide. Cash costs at the complex averaged $1,196 per ounce over the first nine months after jumping to $1,508 in the third quarter, so the $1,260 full-year plan points to lower unit costs in the fourth quarter now that the pit has reopened.
Unchanged after the $400 million raise in the second quarter for Hope Bay construction. Alongside $290 million to $330 million of capitalized exploration, total capital additions reached $2.33 billion in the first nine months, leaving $564 million to $804 million of total additions for the fourth quarter by our math.
Unchanged. The middle of the range stays at $310 million, down slightly from $318.4 million in 2025, supporting drilling to replace mined reserves across Canada, Finland and Australia.
Unchanged on the range, but management now expects the full-year charge near the $1.75 billion top end because fewer lifetime tonnes at the Barnat pit raised the per-tonne charge at Canadian Malartic. By our math, hitting $1.75 billion after $1.30 billion in the first nine months leaves $449 million for the fourth quarter, near the third quarter's $457 million.
❓ Key Questions
What was third-quarter all-in sustaining cost per ounce?
The report states that full-year all-in sustaining costs will finish near the $1,550 per ounce top of the range, but the tables omit the third-quarter actual figure and the split between sustaining and development capital.
Why did all diesel hedges roll off by September?
Agnico Eagle had 16 million gallons of diesel hedged at year-end and 54% of 2026 fuel hedged in the first quarter, yet held zero diesel derivatives at September 30 while flagging diesel as a major cost pressure.
What did the first Boston deposit drill results show?
Exploration chief Guy Gosselin previously said assay results from the 6,500-metre drill programme at Hope Bay's Boston deposit would arrive with the third-quarter release, but the report did not include them.
Will the 2027–2028 production plan be cut in February?
The Barnat pit redesign removes up to 150,000 ounces a year in 2027 and 2028, and investors need to know whether Detour Lake or Odyssey can fill that gap to preserve the 3.3 to 3.5 million ounce multi-year target.