Agnico Eagle, Canada's largest gold producer, earned more than analysts expected in the third quarter. A 22.7% rise in the gold price it received outweighed a 6% fall in production and a nearly 24% jump in all-in sustaining costs.
At a glance
- Adjusted net income was $1.324 billion, or $2.62 a share, against analysts' estimate of $2.56.
- Diesel for its Nunavut mines cost about 45% more than budgeted, even after hedging.
- Agnico expects 2026 output near the lower end of its 3.3 million to 3.5 million ounce guidance.
Background
All-in sustaining cost (AISC) is the full cost of producing an ounce of gold, including the spending needed to keep mines running. Agnico Eagle is Canada's largest gold producer, with operations including Canadian Malartic and Detour Lake. Miners' margins depend on how fast gold prices rise compared with costs such as fuel, labour and royalties.
What happened
Agnico Eagle reported adjusted net income of $1.324 billion, or $2.62 a share, for the third quarter on Wednesday, Kitco reported. That beat the analysts' consensus of $2.56 a share and was 21.3% higher than a year earlier.
The company received an average of $4,264 an ounce for its gold, up 22.7% from $3,476 a year before. It produced 814,012 ounces, down 6.1%.
Costs are rising
All-in sustaining costs rose nearly 24% to $1,648 an ounce, from $1,331 a year earlier. Diesel for the Nunavut operations cost about 45% more than budgeted, even after hedging, and now makes up about 11% of operating costs.
Agnico expects costs to finish near the top of its guidance ranges. Lower output reflects disruption at Canadian Malartic in Quebec, where rock movement at the Barnat open pit in July forced changes to mining.
Cash and growth
The miner generated $852 million in free cash flow in the quarter and ended it with net cash of $3.416 billion. It returned $478 million to shareholders through dividends and buybacks.
Agnico expects projects at Canadian Malartic, Detour Lake, Upper Beaver and Hope Bay to lift annual output by 20% to 30% over the next decade. That could take it above 4 million ounces a year in the early 2030s.
Our read
Outlook: neutral. Strong miner earnings reflect high gold prices but do not change gold supply or demand.
What to watch
- Whether Agnico's output reaches the lower end of its 2026 guidance.
- Diesel and labour costs, which are pushing AISC higher.
- Progress at Canadian Malartic after the Barnat pit disruption.
For information only, not investment advice.
Gold price in India
metalscost.com India reference price as of 2026-11-01.
Detailed analysis
Timeline
- 2026-10-28: Agnico Eagle reports third-quarter earnings above estimates.
Mining Production
Agnico's gold output fell 6.1% to 814,012 ounces, partly because of the Barnat pit disruption.
What could lift prices
- Lower output at a major producer slightly reduces gold supply.
- Rising costs raise the price gold needs to sustain new mines.
What could weigh on prices
- Agnico plans to lift output 20-30% over the next decade.
- High prices are giving miners strong cash flow to expand.
Country impact
| Country | Impact | Reason |
|---|---|---|
| Canada | Medium | Canada's largest gold producer reported higher profit despite rising costs. |
Industry impact
| Industry | Effect | Reason |
|---|---|---|
| Gold Mining | Positive | High gold prices are lifting miners' profits despite cost pressures. |
Who gains, who loses
- Agnico Eagle shareholders: The company returned $478 million in the quarter and plans to return over half its free cash flow.
- Gold miners with high fuel costs: Diesel prices are well above budgets, squeezing margins.
Other ways this could play out
- If gold stays above $4,000, Agnico's cash returns could keep rising.
- If energy costs climb further, margins could narrow despite high prices.
Price risks
- Higher diesel and labour costs could push AISC above guidance.
- A fall in gold prices would hit miners' margins quickly.
Technical view
Price is trading below both its 20-period and 50-period moving averages, a bearish alignment.
Computed from metalscost.com's own stored price history.
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