Analysis of Profitability Ratios
Quarterly Data
Profitability ratios measure the company ability to generate profitable sales from its resources (assets).
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- Balance Sheet: Liabilities and Stockholders’ Equity
- Common-Size Income Statement
- Analysis of Long-term (Investment) Activity Ratios
- Enterprise Value (EV)
- Dividend Discount Model (DDM)
- Net Profit Margin since 2005
- Operating Profit Margin since 2005
- Return on Equity (ROE) since 2005
- Total Asset Turnover since 2005
- Price to Sales (P/S) since 2005
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Profitability Ratios (Summary)
Freeport-McMoRan Inc., profitability ratios (quarterly data)
Based on: 10-Q (reporting date: 2026-03-31), 10-K (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31).
An analysis of the profitability metrics reveals a period of significant contraction followed by a phase of stabilization and a gradual recovery in bottom-line efficiency. The most pronounced decline occurred between March 2022 and the first half of 2023, after which margins and returns reached a floor and began a slow ascent.
- Gross and Operating Profit Margins
- Gross profit margins experienced a sharp downward trend, falling from 41.20% in March 2022 to a low of 28.81% by June 2023. Following this decline, the margin stabilized, fluctuating within a narrow band between 28.16% and 31.95% through March 2026. Operating profit margins mirrored this trajectory, decreasing from 39.20% in March 2022 to 25.14% in June 2023, before recovering to 27.83% by the end of the analyzed period.
- Net Profit Margin
- The net profit margin showed the most severe contraction among the margin ratios, dropping from 20.79% in March 2022 to a low of 6.97% in March 2024. A reversal of this trend began in the second quarter of 2024, with a consistent, though gradual, improvement leading to a net profit margin of 10.34% by March 2026.
- Return on Equity (ROE) and Return on Assets (ROA)
- Both ROE and ROA exhibit a U-shaped pattern over the analyzed timeframe. ROE declined sharply from a peak of 34.41% in March 2022 to a minimum of 9.77% in March 2024, subsequently rebounding to 14.01% by March 2026. ROA followed a similar path, falling from 10.47% in March 2022 to 3.06% in March 2024, before ending the period at 4.64%. This suggests that while capital efficiency significantly deteriorated in the first two years, a recovery in asset and equity utilization began to emerge from mid-2024 onwards.
Return on Sales
Return on Investment
Gross Profit Margin
Freeport-McMoRan Inc., gross profit margin calculation (quarterly data)
Based on: 10-Q (reporting date: 2026-03-31), 10-K (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31).
1 Q1 2026 Calculation
Gross profit margin = 100
× (Gross profitQ1 2026
+ Gross profitQ4 2025
+ Gross profitQ3 2025
+ Gross profitQ2 2025)
÷ (RevenuesQ1 2026
+ RevenuesQ4 2025
+ RevenuesQ3 2025
+ RevenuesQ2 2025)
= 100 × ( + + + )
÷ ( + + + )
=
The gross profit margin exhibits a sustained long-term contraction over the analyzed period, transitioning from a peak efficiency level in early 2022 to a lower, stabilized baseline by early 2026.
- Margin Erosion Trends
- A significant downward trend is observed between March 2022 and June 2023, where the gross profit margin declined from 41.20% to 28.81%. This period represents the most aggressive contraction in profitability, characterized by a consistent quarter-over-quarter decrease.
- Stabilization and Fluctuations
- Following the initial decline, the margin entered a phase of relative stabilization from mid-2023 through early 2026, generally fluctuating between 28.16% and 31.95%. A moderate recovery occurred between September 2023 and September 2024, with the margin reaching a local peak of 31.95% in the third quarter of 2024.
- Revenue and Profitability Correlation
- Revenue volatility did not correlate with a return to previous margin highs. Despite revenues reaching a period high of 7,582 million US dollars in June 2025, the gross profit margin for that quarter remained suppressed at 29.73%, indicating that increased sales volume did not result in improved cost efficiencies.
- Final Performance State
- The period concludes with the gross profit margin at 28.18% as of March 31, 2026. This represents a total compression of 13.02 percentage points from the initial measurement, suggesting a structural shift in the relationship between revenues and the cost of goods sold.
Operating Profit Margin
Freeport-McMoRan Inc., operating profit margin calculation (quarterly data)
Based on: 10-Q (reporting date: 2026-03-31), 10-K (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31).
1 Q1 2026 Calculation
Operating profit margin = 100
× (Operating incomeQ1 2026
+ Operating incomeQ4 2025
+ Operating incomeQ3 2025
+ Operating incomeQ2 2025)
÷ (RevenuesQ1 2026
+ RevenuesQ4 2025
+ RevenuesQ3 2025
+ RevenuesQ2 2025)
= 100 × ( + + + )
÷ ( + + + )
=
The operating profit margin exhibited a significant downward trajectory during the first half of the analyzed period, followed by a phase of relative stabilization and intermittent volatility. A transition is observed from a period of peak profitability in early 2022 to a normalized operating range between 25% and 28% throughout 2023 and 2026.
- Initial Margin Contraction (March 2022 – June 2023)
- A consistent decline in the operating profit margin is evident, falling from a high of 39.20% in March 2022 to a low of 25.14% by June 2023. This contraction occurred alongside a reduction in both revenues and operating income, suggesting that costs were not reduced at the same rate as the decline in top-line performance during this interval.
- Stabilization and Moderate Recovery (June 2023 – September 2024)
- Following the trough in mid-2023, the operating profit margin entered a period of relative stability, generally fluctuating between 26% and 28%. Despite fluctuations in quarterly revenues, operating income showed a gradual upward trend, peaking at 2,049 million US$ in June 2024, which supported a margin recovery to 28.64% by September 2024.
- Recent Volatility and Margin Performance (December 2024 – March 2026)
- The latter portion of the period is characterized by increased volatility in both revenue and income. A significant peak in revenue was recorded in June 2025 at 7,582 million US$, yet the operating profit margin remained flat at 26.79%, indicating that the increased scale did not yield higher proportional efficiency. A sharp contraction in operating income to 811 million US$ in December 2025 led to a margin dip of 25.15%, before a recovery to 27.83% was observed in March 2026.
Overall, the analysis indicates that while the company has moved away from the exceptional margins seen in early 2022, it has established a baseline operating efficiency around 26-27%. The disconnect between peak revenues in 2025 and the stagnating margin suggests that operating expenses have scaled linearly with revenue growth during the most recent periods.
Net Profit Margin
Freeport-McMoRan Inc., net profit margin calculation (quarterly data)
Based on: 10-Q (reporting date: 2026-03-31), 10-K (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31).
1 Q1 2026 Calculation
Net profit margin = 100
× (Net income attributable to common stockholdersQ1 2026
+ Net income attributable to common stockholdersQ4 2025
+ Net income attributable to common stockholdersQ3 2025
+ Net income attributable to common stockholdersQ2 2025)
÷ (RevenuesQ1 2026
+ RevenuesQ4 2025
+ RevenuesQ3 2025
+ RevenuesQ2 2025)
= 100 × ( + + + )
÷ ( + + + )
=
The net profit margin exhibits a distinct three-phase cycle characterized by a prolonged period of contraction, a stabilization phase, and a subsequent recovery trend.
- Margin Compression (March 2022 – March 2024)
- A consistent downward trend in profitability is observed starting from a peak of 20.79% in March 2022. The net profit margin declined steadily throughout 2022 and 2023, reaching a low of 6.97% by March 2024. This period represents a significant erosion of profitability, where net income decreased at a faster rate than revenues, indicating rising operational costs or falling commodity prices impacting the bottom line.
- Stabilization and Bottoming Out (March 2024 – December 2024)
- Following the trough in early 2024, the profit margin entered a phase of relative stability. Between March and December 2024, the margin fluctuated within a narrow range between 6.97% and 7.83%. Despite fluctuations in revenue—including a dip to 5.72 billion in December 2024—the margin remained resilient, suggesting a successful effort to align cost structures with prevailing revenue levels.
- Recovery and Expansion (March 2025 – March 2026)
- An upward trajectory is evident starting in 2025. The net profit margin rose from 7.11% in March 2025 to 10.34% by March 2026. This recovery was supported by a significant peak in revenues during June 2025, reaching 7.58 billion. The consistent quarterly increases in the margin during this period indicate improved operational efficiency or favorable market pricing, allowing a larger percentage of revenue to be converted into net income.
Overall, while the company experienced a substantial decline in profitability over the first two years of the observed period, the most recent data indicates a successful reversal of that trend, with the net profit margin trending back toward double-digit levels.
Return on Equity (ROE)
Freeport-McMoRan Inc., ROE calculation (quarterly data)
Based on: 10-Q (reporting date: 2026-03-31), 10-K (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31).
1 Q1 2026 Calculation
ROE = 100
× (Net income attributable to common stockholdersQ1 2026
+ Net income attributable to common stockholdersQ4 2025
+ Net income attributable to common stockholdersQ3 2025
+ Net income attributable to common stockholdersQ2 2025)
÷ Stockholders’ equity
= 100 × ( + + + )
÷ =
An analysis of the profitability metrics from March 2022 through March 2026 reveals a significant cyclical contraction in efficiency followed by a period of gradual recovery. The return on equity (ROE) experienced a substantial decline during the first two years of the period, reaching a trough in early 2024 before beginning a steady upward trajectory.
- Net Income Volatility
- Net income attributable to common stockholders exhibited significant volatility, starting at a peak of 1,527 million US$ in March 2022 and declining sharply to 388 million US$ by December 2023. A further dip to 274 million US$ occurred in December 2024. However, a recovery phase is evident starting in 2025, with income rising to 881 million US$ by March 2026, indicating a return to stronger operational profitability.
- Stockholders' Equity Expansion
- Unlike the volatility seen in earnings, stockholders' equity demonstrated consistent and linear growth throughout the entire observed period. The equity base increased from 14,866 million US$ in March 2022 to 19,505 million US$ by March 2026. This steady accumulation of capital expanded the denominator of the ROE calculation, which contributed to the downward pressure on the ratio during periods of stagnating or declining net income.
- Return on Equity (ROE) Dynamics
- The ROE followed a distinct U-shaped pattern. A high initial ROE of 34.41% in March 2022 eroded steadily over eight consecutive quarters, hitting a low of 9.77% in March 2024. This decline was the result of a dual impact: plummeting net income coupled with a growing equity base. From June 2024 onward, the ROE entered a recovery phase, climbing back to 14.01% by March 2026. This recent improvement suggests that net income growth is now outpacing the rate of equity expansion, enhancing the efficiency of shareholder capital utilization.
Return on Assets (ROA)
Freeport-McMoRan Inc., ROA calculation (quarterly data)
Based on: 10-Q (reporting date: 2026-03-31), 10-K (reporting date: 2025-12-31), 10-Q (reporting date: 2025-09-30), 10-Q (reporting date: 2025-06-30), 10-Q (reporting date: 2025-03-31), 10-K (reporting date: 2024-12-31), 10-Q (reporting date: 2024-09-30), 10-Q (reporting date: 2024-06-30), 10-Q (reporting date: 2024-03-31), 10-K (reporting date: 2023-12-31), 10-Q (reporting date: 2023-09-30), 10-Q (reporting date: 2023-06-30), 10-Q (reporting date: 2023-03-31), 10-K (reporting date: 2022-12-31), 10-Q (reporting date: 2022-09-30), 10-Q (reporting date: 2022-06-30), 10-Q (reporting date: 2022-03-31).
1 Q1 2026 Calculation
ROA = 100
× (Net income attributable to common stockholdersQ1 2026
+ Net income attributable to common stockholdersQ4 2025
+ Net income attributable to common stockholdersQ3 2025
+ Net income attributable to common stockholdersQ2 2025)
÷ Total assets
= 100 × ( + + + )
÷ =
The Return on Assets (ROA) exhibits a pronounced downward trajectory from a peak of 10.47% in the first quarter of 2022 to a trough of 3.06% in the first quarter of 2024, followed by a gradual period of recovery. This trend indicates a significant contraction in asset efficiency over the first two years of the observed period, followed by a moderate stabilization.
- Profitability and ROA Correlation
- The decline in ROA was primarily driven by a substantial reduction in net income attributable to common stockholders. Net income fell from a high of $1,527 million in March 2022 to $473 million by March 2024. Because the earnings generated from the asset base decreased sharply while the assets themselves remained stable or increased, the ROA experienced a consistent compression.
- Asset Base Expansion
- Total assets demonstrated a steady and consistent growth pattern, increasing from $48,832 million in March 2022 to $58,840 million by March 2026. This continuous expansion of the balance sheet created a larger denominator for the ROA calculation, which further contributed to the downward pressure on the ratio during periods of stagnant or declining net income.
- Recovery and Stabilization Phase
- A reversal of the downward trend is observable starting in the second quarter of 2024. ROA climbed from 3.06% to 4.64% by March 2026. This recovery is closely linked to an improvement in quarterly net income, which rose to $881 million in the final reported period. The data suggests that the company began regaining operational efficiency, allowing earnings growth to outpace the rate of asset expansion toward the end of the series.