Nexa Resources (NYSE: NEXA) reported Q2 2026 net revenue of US$908 million, up 28% year over year, and net income of US$98 million, compared with US$13 million in Q2 2025. Adjusted EBITDA increased 78% to US$286 million as higher zinc prices, stronger by-product contributions, more internally sourced concentrate, lower operating costs, and recovering Peruvian operations offset weaker smelting volumes.
Core earnings data
The year-over-year earnings improvement was broad-based, although net income declined sequentially from US$118 million in Q1 2026. Nexa did not disclose quarterly EPS, cash flow, or profit-margin figures in the supplied release.
| Metric | Q2 2026 | Q2 2025 | Year-over-year change |
|---|---|---|---|
| Net revenue | US$908 million | Not disclosed | +28% |
| Net income | US$98 million | US$13 million | Approximately +654% |
| Adjusted EBITDA | US$286 million | Not disclosed | +78% |
| CAPEX | US$89 million | Not disclosed | +3% |
| Net debt/LTM adjusted EBITDA | 1.40x | 2.28x | Improved by 0.88x |
Peruvian mining operations continued to recover from setbacks in Q1, with treated ore volume increasing 11% sequentially. Higher zinc prices and lower operating costs also supported profitability, while the increased use of concentrate from Nexa’s own mines reduced its exposure to difficult merchant-smelting conditions.
Mining improved while the Cajamarquilla fire reduced smelting volumes
Mining and smelting moved in different directions during the quarter. Zinc output benefited from higher grades, but zinc metal and oxide production fell after the May fire temporarily suspended operations at the Cajamarquilla smelter.
| Operating metric | Q2 2026 | Year-over-year change |
|---|---|---|
| Mining zinc production | 79kt | +8% |
| Lead production | 15kt | +2% |
| Copper production | 6.3kt | -31% |
| Silver production | 2.7 million oz | +1% |
| Zinc metal and oxide production | 125kt | -10% |
| Zinc metal and oxide sales | 134kt | -7% |
| Sulfuric acid production | 202kt | +9% |
| Silver content sales | 468koz | +22% |
| Copper cement sales | 2.8kt | +38% |
Copper production was the main mining weakness, declining because of lower head grades at Cerro Lindo and Aripuanã. Silver production rose 17% from Q1 as the Peruvian operations recovered, while stronger silver content sales reflected improved recovery at Cajamarquilla and the use of higher-silver calcine inventory at Juiz de Fora.
Cajamarquilla returned to normal operating levels in June, and zinc cathode production continued during the restoration work. Nexa expects to recover the affected volumes during the second half of 2026.
Operationally, Aripuanã commissioned its fourth tailings filter and ended June at 86% average capacity utilization. Cerro Lindo started block-caving operations late in the quarter and reached regular operation in July; Nexa expects the method to lower unit costs, improve access to higher-grade copper areas, and reduce personnel exposure as the caving footprint expands.
Leverage improved as capital spending increased
Net leverage declined to 1.40x from 1.59x in Q1 2026 and 2.28x a year earlier. The improvement primarily reflected last-12-month adjusted EBITDA of US$1.06 billion; net debt was broadly unchanged sequentially and 3% lower year over year.
Quarterly CAPEX increased 24% sequentially to US$89 million, mainly because of higher mine-development spending and faster project disbursements. Spending focused on mine development and tailings storage facilities, including US$9 million for Phase I of the Cerro Pasco Integration Project.
Shareholders also approved a US$17.5 million share-premium reimbursement, equivalent to US$0.132136 per share, payable on August 11, 2026 to shareholders of record as of July 28.
Own-mine feed cushioned smelting pressure as the silver-stream burden fell
The tight zinc-concentrate market creates contrasting effects across Nexa’s integrated portfolio. Negative spot treatment charges in China pressure merchant smelters, but Nexa’s mining operations benefit from those market conditions, while internally sourced feed and by-product credits provide some protection to the smelting business. Nexa’s mines supplied 54% of its smelter feed in Q2.
A separate structural change occurred at Cerro Lindo, where Nexa reached the delivery threshold under its silver-streaming agreement. The streamed share of silver production decreased from 65% to 25% in May, allowing Nexa to retain a larger portion of future silver-related cash generation without additional capital investment. The company did not quantify the Q2 financial contribution from this change.
Guidance and Cerro Pasco project update
Nexa maintained its 2026 guidance for mining production, smelting sales, costs, CAPEX, exploration, project evaluation, and other expenses. However, the total estimated cost of the Cerro Pasco Integration Project increased, and completion of its tailings pumping system shifted into 2027.
| Item | Latest outlook | Previous outlook | Change |
|---|---|---|---|
| 2026 corporate CAPEX | US$381 million | US$381 million | Unchanged |
| Cerro Pasco total estimated CAPEX | US$180 million | US$138 million | +US$42 million, or approximately 30% |
| Tailings pumping system completion | Q1 2027 | Q4 2026 | Delayed by one quarter |
| Start of pumping operations | Early Q3 2027 | Not disclosed | New timing provided |
The project estimate increased after Nexa revised the development sequence for tailings and waste-storage facilities and added geomembrane lining. A reassessment of economically mineable areas at the Atacocha open pit also supported a longer expected operating period. Cerro Pasco’s 2026 project spending remains unchanged, with the additional investment allocated to 2027 and later years.
Risks investors should monitor
- Cajamarquilla volume recovery: The smelter returned to normal operations in June, but Q2 production and sales declined. Recovering the affected volumes during the second half remains an important operating objective.
- Metal prices and treatment charges: Higher zinc prices contributed to the EBITDA increase, while negative spot treatment charges continued to pressure merchant smelting economics. Nexa’s integration offers a cushion but does not remove this exposure.
- Lower copper grades: Copper production fell 31% year over year because of lower head grades at Cerro Lindo and Aripuanã. The planned access to higher-grade areas through block caving has not yet eliminated this pressure.
- Cerro Pasco cost and permitting risk: Total estimated project CAPEX increased by US$42 million, the pumping-system schedule moved into 2027, and environmental approvals and operating authorization are still required.
- Potential change of control: Votorantim and Boliden confirmed discussions about a possible acquisition of Votorantim’s controlling stake in Nexa, but no agreement, timing, or terms were confirmed. S&P placed Nexa’s BBB- rating on CreditWatch with negative implications because of the potential ownership change rather than its operating or financial performance.
Summary
Nexa’s Q2 2026 results benefited from higher zinc prices, improving Peruvian mining operations, lower costs, stronger by-product contributions, and greater use of internally produced concentrate. Smelting volumes remained constrained by the Cajamarquilla fire, but operations normalized in June, while lower leverage and the Cerro Lindo silver-stream stepdown provide financial support. The main follow-up points are second-half volume recovery, copper grades, execution of the more expensive Cerro Pasco project, and uncertainty surrounding the potential controlling-stake transaction.
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