Rio Tinto Plc (Rio Tinto (RIO)) shares climbed on Wednesday after the mining giant reported first-half 2026 results that were a bit of a mixed bag — earnings were right on target, but revenue came in a little light.
Adjusted earnings came in at $4.21 per share, exactly what Wall Street had penciled in. Revenue, however, was $31.03 billion, below the $32.03 billion analysts were expecting. So, not a perfect quarter, but investors seemed to focus on the cash machine humming in the background.
And that cash machine is humming loudly. Operating cash flow jumped 32% to $9.2 billion, giving Rio plenty of firepower to invest in growth while keeping the balance sheet in good shape. Underlying EBITDA rose 28% to $14.8 billion, and free cash flow — the number that really gets shareholders' attention — soared 75% to $3.8 billion.
That cash gusher allowed Rio to declare an interim ordinary dividend of $3.4 billion, up 43% from a year earlier. That's a 50% payout ratio, and it's the biggest dividend boost in years. The company also said it's on track to unlock $5 billion to $10 billion in cash through portfolio optimization, infrastructure initiatives, and other capital release measures. It expects to deliver about $5 billion of those cash releases by the end of 2026.
On the production side, copper-equivalent output rose 3% in the first half, driven by higher volumes across key commodities. Copper production edged up 1% to 442 kilotonnes, while iron ore production increased 5% to 170 million tonnes. Rio maintained its 2026 copper production guidance of 800 to 870 kilotonnes.
The company said operational execution remained strong, helped by the ramp-up of major growth projects like the Oyu Tolgoi copper mine. Pilbara recorded its highest first-half iron ore production since 2018, and aluminum operations also performed well.
Rio's productivity program is also ahead of schedule. It reached a $1.3 billion annualized run rate in the first half, with $870 million in savings realized year to date. The company is on track to hit a $1.8 billion annualized productivity run rate by the end of 2026. That program supports an approximately 3% increase in copper-equivalent production and an approximately 4% compound annual reduction in operating unit costs through 2030.
As of Wednesday's close, Rio Tinto shares were up 1.77% at $93.26.
