You should read the following discussion and analysis of our financial condition and results of operations together with the condensed interim consolidated financial statements and related notes included in Item 1 of Part I of this Quarterly Report on Form 10-Q (this “Quarterly Report”) and with our audited consolidated financial statements and the related notes for the fiscal year ended December 31, 2025 included in Part II of our Annual Report on Form 10-K for the year ended December 31, 2025 filed with the Securities and Exchange Commission (the “SEC”) on February 23, 2026 (the “2025 Form 10-K”).
Special Note Regarding Forward-Looking Statements
This Quarterly Report contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, (the "Securities Act"), and Section 21E of the Securities Exchange Act of 1934, as amended, (the "Exchange Act"), that involve risks and uncertainties, including statements based on our current expectations, assumptions, estimates and projections about future events, our business, our financial condition, results of operations and prospects, our industry and the regulatory environment in which we operate. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. Those statements include, but are not limited to, statements with respect to: estimated calculations of mineral reserves and resources at our properties including changes in those estimated calculations, anticipated results and timing of exploration activities, timing of studies for advancing or developing our properties, plans and objectives, industry trends, our requirements for additional capital, treatment under applicable government regimes for permitting or attaining approvals, government regulation, environmental risks, title disputes or claims, synergies of potential future acquisitions, the projected, forecast or anticipated economic parameters of our mineral projects (including capital cost, operating cost, net present value, internal rate of return and other parameters), and our anticipated uses of the net proceeds from offerings of our securities or other fundraising activities. In some cases, you can identify these statements by forward-looking words such as “may,” “might,” “could,” “should,” “would,” “achieve,” “budget,” “scheduled,” “forecasts,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential” or “continue,” the negative of these terms and other comparable terminology. These forward-looking statements may include projections of our future financial performance, the development of our mineral properties, our anticipated growth strategies and anticipated trends in our industry. All forward-looking statements speak only as of the date on which they are made. These statements are not guarantees of future performance and involve certain risks, uncertainties and assumptions concerning future events that are difficult to predict. Therefore, actual future events or results may differ materially from these statements. We believe that the factors that could cause our actual results to differ materially from those expressed or implied by forward-looking statements include the following: we will require substantial capital investment in the future and we may be unable to raise additional capital on favorable terms or at all; our mineral projects are at the exploration or development stage and are subject to the significant risks and uncertainties associated with mineral exploration and development; our Santa Cruz Copper Project is subject to significant risks associated with mine construction and commissioning, including possible delays, cost overruns, and unanticipated technical problems in addition to the need to obtain all required permits and necessary funding; the Preliminary Feasibility Study (the "PFS") for our Santa Cruz Copper Project includes estimates and assumptions to project potential economic viability and actual economic outcomes may vary greatly from those set forth in the PFS; we have a limited operating history on which to base an evaluation of our business and prospects; we depend solely on our material project for our future operations; our mineral resource and reserve calculations and economic projections relating to our properties are only estimates; actual capital costs, operating costs, production and economic returns at any future mine may differ significantly from those we have anticipated; the title to some of the mineral properties may be uncertain or defective; our business is subject to changes in the prices of copper, gold, silver, nickel, cobalt, vanadium and platinum group metals; we have had claims and legal proceedings against one of our subsidiary's subsidiaries; our business is subject to significant risk and hazards associated with future mining operations; we may fail to identify attractive acquisition candidates or joint ventures with strategic partners or be unable to successfully integrate acquired mineral properties; we may fail to successfully manage joint ventures and are reliant on our joint venture partners to comply with their obligations; our business is extensively regulated by the United States and foreign governments as well as local governments; we and the VRB China Joint Venture may not receive the anticipated payments from Red Sun in connection with the VRB China Joint Venture transaction in full or in a timely manner; the requirements that we obtain, maintain and renew environmental, construction and mining permits are often a costly and time-consuming process; our non-U.S. operations are subject to additional political, economic and other uncertainties not generally associated with domestic operations; we may be adversely affected by current or future military conflicts in the Middle East, Ukraine/Russia or other jurisdictions; our activities may be hindered, delayed or have to cease as a result of climate change effects, including increased and excessive heating and the potential for forest fires at many of our properties; our operations may be impacted by public health emergencies, pandemics, epidemics, or similar events, including impacts to the availability of our workforce, government orders that may require temporary suspension of
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operations, and the global economy; we may be adversely affected by tariff and trade actions; and delays in the delivery or assembly of the TBM and failure of the TBM to function as expected may create material delays or add material additional costs related to the construction and development of the Santa Cruz Copper Project.
You should carefully consider these risks, as well as the additional risks described in other documents we file with the SEC. We also operate in a very competitive and rapidly changing environment. New risks emerge from time to time and it is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in, or implied by, any forward-looking statements.
These factors should not be construed as exhaustive and should be read in conjunction with the risks described under the heading “Risk Factors” in our 2025 Form 10-K. Important factors that could cause actual results to differ materially from our expectations, or cautionary statements, are disclosed under “Risk Factors” in the 2025 Form 10-K. These risks and uncertainties, as well as other risks of which we are not aware or which we currently do not believe to be material, may cause our actual future results to be materially different than those expressed in our forward-looking statements. We caution you not to place undue reliance on these forward-looking statements. We do not undertake any obligation to make any revisions to these forward-looking statements to reflect events or circumstances after the date of this report or to reflect the occurrence of unanticipated events, except as required by law.
Business Overview
We are a technology-driven United States minerals exploration and development company with a focus on copper and other critical metals vital to electric transmission and generation, manufacturing, infrastructure development, technology, and national security. Our wholly owned assets are located in the United States. We operate exploration joint ventures and alliances in Saudi Arabia, Chile and the United States. We use our powerful Typhoon™ geophysical surveying system, together with advanced data analytics provided by our 94.3%-owned subsidiary, Computational Geosciences Inc. (“CGI”), to accelerate and de-risk the mineral exploration process in the search for new deposits of critical metals that may otherwise be undetectable by traditional exploration technologies. We believe the United States is significantly underexplored and has the potential to yield major new discoveries of critical metals.
Through the advancement of our portfolio of critical metals exploration and development projects, headlined by the Santa Cruz Copper Project in Arizona, we intend to contribute to domestic supply by developing resources that support industrial and strategic sectors. We also operate a 50/50 joint venture with Saudi Arabian Mining Company ("Maaden") to explore for minerals on ~50,000 km2 of underexplored Arabian Shield in Saudi Arabia. In 2024, we established an exploration alliance with BHP Mineral Resources Inc. (“BHP”), a subsidiary of BHP Group Limited, to search for critical minerals in the United States. Finally, in 2026, we established a Typhoon™ driven exploration collaboration with Sociedad Química y Minera de Chile (“SQM”"), to explore for copper in northern Chile.
Our other mineral projects in the United States include the Tintic Project, located in Utah, the Hog Heaven Copper-Silver-Gold Project, located in Montana, the Bristol Project located in Nevada, and the Gleeson, Lomitas Negras, Globe-Miami and Perseverance Projects in Arizona.
In addition to our mineral projects, we also own a 90.0% controlling interest in VRB Energy Inc. ("VRB Energy"), which itself owns 100% of VRB Energy USA Inc. ("VRB USA"), an Arizona-based developer of advanced grid-scale energy storage systems utilizing vanadium redox flow batteries for integration with renewable power sources. VRB Energy also has a 49% interest in VRB China which is a joint venture with China Energy Storage Industry Co., Ltd. (“Red Sun”) a subsidiary of privately held Shanxi Red Sun Co., Ltd. VRB China manufactures, develops and sells vanadium redox flow batteries for Asian, African and Middle Eastern markets.
Our shares of common stock are listed on the NYSE American and the TSX under the ticker symbol “IE”.
Business Developments in the Quarter and Subsequent Period
Santa Cruz Copper Project (100% owned)
On May 28, 2026, we, through our wholly owned subsidiary Mesa Cobre Holding Corporation (“Mesa Cobre”), entered into an Agreement for the Purchase, Supply, Transport, Assembly, Testing, and Commissioning of a Crossover XRE Tunnel Boring Machine (“TBM”) and Associated Equipment (the “Purchase Agreement”) with Global TBM Company dba The Robbins Company (“Robbins”).
Pursuant to the Purchase Agreement, Robbins will sell, supply, transport, assemble, test, and commission for Mesa Cobre the TBM for Mesa Cobre’s use on the Santa Cruz Copper Project. Mesa Cobre will pay Robbins a total of $64.7
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million, inclusive of a previously-paid deposit of $1.1 million. Upon the signing of the Purchase Agreement in June 2026, we paid $12.7 million to Robbins and will pay the remainder in a series of milestone payments relating to certain events specified in the Purchase Agreement relating to shipping, delivery to the Santa Cruz Project site, and assembly, commissioning and use of the TBM. Transportation to the project site will be reimbursed by Mesa Cobre at cost plus 10%, and any tariffs will be reimbursed by Mesa Cobre without markup. An additional cost of assembly of the TBM of $5.8 million will be paid to Robbins by Mesa Cobre pursuant to certain payment milestones. Title to the TBM and equipment transfers to Mesa Cobre upon delivery at the project.
Commissioning occurs when the equipment is assembled, tested and operational, including the installation of the reaction frame at the bottom of the box cut at the site in accordance with the Purchase Agreement, and is to occur by July 30, 2027 or such other date that the parties may agree in writing.
Our engineers are preparing an updated Santa Cruz Copper Project S-K 1300 Preliminary Feasibility & Technical Report Summary and NI 43-101 Feasibility Study & Technical Report (the "PFS") to incorporate the engineering details of the TBM and material handling system. We expect to complete this study during the third quarter of 2026.
We are in the advanced stages of the application process and due diligence related to project debt financing with the Export-Import Bank of the United States. We also continue to advance discussions with a group of leading commercial banks, as well as potential sources for non-debt funding.
Maaden Joint Venture (50% owned)
On July 7, 2026, we entered into an Amended and Restated Shareholders Agreement (“A&R Shareholders Agreement”) with Maaden, governing the Joint Venture. The A&R Shareholders Agreement amends and restates the Shareholders Agreement dated July 6, 2023, as amended (collectively, the “Prior Agreement”).
The A&R Shareholders Agreement includes certain new provisions not contained in the Prior Agreement including, but not limited to:
•The Joint Venture and its subsidiaries may now acquire exploration licenses and mining licenses directly in the name of the Joint Venture (“Joint Venture Land”) rather than only accessing such licenses held by Maaden;
•If the Joint Venture chooses not to pursue Joint Venture Land, any shareholder may pursue such rights individually with no risk or benefit to the Joint Venture;
•Certain loans made by a shareholder to the Joint Venture to cover any shortfall in funding by the other shareholder shall now be repaid in priority to other shareholder loans;
•The approval of the Joint Venture board of directors is now only required to hire or terminate certain senior executives;
•The technical committee of the Joint Venture is now given more authority to reallocate funds within a board approved budget and approve non-material amendments to a previously approved exploration program, without needing board approval in each instance;
•The exploration term of the Joint Venture will now run for ten (10) years from the effective date, ending now on July 6, 2033; and
•General clean up matters relating to prior amendments.
The Prior Agreement, as amended and restated by the A&R Shareholders Agreement, established a limited liability company under Saudi law and sets out the terms governing the relationship of the parties with respect to the Joint Venture. It provides for the Company and Maaden to participate in the 50/50 Joint Venture which had an initial term of five years but extendable to ten (10) years, now expiring on July 6, 2033.
Kaizen Discovery Inc. (100% owned)
On April 27, 2026, our subsidiary Kaizen Discovery Inc. (“Kaizen Discovery”) sold our indirect interest in the Pinaya Gold-Copper Project to Panam Copper Corp., a British Columbia company (“Panam Copper”), for $11.0 million in stated consideration, consisting of (i) $8.0 million in cash, of which $1.5 million was paid at the closing on April 27, 2026 and the remainder is payable as to $1.5 million after six months, $2.5 million after one year and $2.5 million after 18 months, (ii) $3.0 million in Panam Copper shares, with a deemed value per share using the 10-day VWAP immediately prior to the issuance date or financing price for the initial issuance, with $1.5 million issuable on the date of Panam Copper’s listing on a recognized exchange and $1.5 issuable 12 months thereafter; and (iii) the grant at closing of a one percent (1.0%) net
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smelter return royalty on all minerals produced from the Pinaya Gold-Copper Project. Panam Copper may repurchase 50% of the royalty for $1.0 million prior to the commencement of commercial production.
Management Updates
On August 1, 2026, Alex Neufeld was promoted to Senior Vice President of Exploration, replacing in that role Graham Boyd who resigned effective August 1, 2026.
On August 5, 2026, the Company announced that Michelle Lammers would be joining the Company as Chief Operating Officer effective September 1, 2026.
Segments
We account for our business in four business segments – (i) Santa Cruz Copper Project (ii) Critical Metals, (iii) Data Processing Services and (iv) Energy Storage.
Significant Components of Results of Operations
Revenue, Cost of Sales and Gross Profit
We have not generated any revenue from our mineral projects because they are in the exploration or development stage.
We generate some revenue from our technology businesses, CGI and VRB Energy, which is included in the data processing business segment and energy storage systems business segments, respectively.
CGI generates revenue from the sale of data processing services to the mining, energy (oil & gas and geothermal), and water industries. In prior years, CGI has also generated revenue from software licensing.
VRB Energy generates revenue from developing, manufacturing and selling vanadium redox flow energy storage systems. Prior to October 2024, all of VRB Energy’s revenue was generated by VRB China. In October 2024, VRB Energy reduced its ownership interest in VRB China to 49% and commenced equity accounting for this investment. Since 2025, VRB Energy has been focused on progressing its Arizona-based business, VRB USA, which has not yet generated any revenue.
Exploration Expenses
Direct costs for the acquisition of mineral exploration rights, including option payments, are capitalized and recorded initially at cost as exploration properties. Exploration and evaluation costs are expensed in the period incurred until such time as it has been determined that a mineral property is commercially feasible, in which case subsequent exploration and evaluation costs incurred to develop a mineral property are capitalized. Commercial feasibility is generally established when a mineral property has proven and probable reserves, permits or rights to extract the resources and reserves have been obtained and financing to develop the property has been approved.
Exploration expenses include topographical, geological, geochemical and geophysical studies, exploratory drilling, trenching, sampling and activities in relation to identifying a mineral resource and then evaluating the technical feasibility and commercial viability of extracting the mineral resource, as well as value-added taxes in relation to these direct exploration and evaluation costs incurred in foreign jurisdictions where recoverability of those taxes is uncertain. Exploration expenses also include salaries, benefits and non-cash stock-based compensation expenses of the employees performing these activities.
Exploration expenses also include payments under earn-in and option agreements where the option right is with respect to ownership interests in legal entities owning the underlying mineral project in the exploration project phase. Through our earn-in and option agreements, we have the right (and in some cases, the obligation) to fund and conduct exploration on the underlying mineral project prior to determining whether to acquire a minority or majority ownership interest through further funding the costs of such exploration and, in some cases, through direct payments to the owners of the project. In the event we cease making expenditures on an exploration mineral project or fail to incur the agreed level of exploration expenditures, we will not obtain an ownership right beyond any that may have been acquired as of the date of termination.
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Included in exploration expenses are early stage projects and exploration costs that we incur in relation to generating new projects that may or may not proceed to earn-in agreements depending on our evaluation. These are categorized as “Project generation and other”.
General and Administrative Expenses
Our general and administrative expenses consist of salaries and benefits, stock-based compensation, professional and consultant fees, insurance and other general administration costs.
Three Months Ended June 30, 2026 Compared to the Three Months Ended June 30, 2025
For the three months ended June 30, 2026 we recorded a net loss attributable to common stockholders of $24.7 million ($0.16 per share), compared to $23.9 million ($0.18 per share) for the three months ended June 30, 2025, which was an increase of $0.8 million. Significant contributors to this change for the three months ended June 30, 2026 included an increase of $7.3 million in exploration expenditures and an increase of $2.2 million in share of loss of equity method investees. These increases were offset by a decrease of $1.5 million in general and administrative expenses and an $8.0 million gain recorded on the divestment of the Pinaya Project. The three months ended June 30, 2025 included a $2.6 million impairment expense of a non-core exploration property, there was no similar expense in the three months ended June 30, 2026.
Exploration expenses were $21.4 million for the three months ended June 30, 2026, an increase of $7.3 million from $14.1 million for the three months ended June 30, 2025. Exploration expenses consisted of the following:
Three months ended June 30,
(In thousands) 2026 2025
Exploration Expenses:
Santa Cruz, USA $ 10,537 $ 5,425
Gleeson, USA 3,985 180
Hog Heaven, USA 1,161 394
Alacrán Project (Cordoba) — 4,354
Ivory Coast Project, Ivory Coast 739 331
Chile Exploration Collaboration, Chile — —
Tintic, USA 193 474
Project generation and other 4,793 2,920
Total $ 21,408 $ 14,078
•During the three months ended June 30, 2026, exploration expenditures largely focused on activities at the Santa Cruz Copper Project where $10.5 million of expenditure was incurred in the three months ended June 30, 2026, compared to $5.4 million incurred in the three months ended June 30, 2025. Activities during the three months ended June 30, 2026 at the Santa Cruz Copper Project focused on permitting, updating the PFS to incorporate the engineering details of the TBM and material handling system, conducting optimization studies, and performing geotechnical drilling to support detailed engineering design. The exploration expenditures incurred in the three months ended June 30, 2025 were focused on the technical engineering studies required to support the PFS that was released on June 23, 2025;
•The Gleeson Project in Arizona where $4.0 million of expenditure was incurred in the three months ended June 30, 2026 compared to $0.2 million incurred in the three months ended June 30, 2025. We commenced drilling in November 2025. Activities during the three months ended June 30, 2026, were focused on testing copper-gold porphyry and polymetallic skarn and carbonate-replacement targets. Also, additional land purchases and leases have been executed;
•The Hog Heaven Project where $1.2 million of expenditure was incurred in the three months ended June 30, 2026 compared to $0.4 million incurred in the three months ended June 30, 2025. Activities during the three months ended June 30, 2026 were focused on testing high-sulfidation epithermal mineralization following up on previous exploration success from 2025. Drilling was completed on April 23, 2026; and
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•Project generation and other includes exploration expenses for early stage projects and exploration costs that we incur in relation to generating new projects that may or may not proceed to earn-in agreements depending on our evaluation.
General and administrative expenses were $8.3 million for the three months ended June 30, 2026, a decrease of $1.5 million from $9.7 million for the three months ended June 30, 2025. The main contributor to the decrease was a $1.5 million decrease in general and administrative expenses incurred at Cordoba which were $0.4 million for the three months ended June 30, 2026 compared to $2.0 million for the three months ended June 30, 2025. This decrease was due to activities and personnel at Cordoba reducing since the sale of the Alacran Project on March 5, 2026.
Share of loss of equity method investees was $4.4 million for the three months ended June 30, 2026, an increase of $2.2 million from $2.3 million for the three months ended June 30, 2025. The share of loss of equity method investees for the three months ended June 30, 2026 consisted of a $2.9 million share of the loss from the Maaden Joint Venture and a $1.4 million share of loss from the VRB China Joint Venture.
During the three months ended June 30, 2026 we recorded an $8.0 million gain on the divestment of the Pinaya Gold-Copper Project as a result of the April 27, 2026 sale of the project to Panam Copper. At the time of the transaction the net assets of the disposal group were $nil. We recognized a gain on the divestment of $8.0 million based on the fair value of consideration received.
CGI’s software licensing and data processing services to the mining and oil and gas industries represented 100% of our revenue for the three months ended June 30, 2026 ($0.7 million) and 100% for the three months ended June 30, 2025 ($1.1 million). VRB did not generate revenue during these periods. CGI’s revenue for the three months ended June 30, 2026 was $0.7 million, a decrease of $0.3 million from $1.1 million for the three months ended June 30, 2025. The decrease in CGI’s revenue was a result of less data processing services being performed.
Six Months Ended June 30, 2026 Compared to the Six Months Ended June 30, 2025
For the six months ended June 30, 2026 we recorded net income attributable to common stockholders of $17.1 million ($0.11 per share), compared to a net loss of $54.4 million ($0.42 per share) for the six months ended June 30, 2025, which was a change of $71.5 million. The most significant contributor to this change for the six months ended June 30, 2026 was the gain of $124.7 million being realized on Cordoba's sale of the Alacrán Copper Project in Colombia in March 2026. Also contributing to the change for the six months ended June 30, 2026, was an $8.0 million gain recorded on the divestment of the Pinaya Project, a $5.0 million credit loss provision reversal related to the 2024 sale of VRB China and a decrease of $3.2 million in general and administrative expenses. Offsetting these was an increase of $14.8 million in exploration expenditures.
On March 5, 2026, Cordoba sold its remaining 50% interest in the Alacrán Project for total cash proceeds of $128 million. Under the terms of the sale, the net cash proceeds remaining after settling all outstanding liabilities, and retaining $10 million for ongoing corporate purposes, would be distributed to Cordoba shareholders. On March 25, 2026, Ivanhoe Electric received a $58.4 million cash payment as part of Cordoba's distribution. As a result of these transactions, Ivanhoe Electric has recorded a $124.7 million gain on the sale of Alacrán.
Exploration expenses were $44.6 million for the six months ended June 30, 2026, an increase of $14.8 million from $29.9 million for the six months ended June 30, 2025. Exploration expenses consisted of the following:
Six Months Ended June 30,
(In thousands) 2026 2025
Exploration Expenses:
Santa Cruz, USA $ 20,037 $ 11,929
Gleeson, USA 6,615 276
Hog Heaven, USA 4,364 1,267
Alacrán Project (Cordoba) 3,334 7,691
Ivory Coast Project, Ivory Coast 1,093 656
Chile Exploration Collaboration, Chile 664 —
Tintic, USA 427 1,185
Project generation and other 8,080 6,859
Total $ 44,614 $ 29,863
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During the six months ended June 30, 2026, exploration expenditures largely focused on activities at:
•The Santa Cruz Copper Project where $20.0 million of expenditure was incurred in the six months ended June 30, 2026 compared to $11.9 million incurred in the six months ended June 30, 2025. Activities during the six months ended June 30, 2026 at the Santa Cruz Copper Project focused on permitting, updating the PFS to incorporate the engineering details of the TBM and material handling system, conducting optimization studies, and performing geotechnical drilling to support detailed engineering design. The exploration expenditures incurred in the six months ended June 30, 2025 were focused on the technical engineering studies required to support the PFS that was released on June 23, 2025;
•The Gleeson Project in Arizona where $6.6 million of expenditure was incurred in the six months ended June 30, 2026 compared to $0.3 million incurred in the six months ended June 30, 2025. We commenced drilling in November 2025. Activities during the six months ended June 30, 2026 were focused on testing copper-gold porphyry and polymetallic skarn and carbonate-replacement targets. Also, additional land purchases and leases have been executed;
•The Hog Heaven Project where $4.4 million of expenditure was incurred in the six months ended June 30, 2026 compared to $1.3 million incurred in the six months ended June 30, 2025. Activities during the six months ended June 30, 2026 were focused on testing high-sulfidation epithermal mineralization following up on previous exploration success from 2025. Drilling was completed on April 23 2026;
•The Alacrán Project where $3.3 million of expenditure was incurred by Cordoba in 2026 prior to its sale on March 5, 2026. These pre-sale activities in 2026 were focused on detailed engineering design of the Alacrán mine and consultation associated with the Environmental Impact Assessment process; and
•Project generation and other includes exploration expenses for early stage projects and exploration costs that we incur in relation to generating new projects that may or may not proceed to earn-in agreements depending on our evaluation.
General and administrative expenses were $18.1 million for the six months ended June 30, 2026, a decrease of $3.2 million from $21.3 million for the six months ended June 30, 2025. The main contributor to the decrease was a $2.0 million decrease in general and administrative expenses incurred at Cordoba which were $1.3 million for the six months ended June 30, 2026 compared to $3.3 million for the six months ended June 30, 2025. This decrease was due to activities and personnel at Cordoba reducing since the sale of the Alacran Project on March 5, 2026. Also, contributing to the decrease was a $0.6 million decrease in directors and officers' insurance expenses from $1.6 million for the six months ended June 30, 2025 compared to $1.1 million for six months ended June 30, 2026 due to a decrease in premiums.
CGI’s software licensing and data processing services to the mining and oil and gas industries represented 100% of our revenue for the six months ended June 30, 2026 ($1.6 million) and 100% for the six months ended June 30, 2025 ($1.8 million). VRB did not generate revenue during these periods. CGI’s revenue for the six months ended June 30, 2026 was $1.6 million, a decrease of $0.2 million from $1.8 million for the six months ended June 30, 2025. The decrease in CGI’s revenue was a result of less data processing services being performed.
Stock-Based Compensation
On March 6, 2026, as part of our long term incentive plan the following equity incentives were granted to certain of our officers and employees:
•454,112 stock-settled restricted stock units ("RSU's") that vest in three equal tranches beginning one year from the grant date. The fair value of the stock-settled RSU’s is amortized over the vesting period. The total fair value of the grant was $6.0 million.
•Performance share units ("PSU's") that vest on December 31, 2028, with the number of units to vest determined by our share price performance against constituents from a Base Metals Index. The number of units to vest ranges between zero times to two times the target number of PSU's. The total target number of PSU's is 405,360. The total fair value of the grant was $7.1 million.
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Liquidity, Capital Resources and Capital Requirements
Cash Resources
We have recurring net losses and negative operating cash flows and we expect that we will continue to operate at a loss until we are able to generate revenue from our mining projects and such revenue exceeds our expenses. We cannot assure you that any of our mining projects will advance to commercial production or be profitable once in commercial production.
We have funded our operations primarily through the sale of our equity securities.
At June 30, 2026, we had cash and cash equivalents of $256.9 million and a working capital balance of $216.6 million. Of the total cash and cash equivalents at June 30, 2026, $23.5 million was not available for the general corporate purposes of the Company as these amounts were held by non-wholly-owned subsidiaries.
In December 2025, we closed a $200.0 million senior secured multi-draw Bridge Facility from a syndicate of three international financial institutions (the "Bridge Facility"). The Bridge Facility will support the development of the Santa Cruz Copper Project by providing enhanced liquidity for early construction activities and working capital requirements. The Bridge Facility is currently undrawn.
As at August 7, 2026, we believe that we have sufficient cash resources and availability under the Bridge Facility to carry out our business plans for at least the next 12 months, after which we expect to need additional financing to further advance our projects and conduct our business. We have based these estimates on our current assumptions, which may require future adjustments based on our ongoing business and development decisions. Accordingly, we may require additional cash resources earlier than we currently expect or we may need to curtail currently planned activities.
On April 15, 2025, we received a Letter of Interest from the Export-Import Bank of the United States (“EXIM Bank”) outlining the potential to provide up to $825 million in debt financing with a 15-year repayment tenor for the development of the Santa Cruz Copper Project in Arizona through EXIM Bank’s Make More in America initiative.
EXIM Bank is the official export credit agency of the United States. It is a government agency that offers financial support to companies through means such as direct loans and loan guarantees, working capital guarantees, and export credit insurance. EXIM Bank’s Make More in America initiative and its China and Transformational Exports Program are designed to boost the United States’ competitiveness, strengthen supply chains, and reduce strategic vulnerabilities.
Following the receipt of the Letter of Interest from EXIM Bank, we are currently advancing through the formal application process. EXIM Bank will need to conduct all requisite due diligence necessary to determine if a final lending commitment would be made. Any final lending commitment will be dependent on meeting EXIM Bank’s underwriting criteria, authorization process, and finalization and satisfaction of terms and conditions. All final lending commitments must be in compliance with EXIM Bank policies as well as program, legal and eligibility requirements. We are assessing EXIM Bank’s interest together with other financing alternatives available to us for the development of the Santa Cruz Copper Project. The construction of the Santa Cruz Copper Project will require additional capital beyond the amount that EXIM Bank may make available.
We may seek additional financing at any time through debt, equity, project specific debt, and/or other means, including asset sales. Our continued operations are dependent on our ability to obtain additional financing or to generate future cash flows. However, there can be no assurance that we will be successful in our efforts to raise additional capital on terms favorable to us, or at all.
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Consolidated Cash Balances as of June 30, 2026
The table below discloses the amounts of cash disaggregated by currency denomination as of June 30, 2026 in each jurisdiction that our affiliated entities are domiciled.
Currency by Denomination (in USD Equivalents)
US dollars Canadian dollars Other Total
(In thousands)
Jurisdiction of Entity:
USA $ 227,231 $ 1,823 $ — $ 229,054
Canada 17,512 1,424 — 18,936
Cayman Islands 6,839 432 — 7,271
Other 1,531 — 86 1,617
Total $ 253,113 $ 3,679 $ 86 $ 256,878
Refer to Note 18 of our consolidated financial statements in our 2025 Form 10-K which outlines other restrictions on transfers of net assets from our consolidated subsidiaries to the Company.
Convertible Bond — VRB Energy
On July 8, 2021, VRB Energy issued a convertible bond for gross proceeds of $24.0 million. The bond has a five-year term and interest accrues at a rate of 8% per annum. Prior to the maturity date, the convertible bond will be automatically converted into equity of VRB Energy upon an equity financing or sale event, at a price per share equal to the lower of (A) the transaction price of the equity financing or sale event, and (B) the valuation cap price of $158.0 million divided by the total shares outstanding at the time of the event. If no equity financing or sale event occurs or other agreed restructuring of the convertible bond with its holder occurs, VRB Energy must repay the outstanding principal and interest on maturity in July 2026. At June 30, 2026, the balance of principal and interest on the bond was $35.2 million and it is classified as a current liability on the balance sheet.
On July 1, 2026, VRB Energy and the bond holder entered into an agreement whereby the parties mutually agreed to extend the maturity date of the convertible bond to December 31, 2026. All other terms and conditions remained the same.
Bridge Facility - Mesa Cobre
On December 12, 2025, Mesa Cobre, closed a senior secured multi-draw Bridge Facility which will support the development of the Santa Cruz Copper Project by providing enhanced liquidity for early construction activities and working capital requirements. The Bridge Facility has a two-year maturity term, with a single repayment at maturity. It will bear interest at our election, either at (i) the forward-looking term rate based on the Secured Overnight Financing Rate administered by the Federal Reserve Bank of New York plus a margin of 5.0%, increasing by 0.5% on each of the 6th, 12th, and 18th month following the closing date, or (ii) the alternate base rate as defined in the Bridge Facility agreements. At June 30, 2026, the Bridge Facility was undrawn.
In connection with the Bridge Facility, (i) Mesa Cobre entered into a security agreement which granted a first priority lien on substantially all of its assets, subject to customary exceptions, (ii) Ivanhoe Electric guaranteed Mesa Cobre’s payment obligations pursuant to a guaranty agreement whereby Ivanhoe Electric agrees to maintain at all times a tangible net worth of not less than $225.0 million, (iii) Ivanhoe Electric pledged its shares of Mesa Cobre pursuant to a pledge agreement, and (iv) Mesa Cobre executed a deed of trust and assignment of rents with respect to Mesa Cobre’s real property rights.
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Cash Flows
The following table presents our sources and uses of cash for the periods indicated:
Six Months Ended June 30, 2026
2026 2025
Net cash (used in) provided by:
Operating activities $ (62,275) $ (45,469)
Investing activities 98,923 7,707
Financing activities 46,146 80,916
Effect of foreign exchange on cash (640) 827
Total change in cash $ 82,154 $ 43,981
Operating activities.
Net cash used in operating activities for all periods presented largely was spent on our exploration expenses and our general and administrative costs. We do not generate adequate cash from operations to cover our operating expenses and therefore rely on our financing activities to provide the cash resources to fund our operating and investing activities.
The net cash used in operating activities during the six months ended June 30, 2026 of $62.3 million primarily was the result of $43.4 million of cash exploration expenditures, $13.6 million of cash general and administrative costs and $12.2 million of income taxes paid by Cordoba in relation to sale of the Alacrán Project.
The net cash used in operating activities during the six months ended June 30, 2025 of $45.5 million primarily was the result of $28.7 million of cash exploration expenditures and $16.1 million of cash general and administrative costs.
Investing activities.
Net cash received from investing activities for the six months ended June 30, 2026 of $98.9 million was predominately due to $124.8 million received by Cordoba from the sale of its Alacrán Project. In addition, we received $5.0 million in proceeds from the 2024 sale of VRB China and $1.5 million in initial consideration from the sale of the Pinaya Gold-Copper Project. Offsetting these cash receipts were cash expenditures of $20.9 million on deposits made by the Santa Cruz Copper Project related to infrastructure and equipment, $6.3 million invested into the Maaden Joint Venture, $3.1 million of exploration property purchases and other asset purchases totaling $1.3 million.
During the six months ended June 30, 2025, we received $9.7 million in proceeds from the 2024 sale of a VRB China.
Financing activities.
The net cash provided by financing activities during the six months ended June 30, 2026 of $46.1 million included proceeds of $81.5 million received from the January and February 2026 exercise of approximately 11.6 million Warrants to purchase one share of our common stock at a price of $7.00 per share. In addition, we received $6.1 million from the exercise of stock options during the six months ended June 30, 2026. Also, during the six months ended June 30, 2026, Cordoba distributed $40.1 million to its non-controlling shareholders.
The net cash provided by financing activities during the six months ended June 30, 2025 of $80.9 million was primarily a result of the public offering we completed in February 2025 where we issued 11,794,872 units (the “Units”) at a price of $5.85 per Unit for net proceeds of approximately $65.8 million. Each Unit consisted of (i) one share of our common stock and (ii) one accompanying warrant.
Also during the six months ended June 30, 2025, our subsidiary, Cordoba received a $5.0 million bridge loan from JCHX which was in addition to $5.0 million which was previously received in December 2024. On June 25, 2025, JCHX paid Cordoba $20.0 million which was the third installment under the strategic arrangement signed in 2023 whereby JCHX acquired its 50% ownership of the Alacrán Project. On June 26, 2025, Cordoba repaid the $10.5 million bridge loan using the proceeds from the third installment.
Contractual Obligations
The following information updates our significant contractual obligations disclosed in Part II, Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations" of our 2025 Form 10-K.
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As of June 30, 2026, there have been no material changes, outside the ordinary course of business, in our contractual obligations since December 31, 2025, other than the May 2026 agreement to acquire the TBM for $64.7 million, payable in installments over a two-year period upon the achievement of specified contractual milestones. As of June 30, 2026, the Company had made an initial deposit of $13.8 million.
Off Balance Sheet Arrangements
As of June 30, 2026, we were not involved in any off-balance sheet arrangements that have or are reasonably likely to have a material effect on our financial condition, results of operations, or liquidity.
Related Party Transactions
See Note 15 of our consolidated financial statements for the three and six months ended June 30, 2026.
Critical Accounting Estimates
Our management’s discussion and analysis of our financial condition and results of operations is based on our consolidated financial statements which have been prepared in accordance with U.S. GAAP. The preparation of these financial statements requires us to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses, as well as the disclosure of contingent assets and liabilities as of the date of our financial statements.
Below are the accounting matters that we believe are critical to our financial statements due to the degree of uncertainty regarding the estimates or assumptions involved and the magnitude of the asset, liability, revenue, expense, gain or loss being reported. Actual results may vary from our estimates in amounts that may be material to the financial statements. An accounting estimate is deemed to be critical if it requires an accounting estimate to be made based on assumptions about matters that are highly uncertain at the time the estimate is made, and if different estimates that reasonably could have been used or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact our financial statements.
We base our assumptions and estimates on historical experience and various other sources that we believe to be reasonable under the circumstances. Actual results may differ from the estimates we calculate due to changes in circumstances, global economics and politics and general business conditions. A summary of our significant accounting policies are detailed in Note 2 to our consolidated financial statements included in our 2025 Form 10-K. We have outlined below those policies identified as being critical to the understanding of our business and results of operations and that require the application of significant management judgment in developing estimates.
Recoverable value of exploration mineral interests
We review and evaluate exploration mineral interests for impairment when events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. The recoverability of our exploration mineral interests and intangible assets did not involve significant estimation in the periods presented as circumstances did not indicate the carrying amount of our assets may not be recoverable. However, the recoverability of our recorded mineral interests is subject to market factors that could significantly affect the recoverability of our assets, such as commodity prices, results of exploration activities that may affect our intentions to continue under option or earn-in agreements and geopolitical circumstances. By nature, significant changes in these factors are reasonably possible to occur periodically, which could materially impact our financial statements.
Stock-based compensation
Compensation expense for PSU's granted to certain of our officers and employees is determined based on estimated fair values of the PSU's at the time of grant using a Monte Carlo valuation model, which requires the input of the following subjective assumptions:
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Grant date: March 6, 2026
Expected volatility 69.0 %
Expected life of PSU's (in years) 2.8 years
USA risk-free interest rate 3.4 %
Canada risk-free interest rate 2.6 %
Weighted average grant-date fair value (per unit) $ 17.56
The expected volatility is based on the historical volatility of our stock on the NYSE American over a term commensurate with the expected life of the PSU's. The USA risk-free interest rate was based on the yield observed on the US Dollar treasury curve as at the grant date, while the Canadian risk-free interest rate was based on the yield observed on the Canadian dollar government bond curve as at the grant date.
Income taxes
We make estimates and judgments in determining the provision for income tax expense, deferred tax assets and liabilities and liabilities for unrecognized tax benefits, including interest and penalties. We are subject to income tax laws in many jurisdictions, including the United States, Canada, Australia, the Ivory Coast and Chile.
We report income tax in accordance with U.S. GAAP, which requires the establishment of deferred tax accounts for all temporary differences between the financial reporting and tax bases of assets and liabilities, using currently enacted tax rates. In addition, deferred tax accounts must be adjusted to reflect new rates if enacted into law.
Realization of deferred tax assets is contingent on the generation of future taxable income. As a result, we consider whether it is more likely than not that all or a portion of such assets will be realized during periods when they are available, and if not, we provide a valuation allowance for amounts not likely to be recognized. In determining our valuation allowance, we have not assumed future taxable income from sources other than the reversal of existing temporary differences. The extent to which a valuation allowance is warranted may vary as a result of changes in our estimates of future taxable income. In addition to the potential generation of future taxable income through the establishment of economic feasibility, development and operation of mines on our exploration assets, estimates of future taxable income could change in the event of disposal of assets, the identification of tax-planning strategies or changes in tax laws that would allow the benefits of future deductible temporary differences in certain entities or jurisdictions to be offset against future taxable temporary differences in other entities or jurisdictions.
We recognize the effect of uncertain income tax positions if those positions are more likely than not of being sustained. The amount recognized is subject to estimates and our judgment with respect to the likely outcome of each uncertain tax position. The amount that is ultimately incurred for an individual uncertain tax position or for all uncertain tax positions in the aggregate could differ from the amount recognized. We had no uncertain tax positions as of June 30, 2026.