When a company posts solid earnings, investors pay attention. But when a gold company triples its profit, people really start talking. That’s exactly what happened with Kinross Gold (TSX:K) after it released its first-quarter 2025 results. The stock gained around 4% following the earnings announcement, and for good reason. The results showed that Kinross stock is benefiting from strong gold prices, improving margins, and smart financial management. Despite rising costs, the company’s ability to generate cash and deliver value to shareholders stood out.
What happened?
Kinross reported net earnings of $368 million, or $0.30 per share, compared to $107 million, or $0.09 per share, in the first quarter (Q1) of 2024. Revenue rose to $1.5 billion, up 38% from the same period a year earlier. What really moved the needle was the price of gold. Kinross stock sold its gold at an average price of US$2,857 per ounce, a sharp jump from the US$2,070 it realized a year ago.
Gold prices have surged in recent months due to ongoing geopolitical tensions and investor demand for safe-haven assets. For Kinross stock, this meant stronger gross margins despite a bump in production costs. The gross margin per ounce of gold sold increased to $1,814, up 67% from the same quarter last year. That’s a hefty jump and helped Kinross offset its highest all-in sustaining costs in nearly a decade, which came in at $1,355 per ounce.
Showing strength
Cost pressure came from a few directions. There was a drop in silver output and increased royalties at La Coipa in Chile, as well as operational inefficiencies at the Round Mountain site in Nevada. These challenges pushed costs higher, but not enough to derail the company’s strong quarter. It also helped that production came in at 527,399 gold equivalent ounces, a slight increase from last year.
Beyond just revenue and profit, Kinross stock made real progress on its balance sheet. Operating cash flow rose to $597 million, up from $374 million a year ago. Free cash flow more than doubled to $370 million. That’s important because it gives Kinross the flexibility to reduce debt and return capital to shareholders. In fact, the company paid off the remaining $200 million on its term loan during the quarter, bringing total net debt down to about $540 million.
Looking ahead
Management is also keeping its promises when it comes to rewarding shareholders. Kinross stock maintained its quarterly dividend and continued with its share repurchase program. The board has approved a buyback of up to 110 million shares. As of early April, Kinross had already bought back about $60 million worth of shares and plans to repurchase at least $500 million this year, assuming gold prices remain strong and operations perform well.
Looking ahead, the company reaffirmed its 2025 production guidance of two million gold equivalent ounces, with an all-in sustaining cost of $1,500 per ounce, plus or minus 5%. That’s a modest increase from current levels but reflects some of the cost inflation seen across the industry. With higher expected prices for gold, Kinross stock should still generate strong cash flow even if expenses continue to inch upward.
Bottom line
The real story here is that Kinross stock is taking advantage of favourable market conditions while positioning itself for long-term growth. Its strong performance in Q1 wasn’t just about higher gold prices; it was about execution. The company increased production, reduced debt, and returned capital to shareholders. That’s exactly what investors want to see in a mining company.
So, why did Kinross stock jump after earnings? Because it delivered. It showed investors that it’s more than capable of turning gold market momentum into tangible results. The rising costs are worth watching, but for now, Kinross looks well-prepared to handle them. With solid financials, growing production, and a disciplined approach to capital returns, the company is giving the market exactly what it wants, and that’s why the stock reacted the way it did.
