Global mining profits hit $700 billion as AI reshapes demand – McKinsey report

McKinsey’s Global Materials Perspective 2025 reveals $700 billion in mining profits despite falling revenues, driven by strong demand for energy transition and AI-related metals.

The global metals and mining industry recorded one of its most profitable years in two decades, posting $700 billion in earnings despite a 6% revenue decline, according to McKinsey’s newly released Global Materials Perspective 2025.

Profitability holds, but challenges intensify

McKinsey’s analysis shows that the sector remains highly profitable, even as it grapples with declining ore grades, more complex extraction conditions, and tightening environmental and labor standards. These pressures are steadily increasing costs and reducing margins, pushing companies to invest in electrification, automation, and digital technologies to sustain productivity.

The study notes that profit pools are shifting away from coal and steel toward copper, gold, and aluminum, with productivity recovering by roughly 1% per year since 2018—led by Latin America and North America. Meanwhile, industry concentration has diminished: the market share of the top 10 miners fell from 60% in 2000 to 30% by 2015, where it has since stabilized.

Regional transformation and energy transition

Regional dynamics are reshaping the sector’s landscape. China and North America have gained influence, while Europe’s share has fallen to 11%. Steel’s portion of total market value has been halved since 2000, now representing just 10%.

Demand, however, remains robust. More than half of projected growth through 2035 will come from energy transition materials such as copper, nickel, and lithium. McKinsey estimates that AI data centers alone could boost global copper demand by 3% by 2030, underscoring technology’s increasing impact on raw material markets.

Asia to lead the next growth wave

Asian nations are expected to drive over 45% of global demand growth by 2035, requiring around $4.7 trillion in investment, 270 GW of new power capacity, and 350,000 new jobs across the mining and materials value chain.

Despite operational pressures, capital markets remain optimistic, with total shareholder returns up 3.5 times and global mining market capitalization doubling since 2015.

Key shifts: AI, nationalism, and decarbonization slowdowns

McKinsey identifies four structural changes in this year’s report:

• The rise of resource nationalism in key producing nations.
• Accelerated demand from AI-driven technologies.
• A visible rebound in productivity enabled by generative AI and automation.
• Slower progress in decarbonization, especially in Europe’s steel sector, where nearly one-third of green projects have been delayed or scrapped.

Coal remains resilient, but transition continues

Thermal coal production reached a record eight gigatons, illustrating the uneven pace of the global energy transition. Nonetheless, the long-term outlook remains positive, supported by population growth, urbanization, and the spread of low-carbon technologies.

Strategic outlook

McKinsey outlines three main priorities for mining leaders:

• Expand into new geographies and critical materials.
• Leverage AI and automation to sustain productivity and cost control.
• Pursue pragmatic, cost-effective decarbonization to balance growth and ESG commitments.

According to the report, 30–50% of shareholder overperformance in mining stems from operational decisions. Companies that combine discipline with innovation will be best positioned to thrive.

“Success in metals and mining will hinge on improving productivity and delivering sustainable solutions,” McKinsey concludes. “Those willing to act decisively will be best positioned to seize the opportunities ahead.”