EXK’s Silver Output Jumps 88%: Strong Production But Rising Costs and Losses Define Q3 2025

Production Hits New Heights, Driven by Silver Output

Endeavour Silver Corp. (NYSE:EXK, TSX:EDR) reported a standout quarter for production, with Q3 2025 silver equivalent output up 88% from a year ago to 3.04 million ounces. Silver ounces produced surged to 1.77 million—more than doubling the previous year—helped by the contribution of new mines and greater third-party material processed. Gold production, by contrast, slipped 22% year-over-year to 7,285 ounces, as expected from shifts in ore mix.

Record Revenue and Operating Cash Flow Supported by High Metal Prices

The company benefited from strong metals markets: realized silver prices reached $38.58 per ounce (up 30%), and realized gold prices were $3,550 per ounce (up 40%). Q3 revenue nearly doubled, up 109% to $111.4 million. Operating cash flow before working capital changes also soared to $13.6 million, and adjusted EBITDA more than doubled to $28.2 million. This performance reflects higher output and stronger pricing for both metals, alongside the addition of new mine production from Kolpa and pre-operating output at Terronera.

Operating Costs Surge: Cash Costs Up 59% and AISC Rises 18%

Despite impressive top-line growth, EXK faced rapidly escalating costs. Consolidated cash costs per silver ounce rose to $18.09 (a 59% increase from last year), mainly driven by lower gold by-product credits and a greater share of third-party ore—which comes at a higher price. All-in sustaining costs (AISC) per silver ounce hit $30.53, up 18% year-over-year, with cost pressures from royalties, administrative expense, and higher costs associated with Terronera and Kolpa. The higher realized silver price also meant higher royalty expenses.

Terronera Achieves Commercial Production, Expanding Future Capacity

A key development in Q3 was the announcement of commercial production at Terronera, EXK’s latest flagship mine in Mexico, effective October 1, 2025. Terronera achieved 90% of its nameplate capacity and recoveries over 90%—milestones that set the stage for future production gains across the company’s now four operating mines.

Financial Losses Persist Despite Strong EBITDA

Net losses mounted in Q3, totaling $42.0 million (compared to a $17.3 million loss last year). The sharp losses reflect substantial derivative contract mark-to-market adjustments, higher general and administrative expenses (including a $2.7 million deferred share unit revaluation), and increased costs related to mine commissioning and development. Adjusted net loss was more moderate at $2.1 million, down from a $1.6 million adjusted net profit last year. Notably, working capital shifted from a surplus last year to a $56 million deficit, indicating increased financial leverage and future cash needs as capital spending rises.

Looking Forward: Strong Platform for Growth Amidst Cost and Margin Challenges

EXK’s operational results are compelling—higher silver production, greater sales, and the successful ramp-up of Terronera—while its rising cost base and financial losses underline challenges facing many mid-tier producers in today’s volatile metals market. The company remains in a solid cash position ($57 million as of September 30, 2025), and the increase in adjusted EBITDA signals robust operating momentum. Investors will want to track EXK’s ability to rein in costs, improve working capital, and translate production growth into sustainable bottom-line gains.

With management hosting a Q3 earnings call today, investors have an opportunity to gain deeper insight into how Endeavour plans to address cost inflation and margin compression as it enters a new phase of multi-mine production.

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