Anglo American CEO Duncan Wanblad acknowledged that the diamond industry, particularly De Beers, underestimated the impact of lab-grown diamonds. This misjudgment is a key factor in Anglo American's decision to sell or de-merge De Beers, a business they purchased for nearly $13 billion in 2011, and which was recently valued at $2.3 billion by the end of 2025 after multiple write-downs.
Anglo American's half-year report for 2026 revealed that De Beers' revenue dropped to $1.6 billion from $2 billion in the first half of 2025, with rough diamond sales falling from $1.7 billion to $1.3 billion. The company cited geopolitical and macroeconomic instability, along with the Middle East conflict, as contributing factors. However, the report also highlighted that the demand for smaller and lower-quality natural diamonds faced pricing pressure due to lab-grown diamonds. While larger, higher-quality natural diamonds maintained resilient demand, the average rough diamond price declined by 16% overall, and 32% for uncut gems during the first six months of 2026.
De Beers' underlying loss widened to $739 million from $288 million the previous year, and the underlying EBITDA loss significantly increased to $511 million from $25 million. This reflects lower prices and special deals to sell large volumes of less in-demand rough diamonds at discounts. Anglo American has attributed these challenges partly to retailers delaying full differentiation between natural and synthetic diamonds by maintaining high retail margins on lab-grown stones despite their continued wholesale price reduction. Anglo is actively working on restructuring De Beers to preserve its value and is in the final stages of divesting the business, with a deal hoped to be inked by the end of 2026.
