<PAGE>
 
                                   FORM 10-Q
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, DC  20549


                  QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934


For Quarter Ended  March 31, 1997    Commission File Number 1-10040
                  ----------------                          -------


                          CYPRUS AMAX MINERALS COMPANY
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)



      Delaware                                               36-2684040
--------------------------------------------------------------------------------
(State or other jurisdiction of                            (I.R.S. Employer
incorporation or organization)                         Identification Number)



9100 East Mineral Circle, Englewood, Colorado                    80112
--------------------------------------------------------------------------------
(Address of principal executive offices)                       (Zip Code)


                                 (303) 643-5000
--------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the preceding 12 months (or for such shorter period that the registrant was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.  Yes  X   No 
                                        ---     ---   

Number of shares of common stock outstanding as of May 13, 1997, was
93,328,077 shares.


                        This report contains 26 pages.

                                      -1-
<PAGE>
 
                        PART I.   FINANCIAL INFORMATION
                        -------------------------------

ITEM 1.   FINANCIAL STATEMENTS
------------------------------

                 CYPRUS AMAX MINERALS COMPANY AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF OPERATIONS
                      (IN MILLIONS EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
 
 
                                                 (Unaudited)
                                                Three Months
                                               Ended March 31,
                                             --------------------
                                                1997      1996
                                             ----------  -------
<S>                                          <C>         <C>     
REVENUE                                      $     888   $  684
                                             ---------   ------
COSTS AND EXPENSES
Cost of Sales                                      542      477
Selling and Administrative Expenses                 30       31
Depreciation, Depletion, and Amortization           98       72
Write-Downs and Special Charges                    116        -
Exploration Expense                                  6        7
                                             ---------   ------
TOTAL COSTS AND EXPENSES                           792      587
                                             ---------   ------
INCOME FROM OPERATIONS                              96       97

OTHER INCOME (EXPENSE)
Interest Income                                      9        6
Interest Expense                                   (51)     (42)
Capitalized Interest                                 6       19
Equity Investments and Other                        (3)       2
                                             ---------   ------
INCOME BEFORE INCOME TAXES AND MINORITY 
 INTEREST                                           57       82

Income Tax Provision                                 -      (20)
Minority Interest                                    -        -
                                             ---------   ------
NET INCOME                                          57       62

Preferred Stock Dividends                           (5)      (5)
                                             ---------   ------
INCOME APPLICABLE TO COMMON SHARES           $      52   $   57
                                             =========   ======
 
EARNINGS PER COMMON SHARE
  Primary                                    $     .56   $  .62
                                             =========   ======
  Fully Diluted                              $.56/(1)/   $  .62/(1)/
                                             =========   ======
 
AVERAGE COMMON SHARES OUTSTANDING
  Primary                                         93.4     93.1
  Fully Diluted                                  103.1    102.9

</TABLE>

See accompanying notes to consolidated financial statements.

/(1)/Fully diluted earnings per share were less than 3 percent dilutive.

                                      -2-
<PAGE>
 
                 CYPRUS AMAX MINERALS COMPANY AND SUBSIDIARIES
                           CONSOLIDATED BALANCE SHEET
                       (IN MILLIONS EXCEPT SHARE AMOUNTS)
<TABLE>
<CAPTION>
 
                                                            (Unaudited)
                                                             March 31,    December 31,
             ASSETS                                            1997          1996
                                                            ---------    -------------
<S>                                                           <C>            <C>
CURRENT ASSETS
Cash and Cash Equivalents                                     $  313         $  193
Accounts and Notes Receivable, Net                               188            216
Inventories                                                      494            495
Prepaid Expenses                                                 125            145
                                                              ------         ------
  Total Current Assets                                         1,120          1,049
PROPERTIES - At Cost, Net                                      5,185          5,226
OTHER ASSETS                                                     534            511
                                                              ------         ------
  Total Assets                                                $6,839         $6,786
                                                              ======         ======
           LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Short-Term Debt                                               $   21         $   36
Current Portion of Long-Term Debt                                 94             79
Accounts Payable                                                 125            142
Accrued Payroll and Benefits                                      99             94
Accrued Royalties and Interest                                    63             41
Accrued Closure, Reclamation and Environmental                    55             61
Other Accrued Liabilities                                        139            143
Taxes Payable, Other Than Income Taxes                            69             61
Income Taxes Payable                                              81             69
Dividends Payable                                                 19             19
                                                              ------         ------
  Total Current Liabilities                                      765            745
                                                              ------         ------
NONCURRENT LIABILITIES AND DEFERRED CREDITS
Long-Term Debt                                                 2,412          2,415
Capital Lease Obligations                                        137            139
Deferred Employee and Retiree Benefits                           416            412
Deferred Closure, Reclamation and Environmental                  361            363
Deferred Income Taxes                                             44             44
Other                                                            154            151
                                                              ------         ------
  Total Noncurrent Liabilities and Deferred Credits            3,524          3,524
                                                              ------         ------
MINORITY INTEREST                                                156            157

SHAREHOLDERS' EQUITY
Preferred Stock, $1 Par Value,
  20,000,000 Shares Authorized:
  $4.00 Series A Convertible Stock, $50 Stated Value,
    4,666,667 Authorized, 4,664,302 Issued and Outstanding
    in 1997 and 1996                                               5              5
  Series A Preferred Stock, 500,000 Shares
    Authorized, None Issued or Outstanding                         -              -
Common Stock, Without Par Value,
  150,000,000 Shares Authorized,
  Issued 96,031,128 in 1997 and 96,031,139 in 1996                 1              1
Paid-In Surplus                                                2,948          2,952
Accumulated Deficit                                             (447)          (481)
Other                                                              4              5
                                                              ------         ------
                                                               2,511          2,482
Treasury Stock at Cost, 2,628,541 Shares in 1997
  and 2,788,535 Shares in 1996                                   (60)           (64)
Loan to Savings Plan                                             (57)           (58)
                                                              ------         ------
  Total Shareholders' Equity                                   2,394          2,360
                                                              ------         ------
  Total Liabilities and Shareholders' Equity                  $6,839         $6,786
                                                              ======         ======
</TABLE>
See accompanying notes to consolidated financial statements.

                                      -3-
<PAGE>
 
                 CYPRUS AMAX MINERALS COMPANY AND SUBSIDIARIES
                      CONSOLIDATED STATEMENT OF CASH FLOWS
                                 (IN MILLIONS)
<TABLE>
<CAPTION>
 
                                                              (Unaudited)
                                                             Three Months
                                                            Ended March 31,
                                                           -----------------
                                                             1997     1996
                                                           --------  -------
<S>                                                          <C>      <C>
CASH FLOWS FROM OPERATING ACTIVITIES
Net Income                                                   $  57    $  62

  Depreciation, Depletion, and Amortization                     98       72
  Write-Downs and Special Charges                              116        -
  Deferred Income Taxes                                        (10)      10
  Gain on Sale of Assets                                      (137)      (9)
  Changes in Assets and Liabilities Net of Effects
    from Businesses Acquired/Sold                               48      (40)
  Other, Net                                                     9        7
                                                             -----    -----
NET CASH PROVIDED BY OPERATING ACTIVITIES                      181      102
                                                             -----    -----
CASH FLOWS FROM INVESTING ACTIVITIES
  Capital Expenditures                                        (130)    (255)
  Payments for Businesses Purchased                              -      (70)
  Capitalized Interest                                          (6)     (19)
  Advances to and Investments in Affiliates                     (3)      (9)
  Proceeds from Sale of Assets                                 107       10
                                                             -----    -----
NET CASH USED FOR INVESTING ACTIVITIES                         (32)    (343)
                                                             -----    -----
CASH FLOWS FROM FINANCING ACTIVITIES
  Net Proceeds from Issuance of Long-Term Debt                  16      127
  Net Borrowings on Short-Term Debt                              -      149
  Payments on Short-Term Debt                                  (15)      (7)
  Payments on Long-Term Debt and Other Obligations              (5)     (14)
  Proceeds from Issuance of Stock for Employee Benefits          -        1
  Dividends Paid                                               (23)     (23)
  Dividends to Minority Interests                               (2)      (2)
                                                             -----    -----
NET CASH PROVIDED BY (USED FOR) FINANCING ACTIVITIES           (29)     231
                                                             -----    -----
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS           120      (10)
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR                 193      191
                                                             -----    -----
CASH AND CASH EQUIVALENTS AT END OF PERIOD                   $ 313    $ 181
                                                             =====    =====
 
Non-Cash Investing Activity:
  Note received for Coal Contract                            $  31    $   -
                                                             =====    =====
</TABLE>

See accompanying notes to consolidated financial statements.

                                      -4-
<PAGE>
 
                 CYPRUS AMAX MINERALS COMPANY AND SUBSIDIARIES
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


NOTE 1.  BASIS OF PRESENTATION
------------------------------

The accompanying interim unaudited financial statements include all adjustments
which are, in the opinion of management, necessary for a fair presentation.
Results for any interim period are not necessarily indicative of the results
that may be achieved in future periods.  The financial information as of this
interim date should be read in conjunction with the financial statements and
notes thereto contained in Cyprus Amax's Annual Report on Form 10-K for the year
ended December 31, 1996.

NOTE 2.  INVENTORIES
--------------------

Inventories detailed by component are summarized below (in millions):
<TABLE>
<CAPTION>
 
                                    (Unaudited)
                                     March 31,   December 31,
                                       1997          1996
                                    -----------  ------------
<S>                                 <C>          <C>
Component
  In-Process Ores, Concentrates,
    and Other                            $ 229          $ 237
  Finished Goods                           167            161
  Materials and Supplies                    98             97
                                         -----          -----
                                         $ 494          $ 495
                                         =====          =====
</TABLE>
NOTE 3.  FAIR VALUE OF FINANCIAL INSTRUMENTS
--------------------------------------------

The estimated fair values of financial instruments under SFAS No. 107,
"Disclosures About Fair Value of Financial Instruments," are made at discrete
points in time based on relevant market information. These estimates involve
uncertainties and cannot be determined with precision. At March 31,1997, the net
carrying value of financial instruments approximated a $1,824 million liability,
whereas the fair value approximated a $1,851 million liability. The difference
in fair value is primarily due to lower interest rates.

NOTE 4.  CONTINGENCIES
----------------------

Cyprus Tohono Mining Company was informed in late 1995 by the office of the
Assistant U.S. Attorney in Tucson, Arizona that an action was being considered
under federal environmental laws against Cyprus Tohono Corporation and certain
of its employees.  The facts giving rise to this matter involved a break in the
process line at Tohono occurring in 1992.  It is not possible to state with
reasonable certainty at this time what action will be taken by the government.

Cyprus Miami and other companies, in conjunction with the Arizona Department of
Environmental Quality's Water Quality Assurance Revolving Fund program,
continued remediation and assessment of ground water quality at Pinal Creek near
Miami, Arizona throughout 1996.  The ongoing program, initiated in 1989, has
resulted in continued improvement of subsurface water quality in the area.
While the long-term remedial action plan is not scheduled for submittal to the
State of Arizona for approval until late 1997, completion of risk assessment
studies and the evaluation of remedial action alternatives has provided
information which allows an estimate of Cyprus Amax costs for completing the
remedial action.  As a result of this new information, approximately $50 million
was recorded for the Pinal Creek remediation reserve at December 31, 1996.
Cyprus Miami has commenced contribution litigation against other parties
involved in this matter and has asserted claims against certain of its past
insurance carriers.  While significant recoveries are expected, 

                                      -5-
<PAGE>
 
Cyprus Miami cannot reasonably estimate the amount of recoveries and, therefore,
has not taken potential recoveries into consideration in the provision.

In December 1996, Cyprus Amax received a Unilateral Administrative Order For
Removal Response Activities from the U.S. EPA requiring the removal of asbestos-
containing material at the Horizon Potash Mine located near Carlsbad, New
Mexico.  Cyprus Amax is complying with the order and expects to complete the
removal work by late 1997 along with completing other building demolition and
reclamation at the Horizon site in accordance with a settlement agreement with
the Bureau of Land Management.  Horizon Potash acquired Amax Potash and its
facilities in 1992, abandoned the site in 1993, and entered Chapter 7 bankruptcy
proceedings.

At March 31, 1997, Cyprus Amax had accruals of approximately $416 million for
expected future mine closure, reclamation, and environmental remediation
liabilities.  Total reclamation costs for Cyprus Amax at the end of current mine
lives are estimated at about $307 million.  Additionally, the cost range of
reasonably possible outcomes for sites where remediation costs are estimable is
from $80 million to $300 million of which approximately $109 million was
reserved at March 31, 1997.  Work on these sites is expected to be substantially
completed in the next several years, subject to the inherent delays involved in
the process. Remediation costs that could not be reasonably estimated at March
31, 1997, are not expected to have a material impact on the financial condition
and ongoing operations of the Company.

                                      -6-
<PAGE>
 
NOTE 5.  INFORMATION BY INDUSTRY SEGMENT
----------------------------------------

Cyprus Amax operates in three principal industry segments -- Copper/Molybdenum,
Coal, and Other -- which supply mineral products primarily to the construction,
automobile, steel, and utility industries and gold to banks and other bullion
dealers.  The financial information for these segments is presented below (in
millions):
<TABLE>
<CAPTION>
 
                                        (Unaudited)
                                        Three Months
                                      Ended March 31,
                                   ---------------------
                                      1997        1996
                                   ---------   ---------
<S>                                <C>         <C>
Segment Revenue
 
  Copper/Molybdenum                    $ 394       $ 340
  Coal                                   431         285
  Other                                   63          59
                                       -----       -----
 
                                       $ 888       $ 684
                                       =====       =====
 
Segment Operating Income (Loss)
 
  Copper/Molybdenum                    $  87       $  86
  Coal                                    25          22
  Other                                   (3)          4
                                       -----       -----
 
                                         109         112
 
Corporate                                (13)        (15)
Interest, Net                            (36)        (17)
Equity Investments and Other              (3)          2
                                       -----       -----
 
  Income Before Income Taxes
    and Minority Interest                 57          82
Income Tax Provision                       -         (20)
Minority Interest                          -           -
                                       -----       -----
 
  Net Income                           $  57       $  62
                                       =====       =====
 
</TABLE>

                                      -7-
<PAGE>
 
REVIEW BY INDEPENDENT ACCOUNTANTS
---------------------------------

The financial information as of March 31, 1997, and for the three-month periods
ended March 31, 1997 and 1996, included in Part I pursuant to Rule 10-01 of
Regulation S-X has been reviewed by Price Waterhouse LLP, the Company's
independent accountants, in accordance with standards established by the
American Institute of Certified Public Accountants.  Price Waterhouse LLP's
report is included as page 9 of this quarterly report.

Price Waterhouse LLP does not carry out any significant or additional audit
tests beyond those which would have been necessary if its report had not been
included in this quarterly report. Accordingly, such report is not a "report" or
"part of a registration statement" within the meaning of Sections 7 and 11 of
the Securities Act of 1933 and the liability provisions of Section 11 of such
Act do not apply.

                                      -8-
<PAGE>
 
                       REPORT OF INDEPENDENT ACCOUNTANTS
                       ---------------------------------


To the Board of Directors and Shareholders of Cyprus Amax Minerals Company

We have reviewed the accompanying consolidated balance sheet of Cyprus Amax
Minerals Company and its subsidiaries as of March 31, 1997, and the related
consolidated statements of operations and of cash flows for the three-month
periods ended March 31, 1997 and 1996. These financial statements are the
responsibility of the Company's management.

We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants.  A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters.  It is substantially less in scope than an audit conducted in
accordance with generally accepted auditing standards, the objective of which is
the expression of an opinion regarding the financial statements taken as a
whole.  Accordingly, we do not express such an opinion.

Based on our review, we are not aware of any material modifications that should
be made to the accompanying interim financial information for it to be in
conformity with generally accepted accounting principles.

We previously audited in accordance with generally accepted auditing standards,
the consolidated balance sheet as of December 31, 1996, and the related
consolidated statements of operations, of shareholder's equity, and of cash
flows for the year then ended (not presented herein), and in our report dated
February 12, 1997, we expressed an unqualified opinion on those consolidated
financial statements.  In our opinion, the information set forth in the
accompanying consolidated balance sheet information as of December 31, 1996, is
fairly stated in all material respects in relation to the consolidated balance
sheet from which it has been derived.



/S/ Price Waterhouse LLP

Denver, Colorado
May 14, 1997

                                      -9-
<PAGE>
 
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND
-------------------------------------------------------------------------
FINANCIAL CONDITION
-------------------

To the extent the Company makes forward-looking statements, actual results may 
vary materially therefrom. All of the information set forth in this Form 10-Q, 
including without limitation the Cautionary Statement and Risk Factors described
herein, should be considered and evaluated.

RESULTS OF OPERATIONS
---------------------

CYPRUS AMAX MINERALS COMPANY  reported consolidated net income of $57 million,
or 56 cents per share, on revenue of $888 million for the first quarter of 1997,
compared to 1996 earnings of $62 million, or 62 cents per share, on revenue of
$684 million.  Cyprus Amax recorded an after-tax gain of $29 million or 28 cents
per share for a favorable tax adjustment resulting from settlement of certain
prior year tax issues and the impact of coal settlements, reduced to recognize
certain provisions for mine closing costs.

Excluding the above-mentioned gain, lower 1997 first quarter earnings resulted
from lower copper, molybdenum, coal and gold realizations; higher costs of
copper sold; and the impact of five coal longwall moves, partially offset by
higher produced copper sales, coal and gold sales.
<TABLE>
<CAPTION>
 
                                                       Three Months Ended
                                                            March 31,
                                                       ------------------
SELECTED RESULTS (In millions except per share data)    1997        1996
                                                       ------      ------
<S>                                                    <C>         <C>
Revenue                                                 $ 888       $ 684

Net Income                                              $  57       $  62

Earnings Per Share                                      $ .56       $ .62
</TABLE>

The 1997 first quarter revenue of $888 was $204 million higher than the
comparable 1996 quarter primarily due to $137 million of gains recorded on the
settlements of certain coal contracts and higher produced copper, coal and gold
sales, partially offset by lower copper, molybdenum, coal and gold realizations.

Segment income is earnings before corporate overhead, interest, equity and
other, income taxes, and minority interest.
<TABLE>
<CAPTION>
 
COPPER/MOLYBDENUM
                                                         Three Months Ended
                                                              March 31,
                                                         ------------------
                                                          1997        1996
SELECTED RESULTS (In millions)                           ------      ------
<S>                                                      <C>         <C>  
Revenue                                                   $ 394       $ 340 

Segment Operating Income                                  $  87       $  86  
</TABLE>

COPPER/MOLYBDENUM earned $87 million during the first quarter, $1 million higher
than in the 1996 period. Earnings reflected $5 million higher molybdenum results
and 79 million pounds or 46 percent higher sales of produced copper, partially
offset by six percent lower copper realizations, and five cents per pound higher
costs of copper sold.

First quarter copper realizations averaged $1.10 per pound, seven cents lower
than in the 1996 quarter. As of March 31, 1997, Cyprus Amax has price protection
programs in place that will ensure a minimum average realization on an LME basis
of 96 cents per pound on 400 million pounds for the remainder of 1997, and as of
May 13, 1997 has approximately 175 million pounds at 90 cents per pound for the
first half of 1998. The price protection program for El Abra ensures a minimum
average realization on an LME basis of 90 cents in 1997 on approximately 305
million pounds with a cap of $1.25 per pound on approximately 110 million
pounds. Cyprus Amax's share of El Abra is 51 percent.

                                      -10-
<PAGE>
 
<TABLE>
<CAPTION>
                                                      Three Months Ended
                                                          March 31,
                                                      ------------------
OTHER OPERATING DATA (In millions except as noted)      1997       1996
                                                      -------    -------
<S>                                                   <C>    <C>
Copper Sales Volume, Pounds                             266        198
Produced Copper Sold, Pounds                            251        172
Copper Production, Pounds                               241        173
 
Average Copper Realization, $/Pound                   $1.10      $1.17
Cost of Sales, $/Pound                                $ .82      $ .77
Net Cash Cost, $/Pound                                $ .64      $ .70
Full Cost, $/Pound                                    $ .76      $ .79
 
Bagdad
------
Production - Pounds                                      58         54
Material Mined - Tons                                  18.7       16.1
Ore Mined - Tons                                        7.0        8.1
Ore Milled - Tons                                       7.2        7.5
Ore Grade - %                                           .43        .39
 
Miami
-----
Production - Pounds                                      34         34
Material Mined - Tons                                  24.6       26.1
Ore Mined - Tons                                        8.1        7.7
Ore Grade - %                                           .52        .48
 
Sierrita
--------
Production - Pounds                                      60         57
Material Mined - Tons                                  23.1       24.9
Ore Mined - Tons                                       10.4        9.9
Ore Milled - Tons                                      10.5        9.9
Ore Grade - %                                           .27        .29
 
Cerro Verde
-----------
Production - Pounds                                      30         20
Material Mined - Tons                                   9.2        5.6
Ore Mined - Tons                                        2.0        1.4
Ore Grade - %                                           .86       1.03
 
El Abra
-------
Production - Pounds (51%)                                49          -
Material Mined - Tons (100%)                            8.3          -
Ore Mined - Tons (100%)                                 8.0          -
Ore Grade - %                                           .95          -
</TABLE>

                                      -11-
<PAGE>
 
<TABLE>
<CAPTION>
                                                      Three Months Ended
                                                          March 31,
                                                      ------------------
OTHER OPERATING DATA (In millions except as noted)      1997      1996
                                                      -------    -------
<S>                                                   <C>        <C>
 
Molybdenum Sales - Pounds                                16         16
Produced Molybdenum Sold - Pounds                        16         16
Molybdenum Production - Pounds                           16         14
Average Realization - $/Pound                         $5.58      $5.65
 
Henderson
---------
Production - Pounds                                      10          7
Material Mined - Tons                                   2.0        1.5
Ore Milled - Tons                                       2.0        1.5
Ore Grade - %                                           .26        .26
</TABLE>

During the quarter, Cyprus Amax sold 251 million pounds of produced copper, 79
million pounds more than in the 1996 first quarter.  Cost of sales increased
five cents per pound from the 1996 period to 82 cents per pound for the first
quarter of 1997.  This increase reflects sales of higher cost fourth quarter
1996 sulfide production.

First quarter net cash costs for copper decreased to 64 cents per pound from 70
cents per pound for the first quarter of 1996 primarily reflecting lower costs
contributed by the South American operations.  Excluding molybdenum by-product
credits, cash costs dropped 12 cents per pound or 14 percent.

Copper production totaled 241 million pounds for the quarter compared to 173
million pounds in 1996. Production increased 39 percent due to production from
El Abra of 49 million pounds, which began production in December 1996; a 10
million pound increase at Cerro Verde; and 5 percent increased domestic
production.

Primary molybdenum operations earned $20 million for the first quarter of 1997
compared to $15 million for the year earlier period.  Production of 16 million
pounds was 2 million pounds higher than the comparable 1996 quarter and produced
sales were comparable to 1996.  First quarter 1997 realizations, including
downstream products, averaged $5.58 per pound compared to $5.65 per pound during
the first quarter of 1996.
<TABLE>
<CAPTION>
 
COAL

                                                    Three Months Ended
                                                         March 31,
                                                    ------------------
SELECTED RESULTS (In millions)                       1997        1996
                                                    ------      ------
<S>                                                 <C>         <C> 
Revenue                                              $ 431       $ 285

Segment Operating Income                             $  25       $  22
</TABLE>

COAL reported first quarter earnings of $25 million compared to 1996 first
quarter earnings of $22 million.  During the first quarter of 1997, Cyprus Amax
recorded a pre-tax gain of $17 million.  This result included a net gain of $27
million for the restructuring and assignment of coal contracts at Delta and
Wabash respectively less the associated reduction in asset basis and provision
for employee separation and mine closure costs, and a provision of $10 million
for closure or disposal of Plateau.

Five of the eight longwall moves scheduled for 1997 occurred at major mines
during the first quarter, reducing first quarter earnings by $10 million
compared with the 1996 quarter. In addition to the longwall moves which
decreased earnings, lower realizations resulted from buy-outs of contracts and
timing of shipments from the Powder River Basin mines and higher costs at
Plateau reflected the wind down of production in anticipation of the start-up of
the Willow Creek mine.
                                      -12-
<PAGE>
 
<TABLE>
<CAPTION>
     
                                                     Three Months Ended
SELECTED OPERATING DATA                                  March 31,
                                                --------------------------
                                                   1997            1996
                                                ----------      ----------
<S>                                             <C>             <C>
Sales Volume - Millions of Tons
-------------------------------
  Eastern Mines                                        6.7             6.9
  Western Mines - Powder River Basin                  10.0             8.9
  Western Mines - Other                                3.1             2.2
  Springvale                                            .4               -
                                                ----------      ----------
     Total Sales                                      20.2            18.0
                                                ----------      ----------
  Oakbridge Equity Share                               1.3             1.5

Average Realization - $/Ton                         $14.09          $15.32

Domestic Average Contract Price - $/Ton             $13.44          $14.78
Domestic Average Spot Price - $/Ton                 $16.60          $17.81
Foreign Contract Price - $/Ton                      $26.58          $28.75
Foreign Spot Price - $/Ton                          $23.39          $27.85

Average Cost of Sales - $/Ton                       $13.97          $14.35
Average Cash Cost - $/Ton                           $12.41          $12.27
Average Unit Cost - $/Ton                           $14.14          $13.78
 
Clean Production - Millions of Tons
-----------------------------------
  Pennsylvania                                         2.4             2.7
  Kentucky                                             1.7             1.1
  West Virginia                                        1.9             1.7
  Midwest                                              1.4             1.9
  Wyoming - Powder River                              10.1             8.9
  Colorado                                             2.1             1.4
  Utah                                                 0.5             0.8
  Springvale                                           0.1               -
                                                ----------      ----------
 
     Total Production                                 20.2            18.5
                                                ----------      ----------
 
  Oakbridge Equity Share                               1.0             1.4
 
</TABLE>

Coal production of 21 million tons was one million tons higher than in 1996, and
coal sales of 22 million tons in the first quarter of 1997 were two million tons
higher than in the first quarter of 1996.

Cyprus Amax's equity share in Oakbridge's earnings, which is reported in
Interest, Equity, and Other was a loss of $3 million compared to earnings of $3
million in the 1996 comparable quarter, primarily from lower average
realizations.

Cyprus Amax expects 1997 production to reach approximately 93 million tons
compared to 82 million tons in 1996, including Cyprus Amax's share of production
from Oakbridge.

The Willow Creek mine in Utah is progressing ahead of schedule and within
budget.  Approximately $66 million of $130 million projected was spent through
March 31, 1997 and completion is expected in early 1998.

                                      -13-
<PAGE>
 
<TABLE>
<CAPTION>
OTHER MINERALS
                                                      Three Months Ended
                                                           March 31,
                                                      ------------------
SELECTED DATA (In millions)                            1997        1996
                                                      ------      ------
<S>                                                   <C>         <C> 
 Segment Operating Income (Loss)                       $  (3)      $   4
                                                      ======      ======
 
 Lithium                                               $   5       $   7
 Amax Gold                                                 1          (2)
 Businesses Sold/Non-Operating                            (2)         (2)
 Exploration                                              (7)          1
                                                      ------      ------
 Total                                                 $  (3)      $   4
                                                      ======      ======
 
 Lithium
  Sales Volumes - Millions of Lbs. Carbonate Equiv.       11          11
 Gold (100 percent basis)
  Sales Volumes - Thousands of Ounces                     99          62
  Gold Price - $/Ounce                                   388         412
</TABLE>

OTHER MINERALS, which includes Lithium, Amax Gold, Exploration, and Businesses
Sold/Non-Operating, had a combined loss for the first quarter of 1997 of $3
million compared to earnings of $4 million in 1996.  Lithium earned $5 million,
$2 million less that 1996, due primarily to lower carbonate prices.  Exploration
expense of $7 million was unfavorable to 1996, due to the absence of the gain on
the sale of Cerro Quema.

Amax Gold's earnings were $1 million compared to a $2 million loss in 1996.  The
improvement results from a 59 percent increase in sales and a 23 percent
decrease in cost of sales partially offset by a six percent decrease in gold
realizations.  Higher first quarter gold sales primarily resulted from
production at Fort Knox, which began production March 1, 1997, and Refugio,
partially offset by the absence of production from the Sleeper mine, which is
now in reclamation.

In February 1997, Amax Gold announced that the Kubaka gold mine in Russia poured
its first dore bars.  The mine is currently 50%-owned by Cyprus Amax Minerals
Company and 50%-owned by a group of Russian partners.  Amax Gold managed the
project through construction for Cyprus Amax and Amax Gold's shareholders have
approved the acquisition of Cyprus Amax's interest in the mine.  Cyprus Amax
expects the transaction to be completed in mid-1997.

CORPORATE

Corporate expense of $13 million for the first quarter was $2 million lower than
the 1996 comparable quarter.

INTEREST, EQUITY, AND OTHER expense of $39 million for the 1997 first quarter
was $24 million higher than the 1996 quarter.  Net interest expense of $36
million for the first quarter of 1997 was $19 million higher than the same
period in 1996.  Interest expense increased $9 million to $51 million due to
higher debt balances in the first quarter of 1997.  Capitalized interest
decreased $13 million to $6 million in the first quarter of 1997 due to the
recently completed development projects.  Interest income increased $3 million
in the quarter to $9 million due to higher cash balances.


LIQUIDITY AND CAPITAL RESOURCES

At March 31, 1997, the Company had a ratio of long-term debt to total
capitalization of 52 percent, a ratio of current assets to current liabilities
of 1.5 to 1.0, and a cash balance of $313 million.  At December 31, 1996, the
comparable ratios were 52 percent and 1.4 to 1.0, respectively.  The Company's
cash balance 

                                      -14-
<PAGE>
 
increased from $193 million at year-end to $313 million at March 31 due
primarily to cash provided by continuing operations of $181 million and proceeds
of $105 million from the settlement of coal contracts, partially reduced by
capital expenditures of $130 million.

Capital expenditures, excluding capitalized interest, were $130 million for the
first quarter.  Copper expenditures of $46 million included $9 million for the
El Abra mine and the remainder primarily for sustaining and replacement capital.
Coal expenditures of $42 million included $16 million for the development of the
Willow Creek mine in Utah and the remainder was primarily for sustaining and
replacement capital.  Other Minerals capital expenditures included expenditures
of $26 million primarily for the development of the Kubaka mine.  Total capital
spending for 1997 is projected to be less than $400 million with over 41
percent, 36 percent, and 10 percent spent on copper, coal and gold,
respectively.

On April 1, 1997, Cyprus Amax closed a long-term $110 million project financing
for its Cerro Verde copper mine.  Proceeds from the financing were used to repay
existing debt.  The term of the financing is 8 years which may be extended to 10
years, with an interest rate averaging Libor plus three percent.

In March 1997, Cyprus Amax closed on an agreement with Zambia Consolidated
Copper Mines (ZCCM) to acquire 80 percent of the Kansanshi copper mine and
deposit.  The property is located in the Western Province of Zambia and contains
a delineated copper resource of approximately 24 million tonnes at a grade of 3
percent.  Under the multi-year agreement, Cyprus Amax Minerals paid $3 million
to ZCCM at closing and committed to spend $5 million on an extensive exploration
drilling program over the next two years.  A second phase, depending on the
results of this exploration program, calls for an additional $10 million payment
to ZCCM and a $15 million commitment for further drilling and a feasibility
study.  Upon determination that a mining project is feasible, Cyprus Amax would
make a final payment of $15 million to ZCCM.  If the project is developed, ZCCM
will retain a 20 percent carried interest.

For the full year 1997, Cyprus Amax expects to spend approximately $130 million
for reclamation, remediation, and environmental compliance.

During 1997, Cyprus Amax expects to be able to generate sufficient funds for
general corporate purposes, capital expenditures, and to begin to pay down debt.

Cyprus Amax paid regular dividends of 20 cents per share on its common stock and
$1.00 per preferred share during the quarter.  At March 31, 1997, 93,402,587
shares of the Company's common stock were outstanding.

Statement of Financial Accounting Standards (SFAS) No. 128, Earnings Per Share,
was issued in February 1997.  SFAS No. 128 replaces the presentation of primary
EPS with a presentation of basic EPS.  It requires a reconciliation of the
numerator and denominator of the basic EPS computation to the numerator and
denominator of the diluted EPS computation.  Basic EPS excludes dilution and is
computed by dividing income available to common stockholders by the weighted-
average number of common shares outstanding for the period.  For the three
months ended March 31, 1997, basic earnings per share would be the same as
primary earnings per share presented.

                                      -15-
<PAGE>
 
CAUTIONARY STATEMENT AND RISK FACTORS FOR PURPOSES OF THE "SAFE HARBOR"
PROVISIONS OF THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995

                             CAUTIONARY STATEMENT

With the exception of historical matters, the matters discussed in this report
are forward-looking statements that involve risks and uncertainties that could
cause actual results to differ materially from projected results. Such forward-
looking statements include statements regarding expected commencement dates of
mining or metal production operations, projected quantities of future metal
production, and anticipated production rates, costs and expenditures as well as
projected demand or supply for the products the Company produces, which will
affect both sales levels and prices realized by the Company. Readers are
cautioned not to put undue reliance on forward-looking statements and are
advised to consider the following risk factors. The Company disclaims any intent
or obligation to update publicly these forward-looking statements, whether as a
result of new information, future events or otherwise.

                                      -16-
<PAGE>
 
                                 RISK FACTORS


     The Company's business operations are subject to a number of risks and
hazards inherent in the mining industry, including but not limited to those
summarized below, which materially and adversely may affect the Company's
business, financial conditions, results of operations and cash flows and the
anticipated development of existing properties and reserves and of future
projects, production quantities and rates, overall costs and expenditures and
expected production commencement dates.  The Company is also subject to a number
of risks not specific to the mining industry, including but not limited to
general economic and financial market conditions.

METALS PRICE VOLATILITY

     A significant portion of the Company's revenues are derived from the sale
of metals such as copper and molybdenum and, to a lesser extent, gold through
the Company's majority owned subsidiary Amax Gold.  Thus, the Company's
business, financial condition, results of operations and cash flows are very
sensitive to changes in the prices of these commodities.  Metals prices
fluctuate widely and are affected by numerous factors beyond the Company's
control or ability to predict, including but not limited to domestic and
international economic and political conditions, industry inventory levels and
capacity, global and regional demand and production, the availability and costs
of substitute materials, speculative activities and inflationary expectations.
While the Company historically has used limited financial risk management
techniques to reduce a portion of the Company's exposure to the volatility of
market prices, there can be no assurance that it will continue to do so or that
it will be able to do so effectively in the future.  In addition, depending upon
the specific techniques employed, market conditions and other factors, such
activities could reduce the earnings or cash flow which the Company otherwise
would realize or result in losses.

OPERATING AND PROJECT DEVELOPMENT RISKS

     The Company's business operations are subject to risks and hazards inherent
in the mining industry, including but not limited to unanticipated grade and
other geological problems, water conditions, surface or underground conditions,
metallurgical and other processing problems and mechanical equipment performance
problems, the unavailability of materials and equipment, accidents, labor force
and force majeure factors, unanticipated transportation costs and weather
conditions, prices and production levels of by-products, and potential political
instabilities of foreign governments, any of which materially and adversely can
affect, among other things, the development of properties, production quantities
and rates, costs and expenditures and production commencement dates.

     In the case of development projects, there generally is no operating
history upon which to base estimates of future operating costs and capital
requirements.  The economic feasibility of any individual project is based upon,
among other things: the interpretation of geological data obtained from drill
holes and other sampling techniques; feasibility studies, which derive estimates
of cash operating costs based upon anticipated tonnage and grade of ore to be
mined and processed; the configuration of the ore body; expected recovery rates
of metals from the ore; comparable facility and equipment costs; anticipated
climatic conditions; estimates of labor productivity and other factors.  Such
development projects also are subject to the successful completion of final
feasibility studies, issuance of necessary permits and receipt of adequate
financing.  Accordingly, uncertainties related to operations are magnified in
the case of development projects.

     As a result of the forgoing risks, among other things, expenditures on any
and all projects, actual production quantities and rates, and cash operating
costs materially and adversely may be affected and may differ materially from
anticipated expenditures, production quantities and rates, and costs, just as
estimated production dates may be delayed materially, in each case, especially
to the extent development projects are involved.  Any such events materially and
adversely can affect the Company's business, financial condition, results of
operations and cash flows.

RELIANCE ON COAL CONTRACTS

     A substantial portion of the Company's coal is sold pursuant to long-term
coal supply contracts which are significant to the stability and profitability
of the Company's operations. Some of the Company's contracts currently have
prices which exceed the price at which such coal could be sold in the spot
market. The loss of certain of its long-term contracts could have a material
adverse effect on the Company's business, financial condition, results of
operations and cash flow. Most of the Company's coal contracts with an initial
term of more than one year are subject to price adjustment provisions which,
subject to certain limits, permit an increase or decrease periodically in the
contract price. Some of the Company's coal supply contracts also contain price
re-opener provisions which provide for the periodic upward or downward
adjustment of contract prices; such provisions can lead to disputes with
customers and potential modifications or early termination of the contract.

                                     -17-
<PAGE>
 
COMPETITIVE CONDITIONS

     All of Cyprus Amax's products are sold in highly competitive markets.
Marketing of Cyprus Amax's products is influenced by price, materials
substitution, product quality, transportation costs, general economic
conditions, imports, and competition in all markets.  Cyprus Amax competes with
numerous other copper, molybdenum, coal, lithium, and gold producers.

     Copper, molybdenum, and gold sales generally are characterized by cyclical
and volatile prices, little product differentiation, and strong competition.
Prices are influenced by production costs of domestic and foreign competitors,
worldwide economic conditions, world supply/demand balances, inventory levels,
the United States dollar exchange rate, and other factors.  Copper and
molybdenum prices also are affected by the demand for end-use products in, for
example, the construction, transportation and durable goods markets.

     While the long-term demand for copper has been growing, especially in less
developed countries, it can be affected adversely by substitution of materials
such as aluminum, plastics, and optical fibers.  Copper is an internationally-
traded commodity, and its price is determined on two major metals exchanges:
the Commodities Exchange, Inc. in New York City (COMEX) and the London Metal
Exchange (LME).  These prices broadly reflect the worldwide balance of copper
supply and demand, but also are influenced by speculative activities. The supply
of copper in the world is determined largely by development and production
decisions of those entities controlling mines and reserves. Some major foreign
producers have cost advantages resulting from higher ore grades, lower labor
rates, and less stringent environmental requirements.

     Molybdenum demand depends heavily on worldwide steel industry consumption
and to a lesser extent on chemical applications. A substantial portion of world
molybdenum production is a by-product of copper mining, which is relatively
insensitive to molybdenum price levels. Imports to the west, especially from
China, can also influence competitive conditions. 

     Among factors that affect competition in Cyprus Amax's coal markets are
coal quality, the cost levels of other coal producers, the cost and availability
of transportation, government regulations including the Clean Air Act Amendments
of 1990, the time and expenditures required to develop new coal mines, taxes,
the weather, and the cost of alternative fuels. Sales of coal to utilities are
affected by the demand for electricity. Coal prices are sensitive to caloric
value (Btu) and sulfur content and to a particular user's quality requirements.
Coal prices generally are less volatile than metals prices, since coal typically
is sold under term contracts at fixed prices subject to escalation, de-
escalation, and renegotiation. In line with increases in coal production, an
increasing amount of Cyprus Amax's coal is now being sold in spot markets or
under shorter term contracts.

     Competition in the sale of lithium products is based on price and quality.
During 1996, Cyprus Amax produced approximately 50 percent of the world's supply
of lithium carbonate.  Cyprus Amax has a number of competitors from western
countries in the lithium marketplace, as well as competition from lithium
products from China and the Commonwealth of Independent States (C.I.S.).  In
addition, new competitors are and will be entering certain lithium markets in
the near future.  As a result,  an overcapacity situation has developed
primarily in the lithium carbonate markets which has resulted in the erosion of
prices.

                                     -18-

<PAGE>
 
ENVIRONMENTAL MATTERS

     The mining and mineral processing industries are subject to extensive
regulations for the protection of the environment in the United States and
foreign countries, including but not limited to regulations relating  to air and
water quality, mine reclamation, remediation, solid and hazardous waste handling
and disposal and the promotion of occupational safety.  These laws often require
parties to fund remedial action or to pay damages regardless of fault.
Environmental laws also often impose liability with respect to divested or
terminated operations even if the operations were divested of terminated many
years ago.  As a result, the Company generally is required to engage in
substantial remedial and investigatory activities, including but not limited to
assessment and clean up work.  Although the Company believes that it has
adequate reserves with respect to environmental matters, there can be no
assurance that the amount of capital expenditures and other costs and expenses
which will be required to complete remedial actions and otherwise to comply with
applicable environmental laws will not exceed the amounts reflected in the
Company's reserves or will not have a material adverse effect on the Company's
business, financial condition, results of operations or cash flows.  From time
to time the Company is cited for noncompliance with applicable environmental
laws and regulations.  However, the Company expects to be able to comply in all
material respects with existing laws and regulations.

     The mining operations of the Company also are subject to inspection and
regulation by the United States and foreign governments under a variety of laws
and regulations.  Current and future regulations or regulatory interpretations
do or may require significant expenditures for compliance which may increase the
Company's mine development and operating costs and may require the Company to
modify or curtail its operations.  The Company cannot predict the likely impact
of future or pending legislation on its business, financial condition, results
of operations or cash flows.

     Reference is made to additional information concerning environmental
matters in "Note 4 to the Consolidated Financial Statements on pages 5
and 6 of this Form 10-Q.

RESERVE LEVELS

     There are a number of uncertainties inherent in estimating quantities of
reserves, including many factors beyond the control of the Company.  The reserve
data set forth in or incorporated by reference are in large part estimates only.
No assurance can be given that the volume and grade of reserves recovered and
rates of production will not be less than anticipated.  Declines in the market
price of a particular metal or in coal also may render reserves containing
relatively lower grades of mineralization, or reduced quality of coal,
uneconomic to exploit. If the price realized by the Company for a particular
commodity were to decline substantially below the price at which ore reserves
were calculated for a sustained period of time, the Company potentially could
experience reductions in reserves and asset write-downs. Under certain such
circumstances, the Company may discontinue the development of a project or
mining at one or more of its properties. Further, changes in operating and
capital costs and other factors, including but not limited to short-term
operating factors such as the need for sequential development of ore bodies and
the processing of new or different ore grades, may materially and adversely
affect reserves.

COMPETITION FOR PROPERTIES; EXPLORATION RISKS

     Since mines have limited lives based on proven ore reserves, the Company
continually seeks to replace and expand its reserves.  Mineral exploration, at
both newly acquired properties and existing mining operations, is highly
speculative in nature, involves many risks and frequently is nonproductive.
Once mineral deposits are discovered, it may take a number of years from initial
preparatory work until production is possible, during which time the economic
feasibility of production may change.  Substantial expenditures are required to
establish ore reserves through drilling to determine metallurgical processes
required for extraction from ore and, in the case of new properties, to
construct mining and processing facilities.

     The Company encounters strong competition from other mining companies in
connection with the acquisition of properties producing or capable of producing
metals and coal.  As a result of this competition, some of which is with
companies with greater financial resources than the Company, the Company may be
unable to acquire attractive mining properties on terms it considers acceptable.
In addition, there are a number of uncertainties inherent in any program
relating to the location of economic ore reserves, the development of
appropriate metallurgical processes, the receipt of necessary governmental
permits and the construction of mining and processing facilities.  Accordingly,
there can be no assurance that the Company's acquisition and exploration
programs will yield new reserves to replace and expand current reserves.

FOREIGN OPERATIONS
 
     Certain of the Company's reserves and facilities are located in foreign
countries, including Chile, Peru, Russia, Australia, Canada, the Netherlands and
the United Kingdom.  Such foreign reserves and facilities may be materially and
adversely affected by exchange controls, currency fluctuations, ownership
limitations, expropriation, taxation and laws or policies of particular
countries, as well as the laws or policies of the United States affecting
foreign trade, investment and taxation.  The Company also may be affected
materially and adversely by the policies and practices of multinational
political or financial institutions.

                                     -19-

<PAGE>
 
                           PART II--OTHER INFORMATION
                           --------------------------


ITEM 1.  LEGAL PROCEEDINGS
--------------------------

See Note 4 to Consolidated Financial Statements.

ITEM 2.  CHANGES IN SECURITIES
------------------------------

Not applicable.

ITEM 3.  DEFAULTS UPON SENIOR SECURITIES
----------------------------------------

Not applicable.

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
------------------------------------------------------------

(a)  The annual meeting of shareholders was held on May 7, 1997.

(b)  This information is omitted pursuant to instruction 3.

(c)  Set forth below are the votes cast for the election of Directors:
<TABLE>
<CAPTION>
 
                           For      Withheld
                        ----------  ---------
<S>                     <C>         <C>
 
   John Hoyt Stookey    79,032,870  2,923,159
   Billie B. Turner     79,059,200  2,896,829
   Milton H. Ward       78,824,494  3,131,535
</TABLE>

   The shareholders also voted to approve the Management Incentive Program of
   Cyprus Amax Minerals Company, as amended and restated. Votes cast in favor
   were 49,202,139, against were 21,767,304, abstaining were 1,980,728, and non
   votes were 9,005,858. The shareholders voted to approve the appointment of
   Price Waterhouse LLP as Independent Accountants.  Votes cast in favor were
   80,550,419, against were 932,884, and abstaining were 472,726.

   The shareholders voted down the shareholder proposal relating to an
   independent nominating committee.  Votes cast in favor were 23,677,119,
   against were 43,631,467, abstaining were 5,647,146, and non votes were
   9,000,297.

(d)  Not applicable.

ITEM 5.  OTHER INFORMATION
--------------------------

None.

                                      -20-
<PAGE>
 
ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K
-----------------------------------------

(a) The following Exhibits are filed as part of this Quarterly Report on Form
    10-Q:
 

         Exhibit
         Number                        Document
        ---------    --------------------------------------------------
         (11)        Statement re computation of per share earnings.
         (15)        Letter re unaudited financial information.
         (27)        Financial data schedule.

(b) No Current Report on Form 8-K was filed during the quarter ended March 31,
    1997.

                                      -21-
<PAGE>
 
                                   SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.


                                        CYPRUS AMAX MINERALS COMPANY
                                        ----------------------------
                                                 Registrant



Date:   May 14, 1997                        /s/   John Taraba
       -----------------                    --------------------------------
                                                  John Taraba
                                              Vice President and Controller
                                              (Principal Accounting Officer)

                                      -22-