Exxon beats earnings expectations even as lower oil prices weigh on profits

An Exxon Mobil fuel station in Washington, DC, US, on Tuesday, Nov. 28, 203.

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Exxon Mobil reported quarterly earnings that beat Wall Street’s expectations, however the firm’s revenue declined considerably from similar interval the yr prior as oil prices weakened.

Exxon declared a dividend for the primary quarter of 95 cents per share payable on March 11. The firm returned $32.4 billion to shareholders in 2023 via $14.9 billion in dividends and $17.4 billion in share buybacks.

Exxon’s inventory rose about 1% in premarket buying and selling.

Here’s what Exxon reported for the fourth quarter in contrast with what Wall Street was anticipating, based mostly on a survey of analysts by LSEG, previously recognized as Refinitiv:

  • Earnings per share: $2.48 adjusted vs. $2.21 anticipated
  • Revenue: $84.3 billion vs. $85.2 billion anticipated

Exxon reported internet earnings of $7.63 billion, or $1.91 per share, within the last three months of 2023, down 40% from the $12.75 billion, or $3.09 per share, revenue reported in the identical quarter in 2022.

Profits have been harm by a $2 billion impairment cost in California from regulatory points that prevented manufacturing and distribution from coming again on line. Excluding these prices, Exxon earned $2.48 per share, beating Wall Street’s expectations of $2.21 per share.

Crude oil prices have been risky in 2023, with West Texas Intermediate and Brent falling greater than 10% for the yr on a weakening Chinese financial system and file oil manufacturing within the U.S.

“If you’re taking the market out of it, you’re taking prices and margins out and simply have a look at it on an apples to apples foundation, we have greater than doubled our earnings energy from 2019 to 2023,” Exxon CEO Darren Woods instructed CNBC’s “Squawk Box” in an interview Friday.

Exxon’s inventory reached a 2023 closing excessive of $120.20 on Sept. 27, when oil prices hit their peak however the firm’s shares completed out the yr 16% lower from that top as crude pulled again.

Exxon’s profits from its oil and fuel phase declined to $4.1 billion within the quarter, down 49% in comparison with the $8.2 billion reported within the yr in the past interval. The firm’s power merchandise noticed profits fall to $3.2 billion, down 21% in comparison with $4.07 billion within the fourth quarter of 2022.

Chemical product profits got here in at $189 million within the last three months of 2023, down 24% from $250 million within the year-ago interval.

Capital and exploration expenditures rose about 4% within the fourth quarter to $7.76 billion in comparison with the year-ago interval when spending stood at $7.46 billion.  The greater spending mirrored investments it made within the Permian Basin and Guyana as effectively as its resolution to enter the lithium market. Exxon mentioned it expects to start lithium manufacturing in 2027.

Exxon produced 3.73 million oil equal barrels per day in 2023, largely flat in comparison with the yr prior. Production within the Permian Basin and Guyana elevated 18% over 2022. The firm expects internet common manufacturing of three.8 million barrels per day in 2024.

The oil main agreed to purchase shale rival Pioneer Natural Resources in October for about $60 billion in an all-stock transaction. The deal is predicted to shut within the first half of this yr.

Read the full press release here.

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