Key facts
- ExxonMobil's second-quarter adjusted earnings reached $14.7 billion, its highest in four years.
- The company's earnings per share of $3.52 missed analyst estimates of $3.60.
- High oil prices, averaging $96.68 per barrel for Brent crude, and refining margins boosted profits.
- Production disruptions in Qatar and the UAE impacted output, with 450,000 bpd of LNG and 50,000 bpd of oil offline.
- Permian Basin production hit a record over 1.8 million bpd, offsetting some losses.
- ExxonMobil returned $9.4 billion to shareholders through dividends and share buybacks.
ExxonMobil announced its second-quarter financial results, revealing a profit of $14.7 billion, its highest in four years. However, this figure fell short of the consensus analyst estimate of $3.60 per share, with the company reporting earnings of $3.52 per share. The company attributed the miss to significant fluctuations in commodity prices and refining margins, which were difficult to forecast.
Despite the miss, ExxonMobil's profit more than doubled compared to the same period last year. This performance could reignite criticism from U.S. President Donald Trump, who previously accused oil companies of price gouging. Exxon's CFO, Neil Hansen, stated that the company's underlying operational results were strong, and the miss was due to "extreme swings" in market conditions.
Other major oil companies, including Chevron and Shell, surpassed analyst expectations for the quarter, while TotalEnergies met its forecasts. Exxon CEO Darren Woods highlighted the company's execution in navigating a disruptive quarter, emphasizing its ability to redirect products to where they were needed.
Global energy markets remained volatile. Although a ceasefire between the U.S. and Iran was established in April, disagreements persist over resuming shipping through the Strait of Hormuz, a critical energy transit route. The uncertainty surrounding this waterway contributed to an average Brent crude price of $96.68 per barrel in the second quarter, a 23% increase from the previous quarter.
Exxon's total production averaged 4.5 million barrels of oil equivalent per day (boepd) in the second quarter. Significant production losses were reported, with approximately 450,000 boepd of liquefied natural gas production from Qatar remaining offline due to Iranian attacks on energy facilities. Additionally, about 50,000 bpd of oil output is offline from an oilfield in the United Arab Emirates. Hansen noted that revenue from UAE output cannot be recognized until shipping routes reopen.
Conversely, production from the Permian Basin in the U.S. reached a record of over 1.8 million bpd, helping to offset some of the losses. Furthermore, a fifth floating production platform in Guyana is slated to commence operations in the fourth quarter, expected to boost production capacity by 250,000 bpd.
ExxonMobil demonstrated a commitment to returning capital to shareholders, paying $4.3 billion in dividends and repurchasing $5.1 billion worth of shares during the quarter. This pace keeps the company on track to meet its target of $20 billion in share buybacks for the year. Hansen indicated that the company is prioritizing strengthening its balance sheet before considering further increases in dividends and buybacks, having reduced net debt by $7 billion in the second quarter.