Exxon Mobil’s third-quarter profit declined compared with last year when the oil giant was put up record numbers due to soaring crude prices, but net income was up 15% compared with the previous quarter. It also raised its quarterly dividend.
Those lofty crude prices have fueled a shopping spree this year in the as Exxon acquired pipeline operator Denbury, the beneficiary of changes in U.S. climate policy, for $4.9 billion in July, and then a few weeks ago said it would buy Pioneer for $60 billion.
Exxon isn't alone. Earlier this week, Chevron said it would spend more than $50 billion to acquire Hess.
Exxon Mobil Corp. earned $9.07 billion, or $2.25 per share in the period. That compares with $19.66 billion, or $4.68 per share, a year earlier.
Removing certain items, earnings were $2.27 per share.
Analysts polled by Zacks Investment Research predicted higher earnings of $2.36 per share, but Exxon does not adjust its reported results based on one-time events such as asset sales as most companies do.
Revenue slipped to $90.76 billion from $112.07 billion, but still topped Wall Street's estimate of $89.29 billion.
Production dipped 0.8% to 3,688 thousand oil-equivalent barrels per day.
Exxon said Friday that it delivered its best ever third-quarter global refinery throughput at 4.2 million barrels per day.
“We delivered another quarter of strong operational performance, earnings and cash flows, adding nearly 80,000 net oil-equivalent barrels per day to support global supply," Chairman and CEO Darren Woods said in a prepared statement.
Exxon's results come just a few weeks after announcing that it would acquire Pioneer Natural Resources for nearly $60 billion. It's the company's largest buyout since acquiring Mobil two decades ago. The deal with Pioneer Natural vastly expands Exxon’s presence in the Permian Basin, a massive oilfield that straddles the border between Texas and New Mexico.
Exxon is flush with cash. The company posted unprecedented profits last year of $55.7 billion, breezing past its previous record of $45.22 billion in 2008 when oil prices hit record highs.
Large acquisitions within the energy sector continue to be made this year as oil prices surge, with Chevron saying on Monday that it is buying Hess Corp. for $53 billion.
Crude prices rose sharply in early 2022 with Russia’s invasion of Ukraine and are hovering around $90 per barrel after ticking another 9% higher this year. That has made big drillers cash rich and they are looking for places to invest.
Oil markets are being stretched by cutbacks in oil production from Saudi Arabia and Russia, and now, a war between Israel and Hamas runs the risk of igniting a broader conflict in the Middle East. While attacks on Israel do not disrupt global oil supply, according to an analysis by the U.S Energy Information Administration, “they raise the potential for oil supply disruptions and higher oil prices.”
Exxon also announced Friday that it raised its fourth-quarter dividend to 95 cents per share from 91 cents per share.
Exxon shares are up slightly before the open bell.