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ExxonMobil (XOM) Q3 Earnings Lag Estimates on Upstream Weakness
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Exxon Mobil Corporation (XOM - Free Report) has reported third-quarter 2023 earnings per share of $2.27 (excluding identified items), missing the Zacks Consensus Estimate of $2.36. The bottom line slipped from the year-ago profit of $4.45.
Total quarterly revenues of $90,760 million beat the Zacks Consensus Estimate of $89,287 million but declined from the year-ago quarter’s $112,070 million.
Weak quarterly earnings primarily resulted from the oil equivalent production decline, and lower realizations of crude and natural gas prices.
Exxon Mobil Corporation Price, Consensus and EPS Surprise
The segment reported quarterly earnings (excluding identified items) of $6,139 million, declining from $11,841 million in the year-ago quarter. The metric beat our estimate of $4,510.8 million. Lower crude prices primarily led to the fall.
Operations in the United States recorded a profit of $1,566 million, which decreased from $3,110 million in the September-end quarter of 2022. The company has reported a profit of $4,573 million from non-U.S. operations, deteriorating from $8,731 million in the year-ago quarter.
Production: ExxonMobil’s total production averaged 3,688 thousand barrels of oil equivalent per day (MBoe/d), lower than 3,716 MBoe/d a year ago and lagging our estimate of 3,736.3 MBoe/d.
Liquid production increased to 2,397 thousand barrels per day (MBbls/d) from 2,389 MBbls/d in the prior-year quarter. The outperformance resulted from higher production, primarily in Asia and Canada. Yet, natural gas production was 7,748 million cubic feet per day (Mmcf/d), down from 7,963 Mmcf/d a year ago primarily due to lower output from the United States, Canada and Europe.
Price Realization: In the United States, ExxonMobil recorded crude price realization of $80.45 per barrel, significantly lower than the year-ago quarter’s $91.69 and marginally surpassing our estimate of $80.23. The same metric for non-U.S. operations declined to $77.48 per barrel from $91.42 but beat our estimate of $75.16.
Natural gas prices in the United States were $2.30 per thousand cubic feet (Mcf), lower than the year-ago quarter’s $8.38 and lagging our estimate of $2.45. Also, in the non-U.S. section, the metric declined to $10.50 per Mcf from $22.92. The metric also missed our estimate of $15.73.
Energy Products
The segment recorded a profit (excluding identified items) of $2,475 million, declining from $5,819 million a year ago and missing our estimate of $3,438.7 million primarily due to lower industry refining margins and unfavorable foreign exchange impacts.
Chemical Products
This unit of ExxonMobil recorded a $249-million profit (excluding identified items), down from $812 million in the year-ago quarter. The reported figure also missed our estimate of $523 million. Weaker industry margins hurt the business unit.
Specialty Products
This unit of ExxonMobil recorded a $619-million profit (excluding identified items), down from earnings of $762 million in the year-ago quarter and beating our projection of $597 million. Improved reliability and encouraging finished lube margins aided the business unit, partially offset by weaker basestock margins.
Financials
In the quarter under review, ExxonMobil generated a cash flow of $16,880 million from operations and asset divestments. The company’s capital and exploration spending was $6,022 million.
At the end of third-quarter 2023, ExxonMobil’s total cash and cash equivalents were $32,944 million, and long-term debt amounted to $36,510 million.
Guidance
For 2023, capital and exploration expenditure is expected to reach the upper limit of $23-$25 billion as the company actively seeks out opportunities to enhance value.
Zacks Rank & Stocks to Consider
ExxonMobil currently carries a Zacks Rank #3 (Hold).
Liberty Energy Inc. (LBRT - Free Report) reported third-quarter 2023 earnings of 85 cents per share, which beat the Zacks Consensus Estimate of 74 cents. The Denver, CO-based oil and gas equipment company’s outperformance reflects the impacts of strong execution and increased service pricing.
Liberty’s board of directors announced a cash dividend of 7 cents per common share, payable Dec 20, 2023, to stockholders of record as of Dec 6, 2023. The dividend increased 40% from the previous quarter’s level.
Matador Resources Company (MTDR - Free Report) reported third-quarter 2023 adjusted earnings of $1.86 per share, which beat the Zacks Consensus Estimate of $1.59. MTDR’s milestone led to better-than-expected third-quarter results, with the highest-ever total production averaging more than 135,000 barrels of oil and natural gas equivalent per day.
For the fourth quarter of 2023, Matador expects an average daily oil equivalent production of 145,000 BOE. The recent guidance reflects a 2% upward revision from the prior mentioned 143,000 BOE/D.
APA Corp. (APA - Free Report) released supplemental information regarding its financial and operational results for the third quarter of 2023. The company anticipates its quarterly total adjusted production and adjusted oil production to be in the upper half of its guidance range. This can be mainly attributed to strong Permian oil and U.K. North Sea volumes.
The company expects its adjusted production and adjusted oil production figures to be in the upper half of its guided range. It anticipates adjusted production of 337-339 Mboe/d and adjusted oil production of 159-161 Mboe/d. APA is scheduled to release third-quarter results on Nov 1.
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ExxonMobil (XOM) Q3 Earnings Lag Estimates on Upstream Weakness
Exxon Mobil Corporation (XOM - Free Report) has reported third-quarter 2023 earnings per share of $2.27 (excluding identified items), missing the Zacks Consensus Estimate of $2.36. The bottom line slipped from the year-ago profit of $4.45.
Total quarterly revenues of $90,760 million beat the Zacks Consensus Estimate of $89,287 million but declined from the year-ago quarter’s $112,070 million.
Weak quarterly earnings primarily resulted from the oil equivalent production decline, and lower realizations of crude and natural gas prices.
Exxon Mobil Corporation Price, Consensus and EPS Surprise
Exxon Mobil Corporation price-consensus-eps-surprise-chart | Exxon Mobil Corporation Quote
Operational Performance
Upstream
The segment reported quarterly earnings (excluding identified items) of $6,139 million, declining from $11,841 million in the year-ago quarter. The metric beat our estimate of $4,510.8 million. Lower crude prices primarily led to the fall.
Operations in the United States recorded a profit of $1,566 million, which decreased from $3,110 million in the September-end quarter of 2022. The company has reported a profit of $4,573 million from non-U.S. operations, deteriorating from $8,731 million in the year-ago quarter.
Production: ExxonMobil’s total production averaged 3,688 thousand barrels of oil equivalent per day (MBoe/d), lower than 3,716 MBoe/d a year ago and lagging our estimate of 3,736.3 MBoe/d.
Liquid production increased to 2,397 thousand barrels per day (MBbls/d) from 2,389 MBbls/d in the prior-year quarter. The outperformance resulted from higher production, primarily in Asia and Canada. Yet, natural gas production was 7,748 million cubic feet per day (Mmcf/d), down from 7,963 Mmcf/d a year ago primarily due to lower output from the United States, Canada and Europe.
Price Realization: In the United States, ExxonMobil recorded crude price realization of $80.45 per barrel, significantly lower than the year-ago quarter’s $91.69 and marginally surpassing our estimate of $80.23. The same metric for non-U.S. operations declined to $77.48 per barrel from $91.42 but beat our estimate of $75.16.
Natural gas prices in the United States were $2.30 per thousand cubic feet (Mcf), lower than the year-ago quarter’s $8.38 and lagging our estimate of $2.45. Also, in the non-U.S. section, the metric declined to $10.50 per Mcf from $22.92. The metric also missed our estimate of $15.73.
Energy Products
The segment recorded a profit (excluding identified items) of $2,475 million, declining from $5,819 million a year ago and missing our estimate of $3,438.7 million primarily due to lower industry refining margins and unfavorable foreign exchange impacts.
Chemical Products
This unit of ExxonMobil recorded a $249-million profit (excluding identified items), down from $812 million in the year-ago quarter. The reported figure also missed our estimate of $523 million. Weaker industry margins hurt the business unit.
Specialty Products
This unit of ExxonMobil recorded a $619-million profit (excluding identified items), down from earnings of $762 million in the year-ago quarter and beating our projection of $597 million. Improved reliability and encouraging finished lube margins aided the business unit, partially offset by weaker basestock margins.
Financials
In the quarter under review, ExxonMobil generated a cash flow of $16,880 million from operations and asset divestments. The company’s capital and exploration spending was $6,022 million.
At the end of third-quarter 2023, ExxonMobil’s total cash and cash equivalents were $32,944 million, and long-term debt amounted to $36,510 million.
Guidance
For 2023, capital and exploration expenditure is expected to reach the upper limit of $23-$25 billion as the company actively seeks out opportunities to enhance value.
Zacks Rank & Stocks to Consider
ExxonMobil currently carries a Zacks Rank #3 (Hold).
Investors interested in the energy sector may look at some better-ranked companies mentioned below. The three companies presently sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Liberty Energy Inc. (LBRT - Free Report) reported third-quarter 2023 earnings of 85 cents per share, which beat the Zacks Consensus Estimate of 74 cents. The Denver, CO-based oil and gas equipment company’s outperformance reflects the impacts of strong execution and increased service pricing.
Liberty’s board of directors announced a cash dividend of 7 cents per common share, payable Dec 20, 2023, to stockholders of record as of Dec 6, 2023. The dividend increased 40% from the previous quarter’s level.
Matador Resources Company (MTDR - Free Report) reported third-quarter 2023 adjusted earnings of $1.86 per share, which beat the Zacks Consensus Estimate of $1.59. MTDR’s milestone led to better-than-expected third-quarter results, with the highest-ever total production averaging more than 135,000 barrels of oil and natural gas equivalent per day.
For the fourth quarter of 2023, Matador expects an average daily oil equivalent production of 145,000 BOE. The recent guidance reflects a 2% upward revision from the prior mentioned 143,000 BOE/D.
APA Corp. (APA - Free Report) released supplemental information regarding its financial and operational results for the third quarter of 2023. The company anticipates its quarterly total adjusted production and adjusted oil production to be in the upper half of its guidance range. This can be mainly attributed to strong Permian oil and U.K. North Sea volumes.
The company expects its adjusted production and adjusted oil production figures to be in the upper half of its guided range. It anticipates adjusted production of 337-339 Mboe/d and adjusted oil production of 159-161 Mboe/d. APA is scheduled to release third-quarter results on Nov 1.