There is a version of the oil business where you drill holes in the ground and hope the price of what comes out goes up. Then there is the version ExxonMobil ran this quarter, where you turn other people's crude into diesel while the world's supply lines get squeezed, and the money just shows up.
ExxonMobil Holdings Corporation (XOM) stock rose in premarket trading Friday after the oil giant reported better-than-expected third-quarter earnings and revenue, benefiting from stronger refining margins amid the U.S.-Israeli conflict with Iran and Ukrainian strikes on Russian refineries.
The company also reported record year-to-date refining performance, including its highest global fuels utilization outside the Middle East, highest global diesel yield and highest North American diesel volumes.
Earnings Snapshot
ExxonMobil reported third-quarter adjusted earnings of $4.23 per share, beating analysts' consensus estimate of $4.08.
Revenue reached $113.16 billion, topping Wall Street's estimate of $103.10 billion.
Operating cash flow totaled $25.7 billion, while free cash flow reached $19.1 billion. The company returned $9.4 billion to shareholders during the quarter.
ExxonMobil raised its quarterly dividend to $1.07 per share from $1.03 and announced a $20 billion share repurchase target for 2027.
Net debt declined by nearly $11 billion year to date. The company declared a fourth-quarter dividend of $1.07 per share, payable Dec. 10.
Refining Profits Surge As Global Supply Tightens
ExxonMobil's Energy Products adjusted earnings more than doubled to $9 billion from $4.1 billion in the previous quarter, driven by stronger refining margins and improved operating performance.
U.S. Gulf Coast refineries achieved 100% crude unit utilization, while diesel production reached its second-highest level on record.
The company's Beaumont refinery expansion helped increase U.S. Gulf Coast distillate production by approximately 40% since 2019.
Segment Performance
Upstream: Adjusted earnings declined to $7.3 billion from $9.2 billion in the previous quarter, reflecting lower commodity prices and an accelerated Guyana entitlement impact. Net production averaged 4.5 million oil-equivalent barrels per day, largely unchanged sequentially.
Chemical Products: Adjusted earnings fell to $725 million from $1.2 billion in the second quarter, as weaker margins offset higher sales volumes of high-value products.
Specialty Products: Earnings increased to $1.3 billion from $969 million in the previous quarter, supported by stronger basestock margins.
Production Milestones And Expansion Plans
ExxonMobil reached major production milestones, including 1 billion barrels each at Guyana and Kearl and 100 million tons at PNG LNG.
The company assumed operatorship of Papua LNG and agreed to increase its working interest to 34%. It also agreed to raise its stake in Mozambique's Rovuma LNG project to 50%, where it already serves as operator.
ExxonMobil said investments and efficiency improvements have generated $16.9 billion in structural cost savings since 2019.
The company also advanced its carbon capture business with the startup of its Nucor project and approval of the Rose carbon storage project.
Outlook And Guidance
ExxonMobil expects full-year Permian production of approximately 1.8 million barrels per day, in line with its forecast.
The company plans to start its fifth Guyana floating production, storage and offloading vessel in late fourth quarter.
ExxonMobil expects disruptions in the Middle East to keep approximately 350,000 oil-equivalent barrels per day offline if current conditions persist.
Full-year cash capital expenditures are expected to remain between $27 billion and $29 billion.
The company said the pace of recovery in the Middle East and broader market conditions remain key uncertainties.
ExxonMobil remains on track to achieve its 2030 goals, including increasing earnings by approximately $25 billion and cash flow by about $35 billion from 2024 levels.
XOM Price Action: ExxonMobil Holdings shares were up 1.90% at $186.77 during premarket trading on Friday. The stock is trading at a new 52-week high, according to market data.
