Energy giant Exxon Mobile’s (NYSE: XOM) revenue fall by 33% as oil prices decrease. The biggest U.S. oil company reported its earnings last Friday, reporting the lowest earnings in six years as larger profits from refining was unable to help Exxon recover from plummeted earnings.
Chief Executive Rex Tillerson said this latest quarter “reflect the disparate impacts of the current commodity price environment, but also demonstrate the strength of our sound operations, superior project execution capabilities, as well a continued discipline in capital and expense management.”
The energy giant also bought back $1 billion in shares this second quarter, down from its previous $3 billion in buybacks each quarter. By lowering the amount of shares available, Exxon is able to make their stock more valuable.
Missed expectations for earnings per share
Analysts expected earnings per share of $1.1, but Exxon fell short, reporting earnings of $1 per share. In the same quarter of the previous fiscal year, Exxon reported earnings of $2.05 a share, or a profit $8.78 billion. However, this is a result from the devastating price cuts. The average price for crude fell from $98.55 a barrel in the previous year to currently $54.06. The average price for natural gas fell from $4.46 in the previous year to currently $2.31 per thousand cubic feet
Exxon has announced that it would cut down heavily on capital spending by this year, and reduce stock buybacks in the near term.
The competitor Chevron Corp. (NYSE: CVX), the second largest U.S. oil company reported its lowest profits since 2002 in the second quarter, as Chevron spent more than $2 billion in impairments and charges to suspend projects, a concern since Chevron has been spending on a deficit.
Shares of Exxon Mobile are currently trading just above $78 as the new trading week starts.