Exxon beats profit estimates with higher production despite weak oil prices
HOUSTON (Reuters) -Exxon Mobil beat Wall Street estimate for second-quarter profit on Friday as higher oil and gas production helped the top U.S. oil producer overcome lower crude prices.
Adjusted earnings during the second quarter were $7.1 billion, or $1.64 per share, surpassing consensus analyst estimates of $1.56 per share, according to data compiled by LSEG.
Oil and gas production was the highest for any second quarter since the company was formed by the merger of Exxon and Mobil more than 25 years ago, the oil producer said.
The energy sector has struggled with price volatility as the OPEC+ group of producers ramped up volumes, pushing global benchmark Brent crude prices down 11% in the quarter. Global tariffs levied by U.S. President Donald Trump caused further concerns about a weakening global economy and oil demand.
"The second quarter, once again, proved the value of our strategy and competitive advantages, which continue to deliver for our shareholders no matter the market conditions or geopolitical developments," Exxon CEO Darren Woods said in a statement.
Exxon paid $4.3 billion in dividends and repurchased $5 billion worth of shares during the quarter. The buyback figure puts the company on track to meet its annual share repurchase goal of $20 billion.
The company's key production areas include the Permian basin, the largest U.S. oilfield, as well as the prolific Stabroek Block off the coast of Guyana. Cost of production is low in those fields, allowing them to stay profitable even during times of lower oil prices, Exxon has said previously.
Last month, Exxon lost a legal challenge against Hess, one of its partners in Guyana, which cleared the way for rival Chevron to complete its acquisition of Hess. Exxon had argued it had a contractual pre-emptive right to purchase Hess' 30% stake in the Stabroek Block.
In a press briefing, Woods said Exxon sought out legal opinions from neutral third parties about the joint operating agreement that governed the partnership between Exxon, Hess and China's CNOOC in Guyana.
"In every case, and I mean in literally every case, we were told that our rights were clear," Woods said.
The arbitrators acknowledged in their opinion that Exxon had a commercially reasonable argument but said it relied on a narrow textual argument, Woods said, adding that the company would take steps to strengthen future contracts as needed.
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