ExxonMobil Q2 2022 Earnings Report Recap

XOM beat solidly on earnings but missed on revenue

Key Takeaways

  • Upstream segment net income came in above analysts' expectations.
  • The upstream segment is involved in the exploration and development of oil and natural gas properties as well as the extraction and production of crude oil and natural gas. It benefits from higher oil prices.
  • ExxonMobil increased its Permian oil and gas production by about 130,000 oil-equivalent barrels per day for the quarter to help to meet increasing demand.
ExxonMobil Earnings Results
Metric Beat/Miss/Match Reported Value Analysts' Prediction
Earnings Per Share Beat $4.21 $3.60
Revenue Miss $115.7B $117.1B
Upstream Segment Net Income Beat  $11.4B $10.1B

Source: Predictions based on analysts' consensus from Visible Alpha

ExxonMobil (XOM) Financial Results: Analysis

ExxonMobil Corp. (XOM) reported Q2 FY 2022 earnings that were mixed relative to consensus estimates. Earnings per share (EPS) beat analyst estimates by a large margin, coming close to quadrupling year-over-year (YOY). The company said growth was driven by higher realizations and margins, increased production, and aggressive cost control. ExxonMobil's revenue, however, missed expectations, although it increased by 70.8% YOY. The upstream segment's net income beat analyst predictions.

XOM Upstream Segment Net Income

ExxonMobil's upstream segment posted net income of $11.4 billion, more than tripling YOY and solidly beating analyst predictions. Both Exxon's U.S. and non-U.S. upstream businesses experienced substantial growth in the same period.

The upstream segment is one of the company's three main business segments. Upstream operations are involved in the exploration and development of oil and natural gas properties as well as the extraction and production of crude oil and natural gas. Upstream may be contrasted with downstream operations, which refer to the production of refined oil products and comprise another of ExxonMobil's main business segments. ExxonMobil also engages in midstream operations, such as the operation of pipelines and storage facilities.

ExxonMobil's upstream segment benefits from high crude oil prices and suffers when oil prices plunge, as they did during the early stages of the pandemic. But oil prices sharply rebounded last year amid the economic recovery and have moved even higher this year amid the war in Ukraine. The price of oil has climbed to over $100 per barrel for a substantial portion of this year, a situation not seen for many years.

XOM Outlook and Stock Performance

ExxonMobil did not provide updated forward guidance in its earnings press release.

Shares of ExxonMobil stock traded down about 0.4% in pre-market trading hours following the company's earnings release on July 29, but recovered and rose as much as 3% intraday. Overall, ExxonMobil stock has vastly outperformed the broader market in the last year, providing a 1-year trailing total return of 67.2% compared with -7.5% for the S&P 500 as of July 29.

ExxonMobil's next earnings report (for Q3 FY 2022) is expected to be released on Oct. 28, 2022.

Article Sources
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  2. Visible Alpha. "Financial Data."

  3. U.S. Energy Information Administration. "Short-Term Energy Outlook."

  4. TradingView. "Price Chart: XOM and S&P 500."

  5. MarketScreener. "EXXON MOBIL CORPORATION (XOM)."

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