ExxonMobil Tops Q4 EPS Estimates, Revenue Misses Amid Refining Weakness

ExxonMobil (NYSE: XOM) reported its fourth-quarter 2024 earnings, exceeding Wall Street’s profit expectations despite a decline in refining margins. Adjusted earnings per share (EPS) came in at $1.67, surpassing the consensus estimate of $1.55, though notably lower than the $1.92 reported in the prior year. Meanwhile, total revenue for the quarter fell 1.1% year-over-year to $83.43 billion, missing the analyst forecast of $86.33 billion.

Full-year 2024 earnings totaled $33.46 billion, reflecting a 13.2% decline from the prior year, primarily due to weaker refining margins. Exxon’s cash flow from operating activities reached $12.2 billion in the fourth quarter, while free cash flow stood at $8.0 billion. The company continued its disciplined capital allocation, reporting $7.5 billion in capital and exploration expenditures for the quarter and $27.6 billion for the full year, in line with guidance.

Segment Performance: Strength in Upstream, Weakness in Refining

ExxonMobil’s upstream business was the key driver of the earnings beat, benefiting from increased production in the Permian Basin and Guyana. The company achieved record output levels in both regions, solidifying its position as the largest oil producer in the Permian following its acquisition of Pioneer Natural Resources in May. Despite lower oil prices, Exxon’s efficient operations in these high-margin areas helped offset revenue declines elsewhere.

Conversely, the refining segment faced notable headwinds. Earnings from Exxon’s energy products unit dropped to $402 million in Q4, down sharply from $1.3 billion in Q3. For the full year, refining profits fell to $4 billion from $12 billion in 2023. The decline stemmed from an increase in global fuel supply due to new refinery startups in Asia and Africa, coupled with weaker-than-expected demand for gasoline and diesel. Exxon CFO Kathryn Mikells acknowledged the challenging refining environment and noted that the company will continue monitoring global supply-demand dynamics heading into 2025.

Chemicals, another key business segment, also underperformed relative to expectations, missing analyst forecasts by approximately $300 million. Meanwhile, corporate and other earnings provided a $200 million boost to results, helping offset weaknesses in the refining and chemicals businesses.

Outlook and Key Developments

Looking ahead, ExxonMobil expects lower seasonal scheduled maintenance to increase upstream volumes by approximately 80,000 barrels of oil equivalent per day (koebd) in Q1 2025. However, corporate and financing expenses for the quarter are projected to be between $400 million and $600 million. The company also reiterated its commitment to delivering strong shareholder returns, having distributed $36 billion in 2024 through dividends and buybacks, up from $32 billion in 2023. This level of shareholder distribution ranks Exxon among the top five S&P 500 companies in terms of cash returned to investors.

On the legal front, ExxonMobil continues to await a decision in its arbitration challenge to Chevron’s acquisition of Hess, a move that could impact its stake in Guyana’s oil fields. The ruling is expected by September 2025. Exxon and CNOOC, Hess’ partners in the Guyana oil joint venture, maintain that they have a contractual right of first refusal to Hess’ stake.

Stock Performance and Technical Analysis

Despite the revenue shortfall, ExxonMobil’s stock showed resilience, edging up 0.4% to $109.97 in premarket trading following the earnings release. From a technical standpoint, XOM has successfully held support at its 20-day moving average, indicating underlying strength. If the stock continues its upward momentum, the next critical test will be the 50-day moving average, which currently stands at around $111. Breaking above this level could signal further upside potential.

Conclusion

ExxonMobil’s Q4 results highlight the company’s ability to navigate a volatile energy market. While lower refining margins weighed on overall earnings, strong upstream performance and disciplined capital allocation helped offset these challenges. The company remains focused on delivering shareholder value through sustained buybacks and dividends, while also positioning itself for long-term growth in key regions such as the Permian and Guyana. With the stock maintaining key technical support levels, investors will be watching closely to see if XOM can build on this momentum and test resistance at $111 in the coming weeks.