Major Oil Companies Report Mixed Q4 2024 Results Amid Challenging Market Conditions

Chevron Corporation (CVX.US) and Exxon Mobil Corporation (XOM.US) released their Q4 2024 earnings reports today, showcasing the industry's resilience amid lower crude prices and compressed refining margins. While Exxon exceeded analyst expectations, Chevron missed estimates but raised its dividend amid promises of increased free cash flow growth.

Chevron Q4 2024 Results:

• Revenue: $52.23 billion vs $45.77 billion expected

• EPS: $2.06 vs $2.11 expected (-40.3% YoY)

• Upstream earnings: $4.30 billion (+170% YoY)

• Downstream: -$248 million vs +$1.15 billion YoY

• Production: 3,350 mboe/d (-1.2% YoY)

Earnings vs Estimates. Source: Bloomberg

Segment Performance:

• US Upstream: $1.42 billion vs -$1.35 billion YoY

• International Upstream: $2.88 billion (-1.7% YoY)

• International Downstream: $100 million (-85% YoY)

2025 Financial Outlook:

• Additional $10 billion free cash flow growth through 2026

• Reduced capital spending compared to 2024

• Quarterly dividend increased 5% to $1.71/share

• $2-3 billion structural cost reduction target by 2026

Significant Developments:

• Tengiz project ramping up to 1 million barrels/day, marking a major milestone

• Hess merger faces uncertainty with Exxon's arbitration claim over Guyana assets

• Strategic shift in Permian Basin focusing on efficiency over growth

• Successfully completed strategic asset sales in Canada, Republic of Congo, and Alaska

• Q4 included $715 million in severance charges and $400 million in impairment charges

Market Context:

• Shares up almost 8% YTD (down 2% in premarket), outperforming competitor Exxon

• Brent crude averaged $74/barrel in Q4, down 11% YoY

• Generated $4.4 billion in free cash flow, below $7.5 billion shareholder distributions

• First reduction in capital spending since pandemic signals strategic shift

• Company maintains conservative financial approach despite challenging environment

CEO Commentary: Mike Wirth emphasized 2024 as "a record year" with "record production, record cash to shareholders," while noting that "growing without generating free cash flow is what got the industry in trouble a decade ago."

Exxon Mobil Q4 2024 Results:

• Revenue: $83.43 billion vs $83.71 billion expected

• Adjusted EPS: $1.67 vs $1.55 expected (-13% YoY)

• Upstream adjusted net income: $6.28 billion

• Chemical products adjusted net income: $215 million

Earnings vs Estimates. Source: Bloomberg

Segment Performance:

• Upstream: Strong performance with high-margin production growth

• Chemical Products: $215 million, significantly below $562.5 million estimate

• Specialty Products: $759 million, meeting expectations

• Refinery throughput: 4,030 KBD

2025 Financial Outlook:

• Net Cash Capex: $27-29 billion

• $18 billion cumulative savings target through 2030 vs 2019

• $20 billion annual share buybacks through 2026

• Plans to grow earnings by $20 billion and cash flow by $30 billion by 2030

Significant Developments:

• Successfully completed $60 billion Pioneer Natural Resources acquisition

• Q1 2025 dividend declared at $0.99 per share

• Capital expenditures aligned with full-year guidance at $27.6 billion

• Achieved record $36 billion in shareholder distributions for 2024

• Reported $700 million in net favorable one-time items not expected to repeat in Q1

Market Context:

• Annual profit of $33.7 billion represents third-highest yearly profit in a decade

• Among top six S&P 500 companies in shareholder distributions

• Stock performance shows resilience with 0.8% gain in premarket trading

• Breaking production records in key regions despite market headwinds

• Transformation of cost structure enhancing profit potential across portfolio

CEO Commentary: Exxon's CEO emphasized the company's transformed cost structure and enhanced earnings potential, with CFO Kathy Mikells noting that "all barrels are not created equal, and ours are more and more advantaged."
 

Chevron & Exxon (D1 Interval)

Chevron shares are down 2% in premarket trading, while Exxon is up 0.5%. Despite this, Chevron continues to outperform Exxon year-to-date. Source: xStation