Exxon CEO on Q3 earnings: ‘supply continues to be fairly tight’

Exxon Mobil Corp (NYSE: XOM) is in the red this morning after reporting its financial results for the third quarter that came in shy of Street estimates.

Exxon Q3 financial highlights

• Earned $9.07 billion versus the year-ago $19.66 billion
• Per-share earnings also tanked from $4.68 to $2.25
• Adjusted EPS printed at $2.27 as per the press release
• Revenue declined 19% year-on-year to $90.76 billion
• Consensus was $2.37 a share on $93.41 billion revenue

Exxon attributed the weakness partly to production was slipped 0.8% to 3,688,000 oil-equivalent barrels per day in the recently concluded quarter. On CNBC’s “Squawk Box”, Darren Woods – its Chief Executive said today:

Supply continues to be fairly tight. So, you’ll see margins and prices move pretty dramatically … until additional capacity comes onto the marketplace, which is still a couple years out.

Exxon topped expectations for free cash flow

Exxon Mobil also reported a 47% year-on-year hit to its free cash flow in the third quarter.

On the plus side, though, that metric topped expectations by a significant margin – coming in at $11.68 billion versus $9.11 billion expected. Elaborating on the demand picture, the Chief Executive said this morning:

I think Europe has got its challenges. China has slowly been coming out of its challenges. And then, of course, the U.S. is looking fairly solid.

The earnings release arrives only days after the energy giant confirmed plans of buying Pioneer Natural Resources for about $60 billion. Its shares price has declined about 12% in a month.

Exxon raised dividend on Friday

On Friday, Exxon Mobil Corp said its refineries have not recorded a better throughput in Q3 over the past 24 years.

The oil and gas behemoth announced 4 cents increase in its quarterly dividend to 95 cents per share. According to CEO Darren Woods:

We’ve got a good portfolio of projects and opportunities across all of our businesses. Our projects organisation has been delivering consistently, ahead of schedule, and below budget, and operating very well.

The chief executive confirmed that the Israel-Hamas war has so far not had a specific effect on Exxon Mobil Corp. Wall Street currently has a consensus “overweight” rating on the oil stock.