ExxonMobil (NYSE: XOM) expects to book sharply lower second-quarter earnings compared to the same period last year and to the first quarter, due to low natural gas prices and lower refining margins.
For the first quarter this year, Exxon booked record earnings for a first quarter of $11.4 billion, double from the $5.48 billion for the first quarter of 2022 and down from $12.75 billion for the fourth quarter of 2022. The per-share earnings of $2.79 for the first quarter of 2023 beat The Wall Street Journal consensus estimate of $2.60.
In an SEC filing on Wednesday, the U.S. supermajor estimates that its second-quarter earnings would be lower than the $11.4-billion profit for Q1, due to up to $2.2 billion lower earnings in the upstream division because of low U.S. benchmark natural gas prices, and another up to $2.2 billion decline in the energy products division, due to lower industry margins.
Overall, Exxon’s second-quarter earnings are expected at around $7.8 billion, a sharp drop from $11.4 billion for Q1, and an even steeper slump compared to the $17.85 billion earnings for the second quarter of 2022, when oil and natural gas prices soared after the Russian invasion of Ukraine.
Exxon noted that the 2Q23 Earnings Considerations filing with SEC “is not comprehensive of all changes between 1Q 2023 and 2Q 2023 results and is not an estimate of 2Q 2023 earnings for the Corporation.”
Still, oil prices are now in the mid-$70s, compared to spikes to above $100 per barrel in the spring of 2022, while natural gas prices in the United States have hovered around two-year lows for a large part of the second quarter.
The analyst consensus in The Wall Street Journal expects Exxon’s second-quarter earnings per share at $2.28. Exxon, which has beaten analysts’ earnings estimates in each of the past four quarters, reports Q2 earnings on July 28.
