Exxon Mobil (XOM) reported better-than-expected first-quarter earnings and revenue early Friday, as the industry reels from the collapse in crude oil prices. Chevron (CVX) reported a surprise earnings gain, but the revenue came in light and the oil major cut capital spending yet again. Shares of both Dow Jones energy giants fell early Monday.
XThe Exxon and Chevron earnings reports also come as OPEC+ formally begins implementing its landmark deal to cut production for two years and prop up crude oil prices, starting with a reduction of 9.7 million barrels a day in May and June. Crude oil futures rose early Friday.
Exxon Earnings
Estimates: Analysts saw Exxon earnings plunging 93% to 4 cents with revenue down 15% to $53.8 billion.
Results: Exxon earnings on a non-GAAP basis fell to 53 cents. Revenue sank nearly 12% to $56.16 billion. Total oil-equivalent production of 4.05 million barrels per day was up 1.6% from a year ago but flat from Q4. Permian Basin production jumped 56% from a year ago and 20% from Q4. Cash flow from operations was $6.3 billion.
Earlier this month, Exxon said it sees 2020 capital spending of $23 billion, down from an earlier estimate of $33 billion, with the largest of the capital spending cuts in the Permian Basin.
The Dow Jones oil major also sees a 15% decline in cash operating expenses as the company looks to "increase efficiencies and reduce costs."
Stock: Shares sank 2.1% in premarket trading on the stock market today. Exxon stock recent retook the 50-day average recently, according to MarketSmith analysis.
Chevron Earnings
Estimates: Chevron earnings were expected to fall 59% to 64 cents with revenue down nearly 16% to $29.88 billion.
Results: Chevron earnings on a GAAP basis rose to $1.93 a share. Revenue fell nearly 16% to $29.71 billion.
Stock: Chevron stock fell 0.9% before the open.
Chevron will cut operating costs by another $1 billion and slashed its planned 2020 capital spending yet again, to as low as $14 billion. In March, Chevron reduced its investment budget for the year by $4 billion to $16 billion globally, while also halving its Permian Basin spending. The oil major also suspended share buybacks but raised its quarterly dividend 8% to $1.29 in January.
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On Wednesday, Exxon maintained its dividend at 87 cents a share, though it was the first time since 2007 that it didn't go up during Q2.
But on Thursday, Royal Dutch Shell (RDSA) spooked investors by cutting its quarterly dividend for the first time since World War II, and slashing it to 16 cents from 47 cents.
ConocoPhillips' (COP) kept its dividend at 42 cents Thursday as Q1 earnings plunged but still beat Wall Street estimates.
Shale Budgets
Earlier this month, Conoco Philips cut its 2020 capital expenditure budget by another $1.6 billion to bring it down to $4.3 billion, or 35% its original 2020 guidance.
That's part of an effort to save an additional $3 billion in spending and costs, on top of the $2.2 billion worth of cuts announced in March.
Meanwhile, Permian Basin shale giant Concho Resourcecs (CXO) beat earnings forecasts late Thursday but plans to slash its 2020 capital budget further to $1.6 billion, representing a 40% decrease from its initial view.
Other shale producers have been scrambling to save money with deeper budget cuts, and Bakken giant Continental Resources (CLR) is even halting drilling in North Dakota.
Follow Gillian Rich on Twitter @IBD_GRich for energy news and more.
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2020-05-01 11:53:13Z
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