ExxonMobil (XOM -2.18%), an integrated oil and gas company active in exploration, production, refining, chemicals, and lower-carbon solutions, released its second-quarter 2025 earnings on August 1, 2025. The most important news: While the company reported GAAP earnings per share of $1.64, exceeding analyst expectations of $1.57, Both GAAP earnings and revenue declined year over year. Net income (GAAP) was $7.1 billion. Revenue (GAAP) reached $79.5 billion. and This represented an 11.7% decrease compared to Q2 2024.
The quarter featured robust upstream production and strong share buybacks. However, lower commodity prices and weaker margins, especially in the chemicals segment, weighed on profits. Overall, the period reflected solid cash generation and progress on strategic projects, but GAAP earnings and revenue trended down from Q2 2024 levels.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (GAAP, diluted) | $1.64 | $1.57 | $2.14 | (23.4%) |
| Revenue (GAAP) | $79.5 billion | N/A | $89.99 billion | (11.7%) |
| Cash flow from operating activities (GAAP) | $11.5 billion | N/A | N/A |
Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report.
About ExxonMobil and Its Strategic Direction
ExxonMobil operates a broad set of businesses, including oil and gas production, refining, chemicals, and a growing portfolio of lower-carbon solutions. It explores and produces oil and gas worldwide and manufactures fuels and lubricants.
Recently, the company has prioritized expanding its upstream oil and gas portfolio, most notably with the acquisition of Pioneer Natural Resources in May 2024, a move intended to boost U.S. shale production. ExxonMobil’s critical success factors include cost discipline, efficient project delivery, regulatory compliance, and continued investment in technology, both for traditional operations and for lower-emission alternatives.
Quarter Highlights: Production Growth, Market Pressures, and Shareholder Returns
Production in the upstream segment, meaning the search for and extraction of oil and natural gas, set a record for second-quarter output, marking the highest level since the Exxon and Mobil merger more than 25 years ago. Output climbed to an average of 4.6 million oil-equivalent barrels per day year to date, a 13% increase over the prior year. This growth came primarily from the integration of Pioneer and production ramp-up in Guyana. The Permian Basin, a key U.S. shale region, saw output hit a record 1.6 million oil-equivalent barrels per day.
Despite volume growth, upstream earnings (U.S. GAAP) fell from $6.8 billion in Q1 2025 to $5.4 billion, driven by weaker crude oil and natural gas prices. Year-to-date upstream earnings (GAAP) are $12.2 billion for the first six months of 2025, trailing the previous year's pace despite higher overall production. Management highlighted that numbers are even bigger than the $3 billion annual synergy target following the Pioneer acquisition, according to management's corporate plan update, reflecting more-than-expected cost savings and operational gains.
In its refining operations, the Energy Products business segment, ExxonMobil reported $1.37 billion in quarterly earnings (GAAP), up $539 million versus the prior quarter. This rebound was thanks to stronger industry margins from peak seasonal fuel demand and improved reliability after scheduled maintenance. However, year-to-date results for the six months ended June 30, 2025, trailed the prior year due to broader industry margin weakness. Recent upgrades, such as the Strathcona Renewable Diesel project in Canada and a completed expansion at the Fawley refinery in the U.K., are enabling production of higher-margin fuels.
Chemical product earnings (U.S. GAAP) were $293 million and have dropped significantly compared to the prior year, reflecting industrywide overcapacity and pressured profit margins. Increased volumes from the recently completed China Chemical Complex, a facility making chemical feedstocks, plastics, and related materials, weren’t enough to offset these weaker economics. Management expects continued margin weakness for quite some time due to industry supply exceeding demand.
Shareholder returns totaled $9.2 billion, with $5.0 billion in share repurchases and about $4.3 billion in dividends paid. Notably, the company has repurchased about 40% of the shares issued to complete the Pioneer deal since May 2024. The quarterly dividend was maintained at $0.99 per share.
Financial Position and Key Initiatives
ExxonMobil generated $11.5 billion in cash flow from operating activities (GAAP) and $5.4 billion in free cash flow (non-GAAP), a measure of cash left after capital expenditures that is often used to evaluate a company's ability to fund dividends and share buybacks. Capital spending reached $6.3 billion, bringing year-to-date investment close to $12.3 billion. Management confirmed full-year capital-expenditure plans of $27 to $29 billion.
The company's debt-to-capital ratio was 13%, with net debt (total debt minus cash) to capital at 8%. The balance sheet remains strong and supports both ongoing investment and shareholder distributions.
Since 2019, ExxonMobil says it has achieved $13.5 billion in structural cost savings (non-GAAP) and is targeting $18 billion by 2030. Digital tools, centralized procurement, and logistics automation are helping the company cut costs and increase efficiency across its operations.
Technology investments and innovation remain a focus. ExxonMobil held more than 8,000 active patents at year-end 2024 and generated approximately $102 million in technology licensing revenue during 2024. Several large-scale projects, such as the Singapore Resid Upgrade (converting fuel oil to higher-value products) and the Strathcona Renewable Diesel facility in Canada, began operations.
On the lower-emission energy front, the Strathcona Renewable Diesel project commenced operations and now produces 20,000 barrels per day of renewable fuel. Efforts in carbon capture and storage (CCS), a process that captures carbon dioxide emissions and stores them underground, continue to move forward, but management notes the biggest challenge is signing up stable customers for the Baytown Blue Hydrogen Project.
Looking Ahead: Management View and Trends to Watch
Looking ahead, management expects cash capital expenditures (non-GAAP) for 2025 to remain within the $27 billion to $29 billion range, as previously indicated. The company aims to bring 10 new projects online by the end of the year, expected to add $3 billion in annual earnings by 2026, assuming constant prices and margins. No major changes to investment pace are expected unless policy shifts or customer demand warrant adjustments, especially in low-carbon and hydrogen projects.
ExxonMobil continues to target $1 billion of annual earnings from its low-carbon businesses by 2030. The company remains vigilant about regulatory developments, such as changing tax rules or environmental mandates, which can affect profitability and future investment plans. No clear changes were made to official earnings guidance for the year. The quarterly dividend was maintained at $0.99 per share.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
