Exxon (XOM, Financial) and Chevron (CVX, Financial) both reported earnings on Friday that missed analysts’ expectations for the second quarter as oil prices continue to remain at extremely low levels.Â
Exxon Mobil reported second quarter revenue of $57.7 billion, missing analysts’ estimate by $2.53 billion. EPS for the quarter was 41 cents, missing analysts’ estimate by 23 cents.
Chevron reported second quarter revenue of $29.3 billion, beating analysts’ estimate by $1.22 billion. The company had losses of 78 cents per share.
As both companies suffer from the industry’s low oil prices, segment results were down significantly for the quarter. With the lower revenue, earnings and free cash flow for the second quarter, both companies are at risk of cutting their dividend.
Exxon
In the second quarter, Exxon’s revenue was down 22% from the year-ago quarter. EPS of 41 cents was down 59%. Earnings in upstream, downstream and chemical were all lower in comparison to the second quarter of 2015.
Chevron
Chevron had similar results to Exxon Mobil. Revenue for the quarter was down 27%. Losses of 78 cents per share were down from $1.08 in the year-ago quarter. Upstream and downstream earnings were both significantly lower with segment earnings down $2.041 billion overall.
In a CNBC report Friday, market specialists discussed the energy sector’s challenges and the factors affecting both companies’ dividends.
Disclosure: I do not own any shares of the companies included in this article.
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