It’s been 17 years since Exxon Mobil Corp has seen a quarterly report as weak as the one it just reported for the second quarter of 2016. The company earned $1.7 billion but the earnings were down 59 percent from a year ago as Chairman and CEO Rex Tillerson said the results “reflect a volatile industry environment.”
The net income was less than the $1.8 billion earned in the first quarter but it was the Texas-based company’s smallest profit since the third quarter of 1999 when earnings totaled $1.5 billion.
The report’s downside was the effect of oil prices falling again after rising to the $50 range weeks ago. Add in the fact that gasoline prices keep tumbling despite high summer-time driving demand. Exxon’s profit equaled 41 cents a share, 23 cents below the per share forecast made by 21 analysts before the release of the report.
Exxon’s overall revenue totaled $57.69 billion, a drop of 22 percent. And last year, the company’s capital expenditures for exploration were down 38 percent from a year earlier. Analysts say that kind of spending will eventually result in lower production.