Shares of Exxon Mobil Corp (NYSE:XOM) plunged Friday after the oil giant posted first-quarter earnings that grew from a year ago, but fell short of Wall Street expectations, marking the second straight quarter that earnings disappointed.
Exxon plunged 3.75% to US$77.33 in morning trade.
For the quarter ended March 31, the oil giant booked earnings of US$1.09 per share on revenue of US$68.2bn. The consensus earnings estimate was US$1.14 per share on revenue of US$67.3 bn.
Profits have improved over the last year as the market continues to recover from a prolonged price slump in volatile oil and natural gas prices. Improving profits from its oil and natural gas producing businesses were hit by falling profits in its refining and chemical business.
Exxon's downstream business, which refines and sells fuels and lubricants, saw profits slump nearly 16% from the same period last year.
The company operates 22 refineries in 14 countries, processing nearly 5 million barrels of oil per day. It builds chemical and refining plants in the same location, allowing managers to shift production between fuels or chemicals based on demand.
Exxon attributed the poor performance in the downstream business to its international operations, where it saw higher expenses, lower profit margins and weaker gains from sales of assets.
The company's chemicals business also slumped, with profits falling about 14% from last year. Both at home and abroad, Exxon's profit margins fell while it expands the refining division. The company is investing US$20 bn through 2022 to expand its chemical and oil refining plants on the U.S. Gulf Coast.