By Dave Sebastian

 

Exxon Mobil Corp. recorded its third consecutive quarterly loss as the Covid-19 pandemic continued to sap oil demand.

The Irving, Texas, oil producer Friday posted a third-quarter net loss of $680 million, or 15 cents a share, compared with a net profit of $3.17 billion, or 75 cents a share, in the comparable quarter last year. The results improved by $400 million from the second quarter due to early stages of demand recovery, it said.

On an adjusted basis, it recorded a loss of 18 cents a share. A loss in the first quarter was its first in three decades.

Analysts polled by FactSet had been expecting a loss of 23 cents a share, or 26 cents a share on an adjusted basis.

Revenue fell 29% to $46.2 billion from the year-earlier period. Analysts had been looking for $45.4 billion.

U.S. upstream earnings swung to a loss of $681 million from a profit of $37 million. U.S. downstream earnings swung to a loss of $136 million from a profit of $673 million. The company had expected changes in upstream liquids prices to help its third-quarter results by $1.4 billion to $1.8 billion.

Oil-equivalent production was 3.7 million barrels a day, up 1% from the second quarter.

On Thursday, Exxon said it expects to shed as much as 15% of its global workforce over the next year. The sector's largest companies have also announced layoffs and cut billions of dollars from capital budgets.

Chevron Corp. said earlier this year it would cut its spending by $4 billion, or 20%. It plans to lay off as much as 15% of its staff.

Exxon on Friday said it expects further cost cuts in 2021. It sees a preliminary 2021 capital program of $16 billion to $19 billion, down from its $23 billion target announced in April.

Exxon said it is reassessing North American dry gas assets currently included in its development plan. Long-lived assets with carrying values of $25 billion to $30 billion could be at risk for significant impairment, the company said. But they wouldn't likely be subject to significant impairment if the assets remain in its long-term development plan, Exxon said. It expects to complete the review this quarter.

Despite a modest economic recovery, oil-and-gas companies are being hammered by a sustained drop in consumption of gasoline and jet fuel as millions of people work from home and avoid driving and flying during the pandemic. In Europe, new lockdowns in response to climbing Covid-19 cases are damping hopes that the global economy will regain its footing this year. Longer-term concerns also linger about future competition from renewable energy and electric vehicles to drag down the value of many oil-and-gas companies to decade lows.

Chevron earlier Friday posted a third-quarter net loss of $207 million, or 12 cents a share, compared with a net profit of $2.58 billion, or $1.36 a share, in the comparable quarter last year.

 

Write to Dave Sebastian at dave.sebastian@wsj.com

 

(END) Dow Jones Newswires

October 30, 2020 08:13 ET (12:13 GMT)

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