Exxon breaks US profit record
Posted
Oct 30 2008, 11:45 AM
by
Kim Peterson
Rating:
Unbelievable. Exxon Mobil just reported the biggest profit ever for a U.S. company. It raked in a billion dollars a week in pure profit in the July-September period, 58% more than a year ago.
I don't know whether to admire the accomplishment or hurl.
Crude prices hit an all-time high during the quarter, which helped boost Exxon's profit even though its production actually fell 8% from last year. With that kind of demand, Exxon execs are shrugging off the economic storm felling other companies right now.
"Despite recent volatility in the financial, commodity and credit markets, the fundamentals of Exxon Mobil's business remain strong," executive David Rosenthal said on a call with analysts.
I'll say. The company is printing money, holding the record for the top 10 most-profitable quarters in U.S. corporate history (and the largest annual profit.) Exxon shares are down nearly 3% today after the earnings report to $72.69.
Still, Exxon's next quarter probably won't be so rosy. Crude prices have plunged from all-time highs to around $65 a barrel. Demand for fuel has slowed way down. And production levels for Exxon continue to drop, while the company spends tens of millions of dollars a day to drill wells and build plants.
The party might be over, even for Exxon.
Update: Hoo, boy! Some commenters are up in arms because I didn't mention the taxes Exxon paid during the quarter. Keep in mind that taxes paid aren't generally written about in earnings coverage, mainly because investors don't really care, especially compared with other line items in an earnings release.
But, because you asked for it, here it is. Exxon paid $11.3 billion in income taxes in the quarter, bringing total taxes paid for the first nine months of the year to $31.2 billion. It's a staggering number, just like all the other numbers in the quarterly report. Exxon's income tax rate has increased to 48% from 45%.
Related reading:
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