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Exxon breaks US profit record

Posted Oct 30 2008, 11:45 AM by Kim Peterson
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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:

Exxon: The world's 18th-largest economy?

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Where to put money: The 'super safe' stocks

Oil now lost 23% from July peak

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Comments

 

If Obama puts more taxes on the Oil company what do you think they are going to do?  They are not just going to obsorb the tax, they'll pass it down to the consumer - that's you and me my friend.

JD (Posted 10.30.08 2:48 PM) Report Abuse

I hate when companies are big, employ a lot of people, and make a lot of money.  I hate when people make a lot of money.  We should tax companies who make profits and individuals who make a lot of money more than they are currently being taxed.  That way, when they go out of business or leave and go somewhere else to avoid the high taxes, we can complain about that too.

Hokie Pete (Posted 10.30.08 2:49 PM) Report Abuse

when you make 12 billion a quarter you will pay taxes-they should be investigated for rape

bentover (Posted 10.30.08 2:50 PM) Report Abuse

Maybe we should have the oil companies buy the us auto companies.  They are at opposite ends of the spectrum in terms of profits, but definitely have a common ground.  Maybe it would save the domestic auto market and solve the energy crisis.....

loriindetroit (Posted 10.30.08 2:51 PM) Report Abuse

What do people care if they get taxed by Obama?  At the rate we're going we'll be unemployed or underemployed because all the decent jobs will be gone or overseas under McCain's plan thus the tax rate won't apply.  We've been hearing the oil supply is up because the demand is low yet Exxon continues to reap record profits.  They tell us what to believe and we do.  We're suckers!

CP (Posted 10.30.08 2:51 PM) Report Abuse

I understand Exxon also paid $ 35 BILLION dollars in taxes for the same period.

Dan (Posted 10.30.08 2:51 PM) Report Abuse

Read the story thanks, 27 billion in taxes, but there's 52 weeks in a year.  They're upset because the American consumer was a guinea pig for oil companies.  They wanted to see how high they could push fuel prices and still have us pay them, well they found out.  How can you people honestly support these companies?  And feel bad for them for paying a ton of taxes when they make TONS of money?  

Nick Z (Posted 10.30.08 2:52 PM) Report Abuse

While Exxons total revenue  is up 64% from 2003 - 2007  net income as a % of total revenue went from 8.72% in 2003 to 11.52 % in 2007 - an  increase of only 2.80%. Hardly earth shattering.

Buzzkill (Posted 10.30.08 2:52 PM) Report Abuse

Exxon paid apprximately 43 billion dollars in taxes for the quarter. You won't hear much about that on the news.

Sir (Posted 10.30.08 2:53 PM) Report Abuse

I think its great.  Glad to know somebody is killing it out there.  Just remember, Exxon is public, so they are owned by people from all walks of life, from large shareholders, to a bare minimum.  So if Exxon makes whatever, and folks do well, I think that is what it is all about.  In fact, I am going to stop short here and go make some money myself instead of being jealous waiting on Obama to take over and line my pocket with money I didn't earn.  

tmoskau (Posted 10.30.08 2:53 PM) Report Abuse

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