Chevron Corp
Q3 2024 Earnings
Market Reaction
S&P 500 over the same 30 days: +6.41%.
Did CVX Beat Earnings? Q3 2024 Results
Chevron delivered a mixed but resilient third quarter, posting adjusted earnings per share of $2.51 against a consensus estimate of $2.43, a beat of 3.29%, even as revenue of $48.93 billion came in fractionally below the $48.99 billion estimate and fell 5.8% from a year ago. The headline story was margin compression across the board: lower realizations on refined products, weaker upstream pricing, and the absence of favorable prior-year tax items pushed reported net income to $4.49 billion, down sharply from $6.53 billion in Q3 2023. Offsetting that pressure, worldwide production climbed 7% year-over-year to 3,364 thousand barrels of oil-equivalent per day, with U.S. volumes setting a quarterly record on the back of strong Permian Basin output. Chevron also returned a record $7.70 billion to shareholders through buybacks and dividends. Looking ahead, the company is targeting $2 to $3 billion in structural cost reductions by end of 2026 and expects Gulf of Mexico production to reach 300,000 barrels per day by 2026 as new deepwater projects ramp up.
- Record Permian Basin production driving 7% year-over-year worldwide production growth
- PDC Energy acquisition contributing to higher U.S. production volumes
- Lower margins on refined product sales impacting downstream earnings
- Lower upstream realizations reducing upstream profitability
- Absence of prior year favorable tax items in international upstream
- Higher dividends from equity affiliates and favorable working capital effects supporting cash flow
“We delivered strong financial and operational results, started up key projects in the U.S. Gulf of Mexico and returned record cash to shareholders this quarter.”
Chevron CEO, on the earnings call
Forward Guidance & Outlook
Chevron expects to close asset sales in Canada, Congo, and Alaska in Q4 2024, as part of its plan to divest $10-15 billion of assets by 2028. The company is targeting $2-3 billion of structural cost reductions from 2024 levels by the end of 2026. U.S. Gulf of Mexico production is expected to grow to 300,000 barrels of net oil-equivalent per day by 2026 through current and upcoming project start-ups. The company has realized approximately 30% greater-than-projected capital expenditure and cost synergies from the PDC Energy acquisition.
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Figures from SEC filings and company reports. Not investment advice.