Chevron (NYSE:CVX) spooked shareholders on Friday by disclosing an unexpected 1.6% decline in third-quarter profits, prompting a 2% drop in the No. 2 U.S. energy company’s stock.

The energy giant said it earned $3.77 billion, or $1.87 a share, last quarter, compared with a profit of $3.83 billion, or $1.92 a share, in the year-earlier period. The company’s EPS widely missed expectations from analysts for $2.15.

Revenue rose 7.5% to $48.55 billion, coming in well shy of the Street’s view of $49.48 billion.

Considering the gap between Chevron’s results and analysts’ expectations, the stock’s 2.18% slide to $82.59 was somewhat modest. Chevron’s shares were still up nearly 10% on the year.

“Operationally, we continue to show gains in upstream production and progress on our downstream restructuring,” CEO John Watson said in a statement.

Chevron reported upstream earnings of $3.56 billion last quarter, compared with downstream earnings of just $565 million. The company posted global net output of 2.74 million barrels of oil equivalent a day, up 1% from the year before.

Watson said the company is “pleased” the government decided to lift the drilling moratorium in the Gulf of Mexico that had been put in place in the wake of the BP (NYSE:BP) massive oil spill. Chevron said it has already filed one deepwater drilling permit application and plans to submit “several” more over the next few months.

Chevron also said it plans to begin buying back stock in the fourth quarter under its previously-announced repurchase program. The company said it is targeting a buyback rate of $500 million to $1 billion per quarter.

Rival energy giant ExxonMobil (NYSE:XOM), the world’s largest publicly traded company, reported on Thursday a stronger-than-expected 55% jump in third-quarter profits, but posted a revenue miss.