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 companyâ€™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 companyâ€™s EPS widely missed expectations from analysts for $2.15.
Revenue rose 7.5% to $48.55 billion, coming in well shy of the Streetâ€™s view of $49.48 billion.
Considering the gap between Chevronâ€™s results and analystsâ€™ expectations, the stockâ€™s 2.18% slide to $82.59 was somewhat modest. Chevronâ€™s shares were still up nearly 10% on the year.
â€śOperationally, we continue to show gains in upstream production and progress on our downstream restructuring,â€ť 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 â€śpleasedâ€ť 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 â€śseveralâ€ť 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 worldâ€™s largest publicly traded company, reported on Thursday a stronger-than-expected 55% jump in third-quarter profits, but posted a revenue miss.