Chevron beats earnings expectations, returns more than $7 billion to shareholders

Chevron beat third-quarter earnings and revenue expectations, returning a record amount of cash to shareholders.

The oil major's quarterly profit, however, declined substantially compared to the year-ago period due to lower margins on refined product sales, lower prices and the absence of favorable tax times.

Chevron produced 3.36 million oil-equivalent barrels per day in the quarter, a 7% increase over the third quarter of 2023, driven by record output in the Permian Basin.

Here is what Chevron reported for the third quarter compared with what Wall Street was expecting, based on a survey of analysts by LSEG: 

• Earnings per share: $2.51 adjusted, vs. $2.43 expected
• Revenue: $50.67 billion, vs. $48.99 billion expected

Shares were up 2.6% in the premarket following the report's release.

Chevron's net income came in at $4.49 billion, or $2.48 per share, down 31% from $6.53 billion, or $3.48 per share, in the third quarter of 2023. When adjusted for foreign currency impacts, the company reported earnings of $2.51 per share, solidly topping Wall Street's expectations for the quarter.

Chevron booked revenues of $50.67 billion, also beating Street expectations but declining 6% from the $54.1 billion reported in the third quarter last year.

The oil major returned a record $7.7 billion to shareholders in the quarter, including $4.7 billion in share buybacks and $2.9 billion in dividends.

Chevron is aiming to streamline its portfolio, with asset sales in Canada, Congo and Alaska expected to close in the fourth quarter of 2024. The company is also target $2 billion to $3 billion in cost reductions from 2024 through the end of 2026.

Chevron's stock is largely flat for the year, underperforming the S&P 500 energy sector which has gained more than 6%. Shares have struggled to gain ground as uncertainty looms over the company's pending $53 billion acquisition of Hess.

The Federal Trade Commission has cleared the deal, though it prohibited John Hess from joining Chevron's board.

Chevron remains locked in a dispute with Exxon Mobil, which is claiming a right of first refusal over Hess Corp.'s lucrative oil assets in Guyana. If an arbitration court rules in Exxon's favor, Chevron's acquisition of Hess would fail to close.