Chevron 2022 profits increase to $36.5 billion but miss Wall Street estimates
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Chevron Cory reported a $36.5 billion profit for the 2022 financial year. While this figure was over double the earnings reported during the previous year, it remained below Wall Street estimates. The miss was attributed to increasing costs and asset writedowns.
Chevron 2022 profits hit $36.5 billion
Chevron is the largest oil producer in the United States. The company reported healthy figures in 2022 compared to its previous years. In 2022, Chevron’s adjusted net profits surpassed the record set in 2011 by around $10 billion.
Nevertheless, the company’s financials were dealt a blow by some negative macroeconomic conditions seen during the period. Chevron reported an increase in expenses, while the profits from oil and fuel were weak. This led to the earnings reported in Q4 2022 falling by 6.6% below the forecasts made by Wall Street. Chevron shares closed trading on Friday with a 4.44% drop.
The results reported by Chevron paint an image of what is to be expected from the earnings of leading global energy suppliers. Energy prices have increased significantly because of the high demand and shortages caused by the Russian invasion of Ukraine. According to analysts, Western energy companies will report a total of $200 billion in profit during the year.
The earnings reported by companies during the current season have already led to energy stocks leading the industry earnings. There is a significant increase in companies lifting their payouts to shareholders. This could trigger the need for windfall taxation.
The finance chief at the company noted that there was significant progress in winning back investors to the energy sector, but there was still much that needed to be done. Chevron recently announced its decision to triple spending on share repurchases, but this decision was opposed by the White House. Chevron currently has a budget of $75 billion for share repurchases before the proposed increase.
Chevron Q4 results fail to meet Wall Street expectations
During the fourth quarter of 2022, Chevron reported adjusted earnings of $7.9 billion, equivalent to $4.09 per share. This was below the estimate of $4.38 per share profit given by Wall Street analysts.
The miss in adjusted earnings likely resulted from the increased corporate costs. During the year, oil and gas production declined, resulting in a 7% drop in global output as the concessions in Indonesia and Thailand ended.
Chevron has also shifted its focus on new investments and plans to grow its investments and production activities in the United States. In 2021, production in the US reached a record high, resulting in a 16% gain in Permian. The company also reported a significant recovery in its refining business.
