Exxon posts $2.7B quarterly profit after unprecedented year

Shown is an Exxon service station sign in Philadelphia, Wednesday, April 28, 2021.  Exxon Mobil reported profits of $2.73 billion in the first quarter, after a tumultuous year led to major spending reductions. The The Irving, Texas company produced 3.8 million barrels of oil per day in the first quarter, up 3% from the fourth quarter of 2020.  (AP Photo/Matt Rourke)
Shown is an Exxon service station sign in Philadelphia, Wednesday, April 28, 2021. Exxon Mobil reported profits of $2.73 billion in the first quarter, after a tumultuous year led to major spending reductions. The The Irving, Texas company produced 3.8 million barrels of oil per day in the first quarter, up 3% from the fourth quarter of 2020. (AP Photo/Matt Rourke) (Copyright 2021 The Associated Press. All rights reserved.)

NEW YORK – Exxon Mobil on Friday reported first-quarter profits of $2.73 billion after a tumultuous year led to major spending reductions.

The oil giant brought in $59.15 billion in revenue, up 5% from $56.16 billion during the same quarter last year. It exceeded analyst projections for the quarter.

The oil and gas industry has been struggling with massive losses after the global coronavirus pandemic forced millions of people to shelter at home and travel ground to a halt, pummeling demand for fuel.

But as some countries have picked up the pace of vaccine distribution, there are glimmers of hope that the pandemic may get under control and economies will recover. Oil companies anticipate that will mean more cars on the road and planes in the air. But the virus is still devastating many communities around the globe.

The latest earnings news follows a catastrophic year for the oil industry. Exxon lost $22.4 billion in 2020, reporting its largest-ever losses in the fourth quarter, after the pandemic throttled demand for oil. Planes were grounded, many people ditched their daily commutes and worked from home, and business travel ground to a halt in favor of virtual meetings. The company had not posted an annual loss since Exxon and Mobil merged in 1999.

To stem some of the losses, Exxon reduced capital spending by 30% in 2021 and announced in October that it would slash 1,900 jobs from its global workforce. The oil, gas and chemical industries laid off 107,000 workers between March and August of last year, according to Deloitte Insights.

“We made some tough decisions and committed to bold actions,” said CEO Darren Woods in a conference call with investors Friday. The company expects to achieve $6 billion of annual savings by 2023, compared to 2019, he said.

“Throughout this time, we've never lost sight of the long-term fundamentals of our business," Woods said. “We knew economies would recover, populations and living standards would continue to grow, ultimately driving demand for our products and an industry recovery.”