ExxonMobil outlines $3B earnings growth from 2025 projects while advancing Guyana and Permian expansion

Earnings Call Insights: Exxon Mobil Corporation (XOM) Q2 2025

Management View

Darren W. Woods, Chairman and CEO, emphasized the strength of ExxonMobil’s diversified business, stating, “This quarter once again proved the value of our strategy and our competitive advantages. They continue to deliver for our shareholders, no matter the market conditions or geopolitical developments.” He highlighted record second quarter production in Upstream since the Exxon and Mobil merger and noted, “More than half of our oil and natural gas production comes from high-return, advantaged assets. We expect that number to climb to more than 60% by the end of the decade.”
Woods pointed to Guyana as a critical asset, referencing three major developments online producing roughly 650,000 gross barrels per day and the upcoming Yellowtail project, “anticipated to achieve first oil next week, delivered 4 months out of schedule and under budget.” He projected Guyana’s total production capacity reaching 1.7 million oil equivalent barrels per day from eight developments by 2030.
Addressing the recent arbitration decision, Woods acknowledged, “the ruling was a surprise…While disappointed, we respect the process and the ruling. As we move forward, I hope our investors take comfort in the length we will go to in protecting the value our employees create for the company and our shareholders. With respect to the continuing development of Guyana, the arbitrators decision changes nothing for us.”
In the Permian Basin, Woods reported, “we produced roughly 1.6 million oil equivalent barrels per day, which was another record for us,” and shared technology advances, “improved recoveries up to 20%. That’s up 5 percentage points from what we announced last December. By year-end, we expect deployments to reach roughly 150 more wells.” He set a target to grow Permian production from about 1.6 million to 2.3 million oil equivalent barrels by 2030.
Product Solutions projects are ramping up, with new operations at the China Chemical Complex and Singapore Resid Upgrade. Woods noted, “With this new technology, we’ve introduced a new lubricant base stock, which we’ve sold out, and have essentially sold out the incremental 20,000 barrels per day of production.”
Woods shared, “In total, our 2025 project start-ups are expected to drive more than $3 billion of earnings in 2026 at constant prices and margin. This goes a long way towards derisking our plans to achieve [ 20, 30 ] by 2030. That’s $20 billion of additional earnings and $30 billion of cash flow versus 2024 on a constant price and margin basis.”
James R. Chapman, VP and Treasurer, stated, “We will be publishing our annual global outlook later this month…contains our latest views on global energy demand and supply through 2050, which forms the basis of our business planning.”

Outlook

Woods indicated, “By 2030, we expect to have total production capacity of 1.7 million oil equivalent barrels per day from eight developments” in Guyana and “grow Permian production from about 1.6 million oil equivalent barrels to 2.3 million by 2030.”
Management confirmed, “our 2025 project start-ups are expected to drive more than $3 billion of earnings in 2026 at constant prices and margin,” and reiterated plans to achieve $20 billion of additional earnings and $30 billion of cash flow versus 2024 by 2030.
Chapman noted an upcoming update to the company’s global outlook later in the month.

Financial Results

Woods highlighted the impact of project start-ups, stating, “our 2025 project start-ups are expected to drive more than $3 billion of earnings in 2026 at constant prices and margin.”
In reference to cost controls, Chapman noted, “we’ve added $1.4 billion to that total. We expect to continue that to get to our $18 billion target by 2030 off a 2019 basis, and we see that as effective in offsetting some of the increased expense levels.”
No specific EPS or revenue figures for the quarter were explicitly stated in the transcript.

Q&A

Devin J. McDermott, Morgan Stanley: Asked about M&A strategy. Woods explained ExxonMobil seeks to leverage its technology and scale through value-creating deals, referencing Pioneer, “We’re making really good progress at growing the synergies. We started off with $2 billion, we announced we’re up to $3 billion per year on average over the next 10 years.”
Neil Singhvi Mehta, Goldman Sachs: Queried on Permian production and ExxonMobil’s view on peak production. Woods responded, “Absolutely yes…the lightweight proppant that we shared with all of you in December…we’re actually seeing better results than we had even talked about then, a 20% improvement in recoveries.”
Douglas George Blyth Leggate, Wolfe Research: Questioned inventory life and risk profile in the Permian. Woods stated, “The 20 years of inventory, that is basically the number of wells we’re bringing on every year, wells to sales.”
Stephen I. Richardson, Evercore ISI: Asked about downstream project lessons. Woods detailed, “the project organization was a damn good idea and is delivering…we’ve brought these projects on in less time and with less challenges than we’ve ever done in our history.”
Wei Jiang, Barclays: Inquired about low carbon business and CapEx. Woods explained, “On the carbon capture side…we’ve made great progress. The team has got a lot of additional opportunities in sight.”
Other questions covered AI, cost guidance, LNG, Guyana production optimization, chemical margins, scale in M&A, North American gas, and Golden Pass project status, with management providing detailed, forward-looking responses.

Sentiment Analysis

Analysts maintained a constructive but probing tone, focusing on M&A, project execution, Permian risks, low carbon outlook, and cost trends.
Management delivered confident and detailed responses, with Woods using phrases like, “we are in a league of our own,” and expressing optimism about project execution and future growth targets.
Compared to Q1 2025, management’s tone remained confident but addressed more operational surprises (e.g., arbitration ruling) and project-specific challenges.

Quarter-over-Quarter Comparison

The current quarter placed greater emphasis on project execution (Guyana, Permian, China Chemical Complex), technology deployment, and tangible earnings/cash flow targets for 2026 and 2030.
New developments included the arbitration outcome in Guyana and faster-than-expected Yellowtail progress. Management reiterated and elaborated on Permian production targets and advancements in recovery rates.
Analysts continued to focus on operational flexibility, capital allocation, and near-term risks, but questions shifted more toward project delivery and M&A synergies.
Management’s confidence and focus on execution were consistent, although the mention of the arbitration decision introduced a note of operational caution.

Risks and Concerns

Woods acknowledged the surprise arbitration ruling related to Guyana, emphasizing contract enforcement as a critical industry risk.
Concerns were raised about the risk profile of the Permian’s high decline assets and sustaining dividend growth as production becomes more weighted to shale.
Management noted that future investment in low carbon hydrogen is uncertain, pending policy clarity and market formation, stating, “If we can’t see an eventual path to a market-driven business, we won’t move forward with the project.”
Chapman addressed cost concerns, pointing to structural cost savings offsetting expense growth from new projects and DD&A.

Final Takeaway

ExxonMobil’s management underscored record-setting project execution, advancing both Guyana and Permian production targets, while maintaining a disciplined approach to capital allocation and technology deployment. Despite a surprise arbitration ruling in Guyana, leadership reaffirmed the strength of their diversified portfolio and the company’s trajectory toward $3 billion in incremental 2026 earnings from current project start-ups, with a clear path to $20 billion in additional earnings and $30 billion in cash flow by 2030, emphasizing resilience and value creation for shareholders.

Read the full Earnings Call Transcript