01—Abstract
Summary
Summary of the 10-Q filed August 7, 2024. Cited figures are marked; the original filing is the authoritative source.
Chevron Corporation reported a decrease in net income attributable to Chevron for the second quarter and the first six months of 2024 compared to the same periods in 2023.
For the three months ended June 30, 2024, net income was $4.4 billiona ($2.43 per share diluted), down from $6.0 billion ($3.20 per share diluted) in Q2 2023. For the six months ended June 30, 2024, net income was $9.9 billion ($5.40 per share diluted), down from $12.6 billion ($6.66 per share diluted) in the comparable 2023 period. This decline is primarily attributed to lower downstream margins and higher operating expenses, as well as increased depreciation, depletion, and amortization, partially offset by higher upstream realizations and sales volumes.
Despite the year-over-year decline in profitability, Chevron continues to execute its capital allocation strategy. The company paid $6.0 billionb in dividends to common stockholders during the first six months of 2024 and repurchased $3.0 billion of its stock in the second quarter, with expectations for further repurchases in the third quarter. The company's balance sheet remains solid, with a Net Debt Ratio of 10.7% as of June 30, 2024, indicating a strong financial position to manage its operations and shareholder returns.
02—Key points
Key Highlights
- Net income attributable to Chevron decreased to $4.4 billion in Q2 2024 and $9.9 billion in the first six months of 2024, compared to $6.0 billion and $12.6 billion, respectively, in the prior year periods.
- Diluted EPS stood at $2.43 for Q2 2024, down from $3.20 in Q2 2023, and $5.40 for the first six months of 2024, down from $6.66 in the comparable 2023 period.
- Upstream segment earnings saw a decrease to $4.5 billion in Q2 2024 and $9.7 billion in the first six months of 2024, primarily due to higher depreciation, depletion, amortization, and operating expenses, partially offset by increased realizations and sales volumes.
- Downstream segment earnings significantly declined to $597 million in Q2 2024 and $1.4 billion in the first six months of 2024, largely driven by lower refined product margins and higher operating expenses.
- Chevron returned $6.0 billion to shareholders through dividends and repurchased $3.0 billion of its stock in Q2 2024.
- Capital expenditures increased to $8.1 billion in the first six months of 2024, up from $6.8 billion in the prior year, reflecting higher investments in upstream assets, including post-acquisition spend on PDC assets.
- The company maintains a strong liquidity position with $4.0 billion in cash, cash equivalents, and marketable securities as of June 30, 2024.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2024filed August 7, 2024Financial Statements
Q2 FY2024 against Q2 FY2023
| Line item | Q2 FY2024Q2 FY2023 | Change |
|---|---|---|
| Revenue | $49.57B$47.22B | +5.0% |
| Cost of Revenue | $30.87B$28.98B | +6.5% |
| Gross Profit | $18.71B$18.23B | +2.6% |
| SG&A Expenses | $1.05B$1.13B | −7.1% |
| Operating Expenses | $44.15B$41.06B | +7.5% |
| Interest Expense | $113.00M$120.00M | −5.8% |
| Net Income | $4.43B$6.01B | −26.2% |
| EPS (Basic) | $2.43$3.22 | −24.5% |
| EPS (Diluted) | $2.43$3.20 | −24.1% |
| Shares Outstanding (Basic) | 1.83B1.87B | −2.2% |
| Shares Outstanding (Diluted) | 1.83B1.88B | −2.2% |
05—Questions
Frequently Asked Questions
What caused the decrease in net income for the second quarter and first six months of 2024 compared to 2023?
The decrease in net income was primarily driven by lower downstream margins, higher operating expenses across segments, and increased depreciation, depletion, and amortization. These factors were partially offset by higher upstream realizations and sales volumes.
How did Chevron return capital to shareholders during this period?
Chevron paid $6.0 billion in dividends to common stockholders in the first six months of 2024 and repurchased $3.0 billion of its stock in the second quarter of 2024. The company expects further repurchases in the third quarter of 2024.
What is the outlook for the Upstream and Downstream segments?
Upstream earnings are closely tied to crude oil and natural gas prices, which are subject to global market volatility. Downstream earnings are influenced by refining margins, which have been lower in the reported periods, and operating expenses. The company continues to focus on managing costs and optimizing operations in both segments amidst challenging market conditions.
What is Chevron's current financial health and liquidity position?
Chevron maintains a solid financial position, with $4.0 billion in cash, cash equivalents, and marketable securities as of June 30, 2024. The Net Debt Ratio was 10.7%, indicating a healthy balance sheet. The company has access to committed credit facilities to support its liquidity needs.
06—Continue