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Exxon Mobil Tops Earnings Forecast Amid Activist Investor Pressure

Exxon said there is "growing public and private sector support for carbon capture as a critical enabling technology to reduce emissions and help meet society's net-zero ambitions.”

Exxon Mobil  (XOM) - Get Exxon Mobil Corporation Report posted stronger-than-expected first quarter earnings Friday, and held its capital spending plans in place, as it faces pressure from activist shareholders to accelerate its transition to lower-carbon markets.

Exxon said adjusted earnings for the three months ending in March were pegged at 64 cents per share, up from a 14 cents per share loss from the same period last year and 5 cents ahead of the Street consensus forecast.  Group revenues, Exxon said, rose 5.3% to $59.15 billion, topping analysts' estimates of $54.6 billion.

West Texas Intermediate crude prices traded in a range of between $48.30 and $61.50 per barrel over the three months ending in March, largely in-line from the trading range over the first quarter of last year.

“The strong first quarter results reflect the benefits of higher commodity prices and our focus on structural cost reductions, while prioritizing investments in assets with a low cost of supply,” said CEO Darren Woods “Cash flow from operating activities during the quarter fully covered the dividend and capital investments, and we strengthened the balance sheet by reducing debt."

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"We also made progress on our energy transition strategy by launching our new ExxonMobil Low Carbon Solutions business, which is initially working to develop innovative, large-scale carbon capture and storage (CCS) concepts, including the evaluation and advancement of more than 20 new opportunities, such as a multi-industry hub to reduce emissions from hard-to-decarbonize industries near the Houston Ship Channel," he added. "As the global leader in carbon capture, we are seeing growing public and private sector support for CCS as a critical enabling technology to reduce emissions and help meet society's net-zero ambitions.”  

Exxon Mobil shares were marked 0.12% lower in early Friday trading following the earnings release to change hands at $58.87 each.

Last week, The California Public Employees' Retirement System (CalPERS) weighed into Exxon's ongoing battle with activist investors in the Engine No. 1 hedge fund, who want the oil major to  accelerate its transition to lower-carbon strategies following its first annual loss as a public company on February 2.

CalPERs said it plans to support the hedge fund's board nominees at Exxon's annual meeting on May 26, while the company itself it hoping that recent addition -- including activist investor Jeff Ubben and former Comcast CFO Mike Angelakis -- will placate investor concerns.