Exxon Mobil Corp. (NYSE:XOM)

The financial data reveals notable fluctuations in key profitability and capital measures over the analyzed period.

Net Operating Profit After Taxes (NOPAT)

There was a significant negative NOPAT of approximately -34.1 billion USD at the end of 2020, indicating operational losses during that year. This was followed by a substantial recovery and increase to over 32.7 billion USD in 2021, further rising to 62.7 billion USD in 2022. However, in the subsequent years, NOPAT decreased to 37.9 billion USD in 2023 and then to 31.5 billion USD in 2024. This pattern suggests strong operational profitability rebound after 2020, with a peak in 2022 before a downward trend in the last two years.

Cost of Capital

The cost of capital has exhibited a gradual upward trend throughout the period. Starting at 10.94% in 2020, it increased steadily each year to 12.2% in 2021, 12.93% in 2022, 12.86% in 2023, and reached 13% by 2024. This steady rise indicates increasing capital expenses or risk premiums over time, which may impact investment evaluations and profitability assessments.

Invested Capital

Invested capital remained relatively stable between 2020 and 2021 at around 273 billion USD, before increasing to approximately 297 billion USD in 2022. The upward trend continued in 2023 with roughly 307 billion USD, and there was a pronounced increase to about 379 billion USD in 2024. This consistent growth in invested capital suggests ongoing investment and asset accumulation over this period.

Economic Profit

Economic profit was deeply negative at approximately -64.1 billion USD in 2020, reflecting substantial value destruction likely related to the negative NOPAT and rising costs relative to invested capital. By 2021, economic profit improved dramatically to near breakeven at -536 million USD. In 2022, it turned positive at 24.3 billion USD, indicating value creation during that year. However, economic profit again declined to slight negative values in 2023 (-1.6 billion USD) and further deteriorated to -17.8 billion USD in 2024. This trajectory mirrors the trends in NOPAT and cost of capital and highlights that despite strong operational profits in some years, the increasing cost of capital and growth in invested capital have strained overall economic value generation.

Overall, the data characterizes a period of operational recovery and profitability improvement following a challenging 2020, but with signs of increasing capital costs and diminishing economic profit in recent years. The growth in invested capital coupled with a rising cost of capital has constrained sustained economic value creation despite positive operational earnings in certain years.

The financial data reveals significant fluctuations in the profitability metrics over the five-year period ending December 31, 2024. Both net income and net operating profit after taxes (NOPAT) demonstrate notable volatility, reflecting changing business dynamics and external factors impacting the company.

Net Income (Loss) Attributable to ExxonMobil

The company experienced a substantial net loss in the year 2020, with a figure of negative $22.44 billion. This was followed by a strong recovery in 2021, marked by a sharp turnaround to a net income of $23.04 billion. The upward trend continued robustly into 2022, reaching a peak of $55.74 billion, which represents the highest profit in the examined period. However, the subsequent years showed a moderation in profitability, with net income declining to $36.01 billion in 2023 and further to $33.68 billion in 2024. Despite these decreases, profits remained significantly positive compared to the loss in 2020.

Net Operating Profit After Taxes (NOPAT)

Similar to net income, NOPAT followed a correlated pattern. The year 2020 registered a pronounced negative figure of $34.10 billion, indicating operational challenges and tax impacts during that period. Recovery commenced in 2021 with NOPAT switching to a positive $32.74 billion, followed by a peak in 2022 at $62.75 billion, surpassing the net income peak and underscoring efficient operational performance. Afterwards, NOPAT experienced a decline to $37.86 billion in 2023 and further contraction to $31.48 billion in 2024. These trends suggest the company maintained operational profitability after taxes but faced headwinds causing reduced returns post-2022.

Overall, the data indicates that the company underwent a significant turnaround after 2020, reflecting recovery from adverse conditions that year. The peak in 2022 represents a period of considerable profitability, although the subsequent decline in the following two years points to either reduced market conditions, increased costs, or other operational challenges. Despite the decline post-2022, the company remained profitable with both net income and NOPAT well above the negative values seen in 2020.

The financial data exhibits significant fluctuations in both income tax expense (benefit) and cash operating taxes over the observed five-year period.

Income Tax Expense (Benefit)

The income tax expense started with a substantial benefit of -5,632 million USD at the end of 2020, indicating a tax advantage or credit in that year. However, this shifted markedly in 2021, changing to a positive expense of 7,636 million USD. The upward trend continued into 2022, peaking at 20,176 million USD. Although there was a decline in 2023 to 15,429 million USD, the figure remained significantly elevated compared to 2021 and 2020. By 2024, the expense decreased slightly further to 13,810 million USD, yet maintaining a higher level than in the initial years.

Cash Operating Taxes

The cash operating taxes demonstrate a strong growth trajectory from 2,695 million USD in 2020 to 7,904 million USD in 2021. This upward momentum accelerated, reaching 16,789 million USD in 2022. Following this peak, cash operating taxes slightly declined to 14,713 million USD in 2023 but rebounded modestly to 14,916 million USD in 2024. The overall pattern suggests a multi-year increase with a peak in 2022, followed by stabilization at a high level.

Overall, both tax-related metrics indicate increased tax obligations and cash outflows in the recent years, especially from 2021 onwards. The simultaneous rise in income tax expense and cash operating taxes reflects heightened tax liabilities that stabilize but remain elevated compared to 2020 levels. The initial benefit observed in 2020 may represent one-time tax credits or adjustments, followed by normalization or growth in tax expenses consistent with business conditions in the subsequent years.

Total reported debt & leases

The total reported debt and leases exhibit a significant downward trend from 2020 to 2022, decreasing from $72,802 million to $46,787 million. This reduction suggests a strategy of debt reduction or improved liability management. From 2022 onwards, the figure stabilizes, with a slight increase to $48,188 million by 2024, indicating a relatively steady level of debt in the most recent periods.

Total ExxonMobil share of equity

Shareholder equity shows a consistent upward trend over the entire period. Starting at $157,150 million in 2020, it increases steadily each year, reaching a notable $263,705 million in 2024. This growth reflects strengthening equity positions, possibly driven by retained earnings, asset appreciation, or additional capital infusion.

Invested capital

Invested capital remains relatively stable between 2020 and 2021, with a slight slight decline from $273,920 million to $272,673 million. From 2021 onwards, invested capital steadily rises, reaching $378,995 million in 2024. This upward trend may indicate increased investments in assets or expansion initiatives to support long-term operational growth.

Overall, the financial data indicates a strategic reduction and subsequent stabilization of debt, coupled with strong growth in shareholder equity. The increase in invested capital alongside equity growth suggests ongoing investment in operational capacity supported by a solid equity base, contributing to a potentially stronger financial position over the assessed period.

Economic Profit

There is a notable fluctuation in economic profit over the five-year period. It started with a significant negative value in 2020, showing a loss of approximately 64 billion US dollars. In 2021, the loss drastically reduced to around half a billion US dollars, indicating an improvement in profitability or operational efficiency. By 2022, economic profit turned positive, reaching approximately 24 billion US dollars, which suggests that the company was generating substantial value over its capital costs during that year. However, this positive trend reversed sharply in 2023 and 2024, with economic profit again turning negative, first by about 1.6 billion and then a more considerable loss of nearly 17.8 billion US dollars in 2024, showing a deterioration in economic performance.

Invested Capital

The invested capital shows a consistent upward trend across the five-year span. Starting from roughly 274 billion US dollars in 2020, it slightly decreased in 2021 but then increased steadily each year afterward, reaching nearly 379 billion US dollars by 2024. This growth reflects continuous investment or asset accumulation.

Economic Spread Ratio

The economic spread ratio, which indicates the return over the cost of capital in percentage terms, follows a pattern similar to economic profit. It began very negative in 2020 at about -23.39%, improving significantly to nearly zero in 2021. It became positive in 2022 with an 8.19% spread, signaling that the company was earning a return above its cost of capital. Subsequently, the ratio declined into the negative again, -0.53% in 2023 and -4.69% in 2024, indicating diminished value creation relative to the invested capital.

Sales and Operating Revenue

There is a marked upward trend in sales and other operating revenue from 2020 to 2022, increasing significantly from 178,574 million USD in 2020 to 398,675 million USD in 2022. However, this growth declines in the following years, with revenues decreasing to 334,697 million USD in 2023 and stabilizing around 339,247 million USD in 2024. This pattern suggests a peak in revenue generation in 2022 followed by a contraction or stabilization phase.

Economic Profit

The economic profit shows a highly volatile pattern during the observed period. It begins with a substantial negative economic profit of -64,063 million USD in 2020, indicating significant losses or underperformance relative to capital costs. There is a sharp improvement in 2021, reaching nearly break-even at -536 million USD, followed by a positive economic profit of 24,335 million USD in 2022, suggesting a strong recovery and value creation. However, this gain is not sustained, as economic profit declines again, turning negative with -1,635 million USD in 2023 and further deteriorating to -17,788 million USD in 2024. This rebound and subsequent decline reflect fluctuations in profitability and efficiency in generating returns above the cost of capital.

Economic Profit Margin

The economic profit margin mirrors the volatility observed in absolute economic profit values. It starts with a deeply negative margin of -35.87% in 2020, improving drastically to nearly zero (-0.19%) in 2021 and becoming positive at 6.1% in 2022, which aligns with the peak in economic profit and sales revenue that year. Nonetheless, the margin declines afterward, slipping to -0.49% in 2023 and further to -5.24% in 2024, indicating a reduction in the company's ability to generate economic profit relative to revenue. This trend suggests shrinking profitability margins despite relatively stable revenue levels in the latter years.

Overall Analysis

The observed data indicates a cycle of recovery and setback over the five-year period. The company experienced significant losses initially, improved to strong profitability in 2022 coinciding with peak sales, but faced challenges in maintaining sustainable profit margins afterward. The decoupling of stable revenues and declining economic profit in the later years points to potential increases in costs, decreased operational efficiency, or other financial pressures reducing economic returns. Continuous monitoring and strategic adjustments would be necessary to restore consistent economic value creation.