Exxon Mobil, the world's largest publicly traded oil company, on Thursday posted a $10.89 billion first-quarter profit, boosted by surging oil prices.
In spite of reporting net income rose 17 percent, Exxon's earnings disappointed investors because of a drop in oil production and lower refining margins.
The Irving, Texas, oil giant earned $2.03 a share for the latest quarter, up from $1.62 a share in the year-earlier period. Still, the first quarter was 11 cents short analyst estimates at Thomson Financial.
Shares were down more than $4.56 or 4.9 percent Thursday after the company missed earnings estimates by 10 cents a share.
Revenue rose to $116.85 billion from $87.22 billion in the 2007 first quarter, but despite the growth, the total revenue failed to meet expectations of around $124 billion.
The company said higher crude oil and natural gas realization - caused by record worldwide oil prices - were partly offset by lower refining and chemical margins, weaker production volumes and higher operating costs.
BP, Royal Dutch Shell and ConocoPhillips all reported big gains this week. Most of these gains came as oil prices averaged nearly $100 a barrel in the first quarter, compared with $58 in the period a year ago.
The company's combined oil and gas production fell by nearly 6 percent to 4.18 million barrels a day in the first quarter.
Deeply concerned about future energy supply, the market wants growth, growth and growth, Paul Sankey, an analyst with Deutsche Bank, wrote in a note Thursday morning. ExxonMobil does not offer that right now.
Earnings from the company's exploration and production division were up 45 percent to $8.79 billion while its refining profits dropped 39 percent to $1.17 billion.