Exxon Mobil Corp 10-Q

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS Overview During the first quarter of 2025, the price of crude oil remained roughly flat relative to fourth quarter 2024 and near the middle of the 10-year historical range (2010-2019). Natural gas prices improved during the quarter and moved above the 10-year range on stronger global demand, driven by colder weather in the U.S. and Europe. Global industry refining margins declined and moved below the low end of the 10-year range, driven by weakness in Asia Pacific from capacity additions and higher regional feed costs. The Corporation benefited from its relatively large refining footprint in North America where industry margins improved as a result of turnarounds and industry outages. Chemical margins remained at bottom of cycle conditions, and well below the 10-year range, as growing demand was met by continued capacity additions. During 2025, the U.S. announced a variety of trade-related actions, including the imposition of tariffs on imports from several countries. In response, many countries announced their own retaliatory tariffs. Certain tariffs were paused for a period of time but have not been withdrawn. The global trade environment continues to be volatile. The likelihood of the U.S. or its trading partners resuming tariffs, imposing new or reciprocal tariffs, export restrictions, or other forms of trade-related sanctions is highly uncertain. Additionally, significant uncertainty exists as to what effects these actions will ultimately have on the Corporation, our suppliers and our customers, as well as on the overall macroeconomic environment. We continually monitor the global trade environment and work to mitigate potential impacts. Selected Earnings Driver Definitions The earnings drivers provide additional visibility into our business results. The Company evaluates these drivers periodically to determine if any enhancements may provide helpful insights to the market. Listed below are descriptions of the earnings drivers: Advantaged Volume Growth. Represents earnings impacts from change in volume/mix from advantaged assets, advantaged projects, and high-value products. • Advantaged Assets (Advantaged growth projects). Includes Permian, Guyana, and LNG. • Advantaged Projects. Includes capital projects and programs of work that contribute to Energy, Chemical, and/or Specialty Products segments that drive integration of segments/businesses, increase yield of higher value products, or deliver higher than average returns. • High-Value Products. Includes performance products and lower-emission fuels. Performance products (performance chemicals, performance lubricants) refers to products that provide differentiated performance for multiple applications through enhanced properties versus commodity alternatives and bring significant additional value to customers and end-users. Lower-emission fuels refers to fuels with lower life cycle emissions than conventional transportation fuels for gasoline, diesel and jet transport. Base Volume. Represents all volume/mix drivers not included in Advantaged Volume Growth defined above. Structural Cost Savings. Represents after-tax earnings effects of Structural Cost Savings as defined on page 19 , including cash operating expenses related to divestments. Expenses. Represents all expenses otherwise not included in other earnings drivers. Timing Effects. Represents timing effects that are primarily related to unsettled derivatives (mark-to-market) and other earnings impacts driven by timing differences between the settlement of derivatives and their offsetting physical commodity realizations (due to LIFO inventory accounting). 17 Table of Contents Earnings (loss) excluding Identified Items (Non-GAAP) Earnings (loss) excluding Identified Items are earnings (loss) excluding individually significant non-operational events with, typically, an absolute corporate total earnings impact of at least $250 million in a given quarter. The earnings (loss) impact of an Identified Item for an individual segment may be less than $250 million when the item impacts several segments or several periods. Earnings (loss) excluding Identified Items does include non-operational earnings events or impacts that are generally below the $250 million threshold utilized for Identified Items. Management uses these figures to improve comparability of the underlying business across multiple periods by isolating and removing significant non-operational events from business results. The Corporation believes this view provides investors increased transparency into business results and trends, and provides investors with a view of the business as seen through the eyes of management. Earnings (loss) excluding Identified Items is not meant to be viewed in isolation or as a substitute for net income (loss) attributable to ExxonMobil as prepared in accordance with U.S. GAAP. Three Months Ended March 31, 2025 Upstream Energy Products Chemical Products Specialty Products Corporate and Financing Total (millions of dollars) U.S. Non-U.S. U.S. Non-U.S. U.S. Non-U.S. U.S. Non-U.S. Earnings (loss) (U.S. GAAP) 1,870 4,886 297 530 255 18 322 333 (798) 7,713 Total Identified Items — — — — — — — — — — Earnings (loss) excluding Identified Items (Non-GAAP) 1,870 4,886 297 530 255 18 322 333 (798) 7,713 Three Months Ended March 31, 2024 Upstream Energy Products Chemical Products Specialty Products Corporate and Financing Total (millions of dollars) U.S. Non-U.S. U.S. Non-U.S. U.S. Non-U.S. U.S. Non-U.S. Earnings (loss) (U.S. GAAP) 1,054 4,606 836 540 504 281 404 357 (362) 8,220 Total Identified Items — — — — — — — — — — Earnings (loss) excluding Identified Items (Non-GAAP) 1,054 4,606 836 540 504 281 404 357 (362) 8,220 References in this discussion to Corporate earnings (loss) mean net income (loss) attributable to ExxonMobil (U.S. GAAP) from the Condensed Consolidated Statement of Income. Unless otherwise indicated, references to earnings (loss); Upstream, Energy Products, Chemical Products, Specialty Products, and Corporate and Financing earnings (loss); and earnings (loss) per share are ExxonMobil's share after excluding amounts attributable to noncontrolling interests. Due to rounding, numbers presented may not add up precisely to the totals indicated. 18 Table of Contents Structural Cost Savings (Non-GAAP) Structural Cost Savings describes decreases in cash opex excluding energy and production taxes as a result of operational efficiencies, workforce reductions, divestment-related reductions, and other cost-savings measures that are expected to be sustainable compared to 2019 levels. Relative to 2019, estimated cumulative Structural Cost Savings totaled $12.7 billion, which included an additional $0.6 billion in the first three months of 2025. The total change between periods in expenses below will reflect both Structural Cost Savings and other changes in spend, including market factors, such as inflation and foreign exchange impacts, as well as changes in activity levels and costs associated with new operations, mergers and acquisitions, new business venture development, and early-stage projects. Structural Cost Savings from new operations, mergers and acquisitions, and new business venture developments are included in the cumulative Structural Cost Savings. Estimates of cumulative annual structural savings may be revised depending on whether cost reductions realized in prior periods are determined to be sustainable compared to 2019 levels. Structural Cost Savings are stewarded internally to support management's oversight of spending over time. This measure is useful for investors to understand the Corporation's efforts to optimize spending through disciplined expense management. Dollars in billions (unless otherwise noted) Twelve Months Ended December 31, Three Months Ended March 31, 2019 2024 2024 2025 Components of Operating Costs From ExxonMobil’s Consolidated Statement of Income (U.S. GAAP) Production and manufacturing expenses 36.8 39.6 9.1 10.1 Selling, general and administrative expenses 11.4 10.0 2.5 2.5 Depreciation and depletion (includes impairments) 19.0 23.4 4.8 5.7 Exploration expenses, including dry holes 1.3 0.8 0.1 0.1 Non-service pension and postretirement benefit expense 1.2 0.1 — 0.1 Subtotal 69.7 74.0 16.5 18.5 ExxonMobil’s share of equity company expenses (Non-GAAP) 9.1 9.6 2.4 2.6 Total Adjusted Operating Costs (Non-GAAP) 78.8 83.6 18.9 21.1 Total Adjusted Operating Costs (Non-GAAP) 78.8 83.6 18.9 21.1 Less: Depreciation and depletion (includes impairments) 19.0 23.4 4.8 5.7 Non-service pension and postretirement benefit expense 1.2 0.1 — 0.1 Other adjustments (includes equity company depreciation and depletion) 3.6 3.7 0.9 1.3 Total Cash Operating Expenses (Cash Opex) (Non-GAAP) 55.0 56.4 13.2 14.1 Energy and production taxes (Non-GAAP) 11.0 13.9 3.4 3.9 Total Cash Operating Expenses (Cash Opex) excluding Energy and Production Taxes (Non-GAAP) 44.0 42.5 9.8 10.2 Change vs 2019 Change vs 2024 Estimated Cumulative vs 2019 Total Cash Operating Expenses (Cash Opex) excluding Energy and Production Taxes (Non-GAAP) -1.5 +0.4 Market +4.0 +0.0 Activity / Other +6.6 +1.0 Structural Cost Savings -12.1 -0.6 -12.7 Due to rounding, numbers presented may not add up precisely to the totals indicated. 19 Table of Contents REVIEW OF FIRST QUARTER 2025 RESULTS ExxonMobil’s first quarter 2025 earnings were $7.7 billion, compared to $8.2 billion a year earlier. The decrease in earnings was mainly driven by a significant decline in industry refining margins, weaker crude prices, lower base volumes from divestments, and higher expenses driven by growth initiatives, partly offset by increased volumes from advantaged Upstream investments in the Permian and Guyana, favorable timing effects from derivatives mark-to-market impacts and Structural Cost Savings. Cash capital expenditures were $5.9 billion, up $0.7 billion from first quarter 2024. UPSTREAM Upstream Financial Results (millions of dollars) Three Months Ended March 31, 2025 2024 Earnings (loss) (U.S. GAAP) United States 1,870 1,054 Non-U.S. 4,886 4,606 Total 6,756 5,660 Earnings (loss) excluding Identified Items (1) (Non-GAAP) United States 1,870 1,054 Non-U.S. 4,886 4,606 Total 6,756 5,660 (1) Refer to page 18 for definition of Identified Items and earnings (loss) excluding Identified Items. Upstream First Quarter Earnings Driver Analysis (millions of dollars) Price – Price impacts decreased earnings by $450 million, driven by a decrease in liquids realizations, partly offset by an increase in natural gas realizations. Advantaged Volume Growth – Higher volumes from advantaged assets increased earnings by $920 million, driven by growing production in Permian, including the Pioneer acquisition, and Guyana. Base Volume – Base volumes from divestments decreased earnings by $180 million. Structural Cost Savings – Increased earnings by $310 million. Expenses – Higher expenses decreased earnings by $180 million from higher depreciation. Other – All other items increased earnings by $400 million, mainly driven by divestments. Timing Effects – Favorable timing effects, mainly from derivatives mark-to-market impacts, increased earnings by $280 million. 20 Table of Contents Upstream Operational Results Three Months Ended March 31, 2025 2024 Net production of crude oil, natural gas liquids, bitumen and synthetic oil (thousands of barrels daily) United States 1,418 816 Canada/Other Americas 760 772 Europe 4 4 Africa 137 224 Asia 796 711 Australia/Oceania 24 30 Worldwide 3,139 2,557 Net natural gas production available for sale (millions of cubic feet daily) United States 3,266 2,241 Canada/Other Americas 42 94 Europe 331 377 Africa 118 150 Asia 3,457 3,274 Australia/Oceania 1,256 1,226 Worldwide 8,470 7,362 Oil-equivalent production (1) (thousands of oil-equivalent barrels daily) 4,551 3,784 (1) Natural gas is converted to an oil-equivalent basis at six million cubic feet per one thousand barrels. 21 Table of Contents Upstream Additional Information (thousands of barrels daily) Three Months Ended March 31, Volumes reconciliation (Oil-equivalent production) (1) 2024 3,784 Entitlements - Net Interest — Entitlements - Price / Spend / Other 4 Government Mandates (4) Divestments (122) Growth / Other 889 2025 4,551 (1) Natural gas is converted to an oil-equivalent basis at six million cubic feet per one thousand barrels. Due to rounding, numbers presented may not add up precisely to the totals indicated. 1Q 2025 versus 1Q 2024 1Q 2025 production of 4.6 million oil-equivalent barrels per day increased 767 thousand oil-equivalent barrels per day from 1Q 2024, driven by the Pioneer acquisition. Listed below are descriptions of ExxonMobil’s volumes reconciliation drivers which are provided to facilitate understanding of the terms. Entitlements - Net Interest are changes to ExxonMobil’s share of production volumes caused by non-operational changes to volume-determining drivers. These drivers consist of net interest changes specified in Production Sharing Contracts (PSCs), which typically occur when cumulative investment returns or production volumes achieve defined thresholds, changes in equity upon achieving pay-out in partner investment carry situations, equity redeterminations as specified in venture agreements, or as a result of the termination or expiry of a concession. Once a net interest change has occurred, it typically will not be reversed by subsequent events, such as lower crude oil prices. Entitlements - Price, Spend and Other are changes to ExxonMobil’s share of production volumes resulting from temporary changes to non-operational volume-determining drivers. These drivers include changes in oil and gas prices or spending levels from one period to another. According to the terms of contractual arrangements or government royalty regimes, price or spending variability can increase or decrease royalty burdens and/or volumes attributable to ExxonMobil. For example, at higher prices, fewer barrels are required for ExxonMobil to recover its costs. These effects generally vary from period to period with field spending patterns or market prices for oil and natural gas. Such drivers can also include other temporary changes in net interest as dictated by specific provisions in production agreements. Government Mandates are changes to ExxonMobil's sustainable production levels as a result of production limits or sanctions imposed by governments. Divestments are reductions in ExxonMobil’s production arising from commercial arrangements to fully or partially reduce equity in a field or asset in exchange for financial or other economic consideration. Growth and Other comprise all other operational and non-operational drivers not covered by the above definitions that may affect volumes attributable to ExxonMobil. Such drivers include, but are not limited to, production enhancements from project and work program activities, acquisitions including additions from asset exchanges, downtime, market demand, natural field decline, and any fiscal or commercial terms that do not affect entitlements. 22 Table of Contents ENERGY PRODUCTS Energy Products Financial Results (millions of dollars) Three Months Ended March 31, 2025 2024 Earnings (loss) (U.S. GAAP) United States 297 836 Non-U.S. 530 540 Total 827 1,376 Earnings (loss) excluding Identified Items (1) (Non-GAAP) United States 297 836 Non-U.S. 530 540 Total 827 1,376 (1) Refer to page 18 for definition of Identified Items and earnings (loss) excluding Identified Items. Energy Products First Quarter Earnings Driver Analysis (millions of dollars) Margin – Industry refining margins decreased earnings by $1,290 million, normalizing from historically high levels. Advantaged Volume Growth – Higher volumes from advantaged projects increased earnings by $10 million. Base Volume – Lower base volumes decreased earnings by $70 million. Structural Cost Savings – Increased earnings by $110 million. Expenses – Lower expenses increased earnings by $60 million. Other – All other items increased earnings by $200 million, reflecting favorable forex and inventory impacts. Timing Effects – Favorable timing effects, mainly from the absence of prior year unfavorable derivatives mark-to-market impacts, increased earnings by $430 million. 23 Table of Contents Energy Products Operational Results (thousands of barrels daily) Three Months Ended March 31, 2025 2024 Refinery throughput United States 1,789 1,900 Canada 397 407 Europe 986 954 Asia Pacific 447 402 Other 191 180 Worldwide 3,810 3,843 Energy Products sales (1) United States 2,728 2,576 Non-U.S. 2,555 2,656 Worldwide 5,283 5,232 Gasoline, naphthas 2,162 2,178 Heating oils, kerosene, diesel 1,724 1,742 Aviation fuels 366 339 Heavy fuels 158 214 Other energy products 873 759 Worldwide 5,283 5,232 (1) Data reported net of purchases/sales contracts with the same counterparty. Due to rounding, numbers presented may not add up precisely to the totals indicated. CHEMICAL PRODUCTS Chemical Products Financial Results (millions of dollars) Three Months Ended March 31, 2025 2024 Earnings (loss) (U.S. GAAP) United States 255 504 Non-U.S. 18 281 Total 273 785 Earnings (loss) excluding Identified Items (2) (Non-GAAP) United States 255 504 Non-U.S. 18 281 Total 273 785 (2) Refer to page 18 for definition of Identified Items and earnings (loss) excluding Identified Items. 24 Table of Contents Chemical Products First Quarter Earnings Driver Analysis (millions of dollars) Margin – Weaker margins decreased earnings by $290 million, driven by higher feed costs in North America. Advantaged Volume Growth – High-value product sales growth increased earnings by $10 million. Base Volume – Lower base volumes decreased earnings by $70 million, driven by absence of prior year opportunistic sales. Structural Cost Savings – Increased earnings by $30 million. Expenses – Higher spend on advantaged projects and turnaround activity decreased earnings by $130 million. Other – All other items decreased earnings by $60 million. Chemical Products Operational Results (thousands of metric tons) Three Months Ended March 31, 2025 2024 Chemical Products sales (1) United States 1,706 1,847 Non-U.S. 3,070 3,207 Worldwide 4,776 5,054 (1) Data reported net of purchases/sales contracts with the same counterparty. 25 Table of Contents SPECIALTY PRODUCTS Specialty Products Financial Results (millions of dollars) Three Months Ended March 31, 2025 2024 Earnings (loss) (U.S. GAAP) United States 322 404 Non-U.S. 333 357 Total 655 761 Earnings (loss) excluding Identified Items (1) (Non-GAAP) United States 322 404 Non-U.S. 333 357 Total 655 761 (1) Refer to page 18 for definition of Identified Items and earnings (loss) excluding Identified Items. Specialty Products First Quarter Earnings Driver Analysis (millions of dollars) Margin – Stronger margins increased earnings by $10 million. Advantaged Volume – Earnings remained flat. Base Volume – Lower base volumes decreased earnings by $30 million. Structural Cost Savings – Increased earnings by $40 million. Expenses – Higher expenses mainly related to new product development costs, decreased earnings by $70 million. Other – All other items decreased earnings by $60 million, mainly driven by unfavorable forex effects. 26 Table of Contents Specialty Products Operational Results (thousands of metric tons) Three Months Ended March 31, 2025 2024 Specialty Products sales (1) United States 473 495 Non-U.S. 1,463 1,464 Worldwide 1,936 1,959 (1) Data reported net of purchases/sales contracts with the same counterparty. Due to rounding, numbers presented may not add up precisely to the totals indicated. CORPORATE AND FINANCING Corporate and Financing Financial Results (millions of dollars) Three Months Ended March 31, 2025 2024 Earnings (loss) (U.S. GAAP) (798) (362) Earnings (loss) excluding Identified Items (2) (Non-GAAP) (798) (362) (2) Refer to page 18 for definition of Identified Items and earnings (loss) excluding Identified Items. Corporate and Financing expenses were $798 million for the first quarter of 2025, $436 million higher than the first quarter of 2024, due to lower interest income, unfavorable foreign exchange effects and increased pension-related expenses. 27 Table of Contents LIQUIDITY AND CAPITAL RESOURCES (millions of dollars) Three Months Ended March 31, 2025 2024 Net cash provided by/(used in) Operating activities 12,953 14,664 Investing activities (4,135) ( 4,577 ) Financing activities (13,579) ( 7,982 ) Effect of exchange rate changes 86 ( 324 ) Increase/(decrease) in cash and cash equivalents (4,675) 1,781 Cash and cash equivalents (at end of period) 18,512 33,349 Cash flow from operations and asset sales Net cash provided by operating activities (U.S. GAAP) 12,953 14,664 Proceeds associated with sales of subsidiaries, property, plant & equipment, and sales and returns of investments 1,823 703 Cash flow from operations and asset sales (Non-GAAP) 14,776 15,367 Because of the ongoing nature of our asset management and divestment program, we believe it is useful for investors to consider proceeds associated with asset sales together with cash provided by operating activities when evaluating cash available for investment in the business and financing activities, including shareholder distributions. Cash flow from operations and asset sales in the first quarter of 2025 was $14.8 billion, a decrease of $0.6 billion from the comparable 2024 period primarily due to unfavorable working capital. Cash provided by operating activities totaled $13.0 billion for the first three months of 2025, $1.7 billion lower than 2024. Net income including noncontrolling interests was $8.0 billion, a decrease of $0.5 billion from the prior year period. The adjustment for the noncash provision of $5.7 billion for depreciation and depletion was up $0.9 billion from 2024. Changes in operational working capital were a reduction of $0.9 billion during the period. All other items net increased cash flows by $96 million in 2025 versus a decrease of $0.7 billion in 2024. See the Condensed Consolidated Statement of Cash Flows for additional details. Investing activities for the first three months of 2025 used net cash of $4.1 billion, a decrease of $0.4 billion compared to the prior year. Spending for additions to property, plant and equipment of $5.9 billion was $0.8 billion higher than 2024. Proceeds from asset sales were $1.8 billion, an increase of $1.1 billion compared to the prior year. Net investments and advances decreased $0.1 billion from $0.2 billion in 2024. Net cash used in financing activities was $13.6 billion in the first three months of 2025, including $4.8 billion for the purchase of 43.4 million shares of ExxonMobil stock, as part of the previously announced buyback program. This compares to net cash used in financing activities of $8.0 billion in the prior year. Total debt at the end of the first quarter of 2025 was $37.6 billion compared to $41.7 billion at year-end 2024. The Corporation's debt to total capital ratio was 12.2 percent at the end of the first quarter of 2025 compared to 13.4 percent at year-end 2024. The net debt to capital ratio (1) was 7.1 percent at the end of the first quarter, an increase of 0.6 percentage points from year-end 2024. The Corporation's capital allocation priorities are investing in competitively advantaged, high-return projects; maintaining a strong balance sheet; and sharing our success with our shareholders through more consistent share repurchases and a growing dividend. The Corporation distributed a total of $4.3 billion to shareholders in the first three months of 2025 through dividends. The Corporation has access to significant capacity of long-term and short-term liquidity. Internally generated funds are expected to cover the majority of financial requirements, supplemented by long-term and short-term debt. The Corporation had undrawn short-term committed lines of credit of $0.2 billion and undrawn long-term committed lines of credit of $1.0 billion as of the end of first quarter 2025. The Corporation, as part of its ongoing asset management program, continues to evaluate its mix of assets for potential upgrade. Because of the ongoing nature of this program, dispositions will continue to be made from time to time which will result in either gains or losses. Additionally, the Corporation continues to evaluate opportunities to enhance its business portfolio through acquisitions of assets or companies, and enters into such transactions from time to time. Key criteria for evaluating acquisitions include strategic fit, cost synergies, potential for future growth, low cost of supply, and attractive valuations. Acquisitions may be made with cash, shares of the Corporation’s common stock, or both. Litigation and other contingencies are discussed in Note 3 to the unaudited condensed consolidated financial statements. (1) Net debt is total debt of $37.6 billion less $17.0 billion of cash and cash equivalents excluding restricted cash . Net debt to capital ratio is net debt divided by net debt plus total equity of $269.8 billion. Total debt is the sum of notes and loans payable and long-term debt, as reported in the consolidated balance sheet. 28 Table of Contents TAXES (millions of dollars) Three Months Ended March 31, 2025 2024 Income taxes 3,567 3,803 Effective income tax rate 34 % 36 % Total other taxes and duties (1) 7,066 7,160 Total 10,633 10,963 (1) Includes “Other taxes and duties” plus taxes that are included in “Production and manufacturing expenses” and “Selli ng, general and administrative expenses”, each from the Consolidated Statement of Income. Total taxes were $10.6 billion for the first quarter of 2025, a decrease of $0.3 billion from 2024. Income tax expense was $3.6 billion compared to $3.8 billion in the prior year. The effective income tax rate, which is calculated based on consolidated company income taxes and ExxonMobil's share of equity company income taxes, was 34 percent. This decreased from the 36 percent rate in the prior year period due primarily to a change in mix of results in jurisdictions with varying tax rates. Total other taxes and duties decreased by $0.1 billion to $7.1 billion. CASH CAPITAL EXPENDITURES (Non-GAAP) Cash capital expenditures (Cash Capex) is the sum of Additions to property, plant and equipment; Additional investments and advances; and Other investing activities including collection of advances; reduced by Inflows from noncontrolling interests for major projects, each from the Consolidated Statement of Cash Flows. This measure is useful for investors to understand the current period cash impact of investments in the business. (millions of dollars) Three Months Ended March 31, 2025 2024 Additions to property, plant and equipment 5,898 5,074 Additional investments and advances 153 421 Other investing activities including collection of advances (93) (215) Inflows from noncontrolling interests for major projects (22) (12) Total Cash Capex (Non-GAAP) 5,936 5,268 Cash capex in the first quarter of 2025 was $5.9 billion, up $0.7 billion from the first quarter of 2024. (millions of dollars) Three Months Ended March 31, 2025 2024 Upstream 4,993 4,105 Energy Products 378 517 Chemical Products 291 340 Specialty Products 110 80 Other 164 226 Total Cash Capex (Non-GAAP) 5,936 5,268 The Corporation plans to invest in the range of $27 billion to $29 billion in 2025. Actual spending could vary depending on the progress of individual projects and property acquisitions. 29 Table of Contents FORWARD-LOOKING STATEMENTS Statements related to future events; projections; descriptions of strategic, operating, and financial plans and objectives; statements of future ambitions and plans; future earnings power; potential addressable markets; and other statements of future events or conditions are forward-looking statements. Similarly, discussion of future plans related to carbon capture, transportation and storage, lower-emission fuels, hydrogen, ammonia, direct air capture, Proxxima TM systems, carbon materials, lithium, low-carbon data centers, and other future plans to reduce emissions and emission intensity of ExxonMobil, its affiliates, and third parties are dependent on future market factors, such as continued technological progress, stable policy support and timely rule-making and permitting, and represent forward-looking statements. Actual future results, including financial and operating performance; potential earnings, cash flow, dividends or shareholder returns, including the timing and amounts of share repurchases; total capital expenditures and mix, including allocations of capital to low carbon and other new investments; realization and maintenance of structural cost reductions and efficiency gains, including the ability to offset inflationary pressure; plans to reduce future emissions and emissions intensity, including ambitions to reach Scope 1 and Scope 2 net zero from operated assets by 2050, to reach Scope 1 and 2 net zero in heritage Permian Basin unconventional operated assets by 2030 and in Pioneer Permian assets by 2035, to eliminate routine flaring in-line with World Bank Zero Routine Flaring, to reach near-zero methane emissions from operated assets and other methane initiatives; and to meet ExxonMobil’s emission reduction plans and goals, divestment and start-up plans, and associated project plans as well as technology advances, including the timing and outcome of projects to capture, transport and store CO 2 , produce hydrogen and ammonia, produce lower-emission fuels, produce Proxxima TM systems, produce carbon materials, produce lithium, and use plastic waste as feedstock for advanced recycling; future debt levels and credit ratings; business and project plans, timing, costs, capacities and profitability; resource recoveries and production rates; and planned Denbury and Pioneer integrated benefits, could differ materially due to a number of factors. These include global or regional changes in the supply and demand for oil, natural gas, petrochemicals, and feedstocks and other market factors; economic conditions and seasonal fluctuations that impact prices and differentials for our products; developments or changes in local, national, or international laws, regulations, taxes, trade sanctions, trade tariffs, or policies affecting our business, such as government policies supporting lower carbon and new market investment opportunities, the punitive European taxes on the oil and gas sector and unequal support for different technological methods of emissions reduction or evolving, ambiguous and unharmonized standards imposed by various jurisdictions related to sustainability and greenhouse gas reporting; timely granting of governmental permits and certifications; uncertain impacts of deregulation on the legal and regulatory environment; variable impacts of trading activities on our margins and results each quarter; actions of co-venturers, competitors and commercial counterparties; the outcome of commercial negotiations, including final agreed terms and conditions; the outcome of competitive bidding and project awards; the ability to access debt markets on favorable terms or at all; the occurrence, pace, rate of recovery and effects of public health crises; adoption of regulatory incentives consistent with law; reservoir performance, including variability and timing factors applicable to unconventional resources and the success of new unconventional technologies; the level, outcome, and timing of exploration and development projects and decisions to invest in future reserves and resources; timely completion of construction projects; final management approval of future projects and any changes in the scope, terms, costs or assumptions of such projects as approved; the actions of government or other actors against our core business activities and acquisitions, divestitures or financing opportunities; war, civil unrest, attacks against the Company or industry, and other geopolitical or security disturbances, including disruption of land or sea transportation routes; decoupling of economies, realignment of global trade and supply chain networks, and disruptions in military alliances; expropriations, seizure, or capacity, insurance, shipping, import or export limitations imposed by governments or laws; opportunities for potential acquisitions, investments or divestments and satisfaction of applicable conditions to closing, including timely regulatory approvals; the capture of efficiencies within and between business lines and the ability to maintain near-term cost reductions as ongoing efficiencies without impairing our competitive positioning; unforeseen technical or operating difficulties and unplanned maintenance; the development and competitiveness of alternative energy and emission reduction technologies; consumer preferences including willingness and ability to pay for reduced emission products; the results of research programs and the ability to bring new technologies to commercial scale on a cost-competitive basis; and other factors discussed under "Item 1A. Risk Factors" of ExxonMobil’s 2024 Form 10-K. Forward-looking and other statements regarding environmental and other sustainability efforts and aspirations are not an indication that these statements are material to investors or require disclosure in our filing with the SEC or any other regulatory authority. In addition, historical, current, and forward-looking environmental and other sustainability-related statements may be based on standards for measuring progress that are still developing, internal controls and processes that continue to evolve, and assumptions that are subject to change in the future, including future rule-making. 30 Table of Contents Actions needed to advance ExxonMobil’s 2030 greenhouse gas emission-reductions plans are incorporated into its medium-term business plans, which are updated annually. The reference case for planning beyond 2030 is based on the Company’s Global Outlook (Outlook) research and publication. The Outlook is reflective of the existing global policy environment and an assumption of increasing policy stringency and technology improvement to 2050. Current trends for policy stringency and development of lower-emission solutions are not yet on a pathway to achieve net-zero by 2050. As such, the Outlook does not project the degree of required future policy and technology advancement and deployment for the world, or ExxonMobil, to meet net zero by 2050. As future policies and technology advancements emerge, they will be incorporated into the Outlook, and ExxonMobil’s business plans will be updated accordingly. References to projects or opportunities may not reflect investment decisions made by ExxonMobil or its affiliates. Individual projects or opportunities may advance based on a number of factors, including availability of stable and supportive policy, permitting, technological advancement for cost-effective abatement, insights from the Company planning process, and alignment with our partners and other stakeholders. Capital investment guidance in lower-emission investments is based on our Corporate plan; however, actual investment levels will be subject to the availability of the opportunity set, public policy support, and focused on returns. The term “project” as used in this report can refer to a variety of different activities and does not necessarily have the same meaning as in any government payment transparency reports. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK Information about market risks for the three months ended March 31, 2025, does not differ materially from that discussed under Item 7A of the registrant's Annual Report on Form 10-K for 2024.