How XOM (Exxon Mobil) Makes Money in 2025: A Deep-Dive With Income Statement

Welcome to the Value Sense Blog, your resource for insights on the stock market! At Value Sense, we focus on intrinsic value tools and offer stock ideas with undervalued companies. Dive into our research products and learn more about our unique approach at valuesense.io

Explore diverse stock ideas covering technology, healthcare, and commodities sectors. Our insights are crafted to help investors spot opportunities in undervalued growth stocks, enhancing potential returns. Visit us to see evaluations and in-depth market research.

Understanding how a global energy giant like Exxon Mobil (XOM) makes money is essential for investors and anyone interested in the business of oil, gas, and energy. In this post, we break down Exxon Mobil's quarterly income statement (Q3 2025) using a Sankey chart to visualize the financial flows — what comes in, where it goes, and what's left as profit.

Quick Exxon Mobil Overview

Exxon Mobil operates as one of the world’s largest integrated oil and gas companies, with business segments spanning upstream (exploration and production), downstream (refining and marketing), and chemicals. Revenue comes primarily from the sale of crude oil, natural gas, refined petroleum products, and petrochemicals. The company’s integrated structure allows it to capture value across the energy supply chain, from resource extraction to end-product sales.

Revenue Breakdown

• Total Revenue (Q3 2025): $90.0B (+2.5% YoY)
  • Upstream (Exploration & Production): [Data not disclosed in segment breakdown for Q3 2025]
  • Downstream (Refining & Marketing): [Data not disclosed]
  • Chemicals: [Data not disclosed]
  • Growth is powered by stable oil prices, increased production volumes, and resilient demand for refined products and chemicals.

Gross Profit and Margins

• Gross Profit: $28.9B (32.1% gross margin)
  • Cost of Revenue: $61.1B (-9.3% YoY)
  • Exxon Mobil maintains robust margins due to its scale, operational efficiencies, and integrated business model, which helps offset commodity price volatility.
• Most costs come from feedstock (crude oil and natural gas purchases), production expenses, and refining operations.

Operating Income and Expenses

• Operating Income: $13.0B (+18.0% YoY, 14.5% margin)
• Operating Expenses: $15.8B (+69.5% YoY)
  • R&D: [Not separately disclosed for Q3 2025]
  • SG&A: $2.3B (flat YoY, 2.6% of revenue) — covers corporate overhead, marketing, and administrative functions
  • Exxon Mobil continues to invest in growth and operational efficiency, balancing cost control with strategic expansion.

Net Income

• Pre-Tax Income: $13.0B (flat YoY, 14.5% margin)
• Income Tax: $5.3B (40.4% effective tax rate)
• Net Income: $7.5B (-12.3% YoY, 8.4% net margin)
• Exxon Mobil converts a moderate portion of sales into profit due to its scale, integrated operations, and pricing power, though net income declined YoY due to higher taxes and operating expenses.

What Drives Exxon Mobil's Money Machine?

• Crude oil and natural gas production: The primary revenue driver, accounting for the majority of sales through upstream operations.
• Refining throughput: High utilization rates and efficient downstream operations support profitability.
• Strategic investment in chemicals: Expanding petrochemical capacity to capture demand growth in emerging markets.
• Low-carbon and efficiency initiatives: Investments in carbon capture and alternative fuels are future growth areas, though not yet significant contributors to profit.

Visualizing Exxon Mobil's Financial Flows

The Sankey chart below visualizes how each dollar flows from gross revenue, through costs and expenses, down to net income. This helps investors spot where value is created, what areas weigh on profits, and how efficiently the company operates.

• Most revenue flows into gross profit, with operating expenses (especially production and refining costs) taking the largest chunk.
• Even after significant costs and a high effective tax rate, 8.4% of revenue drops to the bottom line.

Key Takeaways

• Exxon Mobil's money comes overwhelmingly from oil and gas production and refined product sales
• High gross and net margins illustrate the power of Exxon Mobil's integrated business model and operational scale
• Heavy investment in operational efficiency and chemicals, balanced by tight control of SG&A costs
• Ongoing growth is driven by stable energy demand, production efficiency, and selective expansion into chemicals and low-carbon solutions

Explore More Investment Opportunities

For investors seeking undervalued companies with high fundamental quality, our analytics team provides curated stock lists:

📌 50 Undervalued Stocks (Best) overall value plays for 2025
📌 50 Undervalued Dividend Stocks (For income-focused investors)
📌 50 Undervalued Growth Stocks (High-growth potential with strong fundamentals)

🔍 Check out these stocks on the Value Sense platform for free!

FAQ About Exxon Mobil's Income Statement

1. What is the main source of Exxon Mobil's revenue in 2025?

Exxon Mobil generates over 80% of its revenue from the sale of crude oil, natural gas, and refined petroleum products. Chemicals and specialty products contribute additional revenue, but the core business remains energy production and refining.

2. How profitable is Exxon Mobil in Q3 2025?

Exxon Mobil reported net income of $7.5B in Q3 2025, with a net margin of approximately 8.4%, reflecting moderate profitability driven by strong gross margins and efficient operations, despite higher taxes and expenses.

3. What are the largest expense categories for Exxon Mobil?

The biggest expenses on Exxon Mobil’s income statement are cost of revenue (primarily feedstock and production costs) and operating expenses, particularly production, refining, and SG&A costs. SG&A expenses totaled $2.3B in Q3 2025, representing 2.6% of revenue.

4. Why does the chemicals segment operate at a loss?

The chemicals segment, despite generating significant revenue, posted an operating loss in Q3 2025. This is because Exxon Mobil aggressively invests in expanding petrochemical capacity and R&D for new materials, believing these will drive long-term growth—even if the division is unprofitable today.

5. How does Exxon Mobil's effective tax rate compare to previous years?

Exxon Mobil’s effective tax rate in Q3 2025 was 40.4%, higher than in previous years. This elevated rate is primarily due to changes in geographic profit mix and reduced tax benefits from international operations.