U.S. energy giant Chevron Corp. (CVX – Free Report) reported weaker-than-expected fourth-quarter earnings after excluding the impacts of U.S. tax reform. The company reported adjusted earnings per share of 73 cents, lower than the Zacks Consensus Estimate of $1.27.

However, the bottom line improved significantly from the year-ago profit of 22 cents amid the recovery in oil prices and production gains. The profit growth further confirms the industry’s resurgence from the deep oil slump. As a proof of the rebound, Chevron recently hiked its quarterly dividend payments to shareholders by 4 cents to $1.12 per share.

Quarterly revenue of $37,616 million surpassed the Zacks Consensus Estimate of $37,549 million and were up 19.4% year over year.

Segment Performance

Upstream: Chevron’s total production of crude oil and natural gas increased 2.7% compared with last year’s corresponding period to 2,740 thousand oil-equivalent barrels per day (MBOE/d). The U.S. output fell 1.6% year over year to 671 MBOE/d but the company’s international operations (accounting for 76% of the total) was up 4.1% to 2,069 MBOE/d.

Apart from the core business in Gulf of Mexico and higher volumes from shale assets in the prolific Permian Basin, the rise in output could be attributed to contributions from major capital projects – Gorgon and Wheatstone in Australia as well as Angola LNG.

The rise in production was supported by higher oil realizations, the result being a healthy improvement in Chevron’s upstream segment profit – from $930 million in the year-earlier quarter to $5,291 million.

Downstream: Chevron’s downstream segment achieved earnings of $1,279 million, a massive 258.3% higher than the profit of $357 million last year. The jump primarily underlined benefit from U.S. tax reforms and increase in domestic refined product sales.

Chevron Corporation Price, Consensus and EPS Surprise