Chevron Corporation Chairman and Chief Executive Officer John Watson was first to admit that the company’s earnings have been “down substantially,” compared to the same time last year. Hence, he believes there is an immediate need to work on improving results by changing outcomes” within the company’s control. As part of this, Watson says that the company is looking at cutting its workforce by around 6,000 to 7,000.
During this year’s third quarter, Chevron reported operating and administrative expenses decreased by as much as 7 percent, compared to the same quarter last year. However, the company is looking at continuously lowering costs and even expecting the said expenses to lower in the coming quarters. In fact, the company believes that capital and exploratory expenditures will be around 25 percent lower than this year and will total anywhere between $25 to $28 billion.
Chevron recently reported a significant decrease in sales and other operating revenues, which went from $52 billion during the third quarter of 2014 to $33 billion in the third quarter of this year. Meanwhile, Watson reports that the company is doing well on its asset sales program, generating as much as $11 billion in proceeds in the last 2 years and expecting to generate $5 to $10 billion more by the end of 2017.
Moreover, the company also reports that its U.S. upstream operations had incurred a loss of $603 million during the third quarter this year. Last year, the said upstream operations actually earned $929 million during the third quarter. Meanwhile, Chevron reported $1.2 billion in earnings for U.S. downstream operations during the third quarter. This represents a significant increase from $809 million earned from U.S. downstream operations during the same time last year.
It is still unknown which job roles will be affected by the job cuts.