Why TotalEnergies Stock Slumped Today

Key Points

• TotalEnergies beat on revenue for the quarter, but fell short of the consensus analyst estimate for profitability.

• Not surprisingly, it was affected by the slump in global oil prices.

• 10 stocks we like better than TotalEnergies ›

The stock market wasn't particularly energetic when it came to fuel and chemicals conglomerate TotalEnergies (NYSE: TTE) on Thursday. The company's stock took a hit following its release of second-quarter earnings, and it closed the day down almost 3%. Other stocks did better, as the S&P 500 (SNPINDEX: ^GSPC) eked out a marginal gain.

Oil price slump

TotalEnergies, which is headquartered in France but reports in the energy industry's standard currency of U.S. dollars, published its latest set of financial figures that morning. The company's net revenue was slightly under $44.7 billion, comparing unfavorably to the nearly $49.2 billion it booked in the same period of 2024.

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That top-line result was more than high enough to trounce the average analyst estimate, which was a bit under $39.9 billion.

Yet the erosion in non-GAAP (generally accepted accounting principles) adjusted net income was more drastic. That critical line item fell by 21% year over year to $3.6 billion ($1.57 per share). Worse, that per-share figure was notably below the consensus pundit projection of $1.67.

TotalEnergies suffered from a general decline in oil prices, which it said slid by 10% during the quarter. It put a positive spin on its recent struggles by quoting CEO Patrick Pouyanne as saying that the company "continued to successfully execute its balanced multi-energy strategy, supported by sustained growth in hydrocarbon and electricity production."

A gloomy outlook

In TotalEnergies's outlook for the current (third) quarter, the company waxed bearish about the prospects for its industry. It said that due to geopolitical and economic developments, oil prices are volatile at the moment, with the industry coping with an "abundant" supply (which, all things being equal, tends to dampen prices).

While it forecast that it would spend a net amount of $17 billion to $17.5 billion in investments over the course of this year, it did not provide any revenue or profitability guidance in its earnings release.

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Eric Volkman has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.