With the way oil prices have been moving this year, it is not too surprising that oil giant Exxon Mobil (NYSE: XOM) was able to show yet another record setting quarterly profit this morning. However, despite the record setting quarter, the company still failed to meet analyst expectations.

Let’s take a look at the numbers; For the quarter, Exxon posted $2.22 per share on profits of $11.68 billion and a stunning $138 in revenue. If you want to look at it in a different way, that means that the company made profits of $1,485.55 every single second of the quarter.

Sounds great, but analysts were disappointed and were expecting to see the company come in much higher, with EPS of $2.47, and revenues of $144.4 billion.

As a result the stock is dropping today, as traders have looked past the record setting numbers, and driven shares of the company down by about 3.5% after an hours trading this morning.

The main culprit was, believe it or not, the high oil prices. For Exxon, since the company both produces it own oil, and refines it into gasoline, the record high prices that oil has reached lately have put a crimp in the company’s gasoline profit margins. Since Exxon actually buys more oil than it sells, the rising oil prices hit the company’s refining margins, since oil prices were about twice what they were during the same period last year, with gasoline prices “only” rising about 30%.

So, the boys over at Exxon can enjoy sitting back and enjoying the title of the biggest quarterly profit by a U.S. company once again, but if they want to keep a smile on their faces, they are going to have to continue to look for ways to overcome the profit margins in their refining business moving forward.

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