How has the public confused profit, profit margin for oil companies?

Question

I hear so much talk about oil companies have such large profits and that they must be charging too much for gas. But if you look at the numbers they are one of the least profitable industries.
Why does the public buy into this garbage?

According to their financial report, Exxon has a profit a margin of 10.46% for the last quarter, and 9.5% for the last year.
McDonalds over the same time has a profit margin of 14% for the quarter, and 12% for the year.
Apple computers has 11% and 12% for the same time period.

Just because a company has large sales doesnt mean anything about their prices or their actual profit.

Merck has a quarterly profit margin of 22% and annual of 33%.

Answer 1

Quite true. Actually businesses usually measure how profitable they are by comparing the amount of money they make to the amount that has been invested in the business (this is generally called return on equity, or return on invested capital) with the overall average for publicly traded companies being in the teens. At present Exxons Return on equity is a very impressive 35% or so (according to Yahoo finance). In truth Exxon is making a hell of a lot of money, but they don't control the price of oil, and if goes down, those numbers could get a lot less impressive very quickly.

Answer 2

Because ppl are woefully ignorant of economics. And it is the government's fault since the government is in charge of education. Department of Education created by Jimmy Carter and subsequently continued and even enhanced by later Presidents.
Say i own AlphaBetaGamma Inc. I buy the raw materials to produce something for a dollar. I sell that something for 2 dollars. That gives me a 100% markup. But it only gives me a 50% gross profit because it cost me a dollar to produce it. And it will cost me another dollar to produce another one. And the labor, building, tax and other sundry expenses pull my net profit down to say 38%.
My argument is, in a capitalist system - why is profit a bad thing? Isn't that why ppl go into business - to make a profit? And what percentage is too much? 100, 50, 38, 11, 2?
If you analyze the true numbers, oil and gas production is one of the LEAST profitable of all businesses - taking a back seat to pharmaceuticals, banking, automotive, insurance or retailing.

Answer 3

Simple, you have an "immoral-boob" media reporter, that is a complete idiot! If they can shove their "stupid, immoral, ignorance" down your throat, by trying to blame Exxon for their "immoral behavior"(media-boobs) then they will be able to negotaite a 25% increase in their "contract"(pay) to report the so-called news to you. In yesterdays news they "slammed" Exxon for their third quarter earnings(10.5 Billion), that is just way too much!!
They don't tell you that Exxon/Mobil had to spend 3X's that amount in all of taxes, environmental "sh*t", insurance, permits, royalties, and material, to earn that meager profit! Or when the "oil-field" goes "Bust" and the price drops to the cellar, that they(Exxon/Mobil) still have to pay taxes, royalties, environmental "sh*t" so some
''dumb-a**ed queer" can save a "stink-bush" that we can't eat or use, and it is an "eye-sore" to look at! Not too mention, that Exxon/Mobil only makes a few pennies off of every gallon of gas they produce. Over 80% of the cost goes for taxes, and environmental crap, before Exxon/Mobil can make their profit. They(Exxon/Mobil) get "Hit" with every type of tax on top of another tax, then a fee here, a fee there, and then they have to prove this and that with research that they have to pay for in order to "drill, produce, and refine" a gallon of gas on a "Lease" that could be a "Dry-Hole!" There are more "Dry-Holes" that they drill for, than a Well that just "brakes-even" for them, and they can not pass their losses on to us, like McDonalds or any other business does everyday...
Yet, these "Dumb-A**ed" media-boobs and "queer-guys" use Exxon/Mobil to further their career, and get pay raises for their own "Dum-A**es!!"
Until you say; "Dim-wit media boob" you take a 45% "pay-cut" for the "p*ss-poor" job you do everyday, so it can go to Exxon/Mobil to ease their financial burden, and help lower their operating costs even more, so the price of gas can go even lower to help The American People out, or just "Shut The Heck Up!!!"
Your trash is doing more harm, than good!!!
Be a solution, and not an obstacle to the problems at hand!!
Note: why don't the "media-boobs" ever disclose their financial earnings and pay scales of their industry??
That is none of our business, I guess!!!

Answer 4

The media definately skews statistics and blabs meaningless figures to increase the wow-factor of the public. They encourage people to mistake a lot things.

Answer 5

For starters McDonald's is not given billions of dollars in tax revenue to make sure we only eat burgers!