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Exxon Mobil reported a 68% decline in third-quarter earnings Thursday as oil and natural gas prices tumbled from last year’s highs.

The world’s largest publicly traded oil company said it earned $4.73 billion in the second quarter, down 68% from $14.83 billion a year earlier. On a per-share basis, Exxon said it earned 98 cents, down from $2.85 in the third quarter of 2008.

The results were below forecasts. Analysts surveyed by Thomson Reuters were expecting earnings of $1.03 per share.

Profits fell across all of Exxon’s business units. But the larger-than-expected third-quarter decline was driven by weakness in the company’s refining business, according to Oppenheimer analyst Fadel Gheit.

“The earnings miss was largely due to weaker-than-expected downstream earnings, including a loss in the U.S., as well as higher operating costs,” Gheit wrote in a research report.

Exxon and other companies that convert crude oil into refined products such as gasoline and diesel have been squeezed as demand for fuels remains weak and oil prices have trended higher.

“We are in a very challenging environment in the refining business,” David Rosenthal, Exxon’s vice president of investor relations, said in a conference call with analysts. “The severity and depth of the downturn this year is very dramatic.”

Exxon suffered a $203 million loss in its U.S. refining business, while profits from overseas refining operations fell 74% to $528 million in the quarter.

Earnings from Exxon’s exploration and production unit were down 62% in the United States to $709 million and fell 63% overseas to $3.3 billion.

Despite ongoing weakness in fuel demand, Exxon said production rose 3% in the quarter.

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Last year, Exxon reported the largest annual profit in U.S. history, making $45.22 billion on the back of record oil prices. But the company’s earnings have declined along with oil prices as the global economy contracted.

Oil prices averaged around $68 a barrel in the third quarter, compared with an average price of $118 a barrel in the same period during 2008.

While prices remain below last year’s highs, oil has rebounded 67% so far this year as economic conditions have improved, encouraging investors to jump back into the market.

“Oil prices have actually been pretty resilient,” said Jason Gammel, an analyst who covers Exxon at Macquarie Research Equities. “Demand hasn’t resurfaced yet, but the market is building in an expectation of economic recovery next year.”

Exxon (XOM, Fortune 500) said revenue plunged to $82.26 billion in the quarter from $137.74 billion a year earlier. Analysts had forecast sales of $85.16 billion.

Capital and exploration spending fell 5% in the quarter to $6.5 billion.

The company said it invested $19 billion through the first three quarters of the year to develop new energy supplies.

“Despite ongoing global economic weakness and reduced demand for products, we continued our robust investment program and delivered strong results,” Exxon chairman Rex Tillerson said in a statement.

Shares of the Irving, Texas-based company were down 1.1% to $72.76 at midday.

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Yahoo Inc. believes a lot of its good work has been overlooked by investors and the media so it’s spending more than US$100 million to get the word out to consumers directly.

The money is going toward the Internet company’s most expensive marketing campaign since Stanford University graduate students Jerry Yang and David Filo started Yahoo’s Web site 15 years ago.

Yahoo provided a peek at the 15-month blitz Tuesday in New York.

The ads will run on television, online and other media in the United States and nine other countries where Yahoo hopes to expand on a worldwide audience that is already approaching 600 million.

Despite its extensive reach, Yahoo’s brand has been bruised in recent years as its profits sagged and many people turned to Internet search leader Google Inc. and relative newcomers like Facebook Inc. and Twitter Inc. – none of which have spend much money on self-promotion.

Yahoo’s financial struggles were magnified last year when Yang and the rest of the Sunnyvale-based company’s board spurned a $47.5 billion takeover offer from Microsoft Corp.

The rebuff alienated many Yahoo shareholders, and the missed Microsoft opportunity has remained a recurring theme in the business press because the company’s market value now is about 50 percent below Microsoft’s last takeover offer in May 2008, before the rivals ultimately agreed on a search partnership nearly two months ago.

Yahoo Chief Executive Carol Bartz, hired eight months ago to steer a turnaround, believes the company has been getting a bum rap – something she hopes to reverse with the new advertising push.

“When you get outside of New York City and Silicon Valley, everybody loves Yahoo,” Bartz said Tuesday during a press conference that was webcast.

“Why are you (the media) so cynical about us? Be cynical about frigging Google. If you don’t love us, leave us alone.”

Wall Street’s affinity for Google is driven by money.

Google’s revenue has been rising in recent years, even during the U.S. recession, largely because it dominates the Internet search market and can thus sell more text-based ads that appear on the side of search results.

Yahoo’s share of the search market has shrunk in the past few years and, more recently, the recession has made it more difficult to sell the visual ads that have long been its specialty.

Investors have rewarded Google with a market value of nearly $160 billion while Yahoo’s hovers around $24 billion.

Shares in Mountain View, California-based Google gained $2.06 to finish Tuesday at $499.06, after crossing $500 for the first time in 13 months earlier in the trading session.

Yahoo shares fell 18 cents to close at $16.86.

Yahoo’s new ads will highlight its recent efforts to give visitors more ways to customize the pages that they see on Yahoo, even if it means drawing upon material from other sites.

One ad reads: “There’s a new master of the digital universe. You.” – AP

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Are we going to see Mickey in Spiderman suit or imagine Donald Duck as Volverine…WoW !!!

The Walt Disney Co. announced Monday that it has agreed to purchase comic book and action hero company Marvel Entertainment for about $4 billion.

The deal pairs a comic book publisher that just recently began to produce its own movies with one of the largest international media companies in the world.

“This is perfect from a strategic perspective,” Disney Chief Executive Robert Iger told CNNMoney.com. “This treasure trove of over 5,000 characters offers Disney the ability to do what we do best.”

On a conference call with investors, Iger said the deal will allow Disney to sell Marvel’s vast array of characters and properties across different media platforms and in many more markets. For instance, Iger said that Disney’s Pixar animation unit was excited about the opportunities that a Marvel acquisition could yield.

“Spider-Man will appear in ‘A Bug’s Life’ sequel,” joked Barclays Capital analyst Anthony DiClemente.

The deal would give Disney some content that appeals more to boys, a market it has been looking to develop, Iger said. Disney XD, a television station and video game unit, already had a deal with Marvel to use some of the comic book company’s action heroes in its content.

“Disney is the perfect home for Marvel’s fantastic library of characters given its proven ability to expand content creation and licensing businesses,” said Marvel Chief Executive Ike Perlmutter. “This is an unparalleled opportunity for Marvel to build upon its vibrant brand and character properties by accessing Disney’s tremendous global organization and infrastructure around the world.”

Disney Chief Financial Officer Tom Staggs noted that Marvel owns the rights to many action-hero characters that are not widely known, which Disney anticipates bringing to the forefront for future movies or TV shows should the deal go through.

If Marvel shareholders approve the deal, they would receive $30 per share in cash and 0.745 shares of Disney for each share of Marvel that they hold. The deal is valued at $50 per Marvel share, more than a 29% premium, based on Friday’s closing price.

Disney said it will issue about 59 million shares as a result of a deal, but it will repurchase as many shares over the course of the 12 months following the deal’s closing.

Marvel has launched a large number of action-hero movies over the past decade, including “Spider-Man,” “X-Men,” “The Fantastic Four” and “The Incredible Hulk.”

Last summer’s “Iron Man” blockbuster earned just under $100 million over three days, the second-best non-sequel opening ever, according to Entertainment Weekly. “Iron Man” was the first Marvel movie to be fully financed and produced by the comic book company.

But Marvel still holds deals with Paramount, Sony and Fox for future movies, including several more Spider-Man films. Marvel chairman Morton Handel estimated that the company has about five more films with Paramount and intends to honor the current contracts it has with other movie studios, even if the Disney deal is inked before the contracts expire.

Marvel pays Paramount, the comic book company’s primary movie distributor, between $20 million and $60 million per movie in distribution fees, according to Barton Crockett, analyst at Lazard Capital Markets.

Crockett said Disney would likely become the sole distributor of Marvel’s movies in the future, giving it a “full plate” of movie releases, including Pixar, Marvel and its own films.

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