DOW JONES NEWSWIRES 
 

Devon Energy Corp.'s (DVN) second-quarter earnings plunged 76% on lower commodity prices and because of the comparison with a year-ago gain from discontinued operations, but results widely beat expectations.

The oil and gas independent - it produces oil and gas but doesn't refine products - has built its business through unconventional natural gas sources, such as shale. Commodity prices, which have been volatile recently, are nonetheless down sharply from their record highs a year ago. This has hit the industry hard and forced some companies to cut spending and production.

Devon posted income of $314 million, or 70 cents a share, down from $1.3 billion, or $2.88 a share, a year earlier. The results included 4 cents a share this year and $1.57 a share last year, respectively, in earnings from discontinued operations. Excluding items including hedging losses and severance costs, the latest quarter's earnings were 85 cents.

Revenue decreased 41% to $2.09 billion.

Analysts polled by Thomson Reuters expected earnings of 59 cents and revenue of $1.92 billion.

The company does most of its business in North America. Devon shed its West African properties in 2007 and 2008, but it still has assets in China, Brazil and Azerbaijan.

Production from continuing operations rose 12% to 719,000 barrels of oil equivalent a day, which the company said was a record. Total natural gas production rose 11% as realized prices, excluding hedging effects, plunged 70%. Oil production grew 17% as prices dropped 53%.

Devon's shares closed Tuesday at $61.23 and haven't traded premarket.

-By Kerry Grace Benn, Dow Jones Newswires; 212-416-2353; kerry.benn@dowjones.com