NEW YORK - Growing is hard for a company as big as Exxon.

Exxon Mobil Corp. managed to increase earnings slightly in the first quarter thanks to surging profits from its chemical business and lower taxes.

But Exxon's makes the bulk of its profit by producing oil and natural gas. And that business slumped - again - in the first three months of the year as production and revenue declined. It was the seventh straight quarter in which production declined compared with the year earlier.

"This company has been very growth-challenged for some time," said Brian Youngberg, an analyst at Edward Jones. "If they can get to the point they could keep (production) flat investors would look very positively at that."

Shares of Exxon, the biggest energy company in the U.S., fell $1.36, or 1.5 percent, to close at $88.07 Thursday, even though its results were better than Wall Street expected.

Finding and producing enough oil and gas to replace the oil and gas sold every year is a difficult task for all of the major oil companies. That's because their production is already high, while the number of untapped oil resources is limited. Also, oil and gas companies have to be careful about investing in long-term projects because if oil and gas prices fall, those projects can quickly become money-losers.

Exxon said Thursday that its net income for the first quarter increased 0.5 percent while revenue fell 12 percent.

The company, based in Irving, Tex. reported net income of $9.5 billion, or $2.12 per share. Analysts expected earnings of $2.05 per share, according to FactSet. During last year's quarter, Exxon earned $9.45 billion, or $2 per share.

Revenue dropped to $108.8 billion from $124.1 billion.

Overall, production fell 3.5 percent. Exxon's oil production slipped 1 percent as its oil fields experienced natural declines from peak production. Production fell in Europe, Africa and Australia, but those declines were partly offset by increases in the U.S., Canada and Asia.

Exxon's revenue was also reduced by oil prices that were $8.66 per barrel lower than in last year's quarter.

Natural gas output fell 5.9 percent worldwide, driven by an 8.7 percent decline in the U.S. Exxon and other domestic gas producers cut back production starting last year after U.S. natural gas prices fell to decade-lows in the wake of the historically warm winter of 2011 - 2012.

Exxon's refining operations took advantage of lower oil prices, and the chemicals business benefited from lower natural gas prices in the U.S. compared with overseas. Exxon was able to sell those more cheaply-produced chemicals and fuels around the world at enormous profit.

"It's just a huge cost advantage," Youngberg said.

Profit at Exxon's global chemicals operation grew 62 percent in the quarter, to $639 million. U.S. refining profit grew 72 percent to $1 billion.

Exxon's results were also helped by a sharp decline in corporate and financing expenses, which Exxon attributed to "favorable tax impacts."

Exxon isn't the only big company with growing pains. Apple Inc., which has jockeyed with Exxon for the title of most valuable company, fell to second place recently as investors question its growth prospects. This comes even though Apple posted the same first-quarter profit as Exxon - $9.5 billion - but on about a third of the revenue.

Follow Jonathan Fahey at http://twitter.com/JonathanFahey .