(Reuters) -Refiner Valero Energy posted a 86% slump in third-quarter profit on Thursday on falling refining margins, but managed to beat Wall Street expectations.

The San Antonio, Texas-based refiner reported net income attributable to stockholders of $364 million, or $1.14 per share, for the three months ended Sept. 30, below $2.6 billion, or $7.49 per share, last year in the same quarter.

However, data compiled by LSEG showed analysts had expected a profit of 98 cents.

The company's refining margins stood at $2.41 billion in the quarter, compared with $5.41 billion last year.

Refiners globally have seen a drop in profitability on soft consumer and industrial demand, especially in China, because of slowing economic growth and the rising penetration of electric vehicles.

U.S. refinery margins, measured by the 3-2-1 crack spread, dipped to $14.28 in mid-September, the lowest since early 2021, on lackluster fuel demand.

Energy majors like Exxon Mobil, BP and Shell had said earlier this month that they expected weaker refining margins to weigh on their earnings in the third quarter.

Valero's refining segment reported operating income of $565 million for the third quarter, compared with $3.4 billion a year earlier.

Revenue came in at $32.87 billion, compared with estimates of $31.13 billion, partly on higher per sales volumes for ethanol and renewable diesel.