SÃ O PAULO—Brazil's state-run oil firm Petró leo Brasileiro SA on Thursday reported second-quarter net income of 531 million reais ($150.2 million), much lower than analysts' expectations, weighed down by slumping oil prices and a hefty tax settlement with the Brazilian government.

The company's net income fell almost 90% compared with the same quarter a year ago. The company's revenue totaled 79.94 billion reais in the quarter, down 3% from the same period in 2014. Earnings before interest, taxes, depreciation and amortization, or Ebitda, increased 21.7% to 19.77 billion reais in the second quarter.

Petrobras took a 1.6 billion reais charge reflecting back taxes and fines paid to settle a tax dispute with Brazilian authorities. Brazil's tax appeals board ruled in July that the company owed a financial transactions tax on loans made to foreign subsidiaries in 2008.

Petrobras shares were up 3.3% at 10.34 reais in after-hours trading in Sã o Paulo.

Write to Will Connors at william.connors@wsj.com and Luciana Magalhaes at Luciana.Magalhaes@dowjones.com

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