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American Water Works' Q2 Earnings Lag, Revenues Beat Estimates
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Key Takeaways
AWK posted Q2 EPS of $1.48, missing estimates by a penny but up 4.2% year over year.
Revenues rose 11% to $1.27B, driven by rate hikes and contributions from acquired assets.
AWK narrowed 2025 EPS guidance to $5.70-$5.75 and reaffirmed 7-9% long-term earnings growth.
American Water Works Company (AWK - Free Report) posted second-quarter 2025 operating earnings per share (EPS) of $1.48, which lagged the Zacks Consensus Estimate of $1.49 by 0.7%.
The bottom line improved 4.2% from the year-ago quarter's EPS of $1.42. The year-over-year improvement in earnings was due to increased revenues from the implementation of new rates in the Regulated Businesses and contributions from acquired assets.
Total Revenues of AWK
Total quarterly revenues of $1.27 billion surpassed the Zacks Consensus Estimate of $1.15 billion by 10.6%. The top line also increased 11% from the year-ago figure of $1.14 billion.
American Water Works Company, Inc. Price, Consensus and EPS Surprise
Regulated businesses’ net revenues in the second quarter were $1.17 billion, up 11.4% year over year.
Other’s net revenues in the second quarter were $92 million, up 6.5% year over year.
Highlights of AWK’s Q2 Release
Total operating expenses for the second quarter were $787 million, up 12.4% from the year-ago quarter’s $700 million, due to an increase in operating and maintenance expenses.
The operating income was $489 million, up 8.9% from the year-ago figure of $449 million.
AWK continues to expand operations through acquisitions and organic means. As of June 30, 2025, the company added 7,600 customers through seven closed acquisitions. Another 20 pending acquisitions, when completed, will add 40,650 customers.
New rates effective since Jan. 1, 2025, will increase revenues for the full year by $270 million. As of June 30, 2025, the pending rate cases, if approved without any changes, can increase revenues by another $126 million.
Financial Highlights of AWK
Cash and cash equivalents amounted to $94 million as of June 30, 2025, compared with $96 million as of Dec. 31, 2024. Total liquidity (including cash and credit) was $1.17 billion as of June 30, which is enough to meet near-term obligations.
Total long-term debt was $12.28 billion as of June 30, 2025, down 1.9% from $12.51 billion as of Dec. 31, 2024.
In the first half of 2025, cash flow from operating activities was $632 million compared with $727 million in the year-ago period. AWK invested $1.3 billion in the first half of 2025 to strengthen its existing operations.
AWK’s Long-Term Guidance
American Water narrowed its 2025 EPS guidance to $5.70-$5.75 from the previous range of $5.65-$5.75. The Zacks Consensus Estimate of $5.71 per share is a tad lower than the midpoint of the company’s guided range. AWK reiterated long-term earnings and dividend growth in the range of 7-9%. The company plans to invest nearly $3.3 billion in 2025.
AWK reiterated its long-term capital expenditure plan to strengthen and expand existing infrastructure. For 2025-2029, capital expenditure is expected in the range of $17-$18 billion and for 2025-3034 in the band of $40-$42 billion.
Essential Utilities Inc. (WTRG - Free Report) is set to report second-quarter 2025 earnings on July 31, after the market close. The Zacks Consensus Estimate for Essential Utilities’ second-quarter EPS is pegged at 29 cents, implying an increase of 3.57% from the prior-year figure. Long-term (three to five years) earnings growth is pegged at 5.18%.
American States Water (AWR - Free Report) is set to report second-quarter 2025 earnings on Aug. 27. The Zacks Consensus Estimate for American States Water’s EPS is pinned at 92 cents, indicating an increase of 8.24% from the year-ago quarter. Long-term earnings growth is pegged at 5.65%.
Global Water Resources Inc. (GWRS - Free Report) is scheduled to report second-quarter 2025 earnings on Aug. 14. The Zacks Consensus Estimate for Global Water Resources’ EPS is pegged at 6 cents, indicating a decline of 14.3% from the year-ago quarter. Long-term earnings growth is pegged at 15%
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American Water Works' Q2 Earnings Lag, Revenues Beat Estimates
Key Takeaways
American Water Works Company (AWK - Free Report) posted second-quarter 2025 operating earnings per share (EPS) of $1.48, which lagged the Zacks Consensus Estimate of $1.49 by 0.7%.
The bottom line improved 4.2% from the year-ago quarter's EPS of $1.42. The year-over-year improvement in earnings was due to increased revenues from the implementation of new rates in the Regulated Businesses and contributions from acquired assets.
Total Revenues of AWK
Total quarterly revenues of $1.27 billion surpassed the Zacks Consensus Estimate of $1.15 billion by 10.6%. The top line also increased 11% from the year-ago figure of $1.14 billion.
American Water Works Company, Inc. Price, Consensus and EPS Surprise
American Water Works Company, Inc. price-consensus-eps-surprise-chart | American Water Works Company, Inc. Quote
AWK’s Segmental Details
Regulated businesses’ net revenues in the second quarter were $1.17 billion, up 11.4% year over year.
Other’s net revenues in the second quarter were $92 million, up 6.5% year over year.
Highlights of AWK’s Q2 Release
Total operating expenses for the second quarter were $787 million, up 12.4% from the year-ago quarter’s $700 million, due to an increase in operating and maintenance expenses.
The operating income was $489 million, up 8.9% from the year-ago figure of $449 million.
AWK continues to expand operations through acquisitions and organic means. As of June 30, 2025, the company added 7,600 customers through seven closed acquisitions. Another 20 pending acquisitions, when completed, will add 40,650 customers.
New rates effective since Jan. 1, 2025, will increase revenues for the full year by $270 million. As of June 30, 2025, the pending rate cases, if approved without any changes, can increase revenues by another $126 million.
Financial Highlights of AWK
Cash and cash equivalents amounted to $94 million as of June 30, 2025, compared with $96 million as of Dec. 31, 2024. Total liquidity (including cash and credit) was $1.17 billion as of June 30, which is enough to meet near-term obligations.
Total long-term debt was $12.28 billion as of June 30, 2025, down 1.9% from $12.51 billion as of Dec. 31, 2024.
In the first half of 2025, cash flow from operating activities was $632 million compared with $727 million in the year-ago period. AWK invested $1.3 billion in the first half of 2025 to strengthen its existing operations.
AWK’s Long-Term Guidance
American Water narrowed its 2025 EPS guidance to $5.70-$5.75 from the previous range of $5.65-$5.75. The Zacks Consensus Estimate of $5.71 per share is a tad lower than the midpoint of the company’s guided range. AWK reiterated long-term earnings and dividend growth in the range of 7-9%. The company plans to invest nearly $3.3 billion in 2025.
AWK reiterated its long-term capital expenditure plan to strengthen and expand existing infrastructure. For 2025-2029, capital expenditure is expected in the range of $17-$18 billion and for 2025-3034 in the band of $40-$42 billion.
Zacks Rank of AWK
American Water currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Upcoming Releases
Essential Utilities Inc. (WTRG - Free Report) is set to report second-quarter 2025 earnings on July 31, after the market close. The Zacks Consensus Estimate for Essential Utilities’ second-quarter EPS is pegged at 29 cents, implying an increase of 3.57% from the prior-year figure. Long-term (three to five years) earnings growth is pegged at 5.18%.
American States Water (AWR - Free Report) is set to report second-quarter 2025 earnings on Aug. 27. The Zacks Consensus Estimate for American States Water’s EPS is pinned at 92 cents, indicating an increase of 8.24% from the year-ago quarter. Long-term earnings growth is pegged at 5.65%.
Global Water Resources Inc. (GWRS - Free Report) is scheduled to report second-quarter 2025 earnings on Aug. 14. The Zacks Consensus Estimate for Global Water Resources’ EPS is pegged at 6 cents, indicating a decline of 14.3% from the year-ago quarter. Long-term earnings growth is pegged at 15%