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AES posted Q2 adjusted EPS of 51 cents, beating estimates and rising 34.2% year over year.
Q2 revenues fell 3% year over year to $2.86B, missing estimates by nearly 13%.
AES secured 1.6 GW of PPAs with data centers, growing its total backlog to 12 GW.
The AES Corporation’s (AES - Free Report) second-quarter 2025 adjusted earnings of 51 cents per share surpassed the Zacks Consensus Estimate of 39 cents by 30.8%. The bottom line also improved 34.2% from 38 cents in the year-ago quarter.
The increase in adjusted earnings was driven by a lower adjusted tax rate and higher contributions from new renewables projects placed in service.
The company incurred a GAAP loss of 15 cents per share against GAAP earnings of 39 cents in the second quarter of 2024.
The year-over-year decline was due to higher income tax expenses, day-one losses on the commencement of sales-type leases at AES Clean Energy Development and lower earnings at the Energy Infrastructure SBU.
AES’ Total Revenues
The company’s total revenues amounted to $2.86 billion, down 3% year over year due to lower non-regulated revenues. The figure also missed the Zacks Consensus Estimate of $3.28 billion by 13.5%.
The AES Corporation Price, Consensus and EPS Surprise
The total cost of sales in the second quarter was $2.40 billion, up 0.5% year over year.
The operating income totaled $453 million, down 18.1% from $553 million in the year-ago period.
Interest expenses amounted to $352 million, down 9.5% from $389 million in the prior-year quarter.
During the second quarter of 2025, the company signed or won new long-term power-purchase agreements (PPAs) for 1.6 gigawatt (GW) of solar and wind, all with data center companies. This brought AES’ total backlog to 12 GW signed long-term PPAs, including 5.2 GW under construction.
AES’ Financial Condition
AES had cash and cash equivalents of $1.35 billion as of June 30, 2025 compared with $1.52 billion as of Dec. 31, 2024.
Non-recourse debt totaled $21.75 billion as of the same date, up from $20.63 billion as of Dec. 31, 2024.
The net cash flow from operating activities amounted to $1.52 billion during the first six months of 2025 compared with $0.68 billion in the first six months of 2024.
Total capital expenditure was $2.59 billion during the first six months of 2025, down from $3.83 billion recorded a year ago.
AES’ 2025 Guidance
AES reaffirmed its 2025 earnings guidance. It still expects to generate adjusted earnings in the range of $2.10-$2.26 per share. The Zacks Consensus Estimate is pegged at $2.14, which lies below the midpoint of the company’s guided range.
The company reaffirmed its average annual earnings growth target in the band of 7-9% through 2027.
NextEra Energy, Inc. (NEE - Free Report) reported second-quarter 2025 adjusted earnings of $1.05 per share, which topped the Zacks Consensus Estimate of $1.02 by 2.9%. The bottom line was also up nearly 9.4% year over year.
In the second quarter, NextEra Energy’s operating revenues were $6.7 billion, which missed the Zacks Consensus Estimate of $7.22 billion by 7.28%. However, the top line improved 10.4% year over year.
American Electric Power Company, Inc. (AEP - Free Report) reported second-quarter 2025 operating EPS of $1.43, which beat the Zacks Consensus Estimate of $1.28 by 11.7%. The bottom line inched up 14.4% from $1.25 recorded in the year-ago quarter.
AEP’s revenues of $5.09 billion rose 11.1% from the year-ago quarter’s level of $4.58 billion. The top line also beat the Zacks Consensus Estimate of $4.94 billion by 2.9%.
CenterPoint Energy, Inc. (CNP - Free Report) reported second-quarter 2025 adjusted earnings of 29 cents per share, which lagged the Zacks Consensus Estimate of 34 cents by 14.7%. The bottom line also declined 19.4% from the year-ago quarter’s figure of 36 cents.
CNP generated revenues of $1.94 billion, which surpassed the Zacks Consensus Estimate by a whisker. The top line also came in 2% higher than the year-ago quarter’s reported figure of $1.91 billion.
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AES Q2 Earnings Outpace Estimates, Revenues Decline Y/Y
Key Takeaways
The AES Corporation’s (AES - Free Report) second-quarter 2025 adjusted earnings of 51 cents per share surpassed the Zacks Consensus Estimate of 39 cents by 30.8%. The bottom line also improved 34.2% from 38 cents in the year-ago quarter.
The increase in adjusted earnings was driven by a lower adjusted tax rate and higher contributions from new renewables projects placed in service.
The company incurred a GAAP loss of 15 cents per share against GAAP earnings of 39 cents in the second quarter of 2024.
The year-over-year decline was due to higher income tax expenses, day-one losses on the commencement of sales-type leases at AES Clean Energy Development and lower earnings at the Energy Infrastructure SBU.
AES’ Total Revenues
The company’s total revenues amounted to $2.86 billion, down 3% year over year due to lower non-regulated revenues. The figure also missed the Zacks Consensus Estimate of $3.28 billion by 13.5%.
The AES Corporation Price, Consensus and EPS Surprise
The AES Corporation price-consensus-eps-surprise-chart | The AES Corporation Quote
Highlights of AES’ Q2 Release
The total cost of sales in the second quarter was $2.40 billion, up 0.5% year over year.
The operating income totaled $453 million, down 18.1% from $553 million in the year-ago period.
Interest expenses amounted to $352 million, down 9.5% from $389 million in the prior-year quarter.
During the second quarter of 2025, the company signed or won new long-term power-purchase agreements (PPAs) for 1.6 gigawatt (GW) of solar and wind, all with data center companies. This brought AES’ total backlog to 12 GW signed long-term PPAs, including 5.2 GW under construction.
AES’ Financial Condition
AES had cash and cash equivalents of $1.35 billion as of June 30, 2025 compared with $1.52 billion as of Dec. 31, 2024.
Non-recourse debt totaled $21.75 billion as of the same date, up from $20.63 billion as of Dec. 31, 2024.
The net cash flow from operating activities amounted to $1.52 billion during the first six months of 2025 compared with $0.68 billion in the first six months of 2024.
Total capital expenditure was $2.59 billion during the first six months of 2025, down from $3.83 billion recorded a year ago.
AES’ 2025 Guidance
AES reaffirmed its 2025 earnings guidance. It still expects to generate adjusted earnings in the range of $2.10-$2.26 per share. The Zacks Consensus Estimate is pegged at $2.14, which lies below the midpoint of the company’s guided range.
The company reaffirmed its average annual earnings growth target in the band of 7-9% through 2027.
AES’ Zacks Rank
AES currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Utility Releases
NextEra Energy, Inc. (NEE - Free Report) reported second-quarter 2025 adjusted earnings of $1.05 per share, which topped the Zacks Consensus Estimate of $1.02 by 2.9%. The bottom line was also up nearly 9.4% year over year.
In the second quarter, NextEra Energy’s operating revenues were $6.7 billion, which missed the Zacks Consensus Estimate of $7.22 billion by 7.28%. However, the top line improved 10.4% year over year.
American Electric Power Company, Inc. (AEP - Free Report) reported second-quarter 2025 operating EPS of $1.43, which beat the Zacks Consensus Estimate of $1.28 by 11.7%. The bottom line inched up 14.4% from $1.25 recorded in the year-ago quarter.
AEP’s revenues of $5.09 billion rose 11.1% from the year-ago quarter’s level of $4.58 billion. The top line also beat the Zacks Consensus Estimate of $4.94 billion by 2.9%.
CenterPoint Energy, Inc. (CNP - Free Report) reported second-quarter 2025 adjusted earnings of 29 cents per share, which lagged the Zacks Consensus Estimate of 34 cents by 14.7%. The bottom line also declined 19.4% from the year-ago quarter’s figure of 36 cents.
CNP generated revenues of $1.94 billion, which surpassed the Zacks Consensus Estimate by a whisker. The top line also came in 2% higher than the year-ago quarter’s reported figure of $1.91 billion.