American Electric Power Company, Inc. (NASDAQ:AEP) on Wednesday posted stronger-than-expected second-quarter results and raised its full-year GAAP earnings guidance, citing customer load growth, favorable regulatory outcomes, and capital strength across key service territories.
The Ohio-based utility reported adjusted earnings of $1.43 per share, up from $1.25 a year ago and above the Street estimate of $1.23. Revenue rose 11.1% year-over-year to $5.09 billion, ahead of the $4.84 billion analyst consensus.
GAAP earnings surged to $2.29 per share, compared to $0.64 a year earlier, primarily due to one-time regulatory and investment-related gains.
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American Electric Power reported higher second-quarter operating earnings across all core segments, with Vertically Integrated Utilities earning $296.7 million, up from $244.8 million, and Transmission & Distribution Utilities contributing $224.1 million, compared with $215.3 million a year ago.
Transmission Holdco posted operating earnings of $224.5 million, up from $208.9 million, while the Generation and Marketing segment rose to $91.7 million from $61.0 million in the prior-year period.
AEP disclosed it has secured financial commitments for 24 gigawatts of new load by the end of the decade, up from 21 GW. The company expects these additions—concentrated in Indiana, Ohio, and Texas—to lift its peak load beyond 60 GW, ranking it among the fastest-growing utilities in North America.
Planning is underway for additional transmission lines across Texas, Virginia, and West Virginia, following recent project selections by the Public Utility Commission of Texas and PJM.
To support this growth, AEP is preparing to announce a new five-year capital plan of approximately $70 billion this fall, up from its current $54 billion plan.
In June, AEP completed a transaction with KKR and PSP Investments, which jointly invested $2.82 billion for a 19.9% stake in AEP’s transmission assets in Ohio and Indiana. Combined with a $2.3 billion forward equity raise in Q1, the moves strengthen the utility’s credit profile and fund infrastructure expansion.
Outlook
AEP reaffirmed its 2025 adjusted earnings per share (EPS) guidance of $5.75 to $5.95, in line with long-term growth targets and slightly above the Wall Street consensus of $5.87. The company now expects to deliver toward the upper half of that range.
Significantly, AEP raised its full-year 2025 GAAP EPS forecast to $6.57 to $6.77, up from the prior $5.71 to $5.91 range and well ahead of the consensus estimate of $5.86. The updated range reflects items such as the sale of AEP OnSite Partners and the impact of recent federal regulatory decisions.
AEP reaffirmed its long-term operating EPS growth target of 6% to 8%, as it continues investing in grid transformation and customer-centric innovation.
Price Action: AEP shares are trading higher by 3.61% at $113.15 at last check Wednesday.
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