Financial Data and Key Metrics Changes - American Electric Power reported third quarter 2025 operating earnings of $1.80 per share, a decrease from $1.85 per share in the same period last year, primarily due to the prior year's sale of the onsite partners' distributed resources business [22] - Year-to-date operating earnings totaled $4.78 per share, up from $4.38 per share in 2024, representing an increase of approximately 9% year over year [23] - The company reaffirmed its 2025 full-year operating earnings range of $5.75 to $5.95 per share, guiding to the upper half of this range [7] Business Line Data and Key Metrics Changes - Significant commercial and industrial load growth of nearly 8% on a rolling 12-month basis as of September 30, 2025, compared to the same period last year [23] - The generation and marketing segment's performance was impacted by the prior year sale of the distributed resources business, but favorable energy margins helped support overall results [24] Market Data and Key Metrics Changes - AEP projects a system peak demand of 65 gigawatts by 2030, with a load growth of almost 76% in the next five years, driven by data centers and reshoring of manufacturing [9] - The company secured 28 gigawatts of contracted load additions, up from the previously reported 24 gigawatts, backed by energy service agreements or letters of agreement [10] Company Strategy and Development Direction - AEP announced an increased long-term operating earnings growth rate of 7% to 9% for 2026 to 2030, with an expected 9% CAGR over the five-year period [5] - The company is focused on a $72 billion capital plan, which is one of the largest in the industry, aimed at supporting infrastructure investments and meeting growing system demand [6][28] - AEP is actively engaging with regulators and policymakers to achieve constructive outcomes that benefit both customers and shareholders [14] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's strategy and team, highlighting the importance of disciplined execution and strong cash flow from operations [35] - The management team emphasized the need for generation diversity to meet electricity demand growth and ensure reliability [16] - AEP is committed to maintaining affordability for customers while executing its capital plan, forecasting residential customer rates to increase by approximately 3.5% annually through 2030 [19] Other Important Information - AEP has secured commission approvals for data center tariffs in Ohio and large load tariff modifications in Indiana, Kentucky, and West Virginia [10] - The company is exploring generation solutions, including participation in the early site permit process for small modular reactors [17] Q&A Session Summary Question: Drivers of earnings step up in 2028 - Management indicated that the capital plan peaking in 2027 and 2028, along with positive legislative outcomes, will drive earnings growth during that period [39] Question: Composition of equity needs - Management discussed the anticipated equity needs and potential for minority stake sell-downs, indicating a proactive approach to funding growth [41] Question: Balance between renewables and gas generation - Management stated that the strategy will align with state energy policies, focusing on both gas and renewables to meet customer demands [67] Question: Transmission capacity for data centers - Management expressed confidence in the ability to connect data centers and manage the increased load growth, highlighting the competitive advantage of AEP's transmission network [66]

Core Viewpoint - American Electric Power (AEP) reported quarterly earnings of $1.8 per share, slightly missing the Zacks Consensus Estimate of $1.81 per share, and down from $1.85 per share a year ago, indicating an earnings surprise of -0.55% [1] Financial Performance - AEP posted revenues of $6.01 billion for the quarter ended September 2025, exceeding the Zacks Consensus Estimate by 6.46%, and up from $5.4 billion year-over-year [2] - Over the last four quarters, AEP has surpassed consensus EPS estimates two times and topped consensus revenue estimates three times [2] Stock Performance - AEP shares have increased approximately 24.8% since the beginning of the year, outperforming the S&P 500's gain of 17.2% [3] Future Outlook - The company's earnings outlook will be crucial for assessing future stock performance, with current consensus EPS estimates at $1.13 for the coming quarter and $5.90 for the current fiscal year [7] - The Zacks Rank for AEP is currently 3 (Hold), indicating expected performance in line with the market in the near future [6] Industry Context - The Utility - Electric Power industry is currently in the top 21% of Zacks industries, suggesting a favorable outlook compared to the bottom 50% [8]

AEP Third Quarter 2025 Earnings Presentation October 29, 2025 AEP CONFIDENTIAL Cautionary Note Regarding Forward- Looking Statements This presentation contains forward-looking statements. Words such as "expect," "anticipate," "intend," "plan," "believe," "will," "should," "could," "would," "project," "continue" and similar expressions, including statements reflecting future results or guidance and statements of outlook are intended to identify forward-looking statements but are not the exclusive means of id ...

Financial Performance - Third-quarter 2025 GAAP earnings were $972 million or $1.82 per share, compared to $960 million or $1.80 per share in the same quarter of 2024[3] - Operating earnings for third-quarter 2025 were $963 million or $1.80 per share, down from $985 million or $1.85 per share in third-quarter 2024[3] - AEP's revenue for the third quarter of 2025 was $6.01 billion, an increase of $590.3 million from $5.42 billion in the same quarter of 2024[13] - Year-to-date GAAP earnings for 2025 were $2,998.0 million, with an EPS of $5.61, compared to $2,551.9 million and $4.78 in the same period of 2024[35] - The company reported a total adjustment impact of $14.8 million on earnings, contributing an additional $0.03 to EPS[37] - The company incurred severance charges of $93.6 million, impacting overall earnings[37] - The impact of regulatory liabilities and adjustments related to NOLC reduced earnings by $259.6 million[37] Operating Earnings Guidance - AEP reaffirms its 2025 operating earnings guidance range of $5.75 to $5.95 per share, expecting results to be in the upper half of this range[4] - AEP announced a new long-term operating earnings growth rate of 7-9% over the next five years, supported by a $72 billion capital plan[4] - Year-to-date operating earnings (non-GAAP) for 2025 were $2,551.9 million, reflecting a significant increase compared to the previous year[35] Capital Investment and Growth - The capital plan is expected to drive a 10% annual growth in rate base, reaching $128 billion by 2030[5] - The company plans to invest over $20 billion in generation resources and $30 billion in transmission assets over the next five years[8] - AEP's capital plan is one of the largest in the industry, driven by commitments from large load customers including data centers and industrials[6] Sales Performance - Total retail electric sales for Q3 2025 reached 25,348 million kWh, a 1.2% increase from 25,043 million kWh in Q3 2024[34] - Wholesale electric sales increased by 18.5% in Q3 2025, totaling 4,217 million kWh compared to 3,559 million kWh in Q3 2024[34] - The company experienced a 30.4% increase in commercial retail electric sales in Q3 2025, reaching 12,610 million kWh[34] - Total retail electric sales increased by 1.3% year-over-year, totaling 71,115 million kWh[39] - Wholesale electric sales surged by 18.6%, reaching 12,451 million kWh compared to the previous year[39] - Residential retail electric sales rose by 1.8%, totaling 24,618 million kWh[39] - Commercial retail electric sales increased by 4.2%, reaching 19,548 million kWh[39] - Total retail electric sales in transmission and distribution utilities grew by 10.6%, totaling 76,172 million kWh[39] Other Financial Impacts - The impact of Ohio legislation resulted in a reduction of $8.5 million in Q3 2025[31] - The company reported a mark-to-market impact of commodity hedging activities resulting in a loss of $0.6 million in Q3 2025[31] - Operating earnings for Q3 2025 (non-GAAP) were $962.9 million, down from $985.4 million in Q3 2024[31]

Core Insights - American Electric Power (AEP) reported third-quarter 2025 GAAP earnings of $972 million or $1.82 per share, an increase from $960 million or $1.80 per share in the same quarter of 2024 [1] - Operating earnings for the same period were $963 million or $1.80 per share, down from $985 million or $1.85 per share in third-quarter 2024 [1] - AEP reaffirmed its 2025 operating earnings guidance range of $5.75 to $5.95 per share, expecting results to be in the upper half of this range [1][9] Financial Performance - AEP's revenue for the third quarter of 2025 was $6,010.4 million, up from $5,420.1 million in the same quarter of 2024, reflecting a change of $590.3 million or 10.9% [8] - Year-to-date revenue increased from $15,025.0 million in 2024 to $16,560.7 million in 2025, a change of $1,535.7 million or 10.2% [8] - Year-to-date GAAP earnings rose from $2,303.0 million in 2024 to $2,998.0 million in 2025, an increase of $695.0 million or 30.2% [8] Growth Strategy - AEP announced a new long-term operating earnings growth rate of 7-9% over the next five years, supported by a $72 billion capital plan [2] - The capital plan is expected to drive a 10% annual growth in rate base, with operating earnings per share anticipated to increase at a 9% compounded annual growth rate over the five-year period [2] - AEP's peak system demand is projected to rise to 65 GW by 2030, up from the current peak of 37 GW, necessitating a $30 billion investment in transmission assets [4] Infrastructure Investments - AEP's capital plan includes over $20 billion in generation resources to meet customer demands in fast-growing regions, with $17 billion dedicated to enhancing the distribution network [5] - The company is confident in securing 28 GW of load additions by 2030, supported by Electric Service Agreements and an additional 190 GW of load requests at various development stages [3] Customer Commitment and Regulatory Engagement - AEP is implementing new tariff structures requiring large power demand customers to make financial commitments based on load forecasts, ensuring fair cost allocation [7] - The company emphasizes listening to regulators and policymakers to improve regulatory outcomes and develop solutions for customer needs [7]

Industry Overview - The Zacks Utility - Electric Power industry offers stable, long-term income due to its regulated framework, allowing companies to recover costs and earn steady returns, thus reducing earnings volatility [1] - The U.S. electric utilities industry is evolving beyond its traditional role as a steady income provider, driven by investments in clean energy, grid modernization, and electrification, supported by federal incentives and climate policies [2] Company Profiles - NextEra Energy (NEE) focuses on renewable energy and sustainable growth, managing one of the largest portfolios of wind and solar projects globally, backed by solid financials and innovation [3] - American Electric Power (AEP) benefits from regulated operations and a commitment to clean energy, investing in renewable and nuclear generation, grid modernization, and transmission upgrades [4] Earnings Growth Projections - NextEra Energy's earnings per share (EPS) estimates for 2025 and 2026 have increased by 7.29% and 7.95% year over year, with long-term growth projected at 8.04% [6] - American Electric Power's EPS estimates for 2025 and 2026 have increased by 4.98% and 6.47% year over year, with long-term growth projected at 6.43% [9] Financial Metrics - NextEra Energy has a return on equity (ROE) of 12.31%, compared to AEP's 11.55%, both exceeding the industry average of 10.35% [7][13] - NextEra Energy's debt-to-capital ratio is 60.48%, while AEP's is 59.78%, both slightly below the industry average of 61.16% [12] Capital Expenditure Plans - NextEra Energy plans to invest approximately $74.6 billion from 2025 to 2029 for infrastructure and clean electricity generation [17] - American Electric Power plans to invest $54 billion during the same period for electric transmission, distribution, and generation infrastructure [17] Dividend Yield - NextEra Energy's current dividend yield is 2.68%, while American Electric Power's is 3.21%, both higher than the S&P 500's yield of 1.49% [19] Valuation - NextEra Energy trades at a Price/Earnings Forward 12-month ratio of 21.53X, while American Electric Power trades at 18.67X, compared to the industry's 15.45X [20] Price Performance - NextEra Energy has gained 18.2% in the last three months, outperforming American Electric Power's 7.3% increase during the same period [21] Conclusion - NextEra Energy shows stronger earnings estimates, higher ROE, and a larger capital expenditure plan, positioning it as a more favorable investment choice in the utility sector compared to American Electric Power [23]

Core Insights - American Electric Power Company, Inc. (AEP) is set to release its third-quarter 2025 results on October 29, before market open [1] - The company achieved an earnings surprise of 11.72% in the last quarter, with a trailing four-quarter average earnings surprise of 6.61% [1] Factors Influencing Q3 Results - Warmer-than-normal weather conditions in AEP's service territories likely increased electricity demand for cooling, positively impacting revenue [2] - Favorable rate revisions, industrial load growth, data center demand, and higher normalized retail sales due to economic development in AEP's operating states are expected to contribute to revenue growth [3] - Increased operating & maintenance (O&M), interest expenses, and depreciation expenses may negatively affect earnings, but positive revenue expectations are anticipated to support bottom-line performance [4] Q3 Expectations - The Zacks Consensus Estimate for AEP's sales is $5.64 billion, indicating a year-over-year growth of 4.5% [5] - The consensus estimate for earnings is $1.80 per share, reflecting a year-over-year decline of 2.7% [5] - Total energy sales for vertically integrated utilities are estimated at 28.87 billion kWh, showing a year-over-year growth of 0.9% [5] Earnings Prediction Model - The current model does not predict an earnings beat for AEP, with an Earnings ESP of -2.35% and a Zacks Rank of 3 (Hold) [6][7] Industry Comparisons - Other industry players like Xcel Energy, Eversource Energy, and Duke Energy are also set to report their Q3 results, with varying Earnings ESPs and growth rates [9][10][11]

Core Thesis - American Electric Power Company, Inc. (AEP) is positioned to benefit from the increasing demand for electricity infrastructure, particularly due to data center growth [2][5] - AEP's share price was $115.66 as of October 6th, with trailing and forward P/E ratios of 16.64 and 18.12 respectively [1] Financial Performance - AEP's earnings are significantly driven by its transmission segment, which accounts for approximately 55% of total earnings and is expected to see an incremental load of 4.7 GW by 2025 [2] - The company has a $70 billion capital expenditure program aimed at expanding and modernizing its transmission network, supporting a projected earnings growth rate of 6–8% [3] Strategic Relationships - AEP has established strategic partnerships with major hyperscalers such as Amazon, Google, Microsoft, and Meta, which enhance revenue visibility and growth potential through interconnection agreements and favorable rate cases [4] Risks and Challenges - Potential headwinds include regulatory and operational challenges, such as permitting timelines for new transmission corridors, the lag between capital expenditures and cost recovery, and risks of regulatory disallowances affecting returns [4] Investment Outlook - The company's strong transmission positioning, long-term investment strategy, and relationships with hyperscalers suggest a favorable risk-reward profile, with opportunities for continued earnings growth [5] - AEP is viewed as a play on the expansion of the transmission grid and the rise in electricity consumption driven by data centers, with multiple factors supporting potential upside [5]

Core Viewpoint - American Electric Power (AEP) has declared a quarterly cash dividend of 95 cents per share, marking a 2-cent increase, and this is the company's 462nd consecutive quarterly dividend since 1910 [1][2]. Group 1: Dividend Information - The dividend is scheduled to be paid on December 10, 2025, to shareholders of record as of November 10, 2025 [2]. - AEP has maintained a consistent cash dividend for 115 years, demonstrating its commitment to shareholder returns [3]. Group 2: Company Overview - AEP is investing $54 billion from 2025 to 2029 to enhance service and meet growing energy needs [3]. - The company operates the largest electric transmission system in the U.S., with 40,000 line miles and over 225,000 miles of distribution lines, serving 5.6 million customers across 11 states [3]. - AEP has a generating capacity of approximately 30,000 megawatts and focuses on safety, operational excellence, and community engagement [3].

Core Viewpoint - American Electric Power (AEP) is anticipated to report a year-over-year decline in earnings despite an increase in revenues for the quarter ending September 2025, with actual results being crucial for stock price movement [1][2]. Earnings Expectations - The consensus estimate for AEP's quarterly earnings is $1.80 per share, reflecting a year-over-year decrease of 2.7%, while revenues are projected to be $5.64 billion, representing a 4.5% increase from the previous year [3]. Estimate Revisions - Over the last 30 days, the consensus EPS estimate has been revised 6.3% higher, indicating a reassessment by analysts regarding AEP's earnings prospects [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that AEP has a negative Earnings ESP of -3.97%, suggesting a bearish outlook from analysts [12]. The stock currently holds a Zacks Rank of 3, complicating predictions for an earnings beat [12]. Historical Performance - In the last reported quarter, AEP exceeded the expected earnings of $1.28 per share by delivering $1.43, resulting in a surprise of +11.72%. Over the past four quarters, AEP has beaten consensus EPS estimates three times [13][14]. Conclusion - AEP does not appear to be a strong candidate for an earnings beat based on current estimates and revisions, but other factors should also be considered when evaluating the stock ahead of its earnings release [17].