Q2 2025 AES Corp Earnings Call Transcript
Key Points
- The AES Corp (AES) reaffirmed its 2025 guidance and long-term growth targets, indicating confidence in its strategic direction.
- The company reported significant growth in its Renewables SBU, with a 56% increase in adjusted EBITDA for the second quarter, driven by 3.2 gigawatts of new projects.
- AES has a strong backlog of 12 gigawatts of signed PPAs, with a substantial portion Safe Harbored, providing protection against policy changes.
- The company is executing the largest investment program in the history of AES Indiana and AES Ohio, aimed at improving customer reliability and supporting economic development.
- AES has developed a robust supply chain strategy, ensuring major equipment is sourced from US-based suppliers, mitigating potential impacts from tariffs and policy changes.
- Higher parent interest expense and a higher adjusted tax rate partially offset the strong growth in adjusted EPS.
- The Utilities SBU experienced lower adjusted pretax contribution due to planned outages and the sell-down of AES Ohio.
- The Energy Infrastructure SBU reported lower EBITDA, primarily due to prior year recognition of the Warrior Run coal PPA monetization and portfolio changes.
- AES faces potential regulatory hurdles and uncertainties related to Safe Harboring and executive orders impacting future projects.
- The company acknowledges that its stock has been consistently undervalued in the public market, which may affect investor perception and valuation.
Hello, everyone, and welcome to the AES Corporation second-quarter 2025 financial review call. My name is Emily, and I'll be coordinating your call today. (Operator Instructions) I would now like to turn the call over to Susan Harcourt, Vice President of Investor Relations. Susan, please go ahead.
Thank you, operator. Good morning, and welcome to our second-quarter 2025 financial review call. Our press release, presentation, and related financial information are available on our website at aes.com.
Today, we will be making forward-looking statements. There are many factors that may cause future results to differ materially from these statements, which are disclosed in our most recent 10-K and 10-Q filed with the SEC. Reconciliations between GAAP and non-GAAP financial measures can be found on our website along with the presentation.
Joining me this morning are Andres Gluski, our President and Chief Executive Officer; Steve Coughlin, our Chief Financial Officer; Ricardo Falu, our
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