Group 1 - The Dividend Champions list is a monthly compilation of companies that have consistently increased their annual dividend payouts, but the data can quickly become outdated due to its monthly publication frequency [1] - Justin Law is a contributor to The Dividend Kings, a group of analysts focused on teaching individuals how to invest wisely in dividend stocks [1] - The Dividend Kings curates the Dividend Champions list, highlighting companies with a history of increasing dividends [1] Group 2 - Justin Law holds a Ph.D. in Chemistry from Rice University and has earned the CFA Institute Investment Foundations certificate, applying his expertise to deep value and dividend-paying stocks [2]

Core Insights - AES reported a significant increase in non-GAAP earnings with Adjusted EPS rising to $0.51, exceeding analyst estimates of $0.40, while GAAP results showed a large loss primarily due to accounting factors [1][5][11] - The company demonstrated substantial growth in its renewables and utilities segments, with renewables SBU adjusted EBITDA increasing approximately 45% year-over-year and a target of 60% renewables growth year-over-year [1][6][12] Financial Performance - Adjusted EPS (Non-GAAP) for Q2 2025 was $0.51, a 34.2% increase from Q2 2024's $0.38 [2] - GAAP net loss was $150 million in Q2 2025, a significant decline from a net income of $153 million in Q2 2024, reflecting a 198.0% year-over-year change [2][5] - Total revenue for Q2 2025 was $2,855 million, down 3.0% from $2,942 million in Q2 2024 [2][6] - Adjusted EBITDA rose to $681 million, a 3.5% increase year-over-year [2][9] Business Overview - AES focuses on electricity generation and distribution, emphasizing renewable energy sources like solar and wind, and is recognized as the top provider of clean energy to corporations globally [3][4] - The company has a substantial project pipeline in renewables, with 12 GW in total, including 5.2 GW under construction [7] Segment Performance - The renewables segment saw a revenue increase of 4.1% year-over-year, driven by new projects and improved operations [6][9] - The utilities segment experienced a 6.5% revenue rise, supported by investments in grid modernization and new generation [8][9] - Energy Infrastructure revenue declined by 10.7% year-over-year due to the absence of one-time benefits from previous years [6] Future Outlook - Management reaffirmed its 2025 financial outlook, expecting non-GAAP Adjusted EBITDA between $2,650 million and $2,850 million, and Adjusted EPS between $2.10 and $2.26 [12] - The company anticipates annualized non-GAAP Adjusted EPS growth of 7% to 9% through 2025, with similar growth of 5% to 7% targeted through 2027 [12] - Investors should monitor trends in renewable energy origination, particularly in the data center sector, and further rate proceedings in the utilities segment [13]

Part I [Financial Statements (Unaudited)](index=5&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS%20(UNAUDITED)) The unaudited condensed consolidated financial statements for the quarterly period ended June 30, 2025, show a decrease in total revenue and a shift from net income to a net loss compared to the same period in 2024 [Condensed Consolidated Balance Sheets](index=5&type=section&id=Condensed%20Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets were $48.54 billion, a slight increase from $47.41 billion at December 31, 2024 Condensed Consolidated Balance Sheet Highlights (in millions) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Current Assets** | $6,320 | $6,831 | | **Total Noncurrent Assets** | $42,222 | $40,575 | | **Total Assets** | **$48,542** | **$47,406** | | **Total Current Liabilities** | $7,679 | $8,571 | | **Total Noncurrent Liabilities** | $31,001 | $30,193 | | **Total Liabilities** | $38,680 | $38,764 | | **Total Equity** | $7,683 | $7,704 | | **Total Liabilities and Equity** | **$48,542** | **$47,406** | [Condensed Consolidated Statements of Operations](index=6&type=section&id=Condensed%20Consolidated%20Statements%20of%20Operations) For the three months ended June 30, 2025, the company reported a net loss of $150 million, a significant downturn from a net income of $153 million in the same period of 2024 Statement of Operations Summary (in millions, except per share data) | Metric | Q2 2025 | Q2 2024 | H1 2025 | H1 2024 | | :--- | :--- | :--- | :--- | :--- | | Total Revenue | $2,855 | $2,942 | $5,781 | $6,027 | | Operating Margin | $453 | $553 | $894 | $1,172 | | Net Income (Loss) | $(150) | $153 | $(223) | $431 | | Net Income (Loss) Attributable to AES | $(95) | $276 | $(49) | $708 | | Diluted EPS | $(0.15) | $0.39 | $(0.08) | $0.99 | [Condensed Consolidated Statements of Cash Flows](index=10&type=section&id=Condensed%20Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash provided by operating activities significantly increased to $1.52 billion from $679 million in the prior year Cash Flow Summary for Six Months Ended June 30 (in millions) | Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $1,521 | $679 | | Net cash used in investing activities | $(2,882) | $(4,224) | | Net cash provided by financing activities | $1,462 | $3,759 | | **Total increase in cash** | **$162** | **$158** | [Notes to Condensed Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Condensed%20Consolidated%20Financial%20Statements) The notes detail key accounting policies and transactions, including a restructuring program, debt financing, asset impairments, and segment reporting updates - The company initiated a restructuring program in February 2025 to streamline its organization, resulting in pre-tax charges of **$52 million** for the first six months of 2025[190](index=190&type=chunk) - A significant asset impairment reversal of **$243 million** was recorded for the Mong Duong asset group after it was reclassified from held-for-sale to held-and-used. Conversely, impairment expenses of **$117 million** were recognized for AES Clean Energy Development projects[162](index=162&type=chunk)[163](index=163&type=chunk)[166](index=166&type=chunk) - The company sold 50% of its interest in Dominican Republic Renewables in June 2025 for **$103 million**, resulting in a pre-tax gain of **$70 million**[174](index=174&type=chunk) - The company changed its segment reporting in Q1 2025, moving the results of its businesses in Chile (excluding two coal plants) from the Energy Infrastructure SBU to the Renewables SBU[130](index=130&type=chunk) [Management's Discussion and Analysis (MD&A)](index=48&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) Management discusses a decrease in net income for Q2 and H1 2025 compared to 2024, primarily due to higher income tax expense, losses on sales-type leases, and lower earnings from the Energy Infrastructure SBU [Executive Summary](index=49&type=section&id=Executive%20Summary) In Q2 2025, net income decreased by $303 million year-over-year to a loss of $150 million, while Adjusted EBITDA rose by $23 million to $681 million Q2 2025 vs Q2 2024 Performance | Metric | Q2 2025 | Q2 2024 | Change | | :--- | :--- | :--- | :--- | | Net Income (Loss) | ($150M) | $153M | ($303M) | | Diluted EPS | ($0.15) | $0.39 | ($0.54) | | Adjusted EBITDA (Non-GAAP) | $681M | $658M | +$23M | | Adjusted EPS (Non-GAAP) | $0.51 | $0.38 | +$0.13 | H1 2025 vs H1 2024 Performance | Metric | H1 2025 | H1 2024 | Change | | :--- | :--- | :--- | :--- | | Net Income (Loss) | ($223M) | $431M | ($654M) | | Diluted EPS | ($0.08) | $0.99 | ($1.07) | | Adjusted EBITDA (Non-GAAP) | $1,272M | $1,298M | ($26M) | | Adjusted EPS (Non-GAAP) | $0.78 | $0.89 | ($0.11) | [Review of Consolidated Results of Operations](index=51&type=section&id=Review%20of%20Consolidated%20Results%20of%20Operations) Consolidated revenue for Q2 2025 decreased by 3% to $2.86 billion, and operating margin fell 18% to $453 million compared to Q2 2024 - Q2 2025 revenue decreased by **$87 million (3%)** YoY, largely due to a **$156 million** decline in the Energy Infrastructure SBU, partially offset by a **$58 million** increase in Utilities and a **$25 million** increase in Renewables[224](index=224&type=chunk) - Q2 2025 operating margin decreased by **$100 million (18%)** YoY, with declines of **$82 million** in Energy Infrastructure, **$20 million** in Utilities, and **$15 million** in Renewables[226](index=226&type=chunk) - A significant driver for the decline in Energy Infrastructure results was the prior year revenue of **$64 million** from the monetization of the Warrior Run coal plant PPA[224](index=224&type=chunk)[229](index=229&type=chunk) - Asset impairment reversals of **$154 million** in Q2 2025, compared to an expense of **$38 million** in Q2 2024, were primarily due to a **$243 million** reversal for the Mong Duong asset group[254](index=254&type=chunk) [SBU Performance Analysis](index=59&type=section&id=SBU%20Performance%20Analysis) In Q2 2025, the Renewables SBU showed strong growth with Adjusted EBITDA increasing 56% to $240 million, while Utilities and Energy Infrastructure SBUs saw declines Adjusted EBITDA by SBU (in millions) | SBU | Q2 2025 | Q2 2024 | % Change | H1 2025 | H1 2024 | % Change | | :--- | :--- | :--- | :--- | :--- | :--- | :--- | | Renewables | $240 | $154 | 56% | $401 | $265 | 51% | | Utilities | $196 | $214 | -8% | $419 | $396 | 6% | | Energy Infrastructure | $254 | $303 | -16% | $508 | $659 | -23% | | New Energy Technologies | ($17) | ($14) | -21% | ($42) | ($31) | -35% | - Renewables SBU growth was driven by new projects coming online and lower costs after restructuring, partially offset by the sale of AES Brasil[301](index=301&type=chunk)[302](index=302&type=chunk) - Utilities SBU performance was impacted by planned outages and the selldown of AES Ohio, though H1 results were boosted by higher retail rates from the 2024 Base Rate Order[309](index=309&type=chunk)[310](index=310&type=chunk)[312](index=312&type=chunk) - Energy Infrastructure SBU decline was mainly due to higher prior-year revenues from the monetization of the Warrior Run PPA and prior-year derivative gains[315](index=315&type=chunk)[317](index=317&type=chunk) [Key Trends and Uncertainties](index=68&type=section&id=Key%20Trends%20and%20Uncertainties) The company faces key trends and uncertainties including supply chain issues, U.S. tax law changes, decarbonization initiatives, and regulatory matters - **Supply Chain:** The company has managed risks from tariffs and trade restrictions by contracting and importing all solar panels and batteries needed for 2025 U.S. projects and has secured U.S. or allied-sourced supply for its 2026-2027 backlog[335](index=335&type=chunk)[336](index=336&type=chunk)[337](index=337&type=chunk)[338](index=338&type=chunk) - **U.S. Tax Law:** The 2025 Act amends and phases out certain renewable energy tax credits (ITC/PTC). While the company expects its project backlog to qualify, new Treasury guidance and restrictions on foreign entities of concern (FEOC) create uncertainty[348](index=348&type=chunk)[350](index=350&type=chunk)[351](index=351&type=chunk)[353](index=353&type=chunk) - **Decarbonization:** AES intends to exit the substantial majority of its coal facilities by year-end 2025, but efforts in some markets will continue beyond 2027 due to grid and market dynamics[378](index=378&type=chunk) - **Regulatory:** AES Ohio withdrew its Smart Grid Phase 2 application due to new legislation (H.B. 15) and has a distribution rate case pending. AES Indiana filed a new rate case in June 2025 seeking a phased revenue increase[385](index=385&type=chunk)[386](index=386&type=chunk)[388](index=388&type=chunk) [Capital Resources and Liquidity](index=79&type=section&id=Capital%20Resources%20and%20Liquidity) As of June 30, 2025, AES had $1.4 billion in unrestricted cash and total Parent Company Liquidity of $2.2 billion, with total debt outstanding of $29.7 billion Parent Company Liquidity (in millions) | Component | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Parent Co. & qualified holding co. cash | $9 | $265 | | Available borrowings under credit facilities | $2,185 | $1,782 | | **Total Parent Company Liquidity** | **$2,194** | **$2,047** | - As of June 30, 2025, total outstanding debt was approximately **$29.7 billion**, comprising **$23.9 billion** in non-recourse debt and **$5.8 billion** in recourse debt[414](index=414&type=chunk) - Primary cash uses in H1 2025 were capital expenditures (**$2.6B**), repayments under revolving credit facilities (**$2.4B**), and repayments of non-recourse debt (**$1.5B**)[425](index=425&type=chunk)[427](index=427&type=chunk) - **$175 million** of subsidiary non-recourse debt is in default as of June 30, 2025, primarily related to AES Puerto Rico (payment default) and technical defaults at AES Ilumina and AES Jordan Solar. These defaults do not currently trigger cross-defaults at the Parent Company level[414](index=414&type=chunk)[449](index=449&type=chunk)[450](index=450&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=86&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) The company is exposed to market risks from commodity prices, interest rates, and foreign currency exchange rates, which are managed through hedging strategies - Primary market risks are commodity prices, interest rates, and foreign currency exchange rates[453](index=453&type=chunk) - As of June 30, 2025, a **10%** increase in commodity prices is projected to result in a pre-tax earnings gain of less than **$5 million** for power and gas, and a loss of less than **$5 million** for coal[457](index=457&type=chunk) - The company has material unhedged forward-looking earnings exposure to the Argentine peso. A **10%** USD appreciation against other key currencies (Colombian peso, Euro, Argentine peso) would result in a potential loss of less than **$5 million** on cash distributions[464](index=464&type=chunk) - A one-time **100-basis-point** increase in interest rates would result in less than a **$5 million** pre-tax earnings impact on interest expense for 2025[468](index=468&type=chunk) [Controls and Procedures](index=89&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) The company's CEO and CFO concluded that disclosure controls and procedures were not effective as of June 30, 2025, due to a previously disclosed material weakness - Management concluded that disclosure controls and procedures were not effective as of June 30, 2025[470](index=470&type=chunk) - The ineffectiveness is due to a previously identified material weakness related to the impairment calculation for the AES Brasil disposition in Q2 2024[471](index=471&type=chunk) - Remediation actions, including policy updates and training, have been implemented but are pending testing to confirm operating effectiveness[473](index=473&type=chunk)[474](index=474&type=chunk)[475](index=475&type=chunk) Part II [Legal Proceedings](index=90&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) The company is involved in several legal proceedings, including arbitration in India, environmental actions in Brazil, and lawsuits in the Dominican Republic - A lawsuit in the Dominican Republic alleges personal injuries from CCRs delivered in 2003-2004 and demands over **$900 million** in damages. A lower court dismissed the case, but the claimants have appealed[484](index=484&type=chunk) - Another lawsuit in the Dominican Republic related to CCRs demands over **$600 million**. The company's motion to dismiss is under consideration[487](index=487&type=chunk) - In Brazil, AES faces a public civil action related to contamination at a former pole factory, with estimated remediation costs of **$3 million** to **$11 million**[480](index=480&type=chunk) - The company and its subsidiary are named as defendants in a putative securities class action lawsuit against Fluence Energy, Inc., alleging violations of the Securities Exchange Act. The company has filed a motion to dismiss[491](index=491&type=chunk) [Risk Factors](index=93&type=section&id=ITEM%201A.%20RISK%20FACTORS) The company states that there have been no material changes to the risk factors previously disclosed in its 2024 Form 10-K - There have been no material changes to the risk factors disclosed in the 2024 Form 10-K[494](index=494&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=94&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) The company did not repurchase any of its common stock during the second quarter of 2025, with $264 million remaining available for future repurchases - No shares of AES Common Stock were repurchased during the second quarter of 2025[495](index=495&type=chunk) - As of June 30, 2025, **$264 million** remained available for future repurchases under the company's stock buyback program[495](index=495&type=chunk)

Core Viewpoint - AES Corporation's stock is performing well despite a broader market downturn, primarily due to better-than-expected earnings results [1][2]. Financial Performance - AES reported earnings of $0.51 per share, surpassing the forecast of $0.40, although it missed revenue expectations with $2.9 billion [2]. - The company experienced a $0.15-per-share loss according to generally accepted accounting principles (GAAP), attributed to various factors including sales type leases and lower margins [4][5]. - Management provided forward guidance of adjusted earnings between $2.10 and $2.26 for the year, while analysts expect GAAP earnings to be around $1.69 per share [6]. Stock Valuation - AES stock is priced at $13, resulting in a price-to-earnings (P/E) ratio of less than 8, which is considered attractive for a company with a 5.4% dividend yield and an 8% projected long-term growth rate [7].

Financial Data and Key Metrics Changes - The company reported adjusted EBITDA of $681 million for Q2 2025, an increase from $658 million in the previous year, driven by growth from new renewables projects and cost reductions [25][26] - Adjusted EPS increased by 34% to $0.51 per share compared to $0.38 in the prior year, supported by higher U.S. renewable tax attributes [26][32] Business Line Data and Key Metrics Changes - The Renewables Strategic Business Unit (SBU) saw adjusted EBITDA of $240 million, representing a 56% growth year-over-year, attributed to 3.2 gigawatts of new projects added to the portfolio [10][27] - The Utilities SBU experienced lower adjusted pretax contributions due to planned outages and the sell-down of AES Ohio, but significant growth is expected driven by new investments [29][31] Market Data and Key Metrics Changes - The company has a backlog of 12 gigawatts of signed Power Purchase Agreements (PPAs), with 4.1 gigawatts international and 7.9 gigawatts in the U.S., with plans to place 6 gigawatts in service by the end of 2027 [13][40] - Demand for electricity in the U.S. is growing rapidly, with expectations of over 600 terawatt hours of additional power needed by the end of the decade, primarily driven by data centers [19][20] Company Strategy and Development Direction - The company aims to maintain its position as a leading provider of renewables to data centers, with over 11 gigawatts of agreements signed to date [18][41] - The strategy focuses on delivering energy solutions that meet customer demands for renewables and storage, while also maintaining flexibility to adapt to market changes [21][38] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the backlog of renewables and energy storage projects, emphasizing that recent U.S. policy changes are largely inconsequential to their operations [12][36] - The company expects strong demand for electricity to continue, with a robust growth outlook even as tax credits expire [18][35] Other Important Information - The company is on track to invest approximately $1.4 billion in U.S. utilities in 2025, focusing on improving customer reliability and supporting economic development [22][24] - The company has implemented a supply chain strategy that mitigates risks from potential future tariffs and ensures compliance with U.S. manufacturing requirements [16][36] Q&A Session Summary Question: Project online timing and EPS/EBITDA recognition - Management confirmed that most of the remaining 1.3 gigawatts will be commissioned by the end of the year, with tax attributes expected to be split between the third and fourth quarters [46][47] Question: Value of the underlying business and potential acquisition - Management believes the company has been undervalued and highlighted the strength of their backlog and execution capabilities [51][52] Question: Risk to safe harboring from executive orders - Management expressed confidence in their robust position, noting that most projects are not exposed to potential changes in treasury guidance [58][60] Question: Load updates and demand in service territories - There is strong interest and demand in their utility sectors, particularly from data centers, with about 2 gigawatts of additional demand signed [64] Question: Details on signed PPAs - The company signed 1.6 gigawatts of new PPAs, primarily with data center customers, skewed towards solar plus batteries [70] Question: Gas generation build-out capabilities - Management confirmed ongoing capabilities to build gas plants as needed, particularly for data centers, while focusing primarily on renewables [101][102] Question: Consolidation in the renewable industry - Management anticipates opportunities for acquisitions of smaller developers and advanced-stage projects due to the current market environment [103]

Core Insights - The AES Corporation reported second-quarter 2025 adjusted earnings of 51 cents per share, exceeding the Zacks Consensus Estimate of 39 cents by 30.8% and improving 34.2% from 38 cents in the same quarter last year [1][9] - The increase in adjusted earnings was attributed to a lower adjusted tax rate and higher contributions from new renewable projects [1] - The company experienced a GAAP loss of 15 cents per share compared to GAAP earnings of 39 cents in the second quarter of 2024 [1] Revenue and Financial Performance - Total revenues for AES amounted to $2.86 billion, reflecting a 3% year-over-year decline due to lower non-regulated revenues, and missing the Zacks Consensus Estimate of $3.28 billion by 13.5% [3][9] - The total cost of sales in Q2 was $2.40 billion, up 0.5% year over year, while operating income fell 18.1% to $453 million from $553 million in the prior year [4] - Interest expenses decreased to $352 million, down 9.5% from $389 million in the same quarter last year [4] New Contracts and Backlog - During Q2 2025, AES secured new long-term power-purchase agreements (PPAs) for 1.6 gigawatts (GW) of solar and wind, increasing its total backlog to 12 GW, with 5.2 GW currently under construction [5][9] Financial Condition - As of June 30, 2025, AES had cash and cash equivalents of $1.35 billion, down from $1.52 billion at the end of 2024 [6] - Non-recourse debt increased to $21.75 billion from $20.63 billion as of December 31, 2024 [6] - Net cash flow from operating activities for the first half of 2025 was $1.52 billion, compared to $0.68 billion in the same period of 2024 [6] Capital Expenditure and Guidance - Total capital expenditure for the first six months of 2025 was $2.59 billion, a decrease from $3.83 billion recorded in the previous year [7] - AES reaffirmed its 2025 earnings guidance, expecting adjusted earnings in the range of $2.10-$2.26 per share, with the Zacks Consensus Estimate at $2.14 [8]

Financial Data and Key Metrics Changes - Adjusted EBITDA for Q2 2025 was $681 million, up from $658 million in the previous year, reflecting growth driven by new renewables projects and cost reductions [22][24] - Adjusted EPS increased by 34% to $0.51 per share compared to $0.38 in the prior year, supported by higher U.S. renewable tax attributes [23][24] Business Line Data and Key Metrics Changes - The Renewables Strategic Business Unit (SBU) saw adjusted EBITDA of $240 million, a 56% increase year-over-year, attributed to 3.2 gigawatts of new projects added to the portfolio [8][24] - The Utilities SBU experienced lower adjusted pretax contributions due to planned outages and the sell-down of AES Ohio, but significant growth is expected driven by new investments [25][28] - The Energy Infrastructure SBU's lower EBITDA was primarily due to prior year recognition of the Warrior Run coal PPA monetization and the transition of Chile renewables to the Renewables segment [25][26] Market Data and Key Metrics Changes - The U.S. electricity market is experiencing rapid demand growth, with a significant shift towards renewables and energy storage expected over the next five years [6][16] - AES has a backlog of 12 gigawatts of signed Power Purchase Agreements (PPAs), with 4.1 gigawatts international and 7.9 gigawatts in the U.S., positioning the company well against U.S. policy changes [11][12] Company Strategy and Development Direction - AES aims to maintain flexibility in its business model by providing electric energy and capacity that meet market demands, focusing on renewables and energy storage [7][16] - The company is executing the largest investment program in the history of its U.S. utilities, with a planned investment of approximately $1.4 billion in 2025 [19][21] - AES is positioned as a leading provider of renewables to data center companies, with over 11 gigawatts of agreements signed to date [16][39] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving 2025 guidance and long-term growth targets, citing a resilient business model and a strong backlog of projects [4][38] - The company anticipates strong demand for electricity driven by data center growth, requiring over 600 terawatt hours of additional power by the end of the decade [16][18] - Management noted that recent U.S. policy changes are largely inconsequential to the majority of their business, including their operating portfolio and international operations [10][12] Other Important Information - AES has implemented a supply chain strategy that mitigates risks from U.S. policy changes and tariffs, ensuring that major equipment is sourced from U.S.-based suppliers [14][15] - The company is focused on maintaining a triple investment grade rating while continuing to pay dividends and invest in growth [32][34] Q&A Session Summary Question: Can you discuss the project online timing for the rest of the year and its impact on EPS and EBITDA recognition? - Management confirmed that most of the remaining 1.3 gigawatts will be commissioned in the third quarter, with full confidence in meeting the timeline [43][44] Question: How does the company view its current valuation compared to private markets? - Management believes the company has been consistently undervalued and highlighted the strength of its backlog and execution capabilities [48][49] Question: What is the company's outlook on safe harboring risks from potential executive orders? - Management expressed confidence in their robust position, noting that most projects are not exposed to new treasury guidance and have safe harbor protections [57][59] Question: How is the demand for electricity evolving in the utility sector? - Management reported strong interest and demand, particularly in their utilities, with significant data center demand contributing to growth [62] Question: Can you provide details on the PPAs signed in the quarter? - Management indicated that all new PPAs signed were with data center customers, with a significant portion being solar plus batteries [68] Question: What is the company's strategy regarding gas generation for data centers? - Management stated that they are capable of building gas plants if required by customers, while continuing to focus on renewables [99][100] Question: Is there potential for consolidation in the renewable industry due to policy uncertainty? - Management acknowledged that smaller developers may face challenges, creating opportunities for AES to acquire assets or advanced stage projects [101][102]

Financial Performance - Adjusted EBITDA for Q2 2025 was $681 million, an increase of $23 million compared to Q2 2024[51] - Renewables SBU Adjusted EBITDA grew by 56% in Q2 2025[18] - Adjusted EPS increased by 34% from $0.38 in Q2 2024 to $0.51 in Q2 2025[53] - The company is reaffirming its 2025 Adjusted EBITDA guidance of $2650-$2850 million [70] - The company is reaffirming its Adjusted EPS guidance of $210-$226 [73] Strategic Highlights & Growth - The company is on track to add 32 GW of new projects in full year 2025, with 19 GW completed year-to-date and ~80% completion on the remaining 13 GW[18] - Since the Q1 call in May, 16 GW of new PPAs for renewables have been signed or awarded, all with data center customers[18] - The backlog of projects under signed PPAs is now 12 GW[18] - The company is on track to invest ~$14 billion across AES Indiana & AES Ohio in 2025[43] Market Position & Resilience - The company has a market-leading position in signed agreements with data center customers, totaling 86 GW[29] - The company expects the majority of capacity to be completed through 2029 has no exposure to potential changes in tax credit policy, with nearly all capacity safe harbored[21] - The company expects data center demand to grow at a 22% CAGR from 2023-2030[29]

AES (AES) came out with quarterly earnings of $0.51 per share, beating the Zacks Consensus Estimate of $0.39 per share. This compares to earnings of $0.38 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +30.77%. A quarter ago, it was expected that this power company would post earnings of $0.37 per share when it actually produced earnings of $0.27, delivering a surprise of -27.03%. Over the last four quarters, the company has ...

Press Release Investor Contact: Susan Harcourt 703-682-1204, susan.harcourt@aes.com Media Contact: Amy Ackerman 703-682-6399, amy.ackerman@aes.com AES Reports Second Quarter 2025 Results; On Track to Deliver on 2025 Guidance and Long-Term Targets Second Quarter 2025 Renewables SBU Adjusted EBITDA Grew 56% Versus Second Quarter 2024 Strategic Accomplishments Q2 2025 Financial Highlights Financial Position and Outlook ARLINGTON, Va., July 31, 2025 – The AES Corporation (NYSE: AES) today reported financial res ...