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Key Takeaways AWK posted Q2 EPS of $1.48, missing estimates by a penny but up 4.2% year over year.Revenues rose 11% to $1.27B, driven by rate hikes and contributions from acquired assets.AWK narrowed 2025 EPS guidance to $5.70-$5.75 and reaffirmed 7-9% long-term earnings growth.American Water Works Company (AWK) posted second-quarter 2025 operating earnings per share (EPS) of $1.48, which lagged the Zacks Consensus Estimate of $1.49 by 0.7%.The bottom line improved 4.2% from the year-ago quarter's EPS of $1 ...

American Water Works Company (AWK) Q2 2025 Earnings Call July 31, 2025 09:00 AM ET Company ParticipantsAaron Musgrave - VP - IRJohn Griffith - President, CEO & DirectorDavid Bowler - EVP & CFOCheryl Norton - EVP & COORichard Sunderland - Equity Research - North American Utilities & PowerConference Call ParticipantsAngie Storozynski - Senior Equity Research AnalystJonathan Reeder - Equities Research Associate AnalystPaul Zimbardo - MD & Research Analyst - Energy AnalystOperatorGood morning, and welcome to Am ...

Financial Data and Key Metrics Changes - Earnings per share (EPS) for Q2 2025 were $1.48, up from $1.42 in Q2 2024, while year-to-date EPS was $2.53, an increase from $2.37 in the same period of 2024 [5][11] - The company expects to achieve the top half of its initial EPS guidance range for 2025, now narrowed to $5.7 to $5.75 per share [6][16] - Total debt to capital ratio was 58%, within the target of less than 60% [17] Business Line Data and Key Metrics Changes - Consolidated revenues increased by $0.50 per share due to authorized rate increases and organic customer growth [9] - Operating and maintenance (O&M) costs rose by $0.17 per share, primarily due to employee-related expenses and technology costs [10] - Capital investments totaled $1.3 billion year-to-date, with a goal of approximately $3.3 billion for 2025 [19] Market Data and Key Metrics Changes - The company reported unfavorable weather impacts estimated at $0.06 per share year-over-year, with wet weather in 2025 affecting revenues [10][11] - The company has 87,000 customer connections under agreement, totaling over $500 million across its business development platform [6][20] Company Strategy and Development Direction - The company aims for long-term earnings and dividend growth of 7% to 9%, driven by 8% to 9% rate base growth [7][17] - The acquisition of NEXUS Water Group systems is expected to add nearly 47,000 customer connections and approximately $200 million to the rate base [6][20] - The company is pursuing regulatory execution and infrastructure investments to enhance shareholder returns [7][12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving consistent EPS growth within the 7% to 9% range through 2029 and beyond [17] - The company anticipates continued revenue increases year-over-year in several states through Q3 2025 [16] - Management highlighted the importance of stakeholder relationships in Pennsylvania ahead of the next rate case application [25][26] Other Important Information - The company has filed general rate cases in multiple jurisdictions, including West Virginia, Kentucky, and California, seeking additional annual revenue [12][14][15] - A decoupling bill related to water utilities has passed out of the California Senate and is awaiting action in the Assembly [15][46] Q&A Session Summary Question: How is the company managing stakeholder relationships in Pennsylvania? - The company has been actively engaging with stakeholders and providing excellent customer service to maintain positive relationships ahead of the next rate case application [25][26] Question: Is the company considering forward issuance for equity needs in 2026? - The company is evaluating all options for equity issuance but plans to issue equity in 2026 [28] Question: What is the earnings power of the Nexus acquisition compared to municipal M&A? - The Nexus acquisition is seen as a strategic opportunity to expand the customer base in existing service areas, with no expected negative impact on profitability [32][36] Question: What is the landscape for fair market value deals in Pennsylvania? - The company expects more fair market value deals to emerge, indicating ongoing consolidation needs in the region [42] Question: What are the goals of the decoupling bill in California? - The bill aims to close gaps in the regulatory framework for decoupling, with hopes for it to pass through the legislature [46][47] Question: What drove the strength in 2025 guidance? - Strong customer usage and consistent regulatory execution were the primary drivers for the improved guidance [53][54]

Financial Performance & Guidance - 2025 YTD EPS reached $2.53, driven by increased revenue from higher rate base and rate case outcomes, showing a 9.4% increase compared to 2024 on a weather-normalized basis[12] - The company narrowed its 2025 EPS guidance to the top half of the range, now expecting $5.70 to $5.75, reflecting an 8.6% EPS growth at the midpoint on a weather-normalized basis[9, 27, 28, 29] - The company affirms long-term financial targets of 7-9% EPS growth and 7-9% dividend per share growth, with a dividend payout ratio target of 55-60% and a debt to capital ratio of less than 60%[13, 15] - The company's projected dividend payout ratio for 2025 is 58%, based on projected cash dividends per share of $3.2475 and EPS guidance midpoint of $5.625, excluding $0.10 incremental interest from amended HOS seller note[56, 57] Capital Investments & Acquisitions - The company invested $1.3 billion in infrastructure improvements and acquisitions through June 30, 2025[12] - The company agreed to purchase Nexus Water Group systems in eight states for $315 million, adding nearly 47,000 customers[12] - The company anticipates ~$1 billion of capital expenditure related to PFAS treatment and up to ~$50 million annually for operating expenses in its 2025-2029 plan[71] Regulatory & Rate Cases - New rates became effective in 2025 in IL, CA, TN, VA, IN, MO, and IA; general cases were filed in KY, WV, and CA[12] - The company completed rate filings that are effective since January 1, 2025, which are expected to generate $232 million in additional annualized revenue from rate cases and $38 million from infrastructure charges, totaling $270 million[82, 83, 86] - The company has pending rate case filings requesting a total revenue increase of $123 million and pending infrastructure surcharges filings requesting $3 million, totaling $126 million[88]

American Water Works (AWK) came out with quarterly earnings of $1.48 per share, missing the Zacks Consensus Estimate of $1.49 per share. This compares to earnings of $1.42 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of -0.67%. A quarter ago, it was expected that this water utility would post earnings of $1.04 per share when it actually produced earnings of $1.05, delivering a surprise of +0.96%.Over the last four quarters, th ...

Exhibit 99.1 July 30, 2025 Investor Contact: Aaron Musgrave Vice President, Investor Relations 856-955-4029 aaron.musgrave@amwater.com Media Contact: Maureen Duffy Executive Vice President, Communications and External Affairs 856-955-4163 maureen.duffy@amwater.com AMERICAN WATER REPORTS SOLID SECOND QUARTER RESULTS NARROWS 2025 EPS GUIDANCE TO TOP HALF OF RANGE AFFIRMS LONG-TERM TARGETS CAMDEN, N.J., July 30, 2025 - American Water Works Company, Inc. (NYSE: AWK) today reported results for the quarter ended ...

[Part I. Financial Information](index=7&type=section&id=Part%20I.%20Financial%20Information) This section covers the company's consolidated financial statements, management's discussion, market risk, and internal controls [Item 1. Consolidated Financial Statements](index=7&type=section&id=Item%201.%20Consolidated%20Financial%20Statements) This section presents the unaudited consolidated financial statements for American Water Works Company, Inc. as of June 30, 2025, and for the three and six-month periods then ended [Consolidated Balance Sheets](index=7&type=section&id=Consolidated%20Balance%20Sheets) As of June 30, 2025, total assets were $33.91 billion, an increase from $32.83 billion at year-end 2024, primarily driven by a rise in net property, plant, and equipment Consolidated Balance Sheet Highlights (in millions) | Balance Sheet Item | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | **$33,913** | **$32,830** | | Property, plant and equipment, net | $28,932 | $28,038 | | Total current assets | $1,399 | $1,215 | | **Total Liabilities** | **$23,231** | **$22,498** | | Long-term debt (including current portion) | $13,397 | $13,155 | | Short-term debt | $1,589 | $879 | | **Total Common Shareholders' Equity** | **$10,682** | **$10,332** | [Consolidated Statements of Operations](index=9&type=section&id=Consolidated%20Statements%20of%20Operations) For the six months ended June 30, 2025, operating revenues increased to $2.42 billion from $2.16 billion year-over-year, with net income attributable to common shareholders rising to $494 million Statement of Operations Summary (in millions, except per share data) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | Six Months Ended June 30, 2025 | Six Months Ended June 30, 2024 | | :--- | :--- | :--- | :--- | :--- | | Operating Revenues | $1,276 | $1,149 | $2,418 | $2,160 | | Operating Income | $489 | $449 | $860 | $775 | | Net Income Attributable to Common Shareholders | $289 | $277 | $494 | $462 | | Diluted Earnings Per Share | $1.48 | $1.42 | $2.53 | $2.37 | [Consolidated Statements of Cash Flows](index=11&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) For the six months ended June 30, 2025, net cash from operating activities was $632 million, while net cash used in investing activities was $1.34 billion, resulting in a net decrease in cash of $5 million Cash Flow Summary for the Six Months Ended June 30 (in millions) | Cash Flow Activity | 2025 | 2024 | | :--- | :--- | :--- | | Net cash provided by operating activities | $632 | $727 | | Net cash used in investing activities | $(1,340) | $(1,471) | | Net cash provided by financing activities | $703 | $478 | | **Net decrease in cash, cash equivalents and restricted funds** | **$(5)** | **$(266)** | [Notes to Consolidated Financial Statements](index=13&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) The notes provide detailed explanations of the company's accounting policies, regulatory activities, acquisitions, debt structure, contingencies, and segment performance, including $232 million in annualized revenue from 2025 general rate cases [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=42&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses the financial results for the second quarter and first half of 2025, highlighting that diluted EPS for the six months ended June 30, 2025, increased to $2.53 from $2.37 year-over-year, driven by new rates from capital investments - Diluted EPS for the six months ended June 30, 2025, was **$2.53**, up from **$2.37** in 2024, primarily driven by new rates in the Regulated Businesses, partially offset by an estimated unfavorable weather impact of **$0.06 per share**[178](index=178&type=chunk) - The company plans to invest approximately **$3.3 billion** in growth strategies in 2025, having invested **$1.3 billion** in Regulated Businesses for infrastructure and **$21 million** for acquisitions adding approximately **7,600 customers** in the first six months[179](index=179&type=chunk)[181](index=181&type=chunk) - On May 19, 2025, the Company entered into an agreement to acquire Nexus Regulated Utilities for approximately **$315 million** in cash, expected to add nearly **47,000 customer connections** and an estimated **$200 million in rate base**, with closing anticipated by or before August 2026[180](index=180&type=chunk)[182](index=182&type=chunk) - The company received an initial settlement payment of **$34 million (net)** from 3M Company related to the PFAS multi-district litigation, recorded as a regulatory liability for customer benefit pending PUC approval[139](index=139&type=chunk)[187](index=187&type=chunk) [Results of Operations](index=47&type=section&id=Results%20of%20Operations) Consolidated operating revenues for the six months ended June 30, 2025, increased by $258 million to $2.42 billion, primarily from authorized rate increases in the Regulated Businesses segment, partly offset by increased operating and depreciation expenses Regulated Businesses Revenue Change Drivers (Six Months Ended June 30, 2025 vs 2024) | Driver | Change (in millions) | | :--- | :--- | | Authorized Rate Increases (incl. surcharges) | +$213 | | Acquisitions and Organic Growth | +$25 | | Unfavorable Weather Impact | -$17 | | **Total Revenue Increase** | **~$242** | - Regulated Businesses' O&M expenses for the first six months of 2025 increased by **$94 million** year-over-year, driven by higher employee-related costs, technology-related services, production costs, and customer uncollectible expense[212](index=212&type=chunk) - Depreciation and amortization for the Regulated Businesses increased by **$57 million** for the six months ended June 30, 2025, due to additional utility plant placed in service and higher depreciation rates from recent rate cases[213](index=213&type=chunk) [Regulatory Matters](index=44&type=section&id=Regulatory%20Matters) In 2025, the company received authorizations for $232 million in annualized incremental revenues from general rate cases and $38 million from infrastructure surcharge mechanisms, with several general rate cases pending 2025 General Rate Case Authorizations (in millions) | State | Annualized Revenue | Effective Date | | :--- | :--- | :--- | | Illinois | $105 | Jan 1, 2025 | | Missouri | $63 | May 28, 2025 | | Indiana (Step) | $17 | May 14, 2025 | | California (Step) | $17 | Jan 1, 2025 | | Virginia | $15 | Feb 24, 2025 | | Iowa | $13 | Aug 1, 2025 | | Other | $2 | Various | | **Total** | **$232** | | - The company received authorizations for **$38 million** in annualized incremental revenues from infrastructure surcharges effective in 2025, with the largest amounts from New Jersey (**$15 million**) and Missouri (**$17 million**)[204](index=204&type=chunk) - Pending general rate cases include a request in California for a **$111 million** total increase over 2027-2029, a **$27 million** request in Kentucky, and a **$48 million** request in West Virginia[201](index=201&type=chunk)[202](index=202&type=chunk)[203](index=203&type=chunk) [Liquidity and Capital Resources](index=51&type=section&id=Liquidity%20and%20Capital%20Resources) As of June 30, 2025, the company had total available liquidity of $1.17 billion, down from $1.88 billion at year-end 2024, primarily due to increased commercial paper borrowings, while maintaining compliance with debt covenants Available Liquidity (in millions) | Component | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash and Cash Equivalents | $94 | $96 | | Availability on Revolving Credit Facility | $1,075 | $1,788 | | **Total Available Liquidity** | **$1,169** | **$1,884** | - Cash flows from operating activities decreased by **$95 million** for the first six months of 2025 compared to 2024, primarily due to a CAMT liability payment and higher customer receivables[243](index=243&type=chunk) - The company's debt-to-capitalization ratio was **0.58 to 1.00** as of June 30, 2025, well within the covenant requirement of not more than **0.70 to 1.00**[248](index=248&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=56&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company states that it is exposed to market risks, including changes in commodity prices, equity prices, and interest rates, with no significant changes since December 31, 2024 - There have been no significant changes to the Company's exposure to market risk since December 31, 2024[255](index=255&type=chunk) [Item 4. Controls and Procedures](index=56&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, concluded that the company's disclosure controls and procedures were effective as of June 30, 2025, with no material changes in internal control over financial reporting identified - The CEO and CFO concluded that as of June 30, 2025, the Company's disclosure controls and procedures were effective at a reasonable level of assurance[257](index=257&type=chunk) - No changes in internal control over financial reporting occurred during the three months ended June 30, 2025, that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting[258](index=258&type=chunk) [Part II. Other Information](index=57&type=section&id=Part%20II.%20Other%20Information) This section provides updates on legal proceedings, risk factors, equity security sales, defaults, mine safety, other information, and a list of exhibits [Item 1. Legal Proceedings](index=57&type=section&id=Item%201.%20Legal%20Proceedings) This section provides updates on key legal matters, including a denied petition challenging the coastal development permit for the Water Supply Project, preliminary court approval for a class action settlement, and a $34 million initial settlement payment related to PFAS litigation - Regarding the Monterey Peninsula Water Supply Project, a court denied a petition challenging the coastal development permit, and the CPUC authorized an **$11 million** increase to the cost cap for certain extraction wells[261](index=261&type=chunk)[263](index=263&type=chunk) - A proposed class action settlement agreement in the Dunbar, West Virginia litigation received preliminary court approval on May 5, 2025, with a final approval hearing scheduled for September 11, 2025[266](index=266&type=chunk) - As of June 30, 2025, the Company received an initial settlement payment of **$34 million (net)** from 3M Company in the PFAS multi-district litigation, with additional payments anticipated in 2025[267](index=267&type=chunk) [Item 1A. Risk Factors](index=58&type=section&id=Item%201A.%20Risk%20Factors) The company reports that there have been no material changes from the risk factors that were previously disclosed in its Annual Report on Form 10-K - There have been no material changes from the risk factors previously disclosed in the Company's Form 10-K[268](index=268&type=chunk) [Item 2. Unregistered Sales of Equity Securities and Use of Proceeds](index=58&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) On May 28, 2025, the company issued 48,381 shares of common stock from treasury stock as consideration for the acquisition of Audubon Water Company, and did not repurchase any shares during the quarter - The Company issued **48,381 shares** of its common stock on May 28, 2025, as consideration for the acquisition of Audubon Water Company[269](index=269&type=chunk) - No common stock was repurchased during the three months ended June 30, 2025, with an aggregate of **5,140,000 shares** remaining available for repurchase under the anti-dilutive stock repurchase program[271](index=271&type=chunk) [Item 3. Defaults Upon Senior Securities](index=58&type=section&id=Item%203.%20Defaults%20Upon%20Senior%20Securities) The company reported no defaults upon its senior securities during the period - None[272](index=272&type=chunk) [Item 4. Mine Safety Disclosures](index=58&type=section&id=Item%204.%20Mine%20Safety%20Disclosures) This item is not applicable to the company - Not applicable[273](index=273&type=chunk) [Item 5. Other Information](index=58&type=section&id=Item%205.%20Other%20Information) During the second quarter of 2025, none of the company's directors or officers adopted or terminated a Rule 10b5-1 trading plan or any non-Rule 10b5-1 trading arrangement - During the three months ended June 30, 2025, no directors or officers adopted or terminated any Rule 10b5-1 trading plans or other non-Rule 10b5-1 trading arrangements[274](index=274&type=chunk) [Item 6. Exhibits](index=59&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including agreements related to acquisitions, debt instruments, compensation plans, and certifications by the CEO and CFO

Core Viewpoint - American Water Works (AWK) is expected to report a year-over-year increase in earnings and revenues for the quarter ended June 2025, with a consensus outlook indicating potential stock price movements based on actual results compared to estimates [1][2]. Earnings Expectations - The consensus estimate for quarterly earnings is $1.49 per share, reflecting a year-over-year increase of +4.9% [3]. - Expected revenues are projected at $1.15 billion, which is an increase of 0.5% from the previous year [3]. Estimate Revisions - The consensus EPS estimate has been revised 0.13% lower in the last 30 days, indicating a reassessment by analysts [4]. - The direction of estimate revisions may not always align with the aggregate change, suggesting variability in analyst sentiment [4]. Earnings Surprise Prediction - The Zacks Earnings ESP model indicates that the Most Accurate Estimate for American Water Works is higher than the Zacks Consensus Estimate, resulting in a positive Earnings ESP of +0.67% [11]. - The company holds a Zacks Rank of 2, suggesting a strong likelihood of beating the consensus EPS estimate [11]. Historical Performance - In the last reported quarter, American Water Works had an earnings surprise of +0.96%, reporting $1.05 per share against an expectation of $1.04 [12]. - Over the past four quarters, the company has beaten consensus EPS estimates two times [13]. Conclusion - American Water Works is positioned as a compelling candidate for an earnings beat, but investors should consider additional factors influencing stock performance beyond earnings results [16].

Core Insights - American Water Works (AWK) has consistently surpassed earnings estimates, making it a strong candidate for future investment opportunities [1][5] - The company reported earnings of $1.05 per share for the last quarter, exceeding the Zacks Consensus Estimate of $1.04 per share by 0.96% [2] - In the previous quarter, AWK's earnings were $1.22 per share against an expectation of $1.13, resulting in a surprise of 7.96% [2] Earnings Performance - Over the last two quarters, American Water Works has averaged a 4.46% earnings surprise [1] - The company's positive Earnings ESP (Expected Surprise Prediction) stands at +1.84%, indicating bullish sentiment among analysts regarding its near-term earnings potential [8] - The next earnings report for American Water Works is anticipated on July 30, 2025 [8] Zacks Rank and Predictive Metrics - American Water Works holds a Zacks Rank of 2 (Buy), which, when combined with its positive Earnings ESP, suggests a high likelihood of another earnings beat [8] - Research indicates that stocks with a positive Earnings ESP and a Zacks Rank of 3 (Hold) or better have a nearly 70% chance of producing a positive surprise [6] - The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate, reflecting the latest analyst revisions [7]