Core Viewpoint - TXNM Energy reported disappointing financial results for Q2 2025, with significant earnings misses and margin compression, primarily due to increased costs and ongoing acquisition processes [1][5][14] Financial Performance - Ongoing (non-GAAP) earnings per share for Q2 2025 were $0.25, missing analyst expectations of $0.41 by 39% [1][2] - GAAP net earnings fell to $21.6 million, down from $48.0 million a year earlier, representing a 55% decline [1][2] - Revenue increased by 2.9% year-over-year to $502.4 million, but operating income (GAAP) dropped by 31% due to rising operating expenses [1][5] - Key cost drivers included an 8.3% increase in energy costs to $167.6 million and a 27.6% rise in administrative expenses to $76.0 million [5][6] Business Overview - TXNM Energy operates as a regulated utility through its subsidiaries PNM and TNMP, serving over 800,000 customers in New Mexico and Texas [3] - The company focuses on modernizing grid infrastructure, expanding renewable energy, and managing customer demand growth [4] Strategic Developments - The company secured a $105 million rate increase for PNM and a $176 million rate base increase for TNMP, crucial for cost recovery and future investments [9][10] - TXNM Energy received regulatory approval to add 450 megawatts of solar and battery storage capacity, supporting its goal for a carbon-free generation portfolio by 2040 [10][11] Acquisition and Future Outlook - TXNM Energy is in the process of being acquired by Blackstone Infrastructure for $61.25 per share, with the transaction expected to close in the second half of 2026 [13][14] - Financial guidance remains uncertain due to the pending acquisition, with management focusing on regulatory approvals and infrastructure investments [14]
TXNM Energy (TXNM) Q2 EPS Drops 58%