Pinnacle West Capital (PNW) Q2 2025 earnings summary

Executive summary

• Q2 2025 net income attributable to common shareholders was $192.6 million ($1.58 per diluted share), down from $203.8 million ($1.76 per share) in Q2 2024, mainly due to higher O&M, depreciation, and lower pension credits, partially offset by sales growth and investment gains.

• Customer and sales growth remained robust at 2.4% and 5.2% respectively, with a new all-time record peak demand of 8,527 MW set in July 2025 and strong economic activity in Arizona.

• Major infrastructure investments are underway, including accelerated timelines for TSMC-related facilities, a new natural gas pipeline, and over 800 MW of new clean energy projects scheduled between 2026 and 2028.

• The company updated its clean energy goal to carbon neutral by 2050, removing interim targets to prioritize reliability and affordability.

• Focus remains on reliability, affordability, and a balanced energy mix, with significant investments in grid infrastructure and customer assistance programs.

Financial highlights

• Q2 2025 operating revenues were $1.36 billion, up $50 million year-over-year, driven by customer growth and higher usage; six-month revenues rose to $2.39 billion from $2.26 billion.

• Q2 2025 EPS was $1.58 (diluted), down from $1.76 in Q2 2024, impacted by higher O&M, depreciation, and lower pension/OPEB credits.

• O&M expenses increased due to timing of outages, IT, and corporate costs, but cost-saving measures are in place.

• Issued $800 million in bonds to refinance 2025 maturities and support capital strategy.

• Dividend declared: $0.895 per share, payable September 2, 2025.

Outlook and guidance

• Full-year 2025 EPS guidance of $4.40–$4.60 is reiterated, with long-term EPS growth targeted at 5%–7% off the 2024 midpoint.

• Projected annual customer growth for 2025–2027 is 1.5%–2.5%, with retail electricity sales growth (excluding weather) expected at 4.0%–6.0% annually.

• Capital expenditures are forecasted at $2.4 billion in 2025, $2.55 billion in 2026, and $2.65 billion in 2027, focused on generation, renewables, storage, and grid infrastructure.

• The 2025 Rate Case seeks a $579.5–$580 million net base rate increase, with rates expected in effect in late 2026.

• Clean energy goals updated to carbon-neutral by 2050, with interim targets removed.