The Southern Company (SO) Q1 2025 earnings summary

Executive summary

• Q1 2025 adjusted EPS rose to $1.23 from $1.03 year-over-year, driven by state-regulated utility investments, favorable weather, and strong commercial and industrial demand, especially from data centers.

• Net income increased 18% to $1.3 billion ($1.21 per share), with adjusted net income at $1.4 billion ($1.23 per share).

• Dividend increased by 8 cents to an annualized $2.96 per share, marking 24 consecutive years of increases.

• Over 90% of earnings and 95% of projected capex are from state-regulated electric and gas utilities.

• Economic development in the Southeast remains robust, with strong customer growth and a large pipeline of commercial and industrial load, especially from data centers.

Financial highlights

• Q1 2025 adjusted EPS was $1.23, up $0.20 year-over-year and $0.03 above estimate; reported EPS was $1.21, excluding $0.02 in charges from plant construction losses and accelerated depreciation.

• Operating revenues rose 17% to $7.8B; operating income increased 18% to $2.0B compared to Q1 2024.

• Retail electric revenues increased 16.7% year-over-year, with notable contributions from Plant Vogtle Unit 4 and rate increases at Alabama Power and Georgia Power.

• Commercial and industrial sales increased, with data center sales up 11%, office buildings up 4%, and transportation up 4% year-over-year.

• Q2 2025 adjusted EPS estimate is $0.85, reflecting less favorable weather and absence of a large asset transaction from the prior year.

Outlook and guidance

• 2025 full-year adjusted EPS guidance is $4.20 to $4.30, excluding further charges from major projects and other non-recurring items.

• Long-term adjusted EPS growth targeted at 5% to 7%, supported by projected 7% rate base growth.

• Large load pipeline across electric subsidiaries exceeds 50 GW through the mid-2030s, with 10 GW in project commitments.

• Only a fraction of the pipeline is included in sales forecasts, maintaining a disciplined approach.

• Potential updates to capital expenditure and financing plans expected on the Q2 call, pending regulatory outcomes.