American Electric Power Raises Outlook as Contracted Load Expands
Second-quarter revenue rose 7.0% to $5.445 billion as the utility added contracted demand.
American Electric Power (AEP), one of the largest U.S. electric utilities, raised its 2026 operating-earnings outlook as contracted incremental load continued to climb.
Contracted load through 2030 increased by 6 gigawatts during the quarter to 69 gigawatts, extending a sharp rise from 24 gigawatts a year earlier. The total had reached 63 gigawatts in the first quarter and 56 gigawatts at the end of 2024.
Second-quarter revenue increased $358 million from a year earlier. GAAP earnings fell 41.8% to $713 million, or $1.31 a share, from $2.29 a share, largely reflecting the prior-year sale of a transmission minority interest and the timing of tax items. Operating earnings declined 3.1% to $742 million, while operating EPS fell to $1.36 from $1.43 and $1.64 in the first quarter.
The utility businesses provided support. Operating earnings at Vertically Integrated Utilities rose to $302 million from $297 million, while Transmission & Distribution Utilities increased to $239 million from $224 million. Those gains were offset by a $44 million widening of the Corporate and Other operating loss to $115 million.
AEP Transmission Holdco's operating earnings were nearly unchanged at $225 million, though its GAAP earnings fell $353 million because the year-earlier period included the minority-interest sale. Generation & Marketing operating earnings slipped $1 million to $91 million.
AEP now expects 2026 operating EPS of $6.25 to $6.55, up 10 cents at both ends from its prior range. The company maintained its target for annual operating-earnings growth of 7% to 9% through 2030.
The company kept its five-year capital plan at $78 billion after raising it by $6 billion in the first quarter, while identifying more than $10 billion of additional investment opportunities. Secured gas-turbine capacity increased by about 3 gigawatts to roughly 13 gigawatts, and AEP is evaluating as much as another 10 gigawatts through 2035.
Executed take-or-pay load agreements could offset as much as $16 billion of residential-customer costs. Large-load tariffs have received approval in five AEP states, with applications pending in three more, tying the demand pipeline more directly to customer protections as the utility prepares for further expansion.