AES Flips Second-Quarter Loss to Profit

The Tip Desk · August 4, 2026 · 3 min read

Adjusted EBITDA rose to $898 million as Renewables and Energy Infrastructure spot markets lifted the power company.

The AES Corporation (AES) reported net income of $387 million for the three months ended June 30, 2026, reversing a $150 million loss a year earlier. Net income attributable to the company was $426 million, compared with a $95 million loss.

Revenue rose 20% to $3,422 million from $2,855 million. Operating margin increased 53% to $692 million. Adjusted EBITDA, a non-GAAP measure, rose $217 million to $898 million from $681 million. The EBITDA increase reflected higher U.S. development services, higher spot energy and capacity sales and prices, higher ownership of Cochrane, and higher retail margin mainly at AES Ohio, partly offset by lower contract sales volume mainly from the expiration of the Maritza PPA in Bulgaria.

Renewables was the largest revenue contributor to the year-over-year increase. Renewables revenue rose 46% to $939 million from $644 million. The increase mainly reflected a $76 million favorable impact from energy derivatives in the U.S., $67 million of higher spot sales and prices in Colombia driven by El Niño, $63 million of development services in the U.S., $53 million from new projects placed in service in the U.S. and Chile, $27 million from appreciation of the Colombian peso, and $21 million of higher retail-supply revenue, partly offset by $13 million of lower contracted and spot sales in Chile. Renewables operating margin was $247 million.

Energy Infrastructure revenue rose 15% to $1,496 million from $1,306 million. The increase was led by $188 million of higher energy and capacity sales and prices in the spot market in Argentina, $25 million of higher spot sales in Mexico after a PPA expiration, $24 million of higher LNG sales, and $23 million of net derivative gains, partly offset by $72 million of lower contract sales volume mainly from the Maritza PPA. Energy Infrastructure operating margin was $241 million.

Utilities revenue increased 7% to $1,018 million from $954 million. The increase was driven by $38 million of higher retail rates after AES Ohio’s November 2025 2024 DRC Settlement and $35 million of higher transmission and rider revenues, partly offset by a $10 million decline in AES Indiana wholesale revenue from lower load and unit availability. Utilities operating margin was $158 million. New Energy Technologies recorded no revenue and a $3 million operating loss.

Other expense fell 91% to $27 million from $295 million, mainly because of $199 million of prior-year losses on commencement of sales-type leases at AES Clean Energy and a prior-year $48 million remeasurement loss on the 5B investment. Gain on disposal and sale of business interests rose to $209 million from $70 million, including a $186 million gain on sale of Fluence shares and a $24 million gain from contributing two JK projects to a trust. Asset impairment moved from a $154 million reversal to $30 million of expense. Income tax expense was $28 million. Interest expense increased 5% to $368 million. General and administrative expenses rose 27% to $62 million, including $11 million of Merger-related costs. Net cash provided by operating activities was $1,046 million.

Sequentially, total revenue rose from $3,180 million in the three months ended March 31, 2026. Renewables revenue rose from $820 million. Energy Infrastructure revenue rose from $1,256 million after declining 5% year over year in the first quarter. Utilities revenue declined from $1,136 million. Operating margin rose from $640 million. Adjusted EBITDA increased from $827 million. Net income attributable to AES fell from $487 million.

On March 1, 2026, AES entered into an Agreement and Plan of Merger with Horizon Parent, L.P. and Horizon Merger Sub, Inc., with Merger Sub to merge with and into the company. Parent is jointly controlled by vehicles affiliated with Global Infrastructure Management and the EQT Infrastructure VI fund. Completion of the transaction, related costs, and restrictions during the pendency of the deal could affect results.