Executive Summary

Q4 2024 delivered stable revenue and stronger GAAP EPS, but non‑GAAP profitability reflected elevated non‑recurring items; 2025 guidance calls for Adjusted EBITDA of $2.65–$2.85B and Adjusted EPS of $2.10–$2.26, with a >60% YoY increase expected in Renewables EBITDA as new U.S. projects contribute and South America normalizes .
Management reaffirmed long‑term growth targets (Adjusted EBITDA CAGR 5–7% through 2027; Adjusted EPS CAGR 7–9% through 2025 and through 2027) and maintained the quarterly dividend at $0.17595 following a 2% increase in December 2024—explicitly stating no need for equity issuance in the plan period .
Strategic de‑risking accelerated: sale of AES Brasil (~~$630M) closed in Q4; AES Ohio 30% sell‑down to CDPQ (~~$546M) announced; coal exits extended at select sites to support cash/metrics, with ~one‑third of previously expected coal EBITDA roll‑off now continuing beyond 2027 for a period .
2025 inflection driven by: full‑year operations from 6.6 GW added in 2023–2024, 3.2 GW new completions expected in 2025, ~$150M 2025 cost savings (ramping to >$300M in 2026), and ~$1.4B tax attributes in 2025; management emphasized balance sheet focus and elimination of equity needs as key stock catalysts .

What Went Well and What Went Wrong

What Went Well
- “2025 will be an inflection point,” with Renewables EBITDA up >60% YoY, aided by 6.6 GW placed in 2023–2024 and additional 3.2 GW set for 2025 COD; demand from AI/data centers and new U.S. manufacturing are core drivers .
- De‑risking and simplification: exit of Brazil, domestic supply chain safe‑harboring through 2027, and reaffirmed long‑term growth targets without equity issuance; dividend maintained .
- Utilities momentum: Indiana ROE 9.9% approved; data center load growth of 2.1 GW at AES Ohio; double‑digit rate base trajectory through 2027 .
What Went Wrong
- Weather and outages impacted 2024: Colombia flooding/drought and Mexico outages weighed on renewables and Energy Infrastructure, pushing Adjusted EBITDA to the low end of the 2024 range; Q4 Adjusted EPS (0.54) trailed prior‑year Q4 (0.73) on elevated non‑recurring adjustments .
- Southland energy margins compressed versus prior hedged period; Warrior Run monetization tailwind ended in 1H24, creating a 2025 headwind .
- Investor concerns on policy, renewables growth cadence, and credit metrics prompted explicit management response; cost reductions include a 10% workforce reduction and organizational streamlining (confidence stated; actions already executed) .

Financial Results

Headline metrics (quarterly trend)

Metric	Q2 2024	Q3 2024	Q4 2024
Revenue ($USD Millions)	$2,942	$3,289	$2,962
Diluted EPS (GAAP)	$0.27	$0.72	$0.79
Adjusted EPS (Non‑GAAP)	$0.38	$0.71	$0.54
Adjusted EBITDA ($MM)	$652	$692	$643
Adjusted EBITDA with Tax Attributes ($MM)	$843	$1,168	$1,061

Q4 YoY comparison

Metric	Q4 2023	Q4 2024	YoY
Revenue ($USD Millions)	$2,968	$2,962	-$6
Diluted EPS (GAAP)	($0.14)	$0.79	+$0.93
Adjusted EPS (Non‑GAAP)	$0.73	$0.54	-$0.19
Adjusted EBITDA ($MM)	$630	$643	+$13
Adjusted EBITDA with Tax Attributes ($MM)	$1,172	$1,061	-$111

Segment revenue breakdown (trend)

Segment Revenue ($MM)	Q2 2024	Q3 2024	Q4 2024
Renewables SBU	$596	$726	$569
Utilities SBU	$896	$961	$878
Energy Infrastructure SBU	$1,469	$1,623	$1,532
New Energy Technologies	$0	$1	$0
Corporate & Other	$40	$33	$56
Eliminations	($59)	($55)	($73)
Total Revenue	$2,942	$3,289	$2,962

KPIs and operating context

KPI	Current/Update
Signed PPAs backlog	11.9 GW; 4.9 GW under construction
2024 activity	4.4 GW new PPAs; 3.0 GW constructed/acquired; 670 MW CCGT in Panama completed
Data center load	2.1 GW new load growth at AES Ohio in 2024
2025 COD	3.2 GW renewables expected online in 2025
2025 tax attributes	~$1.4B expected recognized
Dividend	$0.17595 quarterly (2% increase effective Q1’25)

Note on estimates: S&P Global consensus for Q4 2024 revenue/EPS was unavailable due to access limitations during retrieval.

Guidance Changes

Metric	Period	Previous Guidance	Current Guidance	Change
Adjusted EBITDA ($B)	FY 2025	N/A	$2.65–$2.85	New
Adjusted EBITDA with Tax Attributes ($B)	FY 2025	N/A	$3.95–$4.35	New
Adjusted EPS	FY 2025	N/A	$2.10–$2.26	New
Adjusted EBITDA CAGR	Through 2027	5%–7%	5%–7% (reaffirmed)	Maintained
Adjusted EPS CAGR	Through 2025 (from 2020)	7%–9%	7%–9% (reaffirmed)	Maintained
Adjusted EPS CAGR	Through 2027 (from 2023 guidance base)	7%–9%	7%–9% (reaffirmed)	Maintained
Dividend per share (quarterly)	2025 run‑rate	$0.1725	$0.17595 (Dec‑24 increase); expect to maintain going forward	Raised; then maintained

Earnings Call Themes & Trends

Topic	Q2 2024 (Prior‑2)	Q3 2024 (Prior‑1)	Q4 2024 (Current)	Trend
AI/data center demand	2.2 GW hyperscaler deals since Q1; 1.2 GW utility load; 727 MW TX PPA w/ Google; 310 MW retail in OH	2.2 GW additional contracts; OH data center load totals 2.1 GW; utilities rate base upshift expected	“No AI without timely power”; strong corporate demand; 2025 inflection as 6.6 GW contributes	Strengthening
Supply chain/tariffs	Panels secured for 2024–2025; domestic content ramp from 2026; Maximo AI robot launched	Onshoring/locked equipment; protected via safe harbor; backlog robust	Domestic supply chains established; safe harbor protections; well insulated vs policy shifts	De‑risked
Balance sheet/funding	Asset sale plan on track; hybrid issuance; no change to funding plan	Brasil sale closed; Ohio sell‑down; credit metrics supported; FFO trends	$150M 2025 cost saves (>$300M 2026); reduce parent renewables investment by $1.3B; eliminate equity need	Positive
Renewables cadence/returns	Mid‑teens IRRs; 3.6 GW 2024 COD; backlog 12.6 GW	3.5 GW YTD 2024 PPAs; 1.2 GW COD in Q3; Brasil exit offsets via U.S. growth; Chile resegment	>60% Renewables EBITDA growth in 2025; 3.2 GW 2025 COD; backlog 11.9 GW	Acceleration in ’25
Coal/Infrastructure	Monetization/legacy transitions (Warrior Run)	Southland margins lower; Warrior Run monetization ended 1H24	Select coal kept beyond 2027 to support cash/metrics; ~1/3 prior coal roll‑off continues beyond 2027 for a period	Smoother glidepath

Management Commentary

“2025 will be an inflection point for AES, as we expect to have strong growth in our renewables Adjusted EBITDA from the 6.6 GW that we completed in 2023 and 2024” (CEO) .
“We are taking immediate steps to strengthen our financial position...reducing our current investment in renewables...improving organizational efficiency...continuing to operate some of our energy infrastructure assets...eliminating the need for issuing new equity during the forecast period and maintaining our dividend” (CEO) .
“We will realize approximately $150 million in cost savings in 2025, ramping up to over $300 million in 2026 as we achieve a full year run rate” (CFO) .
“Our long‑term plan is substantially de‑risked...nearly all of our growth through 2027 coming from projects already signed and in our backlog, or from rate base growth at our US utilities” (CFO) .

Q&A Highlights

Cost savings scope and confidence: $150M in 2025 moving to >$300M in 2026; actions already executed; reductions span development resizing, management layers, and a ~10% workforce reduction (COO/CFO/CEO) .
Returns and project selection: Prioritizing higher‑return, fewer/larger projects; focus on EBITDA per dollar invested; IRRs trending up (CEO) .
Coal profile: About one‑third of prior ~$750M coal EBITDA roll‑off may now continue beyond 2027 for a period (CFO) .
Credit metrics: Parent recourse ended ~22% in 2024; aim mid‑20s by period end; Moody’s method dialogue ongoing; construction debt temporarily inflates consolidated leverage (CFO) .
2025 seasonality and Southland/WI Run: First half EBITDA lower YoY; second half significantly higher; Southland energy exposure calibrated and heavily hedged for 2025 (CFO) .

Estimates Context

S&P Global consensus estimates for Q4 2024 revenue and EPS were not available at retrieval time due to access limitations. Accordingly, we do not present beat/miss versus consensus for this quarter.
Given management’s 2025 framework (Adjusted EBITDA $2.65–$2.85B; Adjusted EPS $2.10–$2.26; Renewables EBITDA >60% YoY), estimate revisions are likely to focus on: (1) cadence of renewables CODs and South America normalization; (2) cost‑savings realization timing; (3) Energy Infrastructure slope given selective coal extensions .

Key Takeaways for Investors

2025 operating inflection with Renewables EBITDA up >60% and 3.2 GW COD supports accelerating earnings/cash; full‑year contribution of 6.6 GW placed in 2023–2024 is a core driver .
Balance sheet actions (cost reductions, $1.3B lower parent renewables investment, asset optimization) remove equity issuance from the plan; dividend maintained .
Utilities are a multi‑year growth engine (data centers, trackers/formula rates, 11%+ annualized rate base growth through 2027) enhancing mix quality and credit metrics .
Policy/tariff risks appear mitigated by domestic supply chains and safe harbor protections; backlog largely locked and >85% online by end‑2027 .
Near‑term modeling: 1H25 lower YoY on lapping items/seasonality; 2H25 significantly higher; 2026 expected low‑teens EBITDA growth as cost savings fully annualize .
Stock catalysts: execution on 2025 guidance path; visible cost‑out delivery; incremental hyperscaler wins and CODs; continued evidence of credit metric improvement; selective coal cash support tapering on investor‑friendly timeline .

Additional context and source documents (Q4/FY press release and 8‑K; Q4 transcript; prior quarter materials; Q4 press releases):

Q4/FY 2024 8‑K + Press Release (including segment data, GAAP, Adjusted metrics, guidance):
Q4 2024 Earnings Call Transcript (strategy, 2025 plan, Q&A):
Q3 2024 Press Release and Transcript (trend, Brasil sale, utilities/data centers):
Q2 2024 8‑K and Transcript (data center wins, supply chain, 2024 guidance):
Dividend increase (Dec 2024) and notes issuance (Dec 2024):

AES CORP (AES)·Q4 2024 Earnings Summary