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ALLIANT ENERGY CORP (LNT)·Q2 2025 Earnings Summary

Executive Summary

  • Q2 2025 delivered a clean beat: GAAP EPS of $0.68 versus S&P Global consensus of $0.64 and revenue of $0.961B versus $0.917B, driven by higher revenue requirements from capital investments and favorable temperature impacts, partially offset by higher depreciation and financing expense . EPS/revenue estimates from S&P Global.*
  • Management reaffirmed 2025 ongoing EPS guidance at $3.15–$3.25 and long‑term EPS CAGR of 5–7%, with a revised consolidated effective tax rate assumption to (31%), up from (28%) in Q1 .
  • Strategic load catalysts strengthened: QTS announced a $10.0B Cedar Rapids data center investment; LNT is in advanced talks on a second QTS site (Greater Madison), and disclosed ~1.5 GW of “mature opportunities” as incremental potential load, implying new generation needs in coming years .
  • Financing execution supports growth with flexibility: ~$175M raised on a forward basis under the ATM in H1; incremental CapEx expected to be funded 40–50% with new equity while managing to credit metrics (FFO/debt, equity ratio 40–45%) .

What Went Well and What Went Wrong

  • What Went Well

    • Beat on EPS and revenue versus consensus; Q2 GAAP EPS $0.68 (vs $0.64 est.) and revenue $0.961B (vs $0.917B est.), aided by rate base growth and temperatures versus last year . EPS/revenue estimates from S&P Global.*
    • Strategic load development accelerated: “Physical construction has now started in both Iowa and Wisconsin on three large scale data centers,” with QTS announcing a $10B Cedar Rapids project; management emphasized delivering “cascading waves of growth” and high‑confidence mature opportunities (~1.5 GW) .
    • Regulatory and tax-credit positioning: Extensive safe harboring (100% storage; 750 MW of wind, with line of sight to remaining 450 MW), transferability intact, constructive IA/WI regulatory backdrop, and MISO capacity auction revenues benefiting customers .

  • What Went Wrong

    • Cost headwinds: Higher depreciation and financing expense remained a drag on earnings even as rate base growth supported margins .
    • Industrial volume softness year‑over‑year persisted in several periods (context from prior quarters): retail industrial kWh fell vs. PY in Q2 (2,565k MWh vs. 2,635k MWh), reflecting mix and co‑gen dynamics .
    • Equity needs and dilution: Management reiterated that incremental CapEx would likely require 40–50% equity funding, raising investor concerns about dilution and timing amidst significant growth ambitions .

Financial Results

MetricQ2 2024Q1 2025Q2 2025
Revenue ($USD Billions)$0.894 $1.128 $0.961
GAAP Diluted EPS ($)$0.34 $0.83 $0.68
Operating Income ($USD Millions)$130 $257 $223
Operating Margin (%)14.5% (derived from revenue/OpInc with citations: )22.8% (derived: )23.2% (derived: )

Versus Estimates (Q2 2025):

MetricConsensusActualSurprise
EPS ($)0.6415*0.68 +$0.04; 6% beat
Revenue ($USD Billions)$0.917*$0.961 +$0.044B; 4.8% beat

Segment Earnings and EPS (Q2 2025 vs Q2 2024):

SegmentGAAP Income ($MM) Q2 2024GAAP Income ($MM) Q2 2025GAAP EPS Q2 2024 ($)GAAP EPS Q2 2025 ($)
IPL$18 $98 $0.07 $0.38
WPL$64 $87 $0.25 $0.34
Corporate Services$3 $5 $0.01 $0.02
ATC Holdings$9 $10 $0.04 $0.04
Non‑utility & Parent$(7) $(26) $(0.03) $(0.10)
Consolidated$87 $174 $0.34 $0.68

KPIs (Q2 2025 vs Q2 2024; volumes in ‘000s):

KPIQ2 2024Q2 2025
Retail electric sales (MWh)5,948 5,926
Wholesale + bulk power sales (MWh)1,740 1,327
Total electric sales (MWh)7,702 7,767
Retail gas sales & transported (dekatherms)5,730 6,114
Total gas sold & transported (dekatherms)34,832 33,273
Total retail electric customers997,638 1,004,242
Temperature impact on operating income ($MM)$(4) $6
HDDs (Cedar Rapids)499 535
CDDs (Cedar Rapids)290 313

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Ongoing EPSFY 2025$3.15 – $3.25 $3.15 – $3.25 Maintained
Consolidated effective tax rateFY 2025(28%) (31%) Adjusted higher (more benefit)
Long‑term EPS CAGRMulti‑year5% – 7% (reiterated) 5% – 7% Maintained
Capital expenditures (aggregate)2025–2028$11.5B (updated in Q1) No update in Q2 release; update expected Q3 Maintained, update signaled
Equity funding of incremental CapExForward~45–50% (Q4 call context) ~40–50% (Q2 call) Slightly refined range
Dividend per quarterCurrent$0.5075 (Q1) $0.5075 (declared July 18) Maintained

Earnings Call Themes & Trends

TopicPrevious Mentions (Q4 2024)Previous Mentions (Q1 2025)Current Period (Q2 2025)Trend
Data center load & ESAsBig Cedar phases to 1.9 GW; Beaver Dam land purchase; high interest pipeline 2.1 GW ESAs; accelerated ramp; individual customer rate filings in IA/WI QTS $10B Cedar Rapids; advanced talks for Madison site; ~1.5 GW mature opportunities Strengthening
Resource planning & generation mixLeaning more toward generation in plan; all‑of‑the‑above Mix of existing resources, new gen, demand response, capacity purchases New gen primarily needed for incremental load; gas turbines possible; turbine swap positions secured Increasing clarity
Tax credits & safe harborBroad safe harbor activity; transferability benefits 100% storage safe harbored; majority of credits pre‑2025; tariff exposure ~1–2% of $11.5B plan Transferability intact; 750 MW wind safe harbored; line of sight to remaining 450 MW De‑risking sustained
Tariffs on batteriesN/A in Q4Batteries subject to 20% tariff; sourcing strategy mitigates cost No new tariff issues; flexible resource path reiterated Stable/managed
MISO capacity auctionN/ASold excess capacity; customer bill benefits Capacity auction revenues cited among positives Supportive
Financing & equity plansUpcoming ATM; hybrid options under consideration ATM launch; ~12% of 2025–2028 plan via equity; protect ratings ~$175M raised forward via ATM; incremental CapEx 40–50% equity; equity ratio 40–45% Executing
Regulatory updates (IA/WI)WI sales & use tax exemption for data centers; constructive IA legislation WI rate review for 2026–2027; multiple dockets for customer investments WI rate review schedule: testimony Aug 12, hearing Sep 9; multiple IA approvals (Google ICR, gas plant, storage) Progressing

Management Commentary

  • “Physical construction has now started in both Iowa and Wisconsin on three large scale data centers… Our partnership with the QTS Cedar Rapids data center is a clear demonstration of how we're delivering transformational growth” (Lisa Barton) .
  • “With a solid first half behind us, we are reaffirming our 2025 earnings guidance range of $3.15 to $3.25 per share. And we are reaffirming our long term annual earnings growth target of 5% to 7%” (Robert Durian) .
  • “Under current start of construction guidance, we have safe harbored 100% of the energy storage projects in our capital plan… and we are confident in our ability to safe harbor the remaining 450 megawatts either directly or through a third party developer” (Lisa Barton) .
  • “Think of [mature opportunities] as roughly about one and a half gigawatts of potential new load… As we finalize those energy supply agreements, then we will build into our capital expenditure plan… the resources that we need to serve those” (Robert Durian) .

Q&A Highlights

  • QTS timeline and load ramp: Cedar Rapids ramp expected ~200 MW in 2026, ~300→1,000 MW through 2027, ~1,600 MW in 2028, remainder in 2029; Madison QTS in principle, “little more than half” of mature bucket size .
  • Safe harbor and flexibility: If remaining 450 MW of wind cannot be safe harbored, LNT will pivot technology to meet load while preserving affordability, aided by advanced MISO queue positions .
  • WI rate review cadence: Expect intervener testimony Aug 12, hearing Sep 9; settlement window through the next month (historical precedent) .
  • Financing parameters: Equity ratio guided at 40–45% tied to FFO/debt; incremental CapEx funded ~40–50% equity, balancing dilution with credit metrics .

Estimates Context

  • Q2 2025 results were above consensus: EPS $0.68 vs $0.6415 est.; revenue $0.961B vs $0.917B est., reflecting rate base growth (IPL + WPL orders) and favorable temperatures versus last year . EPS/revenue estimates from S&P Global.*
  • Prior quarter (Q1 2025) also beat: EPS $0.83 vs $0.71 est.; revenue $1.128B vs $1.095B est., indicating momentum that may bias models toward the high end of 2025 guidance if operational tailwinds persist . EPS/revenue estimates from S&P Global.*

Key Takeaways for Investors

  • Strong execution continues: Two consecutive quarterly beats with reaffirmed FY guidance and long‑term growth targets suggest operational momentum into H2 2025 .
  • Data center load is a durable multi‑year catalyst: QTS $10B Cedar Rapids and mature pipeline (~1.5 GW) imply meaningful incremental generation, likely including gas turbines; LNT has pre‑positioned turbine swap capacity and flexible resource planning to meet timelines .
  • Regulatory and tax positioning de‑risks plan: Extensive safe harboring and intact transferability support affordability and financing flexibility; multiple IA/WI approvals underpin near‑term project execution .
  • Financing discipline: ATM forward funding (~$175M) already executed; incremental CapEx guided to 40–50% equity with vigilance on FFO/debt and equity ratio, mitigating ratings risk .
  • Near‑term watch items: WI rate case milestones (Aug testimony/Sep hearing), Q3 update on signed ESAs and CapEx/resource plan alignment, and treasury guidance on tax credits .
  • Trading setup: Narrative tailwinds (data center growth, regulatory approvals) vs. dilution concerns from equity funding; settlement outcomes and Q3 plan update are likely stock catalysts .
  • Operational sensitivity: Temperature impacts can swing quarterly margins; management’s hedges (capacity sales, cost controls) remain effective, but keep model scenarios on HDD/CDD variance .

Footnote: *Values retrieved from S&P Global.