Entergy Q2 2025 slides: Industrial growth powers raised outlook, $40B capital plan

Introduction & Market Context

Entergy Corporation (NYSE:ETR) presented its second quarter 2025 earnings results on July 30, showing strong performance driven by robust industrial sales growth. The utility reported adjusted earnings per share of $1.05, up from $0.96 in the same period last year, continuing its momentum after beating expectations in Q1. Entergy’s stock responded positively, trading up 1.85% in premarket at $89.87, building on its 64.56% return over the past year.

The company’s presentation highlighted exceptional industrial sales growth of approximately 12% in Q2, part of a projected four-year industrial sales compound annual growth rate (CAGR) of 13%. This performance has given management confidence to raise its longer-term earnings outlook while affirming 2025 guidance.

Quarterly Performance Highlights

Entergy’s second quarter results showed solid financial performance across key metrics. The company reported adjusted EPS of $1.05 and operating cash flow of $1,262 million for Q2 2025.

As shown in the following detailed breakdown of quarterly earnings performance:

The $0.09 increase in adjusted EPS from Q2 2024 was primarily driven by utility operating revenue less fuel, power, and regulatory charges (+$0.17) and utility other income (+$0.10). These positive factors were partially offset by increased utility other O&M expenses (-$0.05), utility other operating expenses (-$0.04), utility interest expense (-$0.06), and share effect (-$0.04).

The strong industrial sales growth of approximately 12% in Q2 has been a key driver of Entergy’s performance, reflecting the company’s success in attracting and serving large industrial customers, particularly in the data center segment.

Strategic Initiatives

Entergy has updated its capital plan to approximately $40 billion through 2028, reflecting increased investments to support customer growth and grid resilience. The following chart illustrates the company’s updated capital plan and raised earnings outlooks:

The capital plan breakdown shows a significant focus on generation and transmission infrastructure to support growing customer demand. The company is investing in a diverse mix of generation resources, with approximately 12% allocated to new generation beyond renewables and storage, which account for 7% of the plan.

Entergy also highlighted its progress on equity financing, having settled approximately $800 million of equity forwards in May, with equity needs into 2027 already contracted. The company’s equity plan remains unchanged as illustrated below:

Forward-Looking Statements

Based on strong performance and growth prospects, Entergy has raised its adjusted EPS outlooks for 2027 and 2028 while affirming its 2025 guidance. The company now projects greater than 8% CAGR through 2028, as shown in the following chart:

The updated outlook shows adjusted EPS guidance of $3.75-3.95 for 2025, with raised projections of $4.70-5.00 for 2027 (up $0.05) and $5.20-5.50 for 2028 (up $0.10). This upward revision reflects management’s increased confidence in Entergy’s long-term growth trajectory.

The company’s growth strategy is supported by strong industrial sales momentum, as illustrated in this chart showing cumulative weather-adjusted retail sales growth versus 2024:

Detailed Financial Analysis

Entergy’s financial position remains solid, with credit metrics expected to stay above agency thresholds through the 2025-2028 outlook period. The company’s credit ratings across its operating companies are stable, as detailed below:

The utility is also positioned to benefit from Nuclear Production Tax Credits, with an estimated value of approximately $570 million for 2024. These credits are currently accounted for as an uncertain tax position pending clarity from the U.S. Treasury, with the cash benefit conservatively assumed in the 2025 outlook.

Entergy’s cash flow outlook shows a positive trajectory, supported by both operational performance and tax credits:

Strategic Industry Position

As a vertically integrated electric utility serving approximately 3 million customers across Arkansas, Louisiana, Mississippi, and Texas, Entergy is strategically positioned to capitalize on industrial growth in its service territories. The company operates 24,479 MW of owned and leased generating assets, with a diverse generation mix.

The company’s capital plan reflects its strategic priorities, with investments allocated across key functional areas:

This balanced approach to capital allocation demonstrates Entergy’s commitment to maintaining reliable service while transitioning to a more diverse generation portfolio that includes renewables and storage.

Analyst Perspectives

While specific analyst questions weren’t detailed in the presentation, Entergy’s management expressed confidence in their strategic direction during the Q1 earnings call. CEO Drew Marsh had emphasized the company’s commitment to creating value for all stakeholders, while CFO Kimberly Fontan expressed confidence in delivering on guidance and outlook.

The raised outlook for 2027-2028 suggests management sees sustained growth opportunities, particularly in industrial sales. The significant industrial growth of approximately 12% in Q2 2025 represents an acceleration from the 9.3% growth reported in Q1, indicating strengthening momentum in this key segment.

Entergy’s focus on expanding its industrial customer base, particularly in data centers, aligns with broader industry trends as utilities seek to capitalize on the growing energy demands of digital infrastructure. The company’s updated capital plan and raised earnings outlook reflect confidence in its ability to execute on these opportunities while maintaining financial discipline.

Full presentation:

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