NextEra Energy, Inc. (NEE) Q4 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call reflects strong financial performance with strategic investments in renewable energy and partnerships, like with Google. The Q&A reveals confidence in overcoming competitive risks and regulatory hurdles, with management addressing concerns effectively. Although there are uncertainties in SMR technology and pricing details, the overall sentiment remains positive due to robust growth plans, optimistic guidance, and shareholder returns. The market is likely to react positively to these developments over the next two weeks.
Key Financial Performance
Adjusted Earnings Per Share (EPS) $3.71 for the full year 2025, up over 8% from 2024. The increase was attributed to strong operational and financial performance.
FPL's Earnings Per Share Increased by $0.21 in 2025 compared to 2024, driven by regulatory capital employed growth of approximately 8.1%.
FPL's Capital Expenditures Approximately $2.1 billion in Q4 2025, with a total of roughly $8.9 billion for the full year 2025. This investment supported Florida's growth and infrastructure needs.
FPL's Retail Sales Increased by 1.7% year-over-year in 2025 on a weather-normalized basis, driven by strong customer growth.
Energy Resources Adjusted Earnings Growth Approximately 13% year-over-year for 2025. Contributions from new investments increased by $0.47 per share, while contributions from existing clean energy assets decreased by $0.04 per share.
Energy Resources New Generation and Storage Projects Added approximately 13.5 gigawatts to its backlog in 2025, including a record 3.6 gigawatts in Q4 2025. This reflects growing demand, particularly from hyperscalers.
Battery Storage Deployment Over 2 gigawatts of battery storage placed into service in 2025, representing a 220% increase from 2024.
Consolidated Operating Cash Flow Growth 3- and 5-year compound annual growth rates of over 14% and over 9%, respectively, as of 2025.
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Operating Highlights
New generation and storage projects: Energy Resources added approximately 13.5 gigawatts to its backlog in 2025, including a record quarter of 3.6 gigawatts. They placed 7.2 gigawatts of projects into commercial operations in 2025.
Battery storage: Battery storage now represents almost 1/3 of the 30-gigawatt backlog, with nearly 5 gigawatts originated over the past 12 months. They have secured a domestic battery supply through 2029.
Gas-fired generation: Secured gas turbine slots with GE Vernova to support 4 gigawatts of gas-fired generation projects. They are also advancing a pipeline of 20 gigawatts of gas-fired generation build.
Nuclear energy: Advancing recommissioning of Duane Arnold nuclear plant in Iowa and exploring 6 gigawatts of SMR colocation opportunities at nuclear sites.
Florida growth and infrastructure: FPL expects to invest $90-$100 billion through 2032 to support Florida's growth, with the state projected to surpass 26 million residents by 2040. Florida's economy is now $1.8 trillion, the 15th largest globally.
Hyperscaler partnerships: FPL's large load tariff and speed-to-market advantages have generated significant interest, with over 20 gigawatts of large load interest and advanced discussions on 9 gigawatts.
Operational efficiency: FPL's nonfuel O&M is 71% lower than the industry average, making it the lowest-cost electric utility operator in the U.S.
Rate stabilization: FPL's new 4-year rate agreement includes a rate stabilization mechanism with $1.5 billion available for amortization over the term.
AI and technology partnership: NextEra Energy partnered with Google Cloud for an AI transformation initiative called REWIRE, aiming to enhance field operations and grid reliability.
Data center hub strategy: Energy Resources is targeting 15 gigawatts of new generation for data center hubs by 2035, with discussions on 20 potential hubs expected to rise to 40 by year-end.
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Risk or Challenges
Regulatory and Policy Risks: The company's growth and operations are heavily dependent on regulatory approvals and policies, such as the Florida Public Service Commission's rate agreements and federal energy regulations. Any unfavorable changes or delays in these approvals could impact financial performance and strategic plans.
Economic and Market Risks: The company's financial performance is tied to economic conditions, including inflation and interest rates. Rising financing costs and inflationary pressures could affect profitability and customer affordability.
Supply Chain and Resource Risks: The company relies on securing solar panels, battery storage, and gas turbines for its projects. Any disruptions in the supply chain or inability to secure these resources could delay project execution and impact growth targets.
Competitive Pressures: The company faces competition in the energy infrastructure and renewables market, particularly in securing large-scale projects and hyperscaler partnerships. Failure to maintain its competitive edge could affect market share and growth.
Execution Risks: The company's ambitious growth plans, including the development of 15 gigawatts of new generation for data center hubs and 20 gigawatts of gas-fired generation, require flawless execution. Any delays or cost overruns could impact financial and operational performance.
Technological and Innovation Risks: The company is investing heavily in AI and advanced technologies like SMRs (Small Modular Reactors). Failure to successfully implement these technologies or achieve expected efficiencies could result in financial losses and missed opportunities.
Geopolitical and Environmental Risks: The company's operations, particularly in gas transmission and renewables, are subject to geopolitical and environmental factors. For example, the Mountain Valley Pipeline project could face opposition or regulatory hurdles, impacting its completion and profitability.
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Guidance & Outlook
Adjusted Earnings Per Share Growth: NextEra Energy expects to grow adjusted earnings per share at a compound annual growth rate of 8% plus through 2032, targeting the same growth rate from 2032 through 2035, based on a 2025 base of $3.71.
Florida Power & Light (FPL) Investments: FPL plans to invest between $90 billion and $100 billion through 2032 to support Florida's growth while keeping customer bills low. Typical residential customer bills are expected to increase only about 2% annually between 2025 and 2029.
Energy Resources Transmission and Gas Business: The combined electric and gas transmission business at Energy Resources is expected to grow to $20 billion of total regulated and invested capital by 2032, representing a 20% compound annual growth rate from a 2025 base.
Renewable Energy and Battery Storage: Energy Resources has secured solar panels and domestic battery supply to meet development expectations through 2029. The company has a 30-gigawatt backlog, with battery storage representing nearly one-third of it. They are also exploring long-duration battery storage opportunities.
Data Center Hub Strategy: Energy Resources aims to place 15 gigawatts of new generation for data center hubs by 2035, with a potential to double this goal to 30 gigawatts. The strategy includes a mix of renewables, battery storage, and gas generation.
Nuclear Energy Expansion: Energy Resources is advancing the recommissioning of the Duane Arnold nuclear plant and exploring small modular reactor (SMR) opportunities, with 6 gigawatts of SMR co-location potential at existing nuclear sites.
Dividend Growth: NextEra Energy expects to grow dividends per share at roughly 10% per year through 2026, based on a 2024 base, and 6% per year from year-end 2026 through 2028.
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Shareholder Return Plan
Dividend Growth: NextEra Energy expects to grow its dividends per share at roughly 10% per year through 2026, off a 2024 base, and 6% per year from year-end 2026 through 2028.
Share Buyback Program: No mention of a share buyback program was identified in the transcript.
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Key Q&A
Q:How does Google's acquisition of Intersect impact NextEra's partnership with Google and the competitive risk of hyperscalers acquiring developers?
A:John Ketchum stated that the acquisition has no impact on their partnership with Google. Google informed them in advance, and Intersect is a smaller developer with limited geographic and resource scope. NextEra has a stronger position with extensive permitted sites, supply chain relationships, and inventory secured through 2029. Ketchum expressed confidence in NextEra's competitive position, citing their national footprint, experience, and ability to meet power demand.
Q:What is NextEra's perspective on data center opposition and concerns about rate increases, particularly in Florida?
A:Scott Bores mentioned that Florida is in legislative session with two pieces of legislation, one of which is more constructive and aligns with NextEra's tariff. They support this legislation and are not concerned about opposition in Florida. Nationally, John Ketchum highlighted NextEra's ability to provide affordable and reliable solutions, emphasizing their role as a builder and partner for hyperscalers to shoulder incremental generation costs.
Q:What are NextEra's expectations for achieving their 15-30 gigawatt targets and the resource mix by 2026?
A:John Ketchum explained that the targets are based on historical market share and are achievable. The 15-30 gigawatt target includes 6 gigawatts of gas-fired generation by 2032, with the rest being renewables and storage. For Florida, they have 20 gigawatts of interest and advanced discussions on 9 gigawatts. Armando Pimentel expects announcements regarding large loads in 2026.
Q:What is the update on nuclear recontracting in Wisconsin and the potential for behind-the-meter or virtual deal structures?
A:John Ketchum noted significant interest in Point Beach due to Wisconsin's conducive environment for data center build-out. They are methodical in their approach and aim to maximize shareholder value. The WPPI deal securing 14% of generation is an example of their progress.
Q:Will NextEra participate in PJM's backstop auction, and what are their views on regulatory certainty?
A:John Ketchum stated that regulatory certainty is essential before allocating capital. While PJM could be attractive under the right construct, NextEra is focused on opportunities across the U.S. and is monitoring PJM developments closely.
Q:What is the status of FPL's large load tariff and the factors influencing customer decisions?
A:Armando Pimentel explained that customers are waiting for legislative outcomes in Florida regarding water usage and other factors. He expects constructive legislation and announcements in 2026 regarding large loads in FPL's service territory.
Q:What is the update on NextEra's supply chain for gas turbines and pricing through 2032?
A:John Ketchum mentioned that they have secured a 4-gigawatt position on gas and are advancing discussions on data center hubs. He expressed confidence in their ability to secure additional turbines at competitive prices through their partnership with GE Vernova.
Q:What are NextEra's views on wind additions and the trend towards solar and battery storage?
A:An executive noted an uptick in wind additions for 2028 and 2029 but emphasized a continuing trend towards solar and battery storage due to varying customer needs and opportunities.
Q:What is NextEra's approach to small modular reactors (SMRs) and their potential role in data center hubs?
A:John Ketchum stated that they are evaluating SMR technologies and development opportunities, including greenfield sites and existing nuclear locations. They are cautious about commercial terms and risk-sharing but see potential upside in SMRs, which are not included in their base plan.
Q:What is NextEra's confidence in the PJM transmission project with Exelon?
A:An executive expressed high confidence in the project, citing PJM management's recommendation and the project's importance for reliability. They are engaging with stakeholders and believe it is the lowest-cost solution for the region.
Q:What drives the adjusted EBITDA outlook for 2026 in gas pipelines and infrastructure?
A:Michael Dunne explained that the decline is due to a divestment in Explorer's pipeline assets. Gas pipelines remain a critical growth area, while gas infrastructure's contribution is relatively small and not a key growth driver.
Q:Review of Unclear Management Responses
A:Management avoided providing specific pricing details for gas turbines and did not commit to a single SMR technology or partner, citing the need for competition and prudent decision-making. They also did not provide detailed milestones or timelines for achieving the 15-30 gigawatt targets beyond general expectations.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
AI
America NextEra
BYOG
FPL rate
New Hampshire
PJM
REWIRE
Resources record
Resources service
Symmetry
affordability concern
basis customer
builder
center hub
channel
conference month
context
equity FPL
expansion opportunity
footprint
gas transmission
generation build
generation storage
gigawatts generation
gigawatts power
grid America
indicator
investor conference
load
opportunity site
plant New
power generation
product
rate agreement
rate base
rate stabilization
service gigawatts
share contribution
speed market
stabilization mechanism
transformation
transmission Energy
NEE Transcript
NextEra Energy, Inc. (NEE) Q4 2025 Earnings Call Transcript
Positive1-27
The earnings call reflects strong financial performance with strategic investments in renewable energy and partnerships, like with Google. The Q&A reveals confidence in overcoming competitive risks and regulatory hurdles, with management addressing concerns effectively. Although there are uncertainties in SMR technology and pricing details, the overall sentiment remains positive due to robust growth plans, optimistic guidance, and shareholder returns. The market is likely to react positively to these developments over the next two weeks.
NextEra Energy, Inc. (NEE) Q3 2025 Earnings Call Transcript
Positive10-28
The earnings call summary and Q&A indicate strong financial performance with a significant backlog in renewables and storage, positive shareholder return plans, and optimistic guidance. Although some concerns were raised about project removals and unclear CapEx details, management's confidence and strategic focus on growth opportunities, including partnerships and new technologies, suggest a positive outlook. The company's ability to leverage regulatory environments and strong dividend growth further supports a positive sentiment.
NextEra Energy, Inc. (NEE) Presents at 2025 Wolfe Research Utilities, Midstream & Clean Energy Conference Transcript
Neutral10-1
NextEra Energy, Inc. (NEE) Q2 2025 Earnings Conference Call Transcript
Positive7-23
The earnings call and Q&A highlight strong financial performance, strategic growth plans, and positive outlooks for new projects, like SMRs and Duane Arnold. Despite some uncertainties in EPS guidance and rate case outcomes, the company's robust pipeline, financing strategy, and leadership in renewable energy suggest a favorable stock price movement. The planned dividend growth and capital investments further support a positive sentiment.
NEE Slides
NEE Report
Frequently Asked Questions
Where does this earnings call transcript come from?
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They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
