CenterPoint Energy (NYSE:CNP) used its fourth-quarter and full-year 2025 earnings call to highlight continued earnings and dividend growth, reaffirm 2026 earnings guidance, and outline an updated long-term capital plan tied to accelerating load growth in its Houston Electric business.
Fourth-quarter and full-year results
The company reported GAAP earnings per diluted share of $0.40 for the fourth quarter and $1.60 for full-year 2025. CFO Chris Foster said the full-year GAAP figure included $0.11 related to the disposition of goodwill allocated to the Louisiana and Mississippi natural gas businesses, along with $0.07 of depreciation tied to the company’s large temporary generation units.
Foster walked through key drivers of fourth-quarter earnings compared with the prior-year quarter, including:
- Growth and rate recovery: +$0.12, driven by implementation of rate case and interim filing mechanism outcomes throughout the year
- Weather and usage: +$0.01, tied to higher usage with temperatures largely in line with historical norms
- O&M: -$0.02, as the company accelerated certain work (including reliability and resiliency work initially planned for 2026)
- Interest expense: -$0.05, attributed to roughly $3.3 billion in incremental debt issuances
Guidance reaffirmed and long-term growth targets reiterated
Management reaffirmed 2026 non-GAAP EPS guidance of $1.89 to $1.91, which Wells said is an 8% increase at the midpoint compared with 2025’s delivered results. Over the longer term, the company reiterated expectations to grow non-GAAP EPS at the mid to high end of its 7% to 9% annual range through 2028, and 7% to 9% annually thereafter through 2035.
Foster noted that 2025 year-over-year rate recovery reflected delayed timing of several interim recovery mechanisms until the second half of the year. He said the company expects a return to a “more typical and timely filing cadence” in 2026, which should support stronger and more consistent recovery during the year.
Houston Electric growth accelerates; peak load forecast brought forward
A major theme of the call was accelerating growth in Houston Electric. Wells said CenterPoint is now forecasting peak load demand to increase by 50%—an additional 10 gigawatts—by 2029, which he said is two years earlier than previously planned. Management attributed the acceleration primarily to reshoring of advanced manufacturing facilities and increasing data center demand.
Wells emphasized that the company’s view of “meaningful” growth is tied to large-load projects under construction or firmly committed, rather than unconstrained interconnection queues. As context, he said the company has 2.5 GW of projects in construction and another 5 GW of firmly committed projects expected to be energized by 2028, in addition to 3 GW of ordinary course growth anticipated for the region.
Wells said CenterPoint believes it can meet near-term demand with existing system capacity and manageable system upgrades. He also described customer bill impacts as a key benefit of the load growth, stating that increased demand helps spread fixed costs across a broader base and has helped keep delivery charges nearly flat over the past decade. As an example, Wells said that if 5 GW of existing data center hosting capacity were utilized, the company estimates it could reduce average residential delivery charges by over 2% based on the 2025 average bill. He added that the company projects it can keep rates flat through 2028 due to incremental load.
In the Q&A, Wells said the company expects to provide a second-half update on incremental transmission projects that may be needed to accommodate accelerating large-load growth, including potential new import capacity and intra-regional transmission within the Greater Houston area. He said import lines generally take longer and could affect capital spending toward the tail end of the decade, while intra-regional projects could be needed within the first five years of the plan.
Capital plan increased; 765 kV import line added
Separate from the load-driven planning work, Wells said the company is adding $500 million of incremental capital to its long-term plan to fund an additional 765 kV import line. He said CenterPoint filed for the project in January following feedback from ERCOT indicating the need for additional infrastructure to support Greater Houston growth. Management described the project as the third 765 kV import line for the region and said it is intended to enhance resiliency and reliability.
With the increase, CenterPoint’s 10-year capital investment plan rises to more than $65 billion through 2035. Foster said the spending tied to these electric transmission projects is expected to be added toward the end of the decade given typical project timelines.
For capital deployment in 2025, Foster said CenterPoint invested $5.4 billion, exceeding its positively revised plan of $5.3 billion. He also reaffirmed the company’s 2026 capital plan of $6.8 billion as outlined in its 10-year plan.
Management also reiterated it continues to see more than $10 billion of incremental capital opportunities beyond the $65 billion plan, though it said it will incorporate additional investments only when it has confidence in execution and needed approvals.
Regulatory and balance sheet updates; CAMT guidance seen as a tailwind
On regulation, Foster said the company received a final order in its Ohio Gas LDC rate case. The order made slight modifications to the settlement agreement, approving a $53.1 million revenue requirement and 9.79% ROE, with no change to the 52.9% equity ratio. Foster reiterated that CenterPoint anticipates closing on the sale of the Ohio business in the fourth quarter of this year.
Foster also said regulatory activity is expected to be limited over the next few years, with rate cases anticipated later this year in Minnesota and Indiana, which he said represent less than 20% of consolidated earnings power in aggregate. He added that the company expects to recover approximately 85% of capital investments through capital trackers, and that filings for TCOS and DCRF mechanisms are expected within the next month.
Regarding financing and credit metrics, Foster said CenterPoint’s adjusted FFO-to-debt ratio was 13.8% at year-end under Moody’s methodology, slightly below its targeted cushion. He pointed to expected improvement from securitization related to Hurricane Beryl and proceeds from the Ohio sale, noting the company priced roughly $1.2 billion in securitization bonds and plans to use proceeds to extinguish a $500 million term loan at Houston Electric and reduce commercial paper. Foster also said the company expects $800 million of cash proceeds net of tax in the fourth quarter from the Ohio transaction.
Foster also addressed draft guidance issued by the U.S. Treasury Department related to the Corporate Alternative Minimum Tax (CAMT). While noting the company was still analyzing impacts, he said CenterPoint now believes its annual federal income tax cash tax liability should be near zero through 2035, versus a prior conservative estimate of about $150 million annually. He said the updated profile could improve credit metrics by 60 to 70 basis points in the near term and potentially allow incorporation of roughly $1 billion of customer-driven capital investments into the plan without incremental equity.
Management closed the call emphasizing continued execution, accelerating large-load growth in Houston, and a disciplined approach to incorporating incremental capital into long-term planning as project clarity increases.
About CenterPoint Energy (NYSE:CNP)
CenterPoint Energy, Inc (NYSE: CNP) is a Houston-based regulated utility company that provides electric and natural gas delivery services and related infrastructure operations. The company’s principal activities center on the transmission and distribution of electricity in the greater Houston metropolitan area and the distribution of natural gas to customers across several states in the Midwest and South. As a vertically integrated utility, CenterPoint focuses on the reliable delivery of energy through owned and operated networks of lines, pipelines and associated facilities.
CenterPoint’s core businesses include regulated electric transmission and distribution services, regulated natural gas distribution, and the operation and maintenance of energy infrastructure.
