APS hit a new system peak of 8,648 MW, added more than 34,000 new meters for a second straight year, and reiterated long‑term sales growth of 5%–7% through 2030, with an updated 15‑year IRP due mid‑year that will incorporate 4.5 GW of committed load.
Financials: Q4 EPS was $0.13 (vs a $0.06 loss year‑ago) and full‑year EPS was $5.05, while management reiterated 2026 guidance of $4.55–$4.75 EPS and 4%–6% weather‑normalized sales growth.
Capital and regulatory plans include completing > 400 MW of owned resources ahead of schedule, pursuing up to 2 GW of additional gas capacity by 2030, reaffirming rate‑based growth of 7%–9% through 2028, with nearly $500 million equity priced and $550 million of added revolver capacity, and a rate case with hearings slated for May.
Pinnacle West Capital (NYSE:PNW) reported fourth-quarter and full-year 2025 results highlighting record demand, continued customer and load growth in Arizona, and progress on grid investments and regulatory initiatives. Executives emphasized disciplined execution amid rising peak loads and outlined priorities for 2026, including a pending rate case and continued infrastructure expansion to support large commercial and industrial customers.
Chairman, President and CEO Ted Geisler said the company served “record levels of demand” in 2025 with “top-quartile reliability” and a “top-quartile customer experience,” while managing grid expansion plans with discipline. He noted safety remained the company’s top priority, pointing to performance through Arizona’s “third hottest summer on record.”
APS set a new system peak of 8,648 megawatts on Aug. 7, more than 400 MW higher than the prior year, Geisler said. He also highlighted performance at Palo Verde, which operated at a 100% summertime capacity factor and received a 2025 INPO Excellence Award. Geisler described Palo Verde as the largest producing nuclear plant in the U.S.
On customer metrics, management pointed to improvements in satisfaction and digital engagement. The company said it deployed an AI-powered “high bill analyzer” aimed at helping customers understand billing and usage, and reported ending 2025 in the top quartile nationally among peers for residential overall satisfaction and in the second quartile for business customers, as measured by Escalent. APS also ranked in the first quartile in J.D. Power’s U.S. Utility Digital Experience Study, according to Geisler.
Geisler and CFO Andrew Cooper underscored Arizona’s growth, including increased activity among chip manufacturing and data centers. Management reiterated long-term sales growth expectations of 5% to 7% through 2030 and described customer additions as strong, including more than 34,000 new meters installed for a second consecutive year, the highest level in 20 years.
Management said APS completed more than 400 MW of APS-owned resources ahead of schedule, including new gas units at Sundance, the Agave Battery Storage Facility, and Ironwood Solar. Geisler said the Red Hawk gas expansion remains on track for completion in 2028, with preparations underway to support potential additional gas capacity of up to 2 gigawatts commencing in 2030.
The company said it is monitoring the Transwestern Desert Southwest Pipeline expansion, which management noted has been upsized from 42 inches to 48 inches due to strong regional demand.
In response to analyst questions about longer-term resource needs, management said it expects to file an updated 15-year integrated resource plan (IRP) mid-year. Executives said the IRP will reflect updated load and demand forecasts and the resources needed to meet them, with more specificity in the near-term “action plan window” and more directional guidance beyond that period.
During the Q&A, executives discussed large-load dynamics and how they plan to incorporate committed demand into the IRP. Management said the IRP will reflect “known and committed customer demand,” including how 4.5 GW of committed load is expected to materialize over the 15-year period, along with broader organic growth. They added that the plan will not include portions of the “uncommitted queue” that have not yet been contracted, which would remain incremental to the IRP if agreements are reached.
Executives said they are using a “subscription model” to offer infrastructure opportunities to potential large-load customers in the uncommitted queue and intend to finalize and file an agreement with the commission this year if negotiations are successful. They also said they are developing a pipeline of generation and transmission projects that could be offered to the uncommitted queue on a “repeatable basis.”
Cooper reported fourth-quarter 2025 earnings of $0.13 per share, compared with a $0.06 loss in the fourth quarter of 2024. He said the quarter reflected strong operational execution, cost management, and sales growth, partially offset by milder-than-normal weather, higher financing costs, and higher pension and OPEB expenses.
For the full year, the company reported $5.05 per share, which Cooper said landed in the “upper half” of updated guidance, compared with $5.24 per share in 2024. He attributed the year-over-year decline primarily to weather, citing a $0.71 drag versus 2024, which benefited from an extremely hot summer extending into the fall. Additional headwinds cited included financing costs, higher pension and OPEB expense, depreciation and amortization, and O&M.
Cooper said underlying growth remained strong, including 6.8% weather-normalized sales growth in the fourth quarter and 5% weather-normalized sales growth for the year. He broke out full-year weather-normalized sales growth as 2% residential and 7.5% commercial and industrial, and said total customer growth was 2.4%, at the high end of guidance.
Management reiterated its previously issued 2026 guidance, including:
2026 EPS guidance: $4.55 to $4.75
2026 weather-normalized sales growth: 4% to 6%
Expected contribution from Extra High Load Factor CNI customers: 3% to 5% of sales growth
Long-term sales growth: 5% to 7% through 2030
Cooper also highlighted cost initiatives, saying O&M per megawatt-hour declined 3.3% year over year in 2025, and the company expects further reductions in 2026.
Management reaffirmed its capital and financing plans, saying the capital program remains focused on reliability, resiliency, and supporting growth. Cooper reiterated the company’s rate-based growth guidance of 7% to 9% through 2028.
On financing, Cooper said 2026 equity needs are “largely de-risked,” with nearly $500 million already priced. The company also said it extended core credit facilities to 2031 and expanded revolving borrowing capacity by $550 million.
In the Q&A, Cooper said holding-company debt as a percentage of total debt was about 17% at year-end, “within the range” of the company’s mid-teens target. He also discussed credit metrics, noting the company was “high 14s” on an FFO-to-debt basis as calculated from a Moody’s perspective, and said regulatory lag remains a key factor influencing credit metrics ahead of rate relief.
Geisler said the company’s rate case remains on track, with staff and intervener testimony expected next month and hearings scheduled to begin in May. Management emphasized collaboration with regulators and stakeholders, with stated goals of reducing regulatory lag and ensuring “appropriate cost allocation so that growth pays for growth.”
Executives also addressed implications from a recent UNS case decision involving a formula rate. Geisler characterized the outcome as “generally constructive,” noting UNS received about 86% of its original revenue requirement request and secured a formula rate with a post-test-year plan. He also pointed to differences between the UNS gas utility and APS, including growth profiles and the structure of the proposed formula rate schedule.
Asked about the possibility of a settlement, management said the company remains open to settlement but is currently focused on moving through the “traditional” hearing process, citing the importance of aligning on mechanics for implementing a formula rate and making rate design changes for a new high load factor tariff.
Management also discussed commission decisions to discontinue or condense certain DSM-related regulatory programs, noting those programs are typically recovered through rates and can appear as offsets between revenue and O&M. Geisler said remaining programs were viewed as having the greatest impact for customers who need them most, and emphasized the commission’s focus on affordability alongside the need to fund reliability and growth-related investment.
Looking ahead, Geisler said 2026 priorities include processing the rate case, executing grid expansion plans, keeping rates affordable, and finalizing commercial opportunities with new large customers. He also said the company remains supportive of potential new nuclear development over the medium to long term, while emphasizing it is not expected in the near term due to capital requirements, policy considerations, and supply chain and workforce needs.
Pinnacle West Capital Corporation is a publicly traded utility holding company headquartered in Phoenix, Arizona. Through its principal subsidiary, Arizona Public Service Company (APS), Pinnacle West generates, transmits and distributes electricity to more than one million residential, commercial and industrial customers across central and southern Arizona. The company’s regulated operations focus on delivering safe, reliable power while meeting evolving environmental standards.
The company’s diversified generation portfolio includes natural gas–fired plants, the nuclear-powered Palo Verde Generating Station—the largest nuclear facility in the United States by net output—plus growing investments in solar and battery storage projects.
