What caused CMS's earnings surprises in 2024?

CMS Energy experienced an earnings surprise of -3.73% in 2024, with an EPS of $3.33, which was slightly below the expected EPS. The company's earnings surprises in 2024 can be attributed to several factors:

1. **Revenue Shortfall in Q1 and Q3**: While CMS Energy's EPS beat expectations in Q1 and Q3, revenues fell short of estimates. For instance, in Q1, total revenue was $2.18 billion, down 4.7% from the previous year's Q1, and in Q3, revenue was $1.74 billion, up only 4.2% from the previous year's Q3. This indicates that the company's revenue performance was mixed, with some quarters missing expectations.
2. **Expense Management**: Despite the revenue shortfall, CMS Energy managed to improve its net income and profit margin in Q1 and Q3. In Q1, the company's net income increased by 41% and profit margin improved from 8.8% to 13% due to lower expenses. Similarly, in Q3, net income rose by 44%, and profit margin increased from 10% to 14%. This suggests that the company's focus on expense management played a crucial role in boosting profitability.
3. **Strategic Partnerships**: CMS Energy's strategic partnerships, such as the one with Boyne Resorts for renewable energy initiatives, could have positively influenced earnings by contributing to future revenue streams. While these partnerships may not have had an immediate impact on earnings, they could lead to long-term growth and stability.

In conclusion, CMS Energy's earnings surprises in 2024 were primarily driven by revenue shortfalls in certain quarters, effective expense management, and strategic partnerships. The company's ability to manage expenses and improve profitability despite revenue challenges is a positive sign for its financial performance.