Sempra Q2 2025 Earnings Call Highlights: Strategic Moves and Future Growth Prospects

Sempra (SRE) reported Q2 2025 adjusted EPS of $0.89, consistent with the prior period, and affirmed its full-year 2025 EPS guidance range of $4.30 to $4.70. The company has made significant progress on its capital recycling initiatives and is advancing major construction projects expected to drive future cash flow growth. However, Sempra (SRE) faces ongoing negotiations and uncertainties regarding the equity sale at Sempra Infrastructure, regulatory challenges in California, and uncertainties regarding the execution of increased capital spending in Texas.

Sempra Energy (SRE) reported its second quarter 2025 (Q2 2025) adjusted earnings per share (EPS) of $0.89, consistent with the prior period. The company affirmed its full-year 2025 EPS guidance range of $4.30 to $4.70, as well as its 2026 EPS guidance of $4.80 to $5.30. Sempra has made significant progress on its capital recycling initiatives and is advancing major construction projects expected to drive future cash flow growth.

The company reported GAAP earnings of $461 million or $0.71 per share for Q2 2025, compared to $713 million or $1.12 per share for Q2 2024. Adjusted earnings increased to $583 million from $567 million year-over-year. Sempra's Oncor subsidiary is executing a $36 billion five-year capital plan, with incremental opportunities for 2025-2029. Oncor's expected earned return on equity (ROE) is expected to increase by 50 to 100 basis points due to new legislation.

Sempra's Infrastructure segment reported a $26 million increase in revenue due to contract modifications and higher power volumes. The company has entered a nonbinding letter of intent with KKR for an equity sale at Sempra Infrastructure, which could optimize equity value and improve the balance sheet.

However, Sempra faces ongoing negotiations and uncertainties regarding the equity sale at Sempra Infrastructure, regulatory challenges in California, and uncertainties regarding the execution of increased capital spending in Texas. The company's stock responded positively in pre-market trading, up 1.11% to $82.05, suggesting investors are focusing on the company’s long-term strategy rather than the quarter’s flat performance.

Sempra has committed to investing $13 billion in 2025, with over $5 billion already deployed in the first half of the year. These investments prioritize utility operations and improved returns, particularly in Texas where regulatory changes are expected to enhance profitability. The company's Texas transmission expansion plans are particularly noteworthy, with significant investments planned for the Permian Basin Reliability Plan and other transmission projects.

Despite the flat quarterly performance, Sempra affirmed its financial guidance across multiple timeframes. The company maintained its FY-2025 adjusted EPS guidance range of $4.30-$4.70 and its FY-2026 EPS guidance range of $4.80-$5.30. Sempra also highlighted its continued focus on safety and operational excellence, including wildfire mitigation efforts.

References:
[1] https://finance.yahoo.com/news/sempra-sre-q2-2025-earnings-072957966.html
[2] https://ca.investing.com/news/company-news/sempra-q2-2025-presentation-flat-earnings-amid-strategic-shift-to-utilitycentric-model-93CH-4144134