AEP surges to all-time high after boosting capex by a third to meet 'unprecedented' power demand

[Electricity transmission towers with red glowing wires]
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American Electric Power (AEP [https://seekingalpha.com/symbol/AEP]) +5% in Wednesday's trading to a new all-time high $122.79 after posting mixed Q3 results [https://seekingalpha.com/news/4510082-american-electric-power-reports-mixed-q3-results-reaffirms-fy25-outlook] but saying it plans to upgrade its five-year capital spending plan [https://www.reuters.com/business/energy/utility-aep-raises-capital-spending-plan-meet-data-center-power-demand-2025-10-29/] to $72 billion from $54 billion previously to meet unprecedented power requirements.

Q3 net profit fell slightly to $959.6 million, or $1.80/share, from $972 million, or $1.82/share, in the year-earlier quarter, while revenues rose 10.9% Y/Y to $6.01 billion vs. $5.71 billion FactSet consensus.

AEP (AEP [https://seekingalpha.com/symbol/AEP]) said it had reached service agreements to provide 28 GW of load additions by 2030, up 4 GW since July, plus another 190 GW of load requests at various stages of development, and specified on its earnings conference call, as reported by Reuters, that 80% of the growth is driven by large hyperscalers such as Google, Amazon and Meta, while 20% driven was by new industrial customers, including Nucor's steel mill in West Virginia and Cheniere's LNG facilities in Texas.

AEP (AEP [https://seekingalpha.com/symbol/AEP]), which has ~5.6 million customers in 11 states and possesses the largest U.S. electric transmission system, said its peak system demand is expected to surge to 65 GW by 2030, up from a current peak of 37 GW.

The utility announced a new long-term operating earnings growth rate of 7%-9% over the next five years, supported by an expected 10% annual growth in rate base, likely in the lower half of the range during the first two years of the plan but at or above the high end of the range in 2028-30.

As infrastructure projects are put into service to meet customer demand, AEP (AEP [https://seekingalpha.com/symbol/AEP]) expects operating earnings per share to increase at a 9% compounded annual growth rate over the five-year period, which also supports FY 2026 operating earnings guidance of $6.15-$6.45/share.

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