01—Abstract
Summary
Summary of the 8-K filed April 29, 2025. Cited figures are marked; the original filing is the authoritative source.
Edison International (EIX) reported first-quarter 2025 GAAP earnings per share of $3.73a (net income of $1,436 million) and core EPS of $1.37, up from $1.13 a year earlier.
The GAAP figure is inflated by roughly $908 millionb ($2.36 per share) of non-core items, chiefly the net recognition of TKM settlement cost recoveries at Southern California Edison (SCE). The year-over-year core comparison is not especially meaningful, management says, because SCE has not yet received a final decision in its 2025 General Rate Case and is booking revenue at 2024 authorized levels, with a true-up to follow. Management reaffirmed 2025 core EPS guidance of $5.94-$6.34 and its 5-7% core EPS CAGR from 2025 to 2028 ($6.74-$7.14 in 2028).
Key supports include about 30 cents of one-time TKM true-up, a 14-cent annual run-rate interest expense reduction from the TKM settlement, and a WMCE settlement that is awaiting CPUC approval. Management also said it expects to refresh guidance and its capital and rate base projections about six weeks after a GRC final decision. The most significant risk flagged is the Eaton Fire.
Management stated that SCE has not conclusively determined its equipment caused the ignition, but absent other evidence it believes its equipment could have been associated with it, and it is therefore probable that EIX and SCE will incur material losses in connection with the fire. The filing does not quantify those losses. Investors should weigh this unquantified liability against the otherwise constructive regulatory progress and the reaffirmed growth outlook.
02—Key points
Key Highlights
- Q1 2025 GAAP EPS of $3.73 (net income $1,436M) versus a loss of $0.03 a year earlier; core EPS of $1.37 versus $1.13, with non-core items of $908M ($2.36/share), primarily TKM settlement recoveries.
- 2025 core EPS guidance of $5.94-$6.34 was affirmed; the 5-7% core EPS CAGR for 2025-2028 (2028 EPS of $6.74-$7.14) was reiterated.
- Eaton Fire: management says it is probable EIX and SCE will incur material losses, though the filing does not quantify them. SCE has not conclusively determined its equipment caused the ignition, but believes it could have been associated.
- TKM settlement approved by the CPUC: about $1.6B of cost recovery, with ~30 cents one-time true-up and 14 cents annual interest expense reduction; securitization application to follow, with proceeds expected by year-end 2025.
- Pending regulatory items: 2025 GRC awaiting proposed decision (guidance to be refreshed about six weeks after final decision); 2026 cost of capital request for an 11.75% ROE (vs. 10.33% authorized); WMCE settlement awaiting CPUC approval; NextGen ERP filed (~$1.1B).
- Capital plan of ~$38-43B for 2023-2028 with ~6-8% rate base growth, plus upside from substantial additional investment opportunities not yet in the forecast.
- Balance sheet: Q1 cash rose to $1.3B from $193M at year-end 2024, and EIX issued $550M of senior notes in March that address 2025 parent debt needs; the financing plan shows minimal equity needs.
03—Questions
Frequently Asked Questions
Why is the year-over-year core EPS comparison described as not particularly meaningful?
SCE has not received a final decision in its 2025 General Rate Case. It is recording revenue at 2024 authorized levels, adjusted for the lower authorized ROE, and will record a true-up once a final decision is issued, retroactive to January 1, 2025. Quarterly results therefore do not yet reflect the new rate case outcome.
What drove the large GAAP earnings in Q1 2025?
Most of the $908 million of non-core items came from the TKM settlement: $1,341 million of claim costs and $59 million of legal expenses were authorized for recovery, partially offset by shareholder-funded wildfire mitigation expenses and other charges. These items are excluded from core earnings, which were $528 million.
What is the Eaton Fire exposure and has an amount been quantified?
Management said SCE has not conclusively determined its equipment caused the Eaton Fire ignition but has found no conclusive evidence of another source, so it believes its equipment could have been associated with the ignition. Litigation is pending and management said material losses are probable. The filing does not quantify the potential losses, and it is unclear whether they would be covered by the Wildfire Insurance Fund or recoverable from customers.
Is EIX still on track for its 2025 and long-term earnings targets?
Management affirmed 2025 core EPS guidance of $5.94-$6.34 and reiterated 5-7% core EPS growth through 2028. The 2025 range includes roughly 44 cents from the TKM settlement (30 cents of one-time true-up plus 14 cents of interest savings). Guidance could change after the GRC final decision, which management expects to trigger a refresh.
04—Continue