Entergy beats quarterly profit estimates on lower electricity production costs
Adds details from conference call in paragraphs 4, 6, 7 and 8; updates share price in paragraph 2
Feb 18 (Reuters) - Electric utility Entergy ETR.N beat fourth-quarter profit estimates on Tuesday, benefiting from lower operating expenses and higher electricity demand.
Shares of the company rose 6.4% in morning trade.
Power consumption is set to reach record highs in 2024, the U.S. Energy Information Administration (EIA) had said in December. Utilities are benefiting from rising electricity usage, including from energy-guzzling data centers needed to scale Big Tech's artificial intelligence (AI) technologies.
The company plans to invest $37 billion from 2025 to 2028, to meet customer demand and expand its renewables portfolio.
In December, Entergy Louisiana said it plans to invest in electricity generation and transmission to support the region and Meta Platforms' <META.O> $10 billion data center in Richland Parish.
"In addition to the planned 1,500 megawatts associated with the Meta project, our plans include investment in several new, modern and efficient gas plants," said Entergy CEO Andrew Marsh.
The utility also said it expects to update its agreement with Meta to increase the capacity requirement.
"Today, we are announcing a new electric service agreement with a large customer in Mississippi, the customer has not announced their project, so we cant provide additional details," the company said in a conference call.
Entergy's operating expenses for the fourth quarter ended December 31 came in at $2.07 billion, compared with $2.47 billion a year ago.
For the quarter, Entergy's total retail sales were at 29,497 gigawatt hours (GWh), higher than 27,320 GWh a year ago.
The company posted a quarterly adjusted profit of 66 cents per share, above analysts' average estimate of 64 cents per share, according to data compiled by LSEG.
It forecast its full-year 2025 profit between $3.75 per share and $3.95 per share. Analysts had estimated a profit of $3.91 per share.
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