Vistra reports quarterly profit as AI boom fuels power demand

Adds executive quotes, update on California fire, context throughout

Feb 27 (Reuters) - U.S. independent power producer Vistra Corp VST.N reported fourth-quarter profit on Thursday, as strong electricity demand from AI data centers helped boost the company's earnings.

Utilities have witnessed a surge in electricity demand as Big Tech pours billions of dollars into AI technologies and the infrastructure needed to develop them. AI data centers add to growing electricity use from advanced manufacturing and the electrification of industries like transportation, which has helped to drive U.S. power demand to record highs in 2024, with new records projected this year.

Nuclear power operators like Vistra have been a top beneficiary of the demand surge, with the company's shares soaring nearly 258% in 2024, compared to a 19.6% rise in the S&P 500 utilities sector .SPLRCU in the same period.

"We believe a new paradigm is already occurring and we expect it to continue," Vistra CEO Jim Walker said on a conference call.

Its adjusted core profit from continuing operations for the fourth quarter rose to $1.99 billion, compared to $965 million the previous year, driven by higher income across most segments.

The company said it is continuing to see rapid electricity demand growth across regional power markets PJM and ERCOT, with energy consumption growing faster than peak load.

Vistra expects current-year adjusted core profit from continuing operations to be in the range of $5.50 billion to $6.10 billion, the midpoint of which is higher than the $5.66 billion it earned in 2024.

The Irving, Texas-based company's net income for the three months ended December 31 came in at $490 million, compared with a loss of $184 million during the same period a year earlier.

A fire erupted last month at a battery storage facility in Moss Landing, south of San Francisco, owned and operated by Vistra and one of the world's largest, prompting evacuation of the site and surrounding areas.

No injuries were reported by the company or the authorities after the fire and Vistra has not yet disclosed the details of any financial hit from the incident.

A gas plant has since restarted, but the site's two battery facilities are still offline. Vistra executives said it expected to recover up to total up to $500 million from insurance tied to the fire.

Shares of Vistra initially jumped following earnings, but sank by 8% to $136 in midday trade.