Edison International (EIX) Earnings & Analysis

Latest quarter

Edison International reported third-quarter revenue of $4.9 billion, below the consensus estimate of $5.5 billion. Its core earnings per share of $1.92 exceeded the consensus adjusted EPS estimate of $1.83.

Revenue declined from $5.8 billion a year earlier, while diluted EPS fell to $1.94 from $2.16. CFO Aaron Moss said core EPS was $2.34 in the prior-year quarter, which included a 55 cent true-up following Southern California Edison’s general rate case decision.

Edison’s gross margin fell to 65.5% from 70.4%, and its operating margin declined to 20.1% from 24.9%. The company’s free cash flow, meanwhile, rose to $875.0 million from $618.0 million. Moss said Edison was investing in the business to reduce risk in future periods and improve ongoing efficiency.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

CFO Aaron Moss said the prior-year quarter included a rate-case true-up, and that Edison was using its year-to-date performance and outlook to invest in the business. He said those investments were intended to reduce risk in future periods and support ongoing efficiency.

Moss also addressed the cost of financing SCE’s grid investments. He estimated that elevated credit spreads could add $300 million to customer costs over the life of bonds SCE expects to issue in 2027. In the Q&A, he said elevated spreads had been in place since January of 2025 and that financing costs for long-term investments can take a long time to work their way out of the system.

Asked about reconciling the long-term forecast with investment needs for 2029 and 2030, Moss said Edison was developing its general rate case from the bottom up and assessing customer needs through a benefit-cost lens. If capital costs rise materially, he said, Edison would prioritize safety, reliability and compliance, leaving less for load growth and clean-energy investments. He said the company would work through the reconciliation as it developed its rate-case testimony.

On wildfire reform, Moss said utilities need a predictable framework for reasonably priced capital, including a durable shareholder liability cap beyond the life of the wildfire fund and a liquidity measure. He said SCE had settled three Eaton claims with Subro for about 55 cents on the dollar. Separately, Moss said he could not predict when Edison would be able to estimate Eaton Fire reserves.

Moss said Edison had no long-term debt with variable interest rates and forecast no common equity issuance through 2030. He also said its dividend policy targets a payout of 45% to 55% of SCE core earnings, subject to board approval.

Guidance

Moss said Edison reaffirmed its core EPS guidance for 2026, 2027 and 2028, as well as its long-term core EPS growth target through 2030. He said the company’s 2026 outlook had a bias toward the middle of its range.