AES Utilities - Diversified
The AES Corporation
AES is an Arlington, Virginia-based power company that owns and operates about 34,700 MW of generation and six electric utilities (AES Indiana, AES Ohio, and four in El Salvador) serving 2.7 million customers. It sells most of its power under medium- and long-term contracts, and its strategy centers on supplying renewable energy to large corporations — data center companies in the U.S. and mining companies outside it. FY2025 revenue was $12.2 billion, 41% of it from the U.S. and the rest mainly from Chile, the Dominican Republic, El Salvador, Mexico, and other countries. On March 1, 2026, AES agreed to be acquired for $15.00 a share in cash by investment vehicles affiliated with Global Infrastructure Management (GIP) and the EQT Infrastructure VI fund; stockholders approved the deal on June 26, 2026, and it still awaits remaining regulatory approvals.
Last updated
Analysis last edited: October 4, 2026 · Financial data fetched: October 3, 2026 16:02 (SEC EDGAR) · Source 10-K filed: March 2, 2026
Next update expectedAfter FY2026’s 10-K is filed (roughly 60–90 days after fiscal year end (sooner for larger filers)), financials and analysis will be refreshed.
01
Company profile
- Legal name
- AES CORP
- Headquarters
- ARLINGTON, VA
- Incorporated in
- Delaware
- Fiscal year end
- 12/31
- Exchange & ticker
- NYSE: AES
- Industry
- Utilities - Diversified
- CIK
- 874761
- Website
- https://www.aes.com/ ↗
Workforce (as of FY2025 year-end)
Employees
8,336
Source: Form 10-K (FY2025) cover page and business description
02
Earnings calendar
When the company reports each quarter: the quarter-end date, the day results were released, and when the 10-Q or 10-K was filed.
Next report
Q3 FY2026
Quarter end: September 2026. In past years, Q3 results were released 31–35 days after quarter end (Nov 4, 2025; Oct 31, 2024; Nov 2, 2023). No date has been announced in the sources this site uses.
Reporting pattern
- Fiscal year ends around December 31.
- Reports four times a year: three quarterly reports (10-Q) and an annual report (10-K) for Q4.
- Earnings releases came 31–59 days after quarter end over the last 12 quarters.
| Quarter | Quarter ended | Earnings release (8-K) | Report filed (10-Q / 10-K) |
|---|---|---|---|
| Q2 FY2026 | Jun 30, 2026 | — | Aug 4, 2026 10-Q (+35 days) |
| Q1 FY2026 | Mar 31, 2026 | — | May 5, 2026 10-Q (+35 days) |
| Q4 FY2025 | Dec 31, 2025 | — | Mar 2, 2026 10-K (+61 days) |
| Q3 FY2025 | Sep 30, 2025 | Nov 4, 2025 (+35 days) | Nov 4, 2025 10-Q (+35 days) |
| Q2 FY2025 | Jun 30, 2025 | Aug 1, 2025 (+32 days) | Aug 1, 2025 10-Q (+32 days) |
| Q1 FY2025 | Mar 31, 2025 | May 1, 2025 (+31 days) | May 1, 2025 10-Q (+31 days) |
| Q4 FY2024 | Dec 31, 2024 | Feb 28, 2025 (+59 days) | Mar 11, 2025 10-K (+70 days) |
| Q3 FY2024 | Sep 30, 2024 | Oct 31, 2024 (+31 days) | Oct 31, 2024 10-Q (+31 days) |
| Q2 FY2024 | Jun 30, 2024 | Aug 1, 2024 (+32 days) | Aug 1, 2024 10-Q (+32 days) |
| Q1 FY2024 | Mar 31, 2024 | May 2, 2024 (+32 days) | May 2, 2024 10-Q (+32 days) |
| Q4 FY2023 | Dec 31, 2023 | Feb 26, 2024 (+57 days) | Feb 26, 2024 10-K (+57 days) |
| Q3 FY2023 | Sep 30, 2023 | Nov 2, 2023 (+33 days) | Nov 2, 2023 10-Q (+33 days) |
Source: SEC EDGAR filing history. Release dates are the dates the earnings release was furnished to the SEC on Form 8-K (Item 2.02), which is normally the day results are announced. Fiscal years are labeled by the calendar year in which they end.
03
Flagship products & services
Renewables
Solar, wind, storage, hydro
Examples: Chivor hydro (1,000 MW, Colombia); AES Clean Energy projects in the U.S.
Mostly contracted output.
Utilities
Regulated electricity
Examples: AES Indiana, AES Ohio, AES El Salvador
Six utilities, 2.7 million customers.
Energy Infrastructure
Thermal generation and LNG
Examples: Gas and LNG in the Dominican Republic and Panama; coal plants
Gas is 29% of fleet capacity, coal 15%.
New Energy Technologies
Technology investments
Examples: Fluence (28.19%), Maximo
Energy storage and AI-enabled applications.
Capacity shares are from the FY2025 10-K: renewables 54%, natural gas 29%, coal 15%, pet coke or oil 2%.
04
Recent strategic focus
The pending sale of AES, plus FY2025 developments from the 10-K.
Agreement to be taken private
On March 1, 2026, AES agreed to merge with Horizon Parent, controlled by vehicles affiliated with GIP and the EQT Infrastructure VI fund, for $15.00 a share in cash. The board approved it unanimously.
Source: Form 10-K (FY2025), subsequent events note
Approvals so far
The HSR waiting period expired June 22, 2026; stockholders approved the merger on June 26 (479.1M shares for, 10.1M against); CFIUS approved it on August 27; and the PUCO approved it on September 17. Other regulatory approvals remain.
Source: 8-Ks filed 2026-06-26, 2026-08-27, and 2026-09-17
Selling minority stakes
In 2025 AES sold about 30% of AES Ohio to CDPQ and a minority interest in its captive insurer AGIC for $450M, meeting its $400–500M asset sale target.
Source: Form 10-K (FY2025) Item 1
Capex ÷ D&A (FY2025)
4.07x
Well above depreciation — expansion-stage investment
formulacapital expenditures ÷ depreciation & amortization
e.g.$5,929M ÷ $1,457M = 4.07x
termsCapital expenditures (capex) · Depreciation & amortization (D&A)
M&A spend (5-year total)
$1.8B
Latest year: $108M
Cash-flow-statement spending on acquisitions, net of cash acquired
Where the money goes, over time
Unit: $M. Capex went from $2.12B in FY2021 to $5.93B in FY2025
- Capex
- M&A spend
formulacapital expenditures ÷ depreciation & amortization
termsCapital expenditures (capex) · Depreciation & amortization (D&A)
Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-03-02
05
Key figures at a glance
FY2021–FY2025, 5 years.
Revenue (FY2025)
$12.23B
As reported in the 10-K
Revenue CAGR (4 years)
+2.4%
formula(last-period revenue ÷ first-period revenue) ^ (1 ÷ years) − 1
e.g.($12,233M ÷ $11,141M) ^ (1÷4) − 1 = 2.4%
termsCAGR · ^ (exponent) · Revenue (net sales)
Operating margin (FY2025)
—
formulaoperating income ÷ revenue × 100
ROE (FY2025)
23.6%▲favorable
5-year average: 10.6%
As reported in the 10-K
P/B (FY2025 end)
2.51x
formulaP/E × EPS ÷ BVPS (= period-end share price ÷ book value per share)
e.g.11.4x × $1.26 ÷ $5.70 = 2.51x
Period-end (fiscal year-end) value, not today's P/B
EV/EBITDA (FY2025 end)
—
formula(market cap + interest-bearing debt − cash and equivalents) ÷ (operating income + depreciation & amortization)
termsEV/EBITDA · Market capitalization · Interest-bearing debt · EBITDA · Depreciation & amortization (D&A)
Period-end (fiscal year-end) value, not today's multiple
- ―
Revenue grew +2.4% a year over 4 years (modest growth)
From $11.14B in FY2021 to $12.23B in FY2025. The annualized rate (CAGR) makes it possible to compare growth pace across companies of different sizes.
- ▼
Equity ratio is 7.8% (relatively heavy reliance on debt)
The share of total assets funded by equity rather than debt. 50%+ is often read as low bankruptcy risk, though the right level varies by industry (real estate and leasing run lower, for instance).
- ▼
Free cash flow was positive in 0 of 5 years
Operating cash flow minus capital expenditures: the cash left over after funding the business’s own investment, available for dividends, buybacks, acquisitions, or debt paydown. A negative year can mean heavy investment, or weak core earnings — worth distinguishing.
- ▲
ROE averaged 10.6% over 5 years (latest: 23.6%)
How much profit was generated on shareholders’ equity. Roughly 10%+ is often cited as solid for a U.S. company, though this varies a lot by industry and capital intensity.
06
Business model
Renewables
Solar, wind, energy storage, and hydro plants, mostly selling under long-term contracts. AES develops and builds projects, signing contracts for the output before construction, and funds them largely with non-recourse project debt and tax equity partners.
01 what it draws on
Inputs & resources
- Solar, wind, storage, and hydro plants in the U.S., Chile, Colombia, Panama, and elsewhere
- Non-recourse project debt and tax equity
02 what it does
Activities
- Developing, building, and operating renewable plants
03 who it serves
Customers
- Large corporations, including data center companies in the U.S. and mining companies outside it, plus utilities
04 how money comes in
How it earns
- Long-term power purchase agreements (more than five years)
- Renewable energy certificates and U.S. tax credits
Renewables: how it makes money
- Revenue $2.9B and Adjusted EBITDA $932M (non-GAAP) in FY2025, up on new projects and better hydrology.
- Completed 3.2 GW of solar, storage, and wind in 2025 and signed long-term contracts for 4.0 GW; backlog of 12.0 GW, including 5.7 GW under construction.
Utilities
AES Indiana (a fully integrated regulated utility), AES Ohio (transmission and distribution), and four distribution utilities in El Salvador, each the sole distributor in its territory, earning a regulated return on their asset base.
01 what it draws on
Inputs & resources
- 4,056 MW of generation at the two U.S. utilities
- Distribution networks
02 what it does
Activities
- Generating (Indiana), transmitting, and distributing electricity
03 who it serves
Customers
- 2.7 million residential, commercial, industrial, and government customers
04 how money comes in
How it earns
- Regulated tariffs that recover costs and a return on the asset base
Utilities: how it makes money
- Revenue $4.1B (+14%) and Adjusted EBITDA $863M in FY2025.
- AES says AES Indiana and AES Ohio project double-digit rate base growth through 2027.
- CDPQ owns about 30% of both AES Ohio (since April 2025) and IPALCO, AES Indiana's parent.
Energy Infrastructure
Natural gas, LNG, coal, pet coke, diesel, and oil plants, many under contracts that pass fuel costs through to buyers.
01 what it draws on
Inputs & resources
- Gas, coal, and oil-fired plants in the U.S., Dominican Republic, Panama, Mexico, Bulgaria, Vietnam, and elsewhere
- Fuel, including imported LNG in the Dominican Republic and Panama
02 what it does
Activities
- Generating power; importing and reselling LNG
03 who it serves
Customers
- Utilities, industrial users, and other buyers
04 how money comes in
How it earns
- Contract sales with capacity payments and fuel pass-throughs
- Short-term market sales
Energy Infrastructure: how it makes money
- The largest segment by revenue ($5.4B) and Adjusted EBITDA ($1.13B) in FY2025, but both fell from 2024, mainly because 2024 included revenue from monetizing the Warrior Run coal plant contract.
New Energy Technologies
Investments in energy technology businesses, including a 28.19% economic interest in Fluence (energy storage, Nasdaq: FLNC), and Maximo.
01 what it draws on
Inputs & resources
- Equity stakes and capital
02 what it does
Activities
- Investing in and incubating technology businesses
03 who it serves
Customers
- —
04 how money comes in
How it earns
- Mostly equity-method results
New Energy Technologies: how it makes money
- Adjusted EBITDA loss of $35M in FY2025; FY2025 results include impairments related to Uplight.
Revenue by segment (FY2025)
Unit: $M — bar length = revenue, (%) = share of total company revenue, margin = segment profit ÷ segment revenue × 100
Renewables
2,913 (23%)profit 932 · margin 32.0%
Utilities
4,122 (33%)profit 863 · margin 20.9%
Energy Infrastructure
5,402 (43%)profit 1,130 · margin 20.9%
New Energy Technologies
1 (0%)profit -35 · margin -3500.0%
Source: Form 10-K (FY2025) — Note 19, Segments and Geographic Information Profit is segment Adjusted EBITDA, a non-GAAP measure that AES uses as its segment profit measure; it is before interest, taxes, and depreciation, adjusted for noncontrolling interests. Revenue is before inter-segment eliminations ($354M). Corporate and Other isn't shown.
07
Where it earns
Many U.S.-listed companies earn most of their revenue outside the U.S. — this breaks down revenue by country/region so it's clear where the business actually makes its money.
Largest market (FY2025)
United States (incl. Puerto Rico) — 41% of revenue
Revenue by country / region (FY2025)
Unit: $M — bar length = revenue, (%) = share of total company revenue
United States (incl. Puerto Rico)
5,056 (41%)Chile
1,516 (12%)Dominican Republic
1,363 (11%)El Salvador
1,086 (9%)Mexico
760 (6%)Bulgaria
687 (6%)Panama
649 (5%)Colombia
422 (3%)Argentina
366 (3%)Vietnam
321 (3%)Other
7 (0%)
Source: Form 10-K (FY2025) — Note 19, Segments and Geographic Information Non-U.S. revenue was $7.2B, down from $8.2B in FY2023, partly because AES Brasil (revenue $616M in FY2024) was sold in October 2024.
08
Contract structure
Short-term or spot sales carry different earnings quality than long-term or auto-renewing contracts — this shows how the company actually contracts with its customers.
Most of AES's generation is sold under medium-term (two to five years) or long-term (more than five years) contracts. For fuel-burning plants, contracts are structured to pass through fuel and variable costs, and capacity payments cover fixed costs, debt service, and a return on capital; AES says these contracts significantly reduce its exposure to power and fuel prices, currency, and interest rates. The rest is sold in short-term markets, where earnings move with market prices. The utilities earn regulated tariffs.
- Multi-year / recurring
Long-term PPAs
Part of non-regulated revenue ($8.2B in FY2025)
Typical term: More than five years
Capacity payments mostly denominated in the currency of the plant's fixed costs.
- Multi-year / recurring
Medium-term contracts
Part of non-regulated revenue
Typical term: Two to five years
Fuel costs passed through, indexed, or hedged.
- Short-term contract
Short-term and spot sales
Part of non-regulated revenue
Typical term: Average term under two years, including spot sales
More sensitive to market prices.
- Multi-year / recurring
Regulated utility tariffs
Regulated revenue $4.0B (33%)
Typical term: Reviewed and reset by regulators
Fuel and purchased energy costs generally passed through to customers.
09
Alliances & capital ties
Equity stakes, joint ventures, and strategic partnerships disclosed across the 10-K, 8-Ks, and proxy statement.
Joint venture
Global Infrastructure Management (GIP)
Renewables partnerships in Chile: GIP holds 49% of Chile Renovables and, from August 2025, 49% of AES Desarrollos Renovables (bought for $77M), into which AES contributes renewable projects as they are developed. GIP is also one of the parties acquiring AES.
Source: Form 10-K (FY2025) — Note 18, Equity (noncontrolling interests)
Capital tie / equity stake
CDPQ (La Caisse de dépôt et placement du Québec)
Owns about 30% of AES Ohio (bought in April 2025) and about 30% of IPALCO, the parent of AES Indiana.
Capital tie / equity stake
Fluence Energy (with Siemens)
Fluence began in 2018 as an AES–Siemens joint venture in energy storage and listed on Nasdaq in 2021; AES holds a 28.19% economic interest.
Source: Form 10-K (FY2025) — Item 1, New Energy Technologies
10
Customers & suppliers
Who the company sells to and buys from. Companies rarely name either, so named counterparties come only from the company's own filings and press releases; otherwise this lists the concentration figures the 10-K discloses.
Customers
Power buyers under contracts (utilities, large corporations including data center and mining companies, and other intermediaries), short-term market buyers, and 2.7 million utility customers in Indiana, Ohio, and El Salvador.
Named by the company
No customer is named as material.
What the filings disclose
- Many generation customers don't have investment-grade credit ratings; AES has sought sovereign guarantees for some contracts. (Form 10-K (FY2025), Item 1A)
- AES El Salvador's territory covers 77% of the country. (Form 10-K (FY2025), Item 1)
- Puerto Rico revenue was $404M in FY2025; AES Ilumina's non-recourse debt there remains in technical default following the PREPA bankruptcy. (Form 10-K (FY2025), Note 19 and MD&A)
Suppliers
Fuel (natural gas and LNG, coal, pet coke, oil) and construction contractors. Renewables (54% of capacity) have no significant fuel costs.
Named by the company
- Fluence Energy — Energy storage provider in which AES holds a 28.19% economic interest.Form 10-K (FY2025) — Item 1, New Energy Technologies
What the filings disclose
- LNG is imported for plants in the Dominican Republic and Panama; elsewhere gas comes from local suppliers. (Form 10-K (FY2025), Item 1)
- Pet coke is sourced largely from Mexico and the U.S.; non-U.S. coal plants use international and local coal. (Form 10-K (FY2025), Item 1)
- Construction is typically managed by third-party contractors, supervised by AES's own team. (Form 10-K (FY2025), Item 1)
11
Competitors & peers
Competitors the 10-K names, and the peer group the company itself chose in its proxy statement. Nothing here is this site's own pick.
AES's 10-K says its power markets have numerous strong competitors and increasing competition both for power sales agreements and for buying generation assets, while contracted plants face limited price competition during a contract's term. No company is named.
Competitors named in the 10-K
AES's 10-K doesn't name competitors.
Peer group the company chose
Clean Energy Peer Group, from the proxy statement. Peers are companies the board considers comparable — for example when setting executive pay — not necessarily direct competitors.
One of three benchmarks, alongside the S&P 500 and S&P Utilities indexes, for the relative shareholder return measure in AES's performance awards. For pay levels, the proxy cites WTW survey data on similarly sized companies as its benchmark.
- Brookfield Renewable Partnerssite ↗
- Clearway Energysite ↗
- EDP Renewablessite ↗
- Enel Américassite ↗
- Enlight Renewable Energysite ↗
- Iberdrolasite ↗
- NextEra Energysite ↗
- Ørstedsite ↗
- RWE Clean Energysite ↗
Company names link to this site’s analysis where one exists; “site ↗” opens the company’s own website.
12
M&A history
Companies acquired over the last five years, plus older large acquisitions that still anchor a current business — what each was bought to do, and what happened afterward. From the 10-K, 8-Ks, and the company's press releases.
In recent years AES has mostly sold businesses and minority stakes to fund its renewables build-out, rather than buying companies; it is now itself the target of a pending acquisition.
Cash spent on acquisitions, FY2021–FY2025: $1.8B
Pending (agreed Mar 2026)
AES itself — to be acquired by Horizon Parent (GIP and EQT Infrastructure VI)
$15.00 per share in cash
A merger that would make AES privately owned by funds affiliated with GIP and the EQT Infrastructure VI fund, and other investors.
- Stated purpose (company)
- The FY2025 10-K and 8-Ks describe the terms and approvals but don't state the rationale.
Source: Form 10-K (FY2025) — subsequent events note · Form 8-K (2026-09-17) — PUCO approval
Apr 2025 (sale)
About 30% of AES Ohio — sold to CDPQ
Not disclosed in the 10-K sections reviewed
An indirect minority interest in AES's Ohio transmission and distribution utility.
- Stated purpose (company)
- Not stated in the sections reviewed; the MD&A notes the AES Ohio sell-down reduced FY2025 Adjusted EBITDA.
Q1 2025 (sale)
Minority interest in AGIC (captive insurer)
$450M
AES Global Insurance Company, AES's captive insurance company.
- Stated purpose (company)
- With this sale AES met its full-year 2025 asset sale proceeds target of $400–500M.
Source: Form 10-K (FY2025) — Item 1, 2025 Strategic Highlights
Oct 2024 (sale)
AES Brasil
$412M net proceeds
AES's Brazilian generation business (revenue of $616M in FY2024).
- Stated purpose (company)
- Not stated in the FY2025 10-K; the sale produced a gain in 2024.
Figures as disclosed in the FY2025 10-K and 2026 8-Ks.
13
Five years of financials
Each chart's axis holds a single unit (never mixing dollars, %, and $/share). The table's per-period header links to the filing the numbers came from.
Revenue over time
Unit: $M
Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-03-02
Profit over time (operating → net)
Unit: $M
- Pretax income
- Net income
Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-03-02
Margins over time
Unit: %
- Operating margin
- Net margin
formulaoperating income ÷ revenue × 100
formulanet income attributable to the company ÷ revenue × 100
Cash flow over time
Unit: $M (below zero = cash went out)
- Operating CF
- Investing CF
- Free CF
formulacash flow from operations − capital expenditures
termsFree cash flow (FCF) · Cash flow from operations (operating CF) · Capital expenditures (capex)
Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-03-02
Financial stability & capital efficiency
Unit: %
- Equity ratio
- ROE
formulatotal equity ÷ total assets × 100 (as reported in the 10-K)
termsStockholders’ equity · Total assets
formulanet income ÷ average equity (beginning + ending, ÷2) × 100 (as reported in the 10-K)
termsNet income (attributable to the company) · Stockholders’ equity
Earnings per share (EPS) and dividend per share
Unit: $
- EPS
- Dividend per share
Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-03-02
| Line item | FY202110-K on EDGAR ↗ | FY202210-K on EDGAR ↗ | FY202310-K on EDGAR ↗ | FY202410-K on EDGAR ↗ | FY202510-K on EDGAR ↗ |
|---|---|---|---|---|---|
| Income statement ($M) | |||||
| Revenue | 11,141 | 12,617 | 12,668 | 12,278 | 12,233 |
| Pretax income | 644 | 96 | 104 | 894 | 75 |
| Net income (attributable) | -409 | -546 | 249 | 1,679 | 910 |
| Revenue growthcalc(this year’s revenue − last year’s revenue) ÷ last year’s revenue × 100 | — | 13.2% | 0.4% | -3.1% | -0.4% |
| Net margincalcnet income attributable to the company ÷ revenue × 100 | -3.7% | -4.3% | 2.0% | 13.7% | 7.4% |
| Balance sheet ($M) | |||||
| Total assets | 32,963 | 38,363 | 44,799 | 47,406 | 51,768 |
| Total equity | 4,567 | 4,504 | 5,985 | 7,704 | 9,105 |
| Interest-bearing debtSum of short- and long-term borrowings, notes/bonds payable | 18,699 | 23,498 | 26,878 | 29,018 | 29,897 |
| Equity ratio | 8.5% | 6.4% | 5.6% | 7.7% | 7.8% |
| ROE | -14.6% | -20.9% | 10.1% | 54.8% | 23.6% |
| Cash flow ($M) | |||||
| Operating CF | 1,902 | 2,715 | 3,034 | 2,752 | 4,306 |
| Investing CF | -3,051 | -5,836 | -8,188 | -7,700 | -6,210 |
| Financing CF | 797 | 3,758 | 5,405 | 4,963 | 1,975 |
| Free cash flowcalccash flow from operations − capital expenditures | -214 | -1,836 | -4,690 | -4,640 | -1,623 |
| Cash and equivalents | 943 | 1,374 | 1,426 | 1,524 | 1,382 |
| Per share & other | |||||
| EPS ($) | -0.61 | -0.82 | 0.35 | 2.36 | 1.26 |
| BVPS ($) | 4.20 | 3.64 | 3.72 | 5.12 | 5.70 |
| Dividend per share ($) | 0.61 | 0.64 | 0.67 | 0.69 | 0.70 |
| Payout ratiocalcdividend per share ÷ diluted EPS × 100 | — | — | 191.5% | 29.4% | 55.9% |
| P/E (x) | — | — | 55.0 | 5.5 | 11.4 |
| P/B (x)calcP/E × EPS ÷ BVPS (= period-end share price ÷ book value per share) | — | — | 5.18 | 2.51 | 2.51 |
P/B and EV/EBITDA use each period’s period-end (fiscal year-end) figures, not the current share price. Figures without a "calc" tag are as reported in the Form 10-K (five-year selected financial data and the consolidated financial statements), pulled automatically from SEC EDGAR. Where a later filing restated a prior period, the restated figure is used.
14
Is ROIC above WACC?
ROIC (the return on money invested in the business) above WACC (the cost of raising that money) means the company is creating value. WACC is an estimate, so its assumptions can be adjusted below.
Not enough data (operating income, equity, etc.) to compute ROIC/WACC.
15
What the price implies (DCF)
A company's value can be written as its free cash flow divided by (cost of capital − perpetual growth). Working that backwards from the market's valuation shows how much growth the share price assumed — compared here with the company's actual past growth.
Not enough data for this calculation (FY2025): it needs positive free cash flow, a fiscal year-end P/E, and a positive enterprise value.
16
Earnings quality
The same reported profit can mean different things depending on whether it's backed by cash, driven by the core business, or the result of a one-off item. Four checks below.
- ✓
Operating CF ÷ net income: averages 6.19x
Profit is backed by cash coming in.
- ✓
Accrual ratio (latest): -6.8%
A small share of profit rests on accounting estimates.
- ✓
Days sales outstanding: 46 → 50 days
No major slowdown in collecting on sales.
Operating CF vs. net income
Unit: $M — operating CF above net income means profit is backed by cash
- Operating CF
- Net income
formulacash flow from operations ÷ net income attributable to the company
termsCash flow from operations (operating CF) · Net income (attributable to the company)
formula(net income − operating CF) ÷ average total assets × 100
termsNet income (attributable to the company) · Cash flow from operations (operating CF) · Total assets
Source: each period's Form 10-K (SEC EDGAR). Latest: filed 2026-03-02
Receivables & inventory days
Unit: days — days grow when receivables or inventory build up faster than sales
- Days sales outstanding
- Days inventory outstanding
formulaperiod-end receivables ÷ revenue × 365
formulaperiod-end inventory ÷ revenue × 365
termsInventory · Revenue (net sales)
Worked examples (latest period)
formulacash flow from operations ÷ net income attributable to the company
e.g.$4,306M ÷ $910M = 4.73x
termsCash flow from operations (operating CF) · Net income (attributable to the company)
formulaoperating income ÷ income before income taxes × 100
termsOperating income · Income before income taxes (pretax income)
formulaperiod-end receivables ÷ revenue × 365
e.g.$1,683M ÷ $12,233M × 365 = 50 days
17
Strengths & weaknesses
Strengths
1. Contracted revenue
Most generation is sold under medium- or long-term contracts with capacity payments and fuel pass-throughs, which AES says significantly reduce its exposure to power and fuel prices, currency, and interest rates.
Evidence: Form 10-K (FY2025) Item 1
2. Large renewables pipeline
A 12.0 GW backlog of contracted projects not yet operating, including 5.7 GW under construction; Bloomberg NEF has rated AES one of the top two sellers of renewable power to corporations.
Evidence: Form 10-K (FY2025) Item 1
3. Growing regulated utilities
Utilities SBU revenue rose 14% in FY2025, and AES says AES Indiana and AES Ohio project double-digit rate base growth through 2027.
Evidence: Form 10-K (FY2025) Item 1 and MD&A
4. Debt mostly ring-fenced at projects
Of about $30B of debt, $23.2B is non-recourse: repaid only from each project's revenue and secured only by that project.
Evidence: Form 10-K (FY2025) Item 1A
Weaknesses
1. Thin equity and heavy debt
AES stockholders' equity was $4.1B against $51.8B of total assets at FY2025 year-end, and interest expense of $1.4B is about two-thirds of the $2.2B operating margin.
Evidence: SEC EDGAR XBRL; Form 10-K (FY2025) income statement
2. Earnings shaped by tax-equity accounting
Net income was $162M, but $748M of losses were allocated to noncontrolling interests, mostly tax equity investors under the HLBV method, so net income attributable to AES was $910M.
Evidence: Form 10-K (FY2025) income statement and auditor's report
3. Volatile reported results
Diluted EPS swung from −$0.82 (FY2022) to $2.36 (FY2024) and $1.26 (FY2025), driven by impairments, asset sales, currency, and derivative gains and losses.
Evidence: SEC EDGAR XBRL; Form 10-K (FY2025) MD&A
4. Little cash at the parent
Parent company liquidity fell to $1.38B from $2.05B, with just $10M of cash at the parent and qualified holding companies; the parent depends on distributions from subsidiaries.
Evidence: Form 10-K (FY2025) MD&A, Parent Company Liquidity
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What draws investors to it
Why the stock can look attractive to investors — each point paired with what has to hold for it to stay true, and the opposing view. This is this site's analysis, not a recommendation to buy or sell.
P/E (FY2025)
11.4x
Price at fiscal year-end ÷ diluted EPS
Dividend yield (FY2025)
4.91%
Dividends per share ÷ fiscal year-end price
Payout ratio (FY2025)
56%
Dividends per share ÷ diluted EPS
FCF yield (FY2025)
-15.7%
(Operating CF − capex) ÷ market cap
1. A fixed cash price
Under the merger agreement, each share will be converted into $15.00 in cash at closing; stockholders approved the deal and several regulatory approvals are in hand.
- What has to hold
- The remaining regulatory approvals arrive without a Burdensome Condition and the deal closes.
- The other side
- Holders give up any value above $15.00, and if the deal fails, the share price would again depend on AES's own results and financing.
Evidence: Form 10-K (FY2025) subsequent events note; 8-Ks through 2026-09-17
2. Dividend while the deal is pending
Dividends per share rose each year from $0.61 (FY2021) to $0.70 (FY2025).
- What has to hold
- Payments continue until closing.
- The other side
- AES says it can't assure dividends will continue, and free cash flow has been negative because capex exceeds operating cash flow.
Evidence: SEC EDGAR XBRL; Form 10-K (FY2025) MD&A
P/E, dividend yield, and payout ratio above use the FY2025 year-end share price, before the merger was announced. FCF yield is negative because capital spending exceeds operating cash flow.
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Resilience
How well the company could absorb a bad year: its financial buffer, how its revenue and profit held up in the worst year on record, and what the 10-K says about the business's exposure to shocks. Figures and filing statements only — no overall rating.
1. Financial buffer (FY2025)
Cash & short-term investments ÷ debt due within a year
0.5x
$1.56B vs. $3.11B
Interest coverage (operating income ÷ interest expense)
Not disclosed
The income statement has no operating income line.
Free cash flow ÷ dividends paid
-3.2x
−$1.62B vs. $501M (FCF = operating CF − capex)
2. Worst year in the record, and the recovery
| Figure | Worst year-over-year change | Back to the prior level? |
|---|---|---|
| Revenue | -3.1% in FY2024 ($12.67B → $12.28B) | Not yet, as of FY2025 |
Covers only the 5 fiscal years on record (FY2021–FY2025), which may not include a full recession — the worst year here isn’t necessarily how the company would fare in a severe downturn.
3. Business resilience (from the 10-K)
Non-recourse structure
$23.2B of the roughly $30B of debt is repaid only from individual projects' cash flow, so a problem project's lenders generally can't reach the parent company.
Source: Form 10-K (FY2025), Item 1A
Contracted cash flows
Capacity payments and fuel pass-throughs in contracts cover fixed costs and debt service when plants meet availability standards.
Source: Form 10-K (FY2025), Item 1 · See Contract structure
Parent liquidity
Parent company liquidity of $1.38B at FY2025 year-end ($10M cash plus $1.37B available under credit facilities), down from $2.05B.
Source: Form 10-K (FY2025), MD&A
Dependence on capital markets
Capex exceeded operating cash flow in each of FY2021–FY2025, so growth relies on project debt, tax equity, and asset sales.
Source: SEC EDGAR XBRL
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Risks (including geopolitical)
Starting from the 10-K's Risk Factors section, organized by category — geopolitical, currency, raw materials, regulatory, disaster, and more — with impact and likelihood assessed by this site.
Risk map
Vertical = impact on results, horizontal = likelihood. Upper right = most severe. Numbers match the list below (placement is this site’s own assessment).
Likelihood →
"Company disclosure" vs. "this site’s assessment"
The description and mitigation for each risk are this site’s summary of the 10-K’s "Risk Factors" section. Impact and likelihood are this site’s own assessment, not the company’s — where the company discloses its own likelihood assessment, that is noted in the summary.
Impact is judged from how large the affected business is relative to total revenue/profit, and from the risk’s track record of moving results in the past. Likelihood is judged from the filing’s wording and the current business environment (already occurring, or recurring).
Geopolitical risk highlights
- [2]Emerging-market exposure
- 1Governance & quality
Merger not completing
- Company disclosure (summarized from the 10-K)
- Closing still requires other regulatory approvals — the merger agreement lists the New York PSC, FERC, and certain foreign approvals among those needed. If the deal is terminated in certain circumstances AES would owe a fee of about $321M; in others the buyer would owe AES $100M or about $588M.
- Company’s stated mitigation
- Stockholder, HSR, CFIUS, and PUCO approvals already obtained; closing isn't conditioned on the buyer's financing.
- This site’s assessment
- Impact High / Likelihood Low
- 2Geopolitical
Emerging-market exposure
- Company disclosure (summarized from the 10-K)
- 59% of FY2025 revenue came from outside the U.S., including Chile, the Dominican Republic, El Salvador, Argentina, and Vietnam; the 10-K notes that many customers aren't investment grade.
- Company’s stated mitigation
- Some contracts carry sovereign guarantees; currency of revenue matched to costs and debt.
- This site’s assessment
- Impact Med / Likelihood Med
- 3FX & interest rates
Refinancing and credit ratings
- Company disclosure (summarized from the 10-K)
- A downgrade could raise borrowing costs and force AES to post collateral; some subsidiaries are in default on non-recourse debt ($20M classified as current, at AES Ilumina in Puerto Rico).
- Company’s stated mitigation
- Most debt is non-recourse to the parent; much project debt is hedged.
- This site’s assessment
- Impact Med / Likelihood Med
- 4Disaster
Hydrology and weather
- Company disclosure (summarized from the 10-K)
- Hydro output in Colombia and Panama depends on rainfall, and solar and wind output on resource conditions; better hydrology helped 2025.
- Company’s stated mitigation
- Contract levels managed against expected generation.
- This site’s assessment
- Impact Med / Likelihood High
- 5Law & regulation
U.S. tax credit dependence
- Company disclosure (summarized from the 10-K)
- Renewables results depend partly on earning U.S. renewable tax credits, which AES monetizes through tax equity and credit transfers.
- Company’s stated mitigation
- Not stated in the 10-K excerpts reviewed.
- This site’s assessment
- Impact Med / Likelihood Med
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What to watch going forward
- Remaining regulatory approvals and the closing date of the $15.00-per-share merger (outside date June 1, 2027, extendable).
- Conversion of the 12.0 GW backlog into operating projects.
- Rate case outcomes at AES Indiana and AES Ohio.
- Parent company liquidity and debt refinancing.
- Hydrology in Colombia and Panama.
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Source documents
This page's financial figures come from the Form 10-Ks listed below. Check the original filings for full detail.
Last updated
Analysis last edited: October 4, 2026 · Financial data fetched: October 3, 2026 16:02 (SEC EDGAR) · Source 10-K filed: March 2, 2026
Next update expectedAfter FY2026’s 10-K is filed (roughly 60–90 days after fiscal year end (sooner for larger filers)), financials and analysis will be refreshed.
This page is this site’s own analysis based on public information, and does not represent The AES Corporation’s views. It is not a recommendation to buy or sell any security, and this site does not guarantee the accuracy of any figure or statement here. Always verify against the original source documents before making an investment decision.