FirstEnergy to Release Q2 Earnings: What's in Store for the Stock?

FirstEnergy (FE) is scheduled to report its Q2 2025 results on July 30, with consensus estimates at $0.53 EPS (down 5.4% YoY) and $3.43 billion in revenue (up 4.7% YoY). The quarter is expected to reflect positive impacts from new solar site completions, advanced LiDAR technology deployment for vegetation management, and ongoing grid modernization efforts via the 'Energize365' program. However, severe April storms are anticipated to have driven up restoration costs, potentially offsetting these operational improvements, leading Zacks' quantitative model to not predict an earnings beat due to a negative Earnings ESP of -10.80%.

Analysis

FirstEnergy's upcoming second-quarter 2025 results present a conflicting picture of operational progress against acute cost pressures. On one hand, the company is expected to benefit from strategic initiatives including the completion of a new 5.75 MW utility-scale solar site, enhanced grid reliability from its 'Energize365' program, and efficiency gains from deploying LiDAR technology for vegetation management. These factors support the consensus revenue estimate of $3.43 billion, a 4.7% year-over-year increase, and a 1.5% rise in electric distribution deliveries. However, these positive developments are likely to be offset by significant operating expenses incurred from restoration efforts following severe storms in April. This headwind is the primary driver behind the consensus earnings estimate of $0.53 per share, which represents a 5.4% decrease from the prior year. Underscoring the cautious outlook, a proprietary quantitative model predicts against an earnings beat, citing a highly negative Earnings ESP of -10.80% despite the company's Zacks Rank #3 (Hold).

Key Decisions for Investors

• Investors should approach FirstEnergy's Q2 earnings report with caution, as the combination of a projected 5.4% YoY earnings decline and a negative Earnings ESP of -10.80% indicates a heightened risk of an earnings miss or downward guidance.
• Pay close attention to the reported magnitude of storm-related restoration costs, as this figure will be the key determinant of whether the company meets the lowered profit expectations and will clarify if the impact is a contained one-off event.
• While short-term results may be weak, long-term investors should evaluate management's commentary on the returns from grid modernization and renewable energy investments, as these are central to the company's future growth thesis beyond the current quarter.
• Consider screening utility sector peers such as Eversource Energy (ES), IDACORP (IDA), and Xcel Energy (XEL), which the report notes have more favorable quantitative setups for a potential earnings beat this cycle.