American Electric Power (AEP) stock rose approximately 5% despite mixed Q3 2025 earnings, as investors focused on the company's long-term growth prospects driven by artificial intelligence infrastructure demand. AEP reported revenue of $6.01 billion, exceeding estimates, but slightly missed on EPS. Crucially, the utility raised its long-term operating earnings growth forecast to 7-9% over the next five years and announced a $72 billion capital expenditure plan to expand its transmission network, positioning itself as a key enabler for data centers, while also guiding for an 8% increase in 2026 earnings per share.
American Electric Power (AEP) stock surged approximately 5% despite reporting mixed Q3 2025 earnings, where revenue of $6.01 billion beat estimates by 7.9% but EPS of $1.80 slightly missed. This strong post-earnings performance, on 138% of average volume, signals investor confidence in the company's long-term strategic outlook rather than immediate bottom-line figures. The core of this optimism stems from AEP's pivotal role in the expanding AI infrastructure, which is driving significant power demand. AEP has raised its long-term operating earnings growth forecast to 7-9% over the next five years, underpinned by a substantial $72 billion capital expenditure plan aimed at a 10% annual rate base growth, with peak project activity expected from 2028 to 2030. Furthermore, the company issued robust 2026 earnings guidance of $6.15 to $6.45 per share, representing an approximate 8% increase from its midpoint. AEP also outlined plans to limit residential rate increases to 3-5% annually, addressing concerns about rising electricity costs driven by data center demand, which saw U.S. residential prices increase 6% in 2025.
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