EIX · Q3 2025 Earnings

Cautious

Edison International

Reported October 28, 2025

30-second summary

Edison delivered Q3 core EPS of $2.34 on revenue of $5.75B (+10.6% YoY) and narrowed FY2025 core EPS guidance to $5.95–$6.20 from the prior $5.94–$6.34 — a $0.14 reduction at the high end that lowers the midpoint by ~$0.07 despite management framing it as a tightening. The substantive Q3 developments are real: the GRC final decision approved 91% of requested capital, SB 254 confirmed Eaton Fire as wildfire-fund eligible, and the 5–7% 2025–2028 EPS CAGR was reaffirmed. But the prior briefing's stated 2028 EPS bracket of $6.74–$7.14 has quietly dropped out of the narrative, and Eaton Fire loss estimation remains punted with no estimate yet possible.

Headline numbers

EPS

Q3 FY2025

$2.34

Revenue

Q3 FY2025

$5.75B

+10.6% YoY

Operating margin

Q3 FY2025

24.9%

Key financials

Q3 FY2025

Metric	Q3 FY2025	YoY	Q2 FY2025	QoQ
Revenue	$5.75B	+10.6%	$4.54B	+26.6%
EPS	$2.34	—	$0.97	+141.2%
Operating margin	24.9%	—	17.1%	+785bps

Guidance

FY2025 core EPS guidance lowered at the high end (from $6.34 to $6.20), narrowing the range despite company framing it as a tightening due to regulatory de-risking.

Guidance is issued for the full year only, refreshed each quarter. Prior and new below are the same FY updated this quarter.

Changes to prior guidance

Metric	Period	Prior guide	New guide	Δ	Result
Core EPS	FY2025	$5.94–$6.34	$5.95–$6.20	High end lowered by $0.14; low end slightly raised by $0.01; midpoint down ~$0.07	Lowered

Reaffirmed unchanged this quarter: Core EPS Growth (2025–2028 CAGR) (5–7% annually)

Other KPIs

Q3 FY2025

Segment	Q3 FY2025
Core EPS (Q3 2025)	$2.34
2025 Core EPS Guidance	$5.95–$6.20
Operating Margin (Q3 2025)	24.9%
YoY Revenue Growth (Q3 2025)	10.6%
2025–2028 Core EPS Growth Outlook	5–7% annually
Customers Served (SCE)	15 million people
GRC Final Decision Capital Investment Approval	91% approved
Eaton Fire Wildfire Fund Eligibility	Confirmed as covered wildfire

Management tone

Q2 framing: legislative defense → Q3 framing: regulatory de-risking achieved, but with quieter goalposts.

The most telling shift is the rhetorical pivot from "defending against affordability proposals" in Q2 to "de-risking complete" in Q3 — even as the FY2025 midpoint moves down. In Q2, management spent the call publicly contesting securitization on customer-cost grounds and ruling out shareholder contributions to any expanded fund. In Q3, the language is "made significant progress on the regulatory front this year, further de-risking our financial outlook," paired with a guidance range that is materially lower at the top. The de-risking is genuine — GRC done, SB 254 in force, Eaton wildfire-fund eligibility confirmed — but the framing obscures that the upside case has been clipped.

Second, on Eaton, the posture has not advanced. In Q2 management said complex-fire investigations take 12–18 months; in Q3 they confirmed the recovery compensation program hasn't launched, a single insurance settlement at 52¢ on the dollar is "insufficient data," and no loss estimate is possible. Eight months after ignition, the loss range is still unbounded inside the ~$4B cap.

Third, on positioning within the 5–7% CAGR, UBS pushed for upper- or lower-half guidance and management declined to specify, falling back on "high confidence in the midpoint." Given the high-end cut to FY2025, the unwillingness to lean into the upper half of the multi-year range reads as conservatism that matches the lowered top of the near-term band.

Confidence in Q&A registered higher (rated 4/5 in the underlying analysis) than the formal print suggests — but the substantive moves are the high-end cut and the dropped 2028 bracket, not the reassuring CAGR reaffirmation.

Q&A highlights

Nicholas Campanella · Barclays

Clarification on the $0.10 per share cost related to preferred equity refinancing in 2025 guidance - whether this applies to both 2026 and 2027 maturities, and what refinancing options are being evaluated. Follow-up on Eaton Fire recovery compensation program participation and timeline for loss estimate.

Management confirmed two preferred series with rate resets in March 2026 and 2027. Early refinancing is being evaluated due to TKM settlement and upcoming Woolsey securitization proceeds, which creates options unavailable before. The $0.10 per share represents write-off of deferred transaction costs. For Eaton, the recovery compensation program hasn't launched yet (announced for shortly), and management cannot yet estimate losses - single insurance settlement is insufficient data. SB 254 provides constructive protections including clarity on liability cap (~$4 billion for Eaton based on rate base) and securitization option for claims above fund.

$0.10 per share cost in 2025 from early preferred refinancingTwo preferred series: March 2026 and March 2027 rate resetsEaton liability cap approximately $4 billion under SB 254Single insurance settlement at 52 cents per dollar insufficient for loss estimate

Char Parisa · Wells Fargo

Analysis of SB 254 Phase 2 process - what is viable for limiting EIX's liability, what data points will be relevant, and how transparent will the process be. Follow-up on capital allocation priorities (buybacks, refunds, dividends) in context of 2026 as an inflection year pending Phase 2 outcome.

Pedro emphasized that Phase 2 process is transparent - California Earthquake Authority leading, with abstract deadline November 3, full papers December 12, all submissions to be made public. CEO and others will engage with stakeholders and participate in meetings. Governor's executive order assigns homework to agencies on 10 key areas (risk reduction, fair compensation, equitable cost allocation). Management focused messaging on customer cost impact rather than shareholder returns - maintaining healthy balance sheets and credit ratings is priority. Maria noted company taking measured capital approach with no equity issuances in forecast, cost-efficient refinancing of hybrids, and maintaining 45-55% dividend payout ratio.

California Earthquake Authority leading Phase 2 processNovember 3 abstract deadline, December 12 full papers deadline, April 1 final reportAll submissions to be made publicGovernor's executive order directing agency actions on 10 SB 254 areas

Greg O'Reill · UBS

Clarification on whether Edison is trending toward upper or lower half of the 5-7% EPS growth guidance range, and any additional factors beyond disclosed variables that would influence positioning within the range.

Management declined to specify positioning within the 5-7% range but emphasized high confidence in the midpoint. Noted incorporation of significant new information including GRC decision, multiple regulatory proceedings (TKM, Woolsey settlements), and securitizations. Three key takeaways: reaffirming 5-7% CAGR, significantly more clarity on forecast, and stronger balance sheet. Described scenario analysis conducted across many variables over four-year period.

5-7% EPS CAGR confirmed with 'significantly more clarity'GRC in hand, TKM settlement approved with securitization comingWoolsey settlement pending CPUC approvalStronger balance sheet position achieved

Paul Zimbardo · Jefferies

Question on EPS trajectory linearity beyond 2025 given prior lumpiness, and whether enhanced legacy fire recoveries position company toward upper half of 15-17% FFO to debt target range.

Management deferred 2026 guidance to Q4 call per normal practice. Noted detailed annual planning process now underway post-GRC, considering resources, operational priorities, and work timing. Will provide detail on Q4 call. On credit profile, confirmed comfort within 15-17% FFO to debt range and evaluation of financing options, with commitment to remain 'comfortably' within range regardless of enhancements from legacy fire recoveries.

2026 guidance to be provided on Q4 callAnnual detailed planning process underway post-GRCTarget FFO to debt range: 15-17%Enhanced recovery from legacy fires does not change range commitment

Carly Davenport · Goldman Sachs

Assessment of cost of capital filing outcome and its impact on financial plan in context of customer affordability rhetoric in California. Follow-up on FERC capital plan reduction and upside opportunities.

On cost of capital, management noted filing shows range of 10.75%-11.75% (vs. current 10.33%) based on outside experts' analysis of SCE's risks. Proposed decision due November per schedule. Maria confirmed scenario testing of various ROE outcomes incorporated into 5-7% EPS CAGR range. On FERC capital, small reduction is timing-driven with no material implications. Steve Powell provided context that CAISO 20-year plans show $45-55 billion potential transmission investment over 20 years, with SCE positioning to win both incumbent and competitive projects. No specific FERC upside quantified.

Cost of capital filing range: 10.75%-11.75% (current: 10.33%)Proposed decision due NovemberFERC capital reduction is timing-relatedCAISO 20-year plan: $45-55 billion transmission investment potential

Answers to last quarter's watch list

GRC final decision and the six-week post-decision update. Resolved. The GRC final decision approved 91% of requested capital investment, and management cited this as a primary driver of the "significantly more clarity" framing. However, management did not re-state the 2028 EPS bracket ($6.74–$7.14 implied previously), and declined in Q&A to specify positioning within the 5–7% CAGR. The CAGR floor was not lifted.

Continue monitoring

AB 1054 enhancement legislative outcome. Partially resolved. SB 254 passed and is in force, confirming Eaton Fire as a covered wildfire and establishing a ~$4B liability cap for SCE plus securitization availability for claims above the fund. No upfront shareholder contribution was required, consistent with management's Q2 position. Phase 2 process is now underway with an April 1, 2026 final report.

Resolved positively

Eaton Fire investigation milestones. Not advanced. Eight months after ignition, the recovery compensation program has not yet launched, a single insurance subrogation settled at 52¢ per dollar is described as insufficient to anchor an estimate, and management cannot estimate losses. The SB 254 cap caps downside, but the actual loss within the cap remains unbounded.

Continue monitoring

Securitization provisions in California affordability legislation. Resolved positively for EIX. SB 254 includes securitization as an option for claims above the wildfire fund, which Edison framed as a constructive backstop rather than a forced shareholder-cost mechanism. No equity issuances are in the current forecast.

Resolved positively

2H core EPS run-rate vs. the $5.94–$6.34 range. Resolved negatively at the high end. Q3 core EPS of $2.34 lands the 9M cumulative at roughly $4.16, implying Q4 needs ~$1.79–$2.04 to land within the now-narrowed $5.95–$6.20 range. The high end of the FY range was cut by $0.14. The midpoint is now ~$0.07 lower than the Q2 reaffirmed range.

Resolved negatively

What to watch into next quarter

2026 guidance on the Q4 call and whether the 2028 EPS dollar bracket reappears. The prior $6.74–$7.14 2028 reference has dropped from disclosure. Watch whether the Q4 deck restores a 2028 dollar anchor or only restates the 5–7% percentage. The percentage with a lower 2025 base mathematically lowers the 2028 endpoint.

Cost-of-capital proposed decision in November. Filing range is 10.75–11.75% vs. the current 10.33%. Watch the proposed decision number and whether management can sustain the upper half of the 5–7% CAGR if the PD lands at the low end of the request.

Eaton recovery compensation program launch and first loss-estimate disclosure. Management said "shortly." Watch for an interim filing or quantified loss range that begins to bound the liability inside the ~$4B SB 254 cap.

Phase 2 SB 254 process milestones — Nov 3 abstracts, Dec 12 papers, April 1 final report. Watch whether the Phase 2 framework changes SCE's allocation of any fund replenishment relative to PG&E and SDG&E.

Preferred equity refinancing timing. Two series reset in March 2026 and March 2027. The $0.10/share 2025 write-off is disclosed; watch whether the 2026 refinancing is executed before reset and what coupon it locks in given the FFO-to-debt 15–17% target.

Sources

Edison International Q3 2025 press release (Form 8-K Exhibit 99.1), filed October 28, 2025. https://www.sec.gov/Archives/edgar/data/827052/000082705225000099/eix-2025x1028exx991.htm
Q3 2025 Edison International earnings call, Q&A transcript.
Tapebrief Q2 2025 EIX brief (for prior guidance baseline and watch-list context).

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