Public Service Enterprise Group (PEG +0.72%), a utility company focused on regulated electric and gas operations in New Jersey and nuclear power production, released its results for Q2 2025 on August 5, 2025. The most important news from the report was a significant earnings beat, with non-GAAP operating earnings per share of $0.77 versus the $0.70 analyst expectation. Net income (GAAP) rose to $585 million, and operating earnings (non-GAAP) reached $384 million. just ahead of estimates for non-GAAP EPS, the definitions regarding non-GAAP revenue and earnings reporting highlight continuing questions about comparability. Overall, the quarter saw strong execution in regulated utilities, solid performance in nuclear generation, and continued investments in clean energy and modernization—along with a 5% dividend increase.
| Metric | Q2 2025 | Q2 2025 Estimate | Q2 2024 | Y/Y Change |
|---|---|---|---|---|
| EPS (Non-GAAP) | $0.77 | $0.70 | $0.63 | 22.2% |
| EPS (GAAP) | $1.17 | $0.87 | 34.5% | |
| Revenue (GAAP) | N/A | $2,378 million | N/A | N/A |
| Net Income | $585 million | $434 million | 34.8% | |
| Operating Earnings (Non-GAAP) | $384 million | $313 million | 22.7% |
Source: Analyst estimates provided by FactSet. Management expectations based on management's guidance, as provided in Q1 2025 earnings report.
Business Overview and Success Factors
Public Service Enterprise Group (PEG +0.72%) is a diversified energy company, with its core operations centered around Public Service Electric & Gas (PSE&G), a regulated utility, and its nuclear power generation arm. The utility delivers electricity and natural gas to millions of customers across New Jersey, while also managing one of the region’s largest nuclear fleets through PSEG Power & Other.
In recent years, the business has focused heavily on regulated utility investment, grid modernization, and clean energy infrastructure. Success for the company hinges on maintaining a constructive regulatory environment, disciplined capital deployment in energy efficiency and infrastructure, safe and reliable nuclear operations, and adapting to shifts in energy demand—particularly as electrification, data centers, and clean energy adoption reshape load and investment needs.
Quarter Highlights: Financial and Operational Performance
The quarter featured higher non-GAAP operating earnings across both operating segments. Net income (GAAP) rose to $585 million, up 34.8% from Q2 2024, with Public Service Electric & Gas contributing $332 million and PSEG Power & Other adding $253 million in net income. Non-GAAP operating earnings increased to $384 million, led by improved regulated margins and robust nuclear generation. Nuclear output grew to 7,511 gigawatt-hours (GWh) compared to 7,007 GWh in Q2 2024, with capacity factors—measuring how often the plants ran at maximum power—reaching 88.8%.
The company’s utility segment benefited from base rate increases approved by the New Jersey Board of Public Utilities (BPU), including a $49 million annual increase for gas system upgrades effective August 1 and a $9 million annual boost for further infrastructure projects effective May 1. These approvals support ongoing efforts to modernize the grid and expand clean energy programs. Customer connections continued to rise, with both electric and gas accounts up about 1% year over year for the trailing 12 months ended June 30.
The company invested approximately $0.9 billion in capital improvements during the quarter and is on pace to spend approximately $3.8 billion in regulated capital for the full year. Major focuses included gas main replacements, infrastructure reliability, and deployment of the second phase of the Clean Energy Future - Energy Efficiency II initiative. This energy efficiency program—a core regulated product—offers incentives and finance options to help customers reduce energy usage and bills, and cut carbon emissions. System reliability remained a priority; During the extreme summer heat event in June, PSE&G restored power to 99% of affected customers within 24 hours, highlighting the company’s resilience and operational readiness.
The nuclear generation business achieved stronger fuel cost control, with average fuel cost per megawatt-hour at $6.52. However, the expiration of zero emission certificate (ZEC) subsidies in May 2025 will make future nuclear earnings more sensitive to market prices and production tax credit (PTC) thresholds. The expanding pipeline of large load interconnection requests—now more than 9,400 megawatts as of June 30—signals future demand growth, though management notes only about 10–20 % of these opportunities are likely to convert into actual contracts. No major technology or data center agreements have been finalized yet, due in part to ongoing regulatory and Federal Energy Regulatory Commission (FERC) process discussions regarding how such loads will be served and priced.
Notably, the company continued to mitigate bill pressure for customers. PSE&G launched a temporary $30 per month credit for all residential electric customers for July and August, with costs to be recouped at $10 per month over the following six months (September–February). The utility also extended programs that prevent shutoffs during the winter and offered ongoing support for those struggling with high bills. Weather-normalized sales—a metric that removes the effects of abnormal temperatures—showed electric volumes up 1% and gas volumes down 1% over the trailing twelve months ended June 30.
In the regional energy market, the utility's strong regulated position was reinforced as roughly 90% of expected non-GAAP operating earnings for 2025–2029 are set to come from its core PSE&G unit. The most recent PJM Interconnection capacity auction (July, for the 2026/2027 energy year) cleared at $329 per megawatt-day—above the previous year—and is expected to keep customer bills steady over the next year, based on July PJM capacity auction results of $329 per megawatt-day for the 2026/2027 energy year. Management remains focused on advocating for expanded in-state power generation and newly regulated infrastructure to address long-term supply and affordability challenges in New Jersey.
Looking Ahead: Guidance, Dividend, and Investor Considerations
Management reaffirmed its outlook for fiscal 2025, maintaining non-GAAP operating earnings guidance of $3.94 to $4.06 per share. This represents about 9% non-GAAP growth at the midpoint compared to 2024. The company also plans to sustain a strong balance sheet, with $3.6 billion in available liquidity and a consolidated debt-to-capitalization ratio of 58% as of June 30. No additional equity issuance or asset sales are needed to fund the current five-year capital plan of $21–$24 billion.
The quarterly dividend was raised 5% to an annualized $2.52 per share. Over the 2025–2029 period, management expects non-GAAP operating EPS growth to average 5–7% per year, driven by continued capital investments and regulatory rate base expansion. For investors and stakeholders, key developments to watch in upcoming quarters include how the company manages nuclear revenue sensitivity in the absence of ZECs, regulatory progress on affordability, how quickly large new loads materialize, and any legislative changes impacting regulated generation or long-term infrastructure investment.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
