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American Electric Power

AEP · Nasdaq

Revenue grew more than twice as fast as fuel costs

Revenue rose 13.66% while fuel and purchased power rose 5.35%, so the growth came from what AEP earns on, not what it passes through.

Q3 FY2026, the quarter to Sep 30, 2026 · 10-Q filed Oct 28, 2026

Q3 FY2026 · revenue
$6.8B+34.3% on the year
Operating margin
26.5%
Net income
$1.2B
Free cash flow, quarter
—

Largest source of revenue: Vertically Integrated Utilities, 57.4% of the total.

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Key insights · Q3 FY2026
  1. 01

    Revenue grew more than twice as fast as fuel costs

    Revenue rose 13.66% while fuel and purchased power rose 5.35%, so the growth came from what AEP earns on, not what it passes through.

    Why it matters

    Purchased electricity, fuel and other consumables were $2.09B against $1.98B a year earlier, up 5.35%. Revenue rose 13.66% to $6.83B from $6.01B. The fuel line fell to 30.55% of revenue from 33.0%, and operating margin widened to 26.5% from 25.3%.1

    AnalysisFuel and purchased power are normally recovered from customers at cost, with no markup. When revenue grows well ahead of that line, the extra revenue is mostly the part of the bill that recovers depreciation, operating costs and the allowed return on invested capital. Analysis: that is the higher-quality kind of utility revenue growth, because it tracks the regulated asset base rather than commodity prices.

    AnalysisThe caveat runs the other way too. A margin widened by a slower fuel line can narrow again if gas and coal prices rise, even with no change in the underlying return, because pass-through revenue inflates sales without adding profit.

  2. 02

    Interest takes a steady third of operating profit

    Interest expense of $606M was 33.4% of operating income, the same share as a year earlier, so lenders grew in step with profit.

    Why it matters

    Operating income rose 19.05% to $1.81B from $1.52B. Interest expense rose 19.06% to $606M from $509M. Measured against operating income, interest was 33.4% in both quarters, and 8.87% of revenue this quarter.1

    AnalysisAnalysis: the matching growth rates are what a debt-funded build looks like. New plants and lines enter the rate base and lift operating income, and the borrowing that paid for them lifts interest by about as much. The operating gain did not widen the share left for shareholders before tax; pretax income rose 17.89%, a little slower than operating income.

    AnalysisThe ratio is a useful gauge to follow. If the allowed return on new investment stays above the cost of the debt raised for it, the share holds; if borrowing costs rise faster than rates are reset, interest would take a larger slice.

  3. 03

    A lower tax take pushed net profit past pretax growth

    Tax fell to 9.5% of pretax income from 12.4%, so net income rose 21.8% while pretax income rose 17.89%.

    Why it matters

    Income tax expense fell 10.07% to $125M from $139M while income before tax rose to $1.32B from $1.12B. Tax took 9.5% of pretax income against 12.4% a year earlier. Net income rose 21.8% to $1.22B, ahead of pretax income's 17.89%.1

    Per share, part of that gain was shared with new holders. Earnings attributable to AEP common shareholders rose to $1.19B from $972M, while diluted shares rose to 550.1 million from 538.0 million, so diluted earnings per share went to $2.16 from $1.81.1

    AnalysisThe filing excerpt does not explain the lower tax take. Analysis: utilities often benefit from tax credits tied to their generation and from the regulatory treatment of deferred taxes, and these can vary between quarters, so this quarter's rate should not be read as a lasting level.

  4. 04

    Operating profit nearly doubled since FY2018 on modest sales growth

    Operating income in FY2025 was 1.98 times FY2018's while revenue rose only to $21.88B from $16.20B, lifting operating margin to 24.3% from 16.6%.

    Why it matters

    Operating income was $5.32B in FY2025 against $2.68B in FY2018. Revenue was $21.88B against $16.20B. Operating margin rose to 24.3% from 16.6%, and this quarter's was 26.5%.1

    AnalysisAnalysis: for a regulated utility, operating profit follows the capital it has invested and not yet depreciated, while revenue also carries fuel recovered at cost. A growing asset base raises profit, and the fuel portion of revenue does not, so margin climbs as the base grows. Depreciation and amortization, the recovery of that base, rose 16.61% this quarter to $1.03B, faster than revenue's 13.66%.

Sources

  1. 1.American Electric Power 10-Q for the period to 2026-09-30 (the filing), Oct 28, 2026, read Nov 2, 2026

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Business performance

Growth, profit and margin

Revenue went from $13.4B in FY2007 to $21.9B in FY2025, the operating margin from 17.3% to 24.3%, over 18 years.

  • Revenue$21.9B
  • Operating income$5.3B
  • Operating margin24.3%
Period
Q3 FY2026
Revenue
$6.8B
Operating income
$1.8B
Operating margin
26.5%
Net income
$1.2B
Free cash flow
—
Business performance

Does the profit turn into cash?

  • Operating cash flow$6.9B
  • Capital expenditure$3.5B
  • Free cash flow$3.5B
  • Net income$3.7B

Capital expenditure is drawn below the axis as cash out. Cash conversion is operating cash flow over net income, shown in the tooltip for years with a profit.

Financial data and sources

How the revenue mix has shifted

Each breakdown the filing reports, as shares of revenue, for every period it restates.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME. The filing restates this breakdown for 1 period.

Click a member to isolate it across the years shown.

The figures

Margins, cash and growth for the period, each with what it was computed from.

Gross margin
Not reported
the company reports expenses by nature: no cost of revenue or gross profit line exists
Operating margin
26.5%
Source10-Q, Derived from Operating income and Total revenues in the 10-Q filed 2026-10-28
Net margin
17.8%
Source10-Q, Derived from Net income and Total revenues in the 10-Q filed 2026-10-28
Free cash flow, quarter
Not reported
the quarter's cash flow is year to date in the filing and could not be differenced from the history
Free cash flow margin, quarter
Not reported
the quarter's cash flow is year to date in the filing and could not be differenced from the history
Cash conversion, quarter
Not reported
the quarter's cash flow is year to date in the filing and could not be differenced from the history
Capital spending, quarter
Not reported
the quarter's cash flow is year to date in the filing and could not be differenced from the history
Revenue growth
+34.3%
From the record's own history, against the prior year.

Not reported, or not derivable

  • gross margin: the company reports expenses by nature: no cost of revenue or gross profit line exists
  • free cash flow: the quarter's cash flow is year to date in the filing and could not be differenced from the history
  • fcf margin: the quarter's cash flow is year to date in the filing and could not be differenced from the history
  • capex to revenue: the quarter's cash flow is year to date in the filing and could not be differenced from the history
  • cash conversion: the quarter's cash flow is year to date in the filing and could not be differenced from the history

Where revenue comes from

Every breakdown the filing reports for the period, with each item's share.

Revenue streams

Vertically Integrated Utilities$3.9B57.4%
Transmission and Distribution Utilities$1.9B27.1%
Generation & Marketing Revenues$922.0M13.5%
Other Revenues$134.0M2.0%

Source10-Q, us-gaap:Revenues, as reported in the 10-Q filed 2026-10-28

Segments

VIU$4.0B58.6%
T&D$1.9B27.3%
G&M$950.0M13.9%
AEPTHCo$615.0M9.0%

These items do not sum to total revenue; the filing states them beside it. Source10-Q, us-gaap:Revenues, as reported in the 10-Q filed 2026-10-28

RelatedPartyTransactionsByRelatedParty

Nonrelated Party$6.8B100.0%
Related Party$00.0%

Source10-Q, us-gaap:Revenues, as reported in the 10-Q filed 2026-10-28

LegalEntity

OPCo$1.2B17.7%
APCo$1.1B16.6%
I&M$894.0M13.1%
PSO$868.0M12.7%
SWEPCo$770.0M11.3%
AEP Texas$659.0M9.6%
AEPTCo$594.0M8.7%

These items do not sum to total revenue; the filing states them beside it. Source10-Q, us-gaap:Revenues, as reported in the 10-Q filed 2026-10-28

ConsolidationItems

Operating Segments$7.4B108.8%
Corporate and Other$38.0M0.6%
Reconciling Adjustments-$640.0M-9.4%

Source10-Q, us-gaap:Revenues, as reported in the 10-Q filed 2026-10-28

What it costs

The cost lines beneath operating income, each as a share of revenue, then the operating result.

Costs are reported by nature: what they are (food, labor, occupancy, personnel, marketing), not what they were for, so there is no cost-of-revenue line and no gross profit.

Cost lineQ3 FY2026Of revenueSource
Total expenses$5.0B73.5%Source10-Q, us-gaap:CostsAndExpenses, as reported in the 10-Q filed 2026-10-28
Operating income$1.8B26.5%Source10-Q, us-gaap:OperatingIncomeLoss, as reported in the 10-Q filed 2026-10-28

The statements, as filed

The income statement, cash flow statement and balance sheet in the company's own order and words. Every line links to the filing.

Income statement28 lines, as presented in the 10-Q
LineQ3 FY2026A year earlierChangeOf revenueSource
Revenues
Total revenues$6.83B$6.01B+14%100%Source10-Q, us-gaap:Revenues, as reported in the 10-Q filed 2026-10-28
Vertically Integrated Utilities$3.92B$3.51B+12%57.4%Source10-Q, us-gaap:Revenues [us-gaap:ElectricityMember], as reported in the 10-Q filed 2026-10-28
Transmission and Distribution Utilities$1.85B$1.68B+10%27.1%Source10-Q, us-gaap:Revenues [aep:TransmissionandDistributionUtilitiesRevenuesMember], as reported in the 10-Q filed 2026-10-28
Generation & Marketing Revenues$922.0M$694.0M+33%13.5%Source10-Q, us-gaap:Revenues [aep:GenerationAndMarketingRevenuesMember], as reported in the 10-Q filed 2026-10-28
Other Revenues$134.0M$126.0M+6.3%2.0%Source10-Q, us-gaap:Revenues [us-gaap:ProductAndServiceOtherMember], as reported in the 10-Q filed 2026-10-28
Expenses
Purchased Electricity, Fuel and Other Consumables Used for Electric Generation$2.09B$1.98B+5.4%30.5%Source10-Q, us-gaap:CostOfGoodsAndServiceExcludingDepreciationDepletionAndAmortization, as reported in the 10-Q filed 2026-10-28
Other Operation$1.03B$798.0M+29%15.0%Source10-Q, us-gaap:UtilitiesOperatingExpenseOperations, as reported in the 10-Q filed 2026-10-28
Maintenance$447.0M$405.0M+10%6.5%Source10-Q, us-gaap:UtilitiesOperatingExpenseMaintenance, as reported in the 10-Q filed 2026-10-28
Asset Impairments and Other Related Charges$0$00.0%Source10-Q, us-gaap:OtherAssetImpairmentCharges, as reported in the 10-Q filed 2026-10-28
Depreciation and Amortization$1.03B$879.0M+17%15.0%Source10-Q, us-gaap:UtilitiesOperatingExpenseDepreciationAndAmortization, as reported in the 10-Q filed 2026-10-28
Taxes Other Than Income Taxes$433.0M$426.0M+1.6%6.3%Source10-Q, us-gaap:UtilitiesOperatingExpenseTaxes, as reported in the 10-Q filed 2026-10-28
Total expenses$5.02B$4.49B+12%73.5%Source10-Q, us-gaap:CostsAndExpenses, as reported in the 10-Q filed 2026-10-28
Income Statement
Operating income$1.81B$1.52B+19%26.5%Source10-Q, us-gaap:OperatingIncomeLoss, as reported in the 10-Q filed 2026-10-28
Other Income (Expense):
Other Income$6.0M$12.0M-50%0.1%Source10-Q, us-gaap:OtherNonoperatingIncomeExpense, as reported in the 10-Q filed 2026-10-28
Allowance for Equity Funds Used During Construction$81.0M$59.0M+37%1.2%Source10-Q, us-gaap:PublicUtilitiesAllowanceForFundsUsedDuringConstructionCapitalizedCostOfEquity, as reported in the 10-Q filed 2026-10-28
Non-Service Cost Components of Net Periodic Benefit Cost (shown as a deduction)(-$25.0M)-$34.0M-26%0.4%Source10-Q, us-gaap:NetPeriodicDefinedBenefitsExpenseReversalOfExpenseExcludingServiceCostComponent, as reported in the 10-Q filed 2026-10-28
Interest Expense (shown as a deduction)($606.0M)$509.0M+19%8.9%Source10-Q, us-gaap:InterestExpenseNonoperating, as reported in the 10-Q filed 2026-10-28
Income Statement
Income before income tax expense (benefit)$1.32B$1.12B+18%19.3%Source10-Q, us-gaap:IncomeLossFromContinuingOperationsBeforeIncomeTaxesMinorityInterestAndIncomeLossFromEquityMethodInvestments, as reported in the 10-Q filed 2026-10-28
Income Tax Expense$125.0M$139.0M-10%1.8%Source10-Q, us-gaap:IncomeTaxExpenseBenefit, as reported in the 10-Q filed 2026-10-28
Equity Earnings of Unconsolidated Subsidiaries$25.0M$21.0M+19%0.4%Source10-Q, us-gaap:IncomeLossFromEquityMethodInvestments, as reported in the 10-Q filed 2026-10-28
Net income$1.22B$1.00B+22%17.8%Source10-Q, us-gaap:ProfitLoss, as reported in the 10-Q filed 2026-10-28
Net Income Attributable to Noncontrolling Interests$31.0M$28.0M+11%0.5%Source10-Q, us-gaap:NetIncomeLossAttributableToNoncontrollingInterest, as reported in the 10-Q filed 2026-10-28
EARNINGS (LOSS) ATTRIBUTABLE TO AEP COMMON SHAREHOLDERS, Basic$1.19B$972.0M+22%17.4%Source10-Q, us-gaap:NetIncomeLossAvailableToCommonStockholdersBasic, as reported in the 10-Q filed 2026-10-28
EARNINGS (LOSS) ATTRIBUTABLE TO AEP COMMON SHAREHOLDERS, Diluted$1.19B$972.0M+22%17.4%Source10-Q, us-gaap:NetIncomeLossAvailableToCommonStockholdersDiluted, as reported in the 10-Q filed 2026-10-28
WEIGHTED AVERAGE NUMBER OF BASIC AEP COMMON SHARES OUTSTANDING (in shares)544,400,000534,900,000+1.8%Source10-Q, us-gaap:WeightedAverageNumberOfSharesOutstandingBasic, as reported in the 10-Q filed 2026-10-28
TOTAL BASIC EARNINGS PER SHARE ATTRIBUTABLE TO AEP COMMON SHAREHOLDERS (in dollars per share)$2$2+20%0.0%Source10-Q, us-gaap:EarningsPerShareBasic, as reported in the 10-Q filed 2026-10-28
WEIGHTED AVERAGE NUMBER OF DILUTED AEP COMMON SHARES OUTSTANDING (in shares)550,100,000538,000,000+2.2%Source10-Q, us-gaap:WeightedAverageNumberOfDilutedSharesOutstanding, as reported in the 10-Q filed 2026-10-28
TOTAL DILUTED EARNINGS PER SHARE ATTRIBUTABLE TO AEP COMMON SHAREHOLDERS (in dollars per share)$2$2+19%0.0%Source10-Q, us-gaap:EarningsPerShareDiluted, as reported in the 10-Q filed 2026-10-28
Cash flow statement5 lines, as presented in the 10-Q

Year to date, as a quarterly filing reports it.

LineQ3 FY2026A year earlierChangeSource
Operating activities
Net Income$1.22B$1.00B+22%Source10-Q, us-gaap:ProfitLoss, as reported in the 10-Q filed 2026-10-28
Adjustments to Reconcile Net Income to Net Cash Flows from Operating Activities:
Depreciation and Amortization$1.03B$879.0M+17%Source10-Q, us-gaap:UtilitiesOperatingExpenseDepreciationAndAmortization, as reported in the 10-Q filed 2026-10-28
Asset Impairments and Other Related Charges$0$0Source10-Q, us-gaap:OtherAssetImpairmentCharges, as reported in the 10-Q filed 2026-10-28
Allowance for Equity Funds Used During Construction (shown as a deduction)($81.0M)$59.0M+37%Source10-Q, us-gaap:PublicUtilitiesAllowanceForFundsUsedDuringConstructionCapitalizedCostOfEquity, as reported in the 10-Q filed 2026-10-28
Statement of Cash Flows
Cash, Cash Equivalents and Restricted Cash at End of Period$507.0M$1.11B-54%Source10-Q, us-gaap:CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents, as reported in the 10-Q filed 2026-10-28
Balance sheet64 lines, as presented in the 10-Q
LineQ3 FY2026A year earlierChangeSource
Current assets
Cash and Cash Equivalents$418.0MSource10-Q, us-gaap:CashAndCashEquivalentsAtCarryingValue, as reported in the 10-Q filed 2026-10-28
Restricted Cash$89.0MSource10-Q, us-gaap:RestrictedCashAndCashEquivalentsAtCarryingValue, as reported in the 10-Q filed 2026-10-28
Other Temporary Investments$252.0MSource10-Q, us-gaap:ShortTermInvestments, as reported in the 10-Q filed 2026-10-28
Accounts Receivable:
Customers$1.42BSource10-Q, us-gaap:AccountsReceivableGrossCurrent, as reported in the 10-Q filed 2026-10-28
Accrued Unbilled Revenues$422.0MSource10-Q, us-gaap:UnbilledReceivablesCurrent, as reported in the 10-Q filed 2026-10-28
Pledged Accounts Receivable – AEP Credit$1.60BSource10-Q, us-gaap:TransfersAccountedForAsSecuredBorrowingsAssetsCarryingAmount, as reported in the 10-Q filed 2026-10-28
Miscellaneous$101.0MSource10-Q, us-gaap:OtherReceivables, as reported in the 10-Q filed 2026-10-28
Allowance for Credit Losses (shown as a deduction)($54.0M)Source10-Q, us-gaap:AllowanceForDoubtfulAccountsReceivableCurrent, as reported in the 10-Q filed 2026-10-28
Total Accounts Receivable$3.49BSource10-Q, us-gaap:AccountsReceivableNetCurrent, as reported in the 10-Q filed 2026-10-28
Current assets
Fuel$506.0MSource10-Q, us-gaap:InventoryRawMaterials, as reported in the 10-Q filed 2026-10-28
Materials and Supplies$1.29BSource10-Q, us-gaap:MaterialsSuppliesAndOther, as reported in the 10-Q filed 2026-10-28
Risk Management Assets$588.0MSource10-Q, us-gaap:DerivativeAssetsCurrent, as reported in the 10-Q filed 2026-10-28
Accrued Tax Benefits$344.0MSource10-Q, us-gaap:IncomeTaxesReceivable, as reported in the 10-Q filed 2026-10-28
Regulatory Asset for Under-Recovered Fuel Costs$504.0MSource10-Q, us-gaap:RegulatoryAssetsCurrent, as reported in the 10-Q filed 2026-10-28
Prepayments and Other Current Assets$362.0MSource10-Q, us-gaap:PrepaidExpenseAndOtherAssetsCurrent, as reported in the 10-Q filed 2026-10-28
Total current assets$7.84BSource10-Q, us-gaap:AssetsCurrent, as reported in the 10-Q filed 2026-10-28
Property, plant and equipment
Generation$27.67BSource10-Q, aep:PublicUtilitiesPropertyPlantAndEquipmentGenerationOrProcessingGross, as reported in the 10-Q filed 2026-10-28
Transmission$44.51BSource10-Q, aep:PublicUtilitiesPropertyPlantAndEquipmentTransmissionGross, as reported in the 10-Q filed 2026-10-28
Distribution$35.25BSource10-Q, aep:PublicUtilitiesPropertyPlantAndEquipmentDistributionGross, as reported in the 10-Q filed 2026-10-28
Other Property, Plant and Equipment (Including Coal Mining and Nuclear Fuel)$9.84BSource10-Q, us-gaap:PropertyPlantAndEquipmentOther, as reported in the 10-Q filed 2026-10-28
Construction Work in Progress$10.91BSource10-Q, us-gaap:ConstructionInProgressGross, as reported in the 10-Q filed 2026-10-28
Total Property, Plant and Equipment$128.18BSource10-Q, us-gaap:PropertyPlantAndEquipmentGross, as reported in the 10-Q filed 2026-10-28
Accumulated Depreciation and Amortization$27.96BSource10-Q, aep:AccumulatedDepreciationDepletionAndAmortizationPropertyPlantAndEquipmentIncludingPublicUtilities, as reported in the 10-Q filed 2026-10-28
Total property, plant and equipment – net$100.23BSource10-Q, aep:RegulatedAndNonregulatedPropertyPlantAndEquipmentNet, as reported in the 10-Q filed 2026-10-28
Other noncurrent assets
Regulatory Assets$4.97BSource10-Q, us-gaap:RegulatoryAssetsNoncurrent, as reported in the 10-Q filed 2026-10-28
Securitized Assets$2.22BSource10-Q, us-gaap:SecuritizedRegulatoryTransitionAssetsNoncurrent, as reported in the 10-Q filed 2026-10-28
Spent Nuclear Fuel and Decommissioning Trusts$5.26BSource10-Q, aep:SpentNuclearFuelAndDecommissioningTrustsNoncurrent, as reported in the 10-Q filed 2026-10-28
Goodwill$53.0MSource10-Q, us-gaap:Goodwill, as reported in the 10-Q filed 2026-10-28
Long-term Risk Management Assets$266.0MSource10-Q, us-gaap:DerivativeAssetsNoncurrent, as reported in the 10-Q filed 2026-10-28
Operating Lease Assets$660.0MSource10-Q, us-gaap:OperatingLeaseRightOfUseAsset, as reported in the 10-Q filed 2026-10-28
Deferred Charges and Other Noncurrent Assets$4.20BSource10-Q, aep:DeferredChargesAndOtherNoncurrentAssets, as reported in the 10-Q filed 2026-10-28
Total other noncurrent assets$17.63BSource10-Q, us-gaap:OtherAssetsNoncurrent, as reported in the 10-Q filed 2026-10-28
Statement of Financial Position
Total assets$125.70BSource10-Q, us-gaap:Assets, as reported in the 10-Q filed 2026-10-28
Current liabilities
Accounts Payable$3.94BSource10-Q, us-gaap:AccountsPayableCurrent, as reported in the 10-Q filed 2026-10-28
Short-term Debt:
Securitized Debt for Receivables – AEP Credit$900.0MSource10-Q, us-gaap:TransfersAccountedForAsSecuredBorrowingsAssociatedLiabilitiesCarryingAmount, as reported in the 10-Q filed 2026-10-28
Other Short-term Debt$975.0MSource10-Q, us-gaap:ShortTermBankLoansAndNotesPayable, as reported in the 10-Q filed 2026-10-28
Total Short-term Debt$1.88BSource10-Q, us-gaap:ShortTermBorrowings, as reported in the 10-Q filed 2026-10-28
Current liabilities
Long-term Debt Due Within One Year$2.68BSource10-Q, us-gaap:LongTermDebtCurrent, as reported in the 10-Q filed 2026-10-28
Risk Management Liabilities$209.0MSource10-Q, us-gaap:DerivativeLiabilitiesCurrent, as reported in the 10-Q filed 2026-10-28
Customer Deposits$770.0MSource10-Q, us-gaap:ContractWithCustomerLiabilityCurrent, as reported in the 10-Q filed 2026-10-28
Accrued Taxes$1.36BSource10-Q, us-gaap:TaxesPayableCurrent, as reported in the 10-Q filed 2026-10-28
Accrued Interest$719.0MSource10-Q, us-gaap:InterestPayableCurrent, as reported in the 10-Q filed 2026-10-28
Obligations Under Operating Leases$95.0MSource10-Q, us-gaap:OperatingLeaseLiabilityCurrent, as reported in the 10-Q filed 2026-10-28
Other Current Liabilities$3.63BSource10-Q, us-gaap:OtherLiabilitiesCurrent, as reported in the 10-Q filed 2026-10-28
Total current liabilities$15.29BSource10-Q, us-gaap:LiabilitiesCurrent, as reported in the 10-Q filed 2026-10-28
Noncurrent liabilities
Long-term Debt$49.86BSource10-Q, us-gaap:LongTermDebtNoncurrent, as reported in the 10-Q filed 2026-10-28
Long-term Risk Management Liabilities$214.0MSource10-Q, us-gaap:DerivativeLiabilitiesNoncurrent, as reported in the 10-Q filed 2026-10-28
Deferred Income Taxes$11.72BSource10-Q, us-gaap:DeferredIncomeTaxLiabilitiesNet, as reported in the 10-Q filed 2026-10-28
Regulatory Liabilities and Deferred Investment Tax Credits$8.75BSource10-Q, us-gaap:RegulatoryLiabilityNoncurrent, as reported in the 10-Q filed 2026-10-28
Asset Retirement Obligations$3.67BSource10-Q, us-gaap:AssetRetirementObligationsNoncurrent, as reported in the 10-Q filed 2026-10-28
Employee Benefits and Pension Obligations$262.0MSource10-Q, aep:EmployeeBenefitsAndPensionObligationsNoncurrent, as reported in the 10-Q filed 2026-10-28
Obligations Under Operating Leases$584.0MSource10-Q, us-gaap:OperatingLeaseLiabilityNoncurrent, as reported in the 10-Q filed 2026-10-28
Deferred Credits and Other Noncurrent Liabilities$1.23BSource10-Q, us-gaap:OtherLiabilitiesNoncurrent, as reported in the 10-Q filed 2026-10-28
Total noncurrent liabilities$76.29BSource10-Q, us-gaap:LiabilitiesNoncurrent, as reported in the 10-Q filed 2026-10-28
Statement of Financial Position
Total liabilities$91.58BSource10-Q, us-gaap:Liabilities, as reported in the 10-Q filed 2026-10-28
Contingently Redeemable Performance Share Awards$76.0MSource10-Q, aep:RedeemableNoncontrollingInterestEquityPerformanceSharesCarryingAmount, as reported in the 10-Q filed 2026-10-28
Equity
Common Stock$3.55BSource10-Q, us-gaap:CommonStockValue, as reported in the 10-Q filed 2026-10-28
Paid-in Capital$12.52BSource10-Q, us-gaap:AdditionalPaidInCapital, as reported in the 10-Q filed 2026-10-28
Retained Earnings$16.66BSource10-Q, us-gaap:RetainedEarningsAccumulatedDeficit, as reported in the 10-Q filed 2026-10-28
Accumulated Other Comprehensive Income (Loss)$51.0MSource10-Q, us-gaap:AccumulatedOtherComprehensiveIncomeLossNetOfTax, as reported in the 10-Q filed 2026-10-28
Total common shareholder’s equity$32.78BSource10-Q, us-gaap:StockholdersEquity, as reported in the 10-Q filed 2026-10-28
Noncontrolling Interests$1.27BSource10-Q, us-gaap:MinorityInterest, as reported in the 10-Q filed 2026-10-28
Total equity$34.04B$31.48B+8.1%Source10-Q, us-gaap:StockholdersEquityIncludingPortionAttributableToNoncontrollingInterest, as reported in the 10-Q filed 2026-10-28
Statement of Financial Position
Total liabilities and equity$125.70BSource10-Q, us-gaap:LiabilitiesAndStockholdersEquity, as reported in the 10-Q filed 2026-10-28

About this data

Source
American Electric Power 10-Q, accession 0000004904-26-000072, filed Oct 28, 2026, read on Nov 2, 2026.
History
From the SEC's XBRL company facts, the value from the latest filing that stated each period.
Reading
Paragraphs marked Analysis are CXProWealth's reading; everything else is the filing's own numbers and words, or a cited source.
Version
methodology business-lens-1.0 · schema 1.2.0 · run business-lens-2026-11-02
Edge and risks

What holds American Electric Power's model up, and what could bend it

Competitive edge

  • Earnings that follow the investment base

    Regulators set rates to recover costs plus a return on invested capital, so each completed plant or line raises the earnings base.

    The detail

    Depreciation and amortization rose 16.61% to $1.03B, equal to 56.6% of operating income, and the allowance for equity funds used during construction rose 37.29% to $81M. Both grow with the capital in service or under construction.1

    AnalysisAnalysis: the advantage holds because the service area is a franchise. Competitors cannot build a second set of wires to the same customers, and the allowed return is set by regulators rather than by price competition.

  • The largest cost passes through at cost

    Fuel and purchased power were 30.55% of revenue, the biggest cost line, yet commodity swings move revenue far more than profit.

    The detail

    Purchased electricity, fuel and other consumables were $2.09B against operating income of $1.81B. The line rose 5.35% while operating income rose 19.05%.1

    AnalysisAnalysis: adjustment clauses let a regulated utility collect what it spends on fuel without a markup, so the cost a merchant generator would bear as risk is largely carried by customers' bills. The timing of recovery can still lag, which is a cash question more than a profit one.

  • Even the largest utility brings only 17.7% of revenue

    Ohio Power, the largest operating company, brought in 17.7% of revenue, so no one state regulator decides most of the outcome.

    The detail

    By legal entity, Ohio Power reported $1.21B, 17.7% of consolidated revenue, Appalachian Power $1.13B, 16.6%, Indiana Michigan Power $894M, 13.1%, Public Service Company of Oklahoma $868M, 12.7%, SWEPCo $770M, 11.3%, AEP Texas $659M, 9.6%, and the transmission company AEPTCo $594M, 8.7%.1

    AnalysisAnalysis: each operating company files its own rate cases with its own commission. A spread like this means one unfavorable decision moves a slice of the whole, not the whole.

What to watch

  • Debt and new shares fund the build

    Interest rose 19.06% to $606M and diluted shares rose to 550.1 million, so capital costs arrive before all the new rates do.

    The detail

    Interest expense was $606M against $509M, 8.87% of revenue. Diluted shares averaged 550.1 million against 538.0 million. The quarterly report adds no new risk factors, stating there have been no material changes to those disclosed in the 2025 annual report.1

    AnalysisAnalysis: what has to hold is that allowed returns on new investment stay above the cost of the capital raised, and that rate approvals arrive soon enough that the lag does not erode earnings per share.

  • A growing slice of earnings is construction income

    Equity funds used during construction, non-cash income, were $81M, 6.8% of earnings to common shareholders against 6.1% a year earlier.

    The detail

    The allowance for equity funds used during construction rose 37.29% to $81M from $59M, faster than net income's 21.8%. Against earnings attributable to AEP common shareholders of $1.19B, it was 6.8%, up from 6.1% on $972M.1

    AnalysisAnalysis: this income becomes cash only when projects enter service and their costs enter rates. A delay or a disallowance in a rate case would leave part of today's reported earnings without the recovery it assumes.

  • Other operating costs grew twice as fast as revenue

    Other operation rose 28.82% to $1.03B against revenue's 13.66%, taking 15.05% of revenue, up 1.77 points on a year earlier.

    The detail

    Other operation was $1.03B against $798M. Maintenance rose 10.37% to $447M. Total expenses still grew more slowly than revenue, 11.83% against 13.66%, because the fuel line rose only 5.35%.1

    AnalysisAnalysis: the filing excerpt does not break down the increase. Costs of this kind are recovered when rates are reset, so a sustained rise ahead of rate cases would show up as margin pressure in the periods between them.

Sources

  1. 1.American Electric Power 10-Q for the period to 2026-09-30 (the filing), Oct 28, 2026, read Nov 2, 2026
Go deeper

American Electric Power, further in

Member research, then your own questions on ChatGPT.

What could change the outlook

What American Electric Power's numbers depend on from here, read from the filing: the conditions behind this period's margins and growth, and where a change would show first.

  • What has to go right for the build to reach earnings per share

    The links between rate approvals, financing costs, construction income and new shares, and which of them this quarter's numbers already test.

  • How much of the margin gain will survive a fuel price swing

    Separating what AEP earns on from what it passes through, and what that says about the quality of this quarter's operating margin.

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Questions to start with
  • How much of AEP's Q3 revenue growth came from base rates rather than fuel cost recovery?
  • What would higher borrowing costs do to the share of AEP's operating income that goes to interest?
  • Why did AEP's tax take fall to 9.5% of pretax income this quarter, and is that likely to persist?

Business Lens describes American Electric Power from its own filings with the SEC. It is not a view on its shares, a target, or advice to buy, sell or hold anything; figures are as filed and may be restated by the company later. The filing, the dates and the version are under the financial data above.