CMS Energy reports higher profits on the strong demand for power from data centers

CMS Energy, a U.S. gas and electric utility, reported on Thursday a higher profit for the first quarter. This was due to heightened power demand.

In February, the U.S. Energy Information Administration forecast that power demand would reach record levels in 2025 and in 2026 as data centers are experiencing a surge.

After warning of potential supply-chain problems due to tariffs, the company stated that nearly 90% of its supply chain would be sourced domestically.

Ontario Premier Doug Ford announced in March that Ontario electricity producers will have to charge a 25% extra on all power exported to the U.S. in response to President Donald Trump’s tariffs against Canada.

Ontario's threat to the U.S. grid could put it at risk, despite Michigan's small reliance on Canadian power.

LSEG data shows that CMS Energy's first-quarter revenue rose by 12.4%, to $2.45billion, exceeding analysts' estimates of $2.24billion.

Total operating expenses for the quarter rose from $1.76 to $1.95 billion, and capital expenditures increased by 15% to reach $23 billion.

The U.S. Power Companies are upgrading their grid resilience to meet the rising demand for power from data centres to accommodate the artificial intelligence wave.

CMS Energy's net income for the first quarter attributable by shareholders increased to $302 millions, or $1.01 a share, up from $285, or 96c per share a year earlier.

According to LSEG, the Jackson, Michigan, based company earned $1.02 on an adjusted basis per share in the first quarter. This was in line with analyst expectations of $1.02 according to data compiled. (Reporting and editing by Shreya Biwas in Bengaluru, Pooja Meon from Jackson, Michigan)

(source: Reuters)