Sempra misses its profit forecast due to higher costs and lower utility earnings
Sempra, a U.S. energy company, missed Wall Street's third-quarter profit estimates on Wednesday due to higher interest costs and lower earnings in its utility businesses of Texas and California.
Utilities are ramping up investments in their projects amid booming demand from data centers to power the artificial-intelligence wave, but elevated interest rates in the United States are eating into the companies' margins.
Sempra, based in San Diego, California, reported that its interest expenses rose to $328 millions for the third quarter compared with $312million a year ago.
According to LSEG data, the company, which has about 40 million clients, reported an adjusted profit per share of 89 cents in the third quarter that ended on September 30. This compares with analysts' estimates of $1.05, per share.
Sempra, in order to continue its growth plan, launched a $3 Billion at-the-market offering on Wednesday.
Oncor, the Texas-based unit of the company, expects to increase its capital plan for five years by 40% to 50%.
The company's earnings in Texas fell by 14.4% and those from California dropped 14.8%, to $247 millions. More than half of earnings come from the states.
Electric Reliability Council of Texas (ERC), the operator of Texas' electricity grid, estimates that 152 gigawatts of power will be needed by 2030. This is a 78% rise from 2023.
Sempra's Energia Costa Azul liquefied gas export project is expected to start commercial operations in the spring of 2026.
(source: Reuters)
