AI Takeaway
American Water Works (AWK) delivered solid FY2025 results with revenue growing 10.1% to $5.12B and net income rising 5.7% to $1.11B, driven by continued infrastructure investment and rate increases, though the current ratio of 0.46 signals elevated short-term liquidity pressure.
Revenue
$5.12B
++10.06% YoY
EPS (Basic)
$5.69
++5.57% YoY
Operating Income
$1.88B
++9.37% YoY
Filed · Analysis updated · Source: SEC EDGAR 10-K filing
AWK grew total revenue by 10.1% year-over-year from $4.65B to $5.12B in FY2025, consistent with the regulated utility model where authorized rate increases and capital investment recovery are the primary growth levers.
Source: Source: 10-K Income Statement, Financial Data
Operating income rose 9.4% to $1.88B, while operating margin edged down slightly from 36.9% to 36.7%, suggesting modest cost pressures — likely from higher depreciation (D&A up 13.5% to $894M) associated with the expanding asset base.
Source: Source: 10-K Income Statement & Cash Flow, Financial Data
Investing cash outflows remained substantial at -$3.31B in FY2025 (vs. -$3.38B prior year), underscoring AWK's commitment to infrastructure upgrades and system expansion, which is typical for regulated water utilities seeking future rate base growth.
Source: Source: 10-K Cash Flow Statement, Financial Data
2 more insights available
Upgrade to unlockAWK's current ratio stands at just 0.46, meaning current liabilities of $4.75B significantly exceed current assets of $2.19B. While regulated utilities often carry low current ratios due to predictable cash flows, this level warrants monitoring, especially given the large capital program requiring ongoing external financing.
Source: Source: 10-K Balance Sheet, Financial Data
Unlock 4 more detailed risk analysis
Upgrade to unlockReported EPS of $1.22 versus the $1.27 analyst consensus — a -3.5% miss for FY2025.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $5.12B | $4.65B | +10.06% |
Operating Income | $1.88B | $1.72B | +9.37% |
Net Income | $1.11B | $1.05B | +5.71% |
EPS (Basic) | $5.69 | $5.39 | +5.57% |
EPS (Diluted) | $5.69 | $5.39 | +5.57% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $35.44B | $32.83B | +7.96% |
Current Assets | $2.19B | $1.22B | +80.33% |
Current Liabilities | $4.75B | $3.15B | +50.70% |
Stockholders' Equity | $10.84B | $10.33B | +4.89% |
Cash & Equivalents | $98M | $96M | +2.08% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $2.06B | $2.04B | +0.68% |
Investing Cash Flow | $-3.31B | $-3.38B | +2.07% |
Financing Cash Flow | $1.25B | $1.11B | +12.52% |
D&A | $894M | $788M | +13.45% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Margin | 36.7% | 36.9% | -0.23% |
Net Margin | 21.7% | — | — |
ROE | 10.3% | — | — |
ROA | 3.1% | — | — |
Current Ratio | $0.462 | — | — |
American Water Works grew revenue by 10.1% in FY2025, reaching $5.12B compared to $4.65B in the prior year. This growth was primarily driven by authorized rate increases across its regulated water and wastewater systems, consistent with the company's regulated utility business model.
AWK delivered solid FY2025 results with revenue up 10.1% to $5.12B, operating income up 9.4% to $1.88B, and net income up 5.7% to $1.11B. EPS grew to $5.69 from $5.39, though the current ratio of 0.46 highlights elevated short-term liquidity pressure from the company's large capital investment program.
Yes, AWK remained solidly profitable in FY2025 with a net income of $1.11B and a net margin of approximately 21.7%. The company also generated $2.06B in operating cash flow, reflecting the stable and predictable earnings power of its regulated utility operations.
Key risks inferred from AWK's FY2025 financial data include a very low current ratio of 0.46 indicating short-term liquidity pressure, regulatory risk from dependence on state utility commission rate approvals, and rising depreciation (up 13.5% to $894M) compressing margins as the asset base expands. The company also carries significant leverage to fund its approximately $3.31B annual capital expenditure program.
AWK's long-term financial health appears stable, supported by $2.06B in operating cash flow, a growing rate base, and $10.84B in stockholders' equity. However, short-term liquidity is a concern with a current ratio of only 0.46, and the company runs deeply negative free cash flow (approximately -$1.25B) due to its large infrastructure investment program, requiring ongoing access to capital markets.