AI Takeaway
Southern Company (SO) delivered 10.6% revenue growth to $29.6B in FY2025, but net income slipped 1.4% to $4.3B as rising costs and heavy capital investment pressured margins and earnings per share.
Revenue
$29.55B
++10.59% YoY
EPS (Basic)
$3.94
-1.99% YoY
Operating Income
$7.29B
++3.07% YoY
Filed · Analysis updated · Source: SEC EDGAR 10-K filing
Revenue surged 10.6% year-over-year from $26.7B to $29.6B in FY2025, reflecting utility rate increases, customer growth, and higher energy demand across Southern Company's regulated service territories.
Source: Source: 10-K Income Statement, Financial Data
Operating margin declined approximately 1.8 percentage points to 24.7% in FY2025 from 26.4% in the prior year, indicating that cost growth — including fuel, operations, and depreciation — outpaced revenue gains.
Source: Source: 10-K Income Statement & Key Ratios, Financial Data
Investing cash outflows increased dramatically by 48.5% to -$14.0B in FY2025 from -$9.4B in the prior year, reflecting continued heavy infrastructure investment in generation, transmission, and distribution assets, consistent with the company's long-term capital expenditure plan.
Source: Source: 10-K Cash Flow Statement, Financial Data
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Upgrade to unlockSouthern Company carries a debt-to-equity ratio of approximately 3.24x, and total liabilities grew 7.7% to $116.9B in FY2025. The aggressive capital investment program is being funded substantially through new debt, increasing interest expense risk, particularly in a higher-for-longer interest rate environment.
Source: Source: 10-K Balance Sheet & Key Ratios, Financial Data
Unlock 4 more detailed risk analysis
Upgrade to unlockReported EPS of $0.55 versus the $0.59 analyst consensus — a -6.9% miss for FY2025.
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Revenue | $29.55B | $26.72B | +10.59% |
Operating Income | $7.29B | $7.07B | +3.07% |
Net Income | $4.34B | $4.4B | -1.36% |
EPS (Basic) | $3.94 | $4.02 | -1.99% |
EPS (Diluted) | $3.92 | $3.99 | -1.75% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Total Assets | $155.72B | $145.18B | +7.26% |
Current Assets | $10.92B | $10.69B | +2.09% |
Total Liabilities | $116.85B | $108.51B | +7.69% |
Current Liabilities | $16.89B | $15.99B | +5.60% |
Stockholders' Equity | $36.02B | $33.21B | +8.46% |
Cash & Equivalents | $1.64B | $1.07B | +53.18% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Cash Flow | $9.8B | $9.79B | +0.14% |
Investing Cash Flow | $-13.96B | $-9.4B | -48.50% |
Financing Cash Flow | $4.7B | $-208M | +2357.69% |
| Metric | Current | Previous | YoY Change |
|---|---|---|---|
Operating Margin | 24.7% | 26.4% | -1.80% |
Net Margin | 14.7% | — | — |
ROE | 12.1% | — | — |
ROA | 2.8% | — | — |
Current Ratio | $0.646 | — | — |
Debt to Equity | $3.244 | — | — |
Other companies in Electric Utilities
Southern Company's revenue grew 10.6% year-over-year to $29.6B in FY2025, up from $26.7B in the prior year. This growth was driven by utility rate increases and higher energy demand across its regulated service territories.
Despite 10.6% revenue growth, Southern Company's net income declined 1.4% to $4.3B in FY2025, as rising operating costs, depreciation, and interest expense on growing debt outpaced top-line gains. This also caused diluted EPS to fall from $3.99 to $3.92.
Southern Company maintains a large and growing asset base of $155.7B and generated $9.8B in operating cash flow in FY2025, reflecting stable regulated utility operations. However, the company carries significant leverage with a debt-to-equity ratio of 3.24x and a current ratio of only 0.65x, and is investing heavily with $14.0B in capital expenditures.
Southern Company's investing cash outflows surged 48.5% to approximately $14.0B in FY2025, compared to $9.4B in the prior year, reflecting one of its most aggressive infrastructure investment programs. This heavy spending is being funded in part by significant new financing activities, which swung to a $4.7B net inflow.
Key risks for Southern Company in FY2025 include high financial leverage (debt-to-equity of 3.24x), capital expenditure execution risk given the 48.5% surge in investment spending, and regulatory risk around recovering costs through utility rates. Additionally, the company's current ratio of 0.65x signals a structural liquidity shortfall that relies on continued capital market access.